Peter Jay, who has died aged 87, was, as a 37-year-old journalist, billed by Time magazine as one of 150 future world leaders; but the early brilliance which saw him promoted, only three years later, to the post of British Ambassador to Washington was undermined by certain traits of character.

Jay made his reputation as a brilliantly original economic commentator with a record of championing heresies which subsequently became orthodoxies. In the 1970s, working for The Times and as the main presenter of London Weekend Television’s Weekend World, he rigorously attacked the Barber boom and argued for a floating pound; later he became one of the earliest champions of monetarism – the principle that the supply of money determines the rate of inflation.

Jay could easily have gone on to a top job in journalism or, as some suggested, to the heights of academe. But in 1977, when he was just 40, he was seduced by an invitation from the Foreign Secretary, David Owen, to take on the job of British Ambassador in Washington. It was, he felt sure, a job he had been “born” to do.

Others did not see it the same way. There was fury in Parliament and the press and accusations of blatant nepotism – Jay was married to Prime Minister Jim Callaghan’s daughter Margaret (now Baroness Jay). Nothing in his previous career, it was noted, qualified him to claim the top job in diplomacy.

His tenure began somewhat unpromisingly when, in an introductory speech at the International Press Club, he revealed how his father-in-law, then engaged in a programme of drastic expenditure cuts demanded by the IMF, regarded himself as “Moses leading his people to the Promised Land”, thereby inadvertently providing the Leader of the Opposition, Margaret Thatcher, with a cue for a Prime Minister’s Question Time joke when she advised Callaghan to “keep taking the tablets”.

Jay, nevertheless, was an effective ambassador, making useful contacts in the Carter administration and putting forward the British Government’s case during a difficult period in Northern Ireland with vigour and conviction. But the outcry over his appointment (which was abruptly terminated by Mrs Thatcher in 1979) never abated and Jay subsequently paid a heavy price after details of some of the less official aspects of life at the British embassy in Washington came to light.

The Fall from Grace

In 1983, the novelist Nora Ephron published the hilarious “novel” Heartburn, a fictionalised account of the affair between Jay’s wife Margaret and Ephron’s then husband Carl Bernstein, one of the two investigative reporters who exposed Watergate. Perhaps the least likeable character in the novel was the eccentrically arrogant Jonathan, a thinly disguised portrait of Jay. When the Nora character sobs about the affair between their respective spouses, Jonathan seeks to comfort her with the thought that “the economy is in bad shape too”.

This was embarrassing enough, but worse was to come when, the next year, the Jays’ former live-in nanny, Jane Tustian, revealed that while his wife was involved with Bernstein, Peter Jay was consoling his sorrows with her – and she had an illegitimate son to prove it. Jay was reluctant to accept paternity, suggesting that the child could have been sired by the embassy chauffeur, and Jane Tustian had to take him to court and get a blood test before he would pay maintenance.

The revelations had a traumatic effect on Jay, who arrived back in Britain, not as the returning hero but as an object of public derision. The Sun chronicled his woes under the headline “How The Know-All Came A Cropper”; his marriage broke up and he had difficulty finding employment. In the end, he finished up much as he had started, as an economics journalist on the BBC.

A Legacy of Arrogance and Brilliance

Peter Jay was born on February 7 1937, the eldest son of the future Labour minister Douglas Jay and his wife Peggy, a GLC councillor. Brought up in Hampstead, he went through preparatory and public school taking all the prizes, becoming head boy of Winchester and winning a scholarship to Christ Church, Oxford, where he went after completing National Service in the Royal Navy.

Jay’s tutors at Oxford hailed him as “the cleverest young man in England” – to which his response was to ask: “Is there someone cleverer in Wales?” He became President of the Union and took a First in PPE.

It was at Oxford, too, that he fell in love with Margaret Callaghan, a fellow PPE student from Somerville. They had known each other before, belonging to allied political families, and they married at the House of Commons soon after she had completed her finals in 1961.

Jay began his career as a civil servant in the Treasury and had thoughts of following his father into politics. Instead, aged 29, he took the job of economics editor of The Times, to which he soon added that of front man on LWT’s Weekend World. In 1973 he won awards for best financial journalist of the year and political broadcaster of the year.

Lord Rees Mogg, Jay’s editor at The Times, described him as being “able to achieve things that others do not get near”, but felt that he did not possess “a career-building, cautious character”.

Rees Mogg was an admirer, but the same cannot be said of all Jay’s colleagues, many of whom resented his arrogant manner and his inability to suffer people (and there were plenty of them) whom he considered fools. The story was often told of the occasion when a sub-editor at The Times, who had queried something in Jay’s copy, was brusquely informed by Jay that he was writing for three people in the United Kingdom (two Treasury mandarins and the Governor of the Bank of England) and that the sub-editor was not one of them.

After Jay was dropped as Ambassador to the United States by the incoming Tories in 1979, he and Margaret stayed on in Washington, Margaret’s affair with Bernstein continuing until it petered out in 1981. Hoping to save his marriage, Jay stayed with her, doing the odd bit of consultancy, making speeches, trying to write a book –“doing sod all,” as he later put it. Eventually, they agreed to part.

Back in Britain in the early 1980s, Jay found new work with TV-am, a consortium of high-profile media figures, including David Frost and Anna Ford, set up to bid for the ITV breakfast franchise. They won the franchise but a month after the station’s launch in 1983, ratings slumped and Jay was ousted in a boardroom coup orchestrated by his co-director and former friend Jonathan Aitken. Aitken brought in Greg Dyke who, with the help of his Roland Rat character, turned the station’s fortunes round.

For the next two to three years Jay was, in his own words, “in free fall”, unable to find a satisfactory job; he presented A Week in Politics for Channel 4, and he edited the journal Banking World. Then in 1986 he re-emerged, to many people’s amazement, as “Chief of Staff” to the Mirror tycoon Robert Maxwell.

This was to be the low point of Jay’s career. He became a sort of “whipping boy” for Maxwell who exposed him to daily indignities, introducing him to prominent visitors as “Mr Ambassador”, telephoning him in the middle of the night to ask what time it was, and calling him in for “crisis” meetings at the weekend to establish why a secretary had misfiled a letter – or for no reason at all.

Once, when Jay had gone for a well-deserved weekend’s sailing in the Solent, Maxwell managed to get hold of him and demanded that he return to London immediately. When, a few hours later, Jay arrived at the Mirror building in Holborn, Maxwell greeted him with the words: “Hello Peter. What are you doing here?”

At one stage Maxwell instructed Jay to bug the house of Tom Bower, who was writing Maxwell’s (unofficial) biography. Jay did not carry out the instructions, though he admitted discussing the possibility with a security firm. Later, Maxwell employed his own security man, primarily to bug the telephones and offices of his staff.

Jay stayed with Maxwell for three-and-a-half years before being rescued (two years before Maxwell’s death) by an old friend from LWT days, John Birt, who made him head of economics at the BBC – a very similar position to the one he had held at the Times aged 29.

Having chain-smoked his way through the Maxwell experience – large ashtrays were positioned to either side of his blotter and sometimes he would have two cigarettes alight at the same time – Jay was said to have arrived at the BBC in such a nervous state that in meetings he would scratch away at his right earlobe until it bled. On television, he shook visibly.

As an economist, however, Jay had lost none of his forensic brilliance. An early opponent of Britain’s membership of the ERM, during the events of Black Wednesday in 1992, when Britain was humiliatingly ejected from the system, the clarity and speed of his analysis was held to have made ITN appear amateurish.

But his tendency to address viewers as if they were an economics seminar at Oxford meant that his live appearances were infrequent, a fact that caused resentment among less well-remunerated folk at the BBC – as did the insensitivity which he continued to show to lesser fry. Revealingly, in the preface to a book published to accompany the BBC’s “landmark” Road to Riches series about the economic history of mankind which he presented in 2000, Jay took a swipe at the “clerks and clowns” in the BBC accounts department who dared to query his expenses, apparently oblivious to the interests of the licence fee payer the “clerks and clowns” were there to protect.

There was therefore some glee when Jay was persuaded by the series directors to indulge in such undignified stunts as swapping bananas with a chimp, hurling an imaginary missile at the barbarians over Hadrian’s Wall and, in Athens, delivering the line “Aristotle’s philosophy may be Greek to many of us” while goofily turning his Penguin Classic the right way up.

Jay was touchingly aware of his faults, but seemed at a loss about how things might change: “I can only say I think it’s a bad thing to be arrogant,” he once admitted. “I try not to be arrogant. I don’t wish to be arrogant. But if other people say I’m arrogant, well… they’re probably right.”

By his marriage to Margaret Callaghan, Jay had a son and two daughters. The marriage was dissolved in 1985 and he married, secondly, in 1986, Emma Thornton, a history teacher and garden furniture designer with whom he had three sons.

Peter Jay, born February 7 1937, died September 22 2024