William Niskanen, Former Reagan Economist and Cato Board Chair, Dead at 78

All of us at the Cato Institute are saddened to announce that William A. Niskanen, distinguished senior economist and chairman emeritus of the Cato Institute, passed away today in Washington at 78.

Niskanen served 23 years as chairman of Cato’s board of directors, stepping down in 2008. Prior to joining Cato, he served as a member and acting chairman of President Ronald Reagan’s Council of Economic Advisers.

“Bill Niskanen was a world-renowned economist and a passionate leader of the growing classical liberal movement around the globe,” said Cato founder and president Edward H. Crane. “More importantly, he was a man of unshakeable integrity. His influence on and importance to the Cato Institute cannot be overstated. His passing is a terrible loss to the Institute and to the nation.”

Niskanen had a long and prominent career as an economist, including tenures as director of economics at the Ford Motor Company, professor of economics at the University of California at Berkeley and Los Angeles, assistant director of the federal Office of Management and Budget, a defense analyst at the Rand Corporation, the director of special studies in the Office of the Secretary of Defense, and the director of the Program Analysis division at the Institute of Defense Analysis.

Born March 13, 1933 in Bend, Ore., Niskanen graduated from Bend High School,and received his B.A. and Ph.D in economics from Harvard and the University of Chicago, respectively.

Many of Niskanen’s articles and essays are collected in two books, Policy Analysis and Public Choice and Reflections of a Political Economist: Selected Articles on Government Policies and Political Processes.

Niskanen underwent heart surgery in September, and was undergoing rehabilitation. He suffered a major stroke on Tuesday evening at his home and passed away Wednesday at a D.C.-area hospital, his wife Kathy at his side. He is also survived by daughters Lia, Pamela and Jaime.

Niskanen was granted a Professional Achievement Award by the University of Chicago Alumni Association in 2005, sharing the stage with fellow recipient David Broder, the late longtime Washington Post columnist, and philosopher Richard Rorty. The announcement of the award described Niskanen as “the embodiment of what the University of Chicago stands for in terms of scholarship, professionalism, integrity, and dedication.”

Niskanen’s 1980 departure from the Ford Motor Company was recounted in several books and in a Wall Street Journal profile. These accounts concluded that Niskanen’s departure had been forced upon him due to his principled opposition to protectionist trade policies. “Mr. Niskanen’s sermons against the protectionist temptation weren’t exactly what Ford management wanted to hear,” wrote the Journal’s Robert Simison. “It soon decided to launch anyway what has become an active publicity and lobbying campaign for government controls on Japanese autos. …They also decided they didn’t need Mr. Niskanen’s advice. They fired him.”

“When Bill first came to Washington in the ’60s, Americans had great faith in government,” said Cato scholar John Samples. “Bureaucracy and Representative Government, the book he wrote in 1971, was one of the main forces that helped start to change that. In that book, Bill accurately predicted that Congress would have a very difficult time calculating the true costs of public services, particularly national defense.”