Franco Modigliani (1918 - 2003) photo by Donna Coveney
Six years ago in Romes exclusive club, the Circolo degli Scacchi, at a luncheon hosted by Franco Cingano, chairman of Mediobanca, and attended by, among others, Enrico Cuccia and Eric Roll, I first met Franco Modigliani.
A lucid mind, vivacious eyes, a hearty laugh and two big holes in the heels of his pink socks.
I had known of Francos work and reputation for many years and I greatly admired him as an economist and as a man. When I saw the holes in his socks I liked and admired him even more. I thought, here is a man who doesnt give a damn about appearance; someone who is all meat, no smoke.
Franco Modigliani (1918-2003)
Franco Modigliani was born in Rome and studied there and at the Sorbonne, Paris. He escaped to the United States on the eve of the second world war, and earned his doctorate at the New School for Social Research in New York. His 1944 paper in Econometrica charted a new understanding of the relationship between Keynesian and classical economics.
In the 1950s he worked with John Nash, William Cooper and Herbert Simon at the (then) Carnegie Institute of Technology. In 1962 he began a forty-year association with the Massachusetts Institute of Technology (MIT). His major collaborative work there included the analysis of personal savings (the life-cycle theory) and research into financial markets.
In 1985 he was awarded the Bank of Sweden (Nobel) prize in economic sciences. His autobiography, The Adventures of an Economist, was published in 2001.
I met him subsequently on three or four occasions. Once, we had lunch together at a conference in Villa dEste along with an Italian trade union leader. The discussion was about pensions, a topic on which Franco had done considerable work. I was fascinated by the intensity with which he listened and the rationality as well as the passion with which he argued his thesis.
However, our real friendship started only two or three years ago via several transatlantic telephone conversations, either to Cambridge, Massachusetts or to Marthas Vineyard. We normally spoke of Italian politics, which Franco even though he was proud to be a United States citizen followed with great interest.
Over the last month, our conversations with Franco and his wife, Serena, became more frequent; we often spoke three or four times a day. The spark was the Italian prime minister Silvio Berlusconis notorious interview with the English magazine The Spectator about the mentally disturbed Italian judges and the benign regime of Mussolini.
Franco (who was fourteen years older than me) and I had to leave Italy after the introduction of racial laws by Benito Mussolinis regime in 1938. We were not amused by that interview and were even less amused when we learned that the Anti-Defamation League (ADL) intended to bestow its annual Distinguished Statesman Award on Berlusconi at a gala dinner at the Plaza Hotel in New York. The charter of this ninety-year-old Jewish organisation, after all, commits it to fight against any kind of racial, ethnic or religious discrimination.
Franco and Serena were outraged, but not for religious reasons. Like me (who was even baptised at the age of 10) they were not practicing Jews. Rather, it was a matter of principle. Apart from Berlusconis comments on Mussolini, we agreed that the prime minister leads a coalition which includes a xenophobic and racist party (the Lega Nord) and that he never takes a public stand in challenging it.
Franco had the ability to be indignant at injustice; he emanated this feeling to people around him, instilling courage and the will to fight for a just cause. With enthusiasm, and aided by Serena, he rallied a number of outstanding Massachusetts Institute of Technology (MIT) and Harvard academics, including fellow Nobel laureates Paul Samuelson and Robert Solow. He was as happy as a child with a new toy for having succeeded in obtaining Paul Samuelsons signature. You know, he told me, Paul never signs this sort of letter.
The troika, as they were known, wrote a blasting letter to the New York Times. It was published on the day of the gala dinner and created some disarray among its organisers. It defined clearly a stance of principle against those (like Abraham Foxman, the national director of the ADL) who stood on the ground of petty political calculation in this case, support for George Bush and Ariel Sharon. Francos reasoning, which I totally shared, was that you cannot barter fundamental principles for partisan politics.
The letter was co-signed by another four distinguished professors from MIT and Harvard. The New York Times published the letter with the signatures of the three Nobel laureates alone. It indicated, however, that there were other signatures.
Franco fought this battle with youthful rigour yet maintained throughout it a wonderful sense of humour. He was delighted that the troika managed somehow to spoil ADLs dinner and he giggled when he learned that Kissinger, who was supposed to attend, went to a Top Dog exhibition instead.
Franco Modigliani (1918 - 2003)
He intensely disliked the arrogance and ignorance of politicians. He strongly opposed the war in Iraq and was very critical of Bushs economic policy which, in his view, was aimed at further enriching the rich. He thought Berlusconis was even worse because it was aimed at enriching himself.
He loved his wife Serena, who was very protective of him; very often she would listen in on his phone calls and would intervene with her comments. My feeling is that he just loved that.
Franco Modigliani, my wonderful new, old friend, with whom I spoke just a few hours before he died, has gone. I will miss him a lot.
