James Coyne, who died Friday night in Winnipeg at the age of 102, will always be remembered as the man who won a Pyrrhic victory against former prime minister John Diefenbaker in what has come to be known as The Coyne Affair.
As Governor of The Bank of Canada, Mr. Coyne was highly critical of the prime minister’s monetary and fiscal policy and said so frequently in speeches about the need for “sound money” policies. For his part, Mr. Diefenbaker considered Mr. Coyne “inflexible,” “arrogant” and an “unregenerate Grit.”
Nobody emerged unscathed from their confrontation: Mr. Coyne lost his job in 1961, but won a moral victory in the Liberal dominated Senate; both Mr. Diefenbaker and minister of finance Donald Fleming had their reputations tarnished. Still, as a result of this tempest, the relationship between the government and the governor of the Bank of Canada was clarified.
As for Mr. Coyne, his tumultuous tenure at the bank was only one entry on a curriculum vitae that included a Rhodes Scholarship, a call to the bar in Britain and Manitoba, public-policy making in the recovery efforts after the Depression and during the Second World War and his final and private role as a husband and the father of five children.
“He had a natural gift for it,” said his youngest son, Andrew Coyne, a journalist for the National Post. “Dogs and little children gravitated towards him and loved his mixture of gruffness and warmth.”
Quirky and eccentric, Mr. Coyne was not “kissy huggy, but he was there at crucial moments and he was a very important moral and intellectual guide.”
Susan Coyne, his younger daughter, drew a deft portrait of her father in Kingfisher Days , her 2001 memoir of her childhood. “My father at this time had recently retired from public office, after a highly publicized and principled battle, to which he never referred. The exact nature of his present occupation remained one of the great unsolved mysteries of our childhood. There was always some inviolable corner of the house to which he would retire after breakfast to pore over his important papers. From time to time we would hear him whistling some ancient air from his youth. Later in the day, he would sit in his chair on the porch and do the cryptic crosswords, or read thick books on science and mathematics.”
The Coynes were a prominent Ontario family until James Bowes Coyne, moved to Winnipeg in 1905 (after Upper Canada College, the University of Toronto and Osgoode Hall) to become a partner in the law firm Aikins, Robertson Fullerton and Coyne. He married Margaret Elliott, and later served as a judge on the Manitoba Court of Appeal from 1946-1959.
James Elliott Coyne, the eldest of their three children, was born July 17, 1910 in Winnipeg. He went to local schools and then studied history and mathematics at the University of Manitoba, graduating cum laude with a bachelor degree in 1931, and winning a Rhodes Scholarship to Oxford the following year.
George V. Ferguson, who subsequently became editor of the now defunct Montreal Star, was on the selection committee. He told journalist Peter C. Newman that Mr. Coyne was so far ahead of the other candidates that the meeting was one of the shortest in the committee’s history.
At Oxford, Mr. Coyne studied law, played on the Oxford Blues hockey team (as had Lester Pearson and Roland Michener before him) and was called to the English bar in 1934. He returned to Winnipeg to practise law in his father’s firm, which by then was called Coyne and Coyne. It proved a short-term association, for two years later, J.L. Ralston, counsel for the Turgeon Royal Commission that was investigating the effects of the Depression on the wheat trade, hired Mr. Coyne as his assistant.
As the royal commission toured the West, holding its hearings, the staff often ended up in the same prairie hotels as a research team from the Bank of Canada, which had been founded in 1934 as a private corporation. Long discussions on the Depression and how to solve the country’s economic problems ensued and gradually Mr. Coyne realized that he was more interested in making economic public policy than practising law.
In 1938, the year the bank became a Crown corporation, he abandoned his burgeoning law practice for a job as a clerk in the research department of the Bank of Canada at a salary of $150 a month. Later, he described arriving in Ottawa in January, 1938 and finding an apartment on Metcalfe Street with a bedroom and a kitchen for $45 a month.
Although his expertise was in the grain trade, he was soon assigned to the Rowell-Sirois Commission, which had been struck by former Liberal prime minister Mackenzie King to investigate constitutional and economic repercussions coming out of the devastation of the Depression. A year later, he was seconded to the Central Mortgage Bank, which had been formed by the federal government to help sustain private mortgage-holders on the prairies, but the prospect of war changed everything. Mr. Coyne ended up working for the Foreign Exchange Control Board, which was charged with ensuring that investments required for the war effort didn’t leave the country.