Fred Harrison
(1944 - ) is a British author, economic commentator and corporate policy
advisor, notable for his stances on land reform and belief that an over
reliance on land, property and mortgage weakens economic structures and
makes companies vulnerable to economic collapse.
He is
acknowledged as having predicted the 2008 subprime mortgage crisis,
laying it out in his books as early as 1997.
He was born in
Cyprus and educated in England, Germany and Singapore. After studying at
Ruskin College Oxford he graduated from University College Oxford with a
BA (Hons) and read for his MSc at University of London.
Beginnings in Economics
Harrison was appointed Director of a London think-tank, the Centre for
Incentive Taxation, in 1987, as his theories on economic incentives and
their relationship to the economy as a whole developed. He also wrote a
series of books at this time covering economic theory.
Economic Advisor to Russia
With the fall of the USSR, Fred Harrison took an opportunity to work
with the Russian government in developing economic policy. He spent 10
years in Russia advising their Federal Parliament (Duma) and local
authorities on property tax reform and establishment of land markets. He
conducted long-range economic studies, attempting to steer economic
policy towards investment in schools, science and healthcare. He was the
organizer of the Duma's Land Policy Congress and conducted several
hearings and studies commissioned by a wide range of Russian
authorities. In 2002 he ended his work in Russia when it became apparent
that the trend of investment from resource rents was not into the
ventures he had recommended but instead into what he termed conspicuous
consumption, such as buying western real estate and football clubs. He
wrote "The Silver Bullet" as a response to his disaffection for the
choices of the Russian Duma on these and other issues.
The Economist who got it right
After his sojourn in Russia, he returned to his work in England. He had
already become the Research Director of the Land Research Trust, London,
in 1998 and worked as a corporate business advisor, as well as giving
lectures on property and tax policy. In 2008 he co-founded Motherlode
Ltd. a communication company based in London. He has been widely
acclaimed as the only commentator to get the timing of the 2007
recession correct. Notably, he warned Gordon Brown as far back as 1997
that the UK economy would hit the peak of the cycle in 2007 – and turn
down into a depression in 2010. Since then, his main focus in both
writing and lecturing has been to warn of what he considers to be the
dangers of using land and real estate as the primary drivers of economic
growth. His work links economic policy to social reform. Harrison's
macro-economic analysis is based on the theory that business conforms to
a pattern of 18-year cycles, determined by the unique characteristics of
the land market.
He predicted 2007 in 1997
Since 2005, several commentators have agreed that his predictions have
consistently proved correct. As an example, in 2005 there was an almost
unanimous view[ that the rise in house prices would moderate and that
any talk of a "housing bubble" was both premature and indicated a false
understanding of debt economics. Harrison warned that there would be a
2-year explosive growth in prices and property speculation before the
market imploded in the winter of 2007/08 with heavy damage to the
financial markets. As shown by the 2008 subprime mortgage crisis, he was
essentially correct on all points.
Both in the UK and worldwide, until 2008 most media commentators and
economic theorists dubbed him the ‘Prophet of Doom’ and his pragmatic
approach was rebuffed in favour of mainstream assertions that the "new
economy" was destined to sustain growth. Some niche media outlets agreed
with his thesis and continued to publish his work. His books are widely
distributed. With the collapse of the US and UK banks in 2008, some
elements of the media began to reconsider his ideas, and he is now
engaged primarily in making documentaries to explain and quantify his
theories.
Fred
Harrison