The 50th anniversary of Britain’s declaration of war on Germany brought back some sombre memories for older television viewers. Seeing again those massive piles of rubble smouldering and deserted where once stood the city of Dresden, some may have paused to wonder what sort of man lay behind an act of barbarous inhumanity which obliterated at least 60,000 innocent civilians.

The man was Sir Arthur ‘Bomber’ Harris. History knows him to have been a man of limited intelligence and narrow vision who was possessed of a blinding contempt for the whole German people and all its works. Had Churchill recognised his limitations for what they were, he might never have been persuaded to accept saturation bombing of civilian targets as a justifiable stratagem. Personality defects are likely to give rise to unworthy deeds, and to be aware of the first is to be forewarned of the second.

Personality is sometimes overlooked. It can also be mistaken, as it often is in the case of public figures who tend to be judged not for who they are but for what they do.

Because so much of the impetus for radical innovation these past ten years has stemmed from Mrs Thatcher’s own personality, she has come to be recognised only for the recent injurious results of some ill-considered policies. That is a pity since she is said to possess a fair measure of compassion as well as signal courage and drive. These qualities earn her few tributes because it is difficult to draw any connection between them and their effect on the lives of individual citizens. Obduracy and dogmatism can doubtless be traced back more directly from matter to her mind but they form only part of the Prime Minister’s persona. The picture in the public eye is highly coloured but incomplete.

In other fields, the connection between shepherd and flock is far less remote. The leader of a large company can profoundly and directly alter the fortunes of his shareholders, customers and employees. His personality can make or break each one of them. When today individual entrepreneurs can persuade banks to furnish them with virtually unlimited capital, and with it the power to control single-handed any company in the world, one might suppose that all attention would be focused on the personal qualities of those concerned. It may be of interest to see why it is not.

The change in Britain’s industrial base means that fewer business leaders today have spent much or all of their careers in one company. Many have little experience of work on a factory floor, in a workshop, in a sales department. They may never have been involved in any collective endeavour. During a period of profound structural change the personality of the man at the top arouses little interest, and the only characteristic to excite comment and applause has been a new-found professionalism and efficiency. However these are qualities of the hand not the heart and require little in the way of human understanding or ethical judgement. All that today’s players in the corporate super-league seem to need is financial acumen and an eye for a quick reward. Is it enough and are the more personal qualities really irrelevant?

In recent times, men like Sigmund Warburg, Adrian Cadbury, and Hector Laing were able to stamp the print of their personality on the companies they ran in a way which brought lasting benefit to the whole undertaking. Few of the new generation give the impression that they are trying to do the same and fewer look likely to succeed. Perhaps the leader of the three adventurers pursuing BAT will be one of the few, though the market seems surprisingly little concerned with what lasting impact he might have on a mighty business empire.

BAT employs 310,000 people, sells its products to literally hundreds of millions of customers, and has 146,000 shareholders. Its operations span the globe. Yet City commentators and the financial institutions appear largely indifferent to the personal credentials of a man who would turn it upside down and inside out.

Not that the purely financial consequences of the bid for BAT are unimportant. They are momentous. But there are others and all of them will be vitally affected by the personality and motives of Sir James Goldsmith. A reflective and paternal proprietor will not deal with his company in the same way as an impetuous or opportunistic one. The priority for BAT shareholders should be to decide what sort of man they want to manage their interest as proprietors, and then to assess what they are likely to get in Sir James.

Full blooded free-marketeers like Friedrich Hayek and Milton Friedman say that the more you interfere in the system, for example by keeping out the sharpest predators to protect the weakest, the less well it works. Since we inhabit a jungle we have to put up with the fact that the tiger has sharp claws.

And sadly it is true. Time and again post-war British governments before this one have been forced to apply curbs to the raw workings of the free market. Time and again their efforts have only made matters worse. Over the last 40 years incomes policies, industrial relations legislation, and much of the state welfare system have been introduced with the best of intentions; but they have had limited or perverse results. Piecemeal interventionism has failed and rightly been abandoned.

It should have been replaced by a long term policy programme which made full allowance from the start both for the anomalies and imbalances inevitable in the market system, and for the cost of correcting them. Instead it has been replaced by a political agenda in which little attempt is made to humanise and harmonise natural appetites. Issues like the crises in the environment and in academic funding have been neglected beyond the limit of repair simply because they cannot be dealt with through the market mechanism. Now, when public awareness is wakened, the government has embarked on a fire-fighting programme to contain the political heat.

Damage limitation is not an answer to the basic problem which is that, left alone, mercantilism defeats itself because it makes too many enemies – the poor, the professional classes, academics, and those working in the public sector among others. Without any systematic apparatus of brakes and checks the only safeguard for a large part of the community is the public conscience and an enlightened consensus about each part’s worth to society and society’s duty to it. But the public conscience is unstirred and the consensus remains unenlightened because the whole appeal of mercantilism is to the baser instinct. Personal standards of ethical behaviour are incidental. People cannot be called on to act in particular with the highest motives when they are encouraged to act in general with the lowest.

Investment managers are observers, not judges of the society in which they operate and the people with whom they deal. They are bystanders only, but they require to be informed ones. Personality is of decisive importance in the train of human endeavour, and our political and business no less than private assessments would do well to recognise it. Yet it goes unnoticed because the reason of the age does not allow it a part to play. For Sir James Goldsmith the omission is an opportunity; for Margaret Thatcher it is a tragedy.

15 September 1989