Schooled for thought

Lord Dahrendorf's history is worthy of its subject and does justice to a great international institution. His very readable volume traces the development of the LSE from "an aspiration based on extravagant dreams and tiny beginnings" when it was founded by Sidney Webb in 1895 into one of the leading centres for teaching and research in the social sciences. A vivid picture is given of the personalities of successive directors, their aims and achievements, and of the growth of the staff in numbers and reputation in spite of cramped premises and limited funds. The narrative is enlivened by Dahrendorf's commentary and by the abundance of telling quotations from an extraordinary range of material, much of it unpublished or inaccessible.

It is to Webb that we owe the creation of the LSE. He believed firmly in the need for dispassionate study and research in economics as a means to eventual social reconstruction "plotting the future as a gradual millennium" to quote Mrs Mair. He had visited and been impressed by the Massachusetts Institute of Technology and was influenced also by the German Hochschulen and the Ecole Libre des Sciences Politiques in Paris.

A legacy intended for "the propaganda and other purposes of the (Fabian) Society and its socialism" allowed him to launch the LSE in spite of protests from George Bernard Shaw and others. Later, Sidney was one of many who sought to dissipate the common impression that "the teaching given at the school was of a socialist tendency" arguing that teachers should engage in careful analysis rather than propaganda, although if they turned their backs on politics their lectures and books would be robbed of vitality and interest. It was Sidney, too, who helped to keep the school free from bureaucracy and ensured that the powers formally conferred on the board of governors would in practice be exercised by the director.

It is not Webb, however, who takes up most space in the book but William Beveridge. The first three directors: Hewins, Mackinder and Pember Reeves (1895-1919), are given 137 pages while Beveridge's directorship from 1919 to 1937 takes up 192, or one page more than all six directors who followed.

Beveridge was indeed the "second founder" of the LSE and as Dahrendorf rightly claims, his directorship ranks alongside his Report on the Social Services as one of the two greatest achievements of his career (although his introduction, first of labour exchanges and later of food rationing deserve at least a mention). When Beveridge became director in 1919 there were only 17 full-time lecturers compared with 79 when he left in 1937; the number of part-time teachers hardly changed, with a net increase from 42 to 44 and student numbers also remained stable at about 3,000, so that the staff-student ratio improved from about 150 to about 125.

All this required heavy expenditure on premises and staff when the school "never had a general endowment which would guarantee its survival in an extended period of rainy days" and was dependent on its recurrent income from fees and grants. In its early years the school's tiny income was heavily dependent (up to 77 per cent) on fortuitous donations and an LCC grant. By 1912 its income had grown to £12,000 and by 1920 when Beveridge took over, this had risen to nearly £100,000, of which fee income accounted for about 30 per cent and grants from public bodies (including the Treasury) for 40 per cent.

It was the Rockefeller Foundation, reaching out from the United States, that made the biggest difference to the school's progress under Beveridge. In the 14 years of his directorship the funds provided by the foundation added up to $2 million. Most of this was for capital expenditure nearly three quarters of the total capital expenditure of £439,000; but even on income account over 11 per cent of total receipts in those years of £1.5 million came from Rockefeller subsidies. With this assistance the school was able to acquire much-needed floor space and contemplate further expansion.

In other directions Beveridge was less successful. He set his heart on completing what he thought of as "the circle of the social sciences" by securing a chair in social biology, and, again with the help of Rockefeller, established a research professorship in 1930 with which to attract Lancelot Hogben. Whether Hogben, in his seven years at the school did much to advance the social sciences (apart from demography), must be very doubtful. He would seem to be best remembered for the screaming apes he brought to Houghton Street and the 1,000 enormous amphibious South African toads some of which the ether chamber failed to kill, so that they jumped out of the dustbin in which they were put, hopping all over the road and making a smell that disgusted the porters.

In his last years as director, Beveridge missed out on one significant development: the launching, with Rockefeller aid, of the National Institute of Economic and Social Research.

It might conceivably have taken root in the LSE but Beveridge was not the man to direct it. It was a possible association that re-emerged when Dahrendorf, a more entrepreneurial director, called for a British Brookings. But by then it was too late. It might have developed, as was urged in the early 1960s, from the recently established Centre for Administrative Studies. By 1976, however, there were too many think-tanks around for them all to be merged in a single organisation and the only really hopeful line of advance was probably to house as many as could be persuaded in a single building or within easy reach of one another. A more valuable move, to invite the LSE to establish a Business School, with or without the help of Imperial College, was certainly on the cards and supported by members of the school. It lay well within the traditional field of interest of the school which had much useful experience in management education and with a different director it could almost certainly have been done. But Sydney Caine was not equipped to launch such a project.

The postwar years are dealt with at rather less length. There is a full account of "the troubles" of 1967-68 and of the prolonged struggles of the 1980s to adapt to a much harsher environment. Dahrendorf's comments on the first of these are emollient; he has a good word to say for everyone even for those members of staff, mainly lawyers, who sided with the militants.

On the second, he makes clear how hard it was to meet successive attacks from unsympathetic governments. It was a Labour minister who told him in the director's dining room: "You cannot win. The Tories think that all university teachers are red, and Labour thinks that all university students are middle class." Higher university fees for overseas students began in 1968. In 1979 it was decided that from 1981 they would have to pay "full fees" with a corresponding reduction in government grants to universities which for the LSE meant a cut of 37 per cent. Thus the 15 guineas that Dahrendorf paid in 1952 had risen by 1994/5 to £7,120 (£2,350 for an EU student). Between 1974 and 1984 fee income rose from nine per cent to 41 per cent of the school's income, with overseas students alone providing 29 per cent. As Dahrendorf sadly remarks: "Here was the great School of Economics, the envy of the world, and all we could think about was how to squeeze money out of its students and friends."

Dahrendorf does not hesitate to mix his own conception of the aims and methodology of the social sciences with the narrative. He keeps up a running commentary on the problems and accomplishments of the social scientists at the school, making use also of his knowledge of writers in other countries, especially Germany. He has a particular regard for Karl Popper, but recognises that for him "research without theory seems pointless and research with theory has a point only if it is geared to falsification. In the social sciences in particular this makes most of the work people do appear superfluous".

In his summing up, he insists that "living with conflict is itself a virtue". There is a tension between theory and observation, between what he calls asceticism and worldliness, detachment and involvement, dispassionate inquiry and committed action. It is a tension that the school cannot escape.

One thing Dahrendorf does not do is to set the development of the LSE in the context of the simultaneous development of the social sciences in Britain. In 1890 there were no more than half a dozen professors of economics in the whole country (including Ireland) and few professors in other branches of social science. There were no PhDs in the social sciences and very few even in the 1930s.

There was no Economic Journal, and few journals of any kind were devoted to any of the social sciences apart from the Journal of the Royal Statistical Society; there was little organised research, little provision for the regular publication of articles in applied social science and none at all in theoretical social science.

A hundred years later the situation is entirely different. It is not just that the number of university teachers of the social sciences is now in the thousands and that the number of journals has multiplied to the point where one cannot keep pace with the new ones when they appear, much less familiarise oneself even with the headings of all the articles published or read more than a small sample.

Apart from these changes there has been a mushrooming of think- tanks of all kinds and an outpouring of articles, pamphlets and reviews.

It is rarely the work of the social scientist at the LSE that one reads, hears or sees, but nearly always of someone employed by the media or, in the case of economists, by someone in the City. The social sciences are thus faced with a situation totally different from a hundred years ago and one making necessary a thorough reconsideration of the future training of social scientists.

Sir Alec Cairncross's most recent book is Austin Robinson: the life of an economic adviser.