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Currie, Lauchlin (8 Oct. 1902-23 Dec. 1993), economist, was born in the small fishing village of New Dublin, Nova Scotia, Canada, the son of Lauchlin Bernard Currie, who operated a fleet of merchant ships, and Alice Eisenhauer Currie, a schoolteacher. His father died four years later and his family moved to the nearby town of Bridgewater. Most of his schooling was in Bridgewater, but he also briefly attended schools in Massachusetts and California, where he had relatives. After two years at St. Francis Xavier's University, Nova Scotia (1920-1922), he studied at the London School of Economics and received his B.Sc. in 1925. There his teachers included Edwin Cannan, Hugh Dalton, A. L. Bowley, and Harold Laski.

In 1925 he moved to Harvard, where his chief inspiration was Allyn Abbott Young, then president of the American Economic Association. In 1931 he received his Ph.D. for a dissertation on banking theory and monetary policy. He remained at Harvard until 1934 as assistant to, successively, Ralph Hawtrey, John H. Williams, and Joseph Schumpeter. There, he constructed the first money supply and "income velocity" series for the United States. He also attacked the Fed's "commercial loan theory" of banking (or "real bills" doctrine), blaming it for monetary tightening in mid-1929, when the economy was already declining, and then for its passivity during the next four years in the face of mass liquidations and bank failures (in his book The Supply and Control of Money in the United States [1934]). In a January 1932 Harvard memorandum on antidepression policy, Currie and fellow instructors Harry Dexter White (a close friend since 1925) and Paul T. Ellsworth urged large fiscal deficits coupled with open-market operations to expand bank reserves, as well as the lifting of tariffs and the relief of interallied debts (see Laidler and Sandilands, 2002).

In 1934 Currie became an American citizen and joined Jacob Viner's "freshman brain trust" at the U.S. Treasury. There he outlined an "ideal" monetary system for the United States, which included a 100-percent reserve banking plan to strengthen central bank control over the money supply by preventing member banks from lending out their demand deposit liabilities, while at the same time removing reserve requirements on genuine savings deposits with low turnover. Later that year Marriner Eccles moved from the Treasury to become governor of the Federal Reserve Board. Eccles took Currie with him to the Fed as his personal assistant. White, another "freshman brain trust" recruit, became a top adviser to treasury secretary Henry Morgenthau, and for some years he and Currie worked closely in their respective roles at the Treasury and the Fed.

At the Fed, Currie drafted what became the important 1935 Banking Act. He also constructed a "net federal income-creating expenditure series" to show the strategic role of fiscal policy in complementing monetary policy to revive an economy in acute, persisting depression. When, after four years of recovery, the economy declined sharply in 1937 he was able to explain to President Franklin D. Roosevelt, in an unprecedented four-hour interview, that the declared aim of balancing the budget "to restore business confidence" had damaged the economy. This was part of the "struggle for the soul of FDR" (Stein, 1969) between the cautious Secretary Morgenthau and the expansionist Governor Eccles. At first FDR sided with Morgenthau and disaster followed. In April 1938 the president at last asked Congress for major appropriations for spending on relief and public works. In May 1939 the rationale was explained in theoretical and statistical detail by Currie (dubbed "Mr. Inside" by James Tobin [1976]) and by Harvard's Alvin Hansen ("Mr. Outside") in testimony before the Temporary National Economic Committee to highlight the role of government budgets in the recovery process.

Named FDR's White House economist in July 1939, Currie advised on taxation, social security, and the speeding up of peacetime and wartime production plans. In January 1941 he was sent on a mission to China for discussions with Generalissimo Chiang Kai-shek and Chou En-lai, the Communist representative in the Chinese wartime capital of Chungking. On his return in March he recommended that China be added to the lend-lease program. He was put in charge of its administration under the overall direction of FDR's special assistant Harry Hopkins.

Currie was also asked to expedite the Flying Tigers program, in which U.S. Navy pilots were released for combat as mercenaries under Claire Chennault who commanded the Chinese air force in the war with Japan. He also helped organize a large training program in the United States for Chinese pilots. In May 1941 he prepared a paper on Chinese aircraft requirements for General George C. Marshall and the Joint War Board. The document, accepted by the Board, stressed the role an air force in China could play in defending Singapore, the Burma Road, and the Philippines against Japanese attack, but it also pointed to its potential for strategic bombing of targets in Japan itself. These activities, together with Currie's work in helping to tighten U.S. sanctions against Japan, are said to have played a part in provoking Japan into attacking Pearl Harbor later that year.

Currie returned to Chungking in July 1942 to try to patch up the very strained relations between Chiang and General Joseph W. Stilwell, commander of U.S. forces in China. Currie was one of several of FDR's envoys who recommended Stilwell's recall and reassignment. Back in Washington, Roosevelt asked Currie to put this case to General Marshall, but the general dismissed the idea. Only much later did Marshall concede that his protégé's continued presence in China was indeed a mistake. Stilwell was recalled in October 1944.

In 1943-1944 Currie ran the Foreign Economic Administration, and in early 1945 Roosevelt appointed him to head a tripartite (U.S., British, and French) mission to Bern to persuade the Swiss to freeze Nazi bank balances and stop further shipments of German supplies through Switzerland to the Italian front. He was also closely involved in loan negotiations with the British and the Russians, as well as in preparations for the 1944 Bretton Woods conference--staged primarily by Harry Dexter White--that led to the creation of the International Monetary Fund and the World Bank.

After the war Currie was one of those blamed for "losing" China. It was also alleged by Elizabeth Bentley, an ex-Soviet agent, that Currie and White had participated in wartime Soviet espionage (see Sandilands, 2000, and Boughton and Sandilands, 2002). Though she had never met them herself, she claimed that White and Currie had passed on information to other Washington economists who were consciously abetting her own espionage activities, and that Currie and White probably knew where the information was ultimately destined. White and Currie were, of course, heavily involved in official wartime cooperation with the Soviet ally, but she put a sinister interpretation on these activities. White and Currie demanded to appear together before the House Committee on Un-American Activities in August 1948 to rebut Bentley's charges. Their testimony appeared to satisfy the Committee at that time, though the strain contributed to the fatal heart attack that White suffered immediately after the hearing.

No charges were ever laid against Currie, and in 1949 he was selected to head the first of the World Bank's comprehensive country surveys. This was to Colombia. After Currie's report was published in Washington in September 1950, he was invited by the Colombian government to return to Bogota as adviser to a commission established to implement the report's recommendations. He has been falsely accused (for example by Haynes and Klehr, 1999, p. 150) of fleeing the United States to avoid McCarthyite charges of disloyalty. In fact he returned in December 1952 to appear before a grand jury in New York that was investigating Owen Lattimore's role in the famous Amerasia case that involved the publication of secret State Department documents by that magazine.

When Currie, as a naturalized U.S. citizen, attempted to renew his passport in the poisonous atmosphere of 1954, this was refused, ostensibly on the grounds that he was now residing abroad. However, the reality was probably connected with the then top-secret "Venona" project, which had decrypted some wartime Soviet cables that mentioned Currie's name (see Haynes and Klehr, 1999, and Sandilands, 2000). He had recently been divorced from his first wife, Dorothy Bacon, whom he married in 1927 and with whom he had two sons; in 1954 he married a Colombian, Elvira Wiesner, with whom he later had a son and a daughter. After a military coup in Colombia in 1953 he retired from his economic advisory work and devoted himself to the raising of Holstein cattle on a farm outside Bogota. He developed the highest-yielding dairy herd in the country.

With the return of civilian government in 1958, President Alberto Lleras personally conferred Colombian citizenship upon him and he returned to full-time advisory work for a succession of presidents. Between 1966 and 1971, though, he served as a visiting professor in North American and British universities: Michigan State (1966), Simon Fraser, Canada (1967-1968 and 1969-1971), Glasgow (1968-1969), and Oxford (1969). He returned permanently to Colombia in May 1971 at the personal behest of President Misael Pastrana to prepare a national plan of development known as the Plan of the Four Strategies, with focus on urban housing and export diversification. The plan was implemented, and the institutions that were established in support of the plan played a major role in accelerating Colombia's urbanization.

Currie remained as chief economist at the National Planning Department for ten years, 1971-1981, followed by twelve years at the Colombian Institute of Savings and Housing until his death in 1993. There he doggedly defended the unique housing finance system (based on "units of constant purchasing power" for both savers and borrowers) that he had established in 1972. The system thus continued to boost Colombia's growth rate and urban employment opportunities year by year. Currie was also a renowned adviser and writer on urban planning, and he played a major part in the first United Nations Habitat conference in Vancouver in 1976. His "cities-within-the-city" urban design and financing proposals (including the public recapture of land's socially created "valorización," or "unearned land value increments," as cities grow) were elaborated in his book Taming the Megalopolis (1976). He was a regular teacher at the National University of Colombia, the Javeriana University, and the University of the Andes, and was also publishing widely in international journals. His writings were heavily influenced by his old Harvard mentor Allyn Young. A paper on Youngian "endogenous" growth theory was published posthumously (History of Political Economy 29 [1997]: 413-44). He was still teaching when he died. On the day before his death he was awarded Colombia's highest honor, the Cruz de Boyaca, by President Cesar Gaviria for services to his adopted country.

Bibliography Currie's very extensive collected papers are archived at Duke University's Special Collections Library (http://scriptorium.lib.duke.edu). His China papers are also archived at the Hoover Institution, Stanford University. His most influential early work on monetary theory, policy, and statistics is The Supply and Control of Money in the United States (1934). His long Harvard memorandum (with Harry Dexter White and Paul T. Ellsworth), dated January 1932, on antidepression policy is published in History of Political Economy 32, no. 2 (Summer 2002) with a foreword by David E. Laidler and Roger J. Sandilands that explains its significance as a forerunner of what has become known as the Chicago School's monetary tradition. A comprehensive biography of Currie is Roger J. Sandilands, The Life and Political Economy of Lauchlin Currie: New Dealer, Presidential Adviser, and Development Economist (1990), which includes a comprehensive bibliography of Currie's writings. Discussion of Currie's work in the New Deal is in Herbert Stein, The Fiscal Revolution in America (1969); James Tobin, "Hansen and Public Policy," Quarterly Journal of Economics 90: 32-37; and Ronnie J. Phillips, The Chicago Plan and New Deal Banking Reform (1995). Appraisals of the significance of the "Venona" papers--decrypts of Soviet cables that passed between Moscow and New York during the war--and whether they support the allegations that Currie was a Soviet spy are in John Earl Haynes and Harvey Klehr, Venona: Soviet Espionage in America in the Stalin Era (1999); Roger J. Sandilands, "Guilt by Association? Lauchlin Currie's Alleged Involvement with Washington Economists in Soviet Espionage," History of Political Economy 32, no. 3 (Fall 2000): 473-515; and James M. Boughton and Roger J. Sandilands, "Politics and the Attack on FDR's Economists: From Grand Alliance to Cold War," Intelligence and National Security, 17, no. 2 (Summer 2002). Obituaries are in the New York Times, 30 Dec. 1993, and the London Times, 10 Jan. 1994.