Sociologists From England

"Whatever the final verdict on the General Theory, Keynes' greatness as an economist will not be questioned. His mental capacities had a far wider range than those usually found in professional economists. He was a logician, a great prose writer, a deep psychologist, a bibliophile, an esteemed connoisseur of painting; he had practical gifts of persuasion, political finesse, businesslike efficiency; he had personal gifts which made him have profound influence on those who came into direct contact with him."

"In the field of policy Keynes had a keen sense of the realities of the situation. He was practical and a man of the world. He was a tremendous fighter, prepared to take on great odds, but he was not inclined to be a crusader for a merely Utopian aim."

"Keynes could be gross, crude, coarse, he had a Rabelaisian wit, an obsessive curiosity about sexual matters, and he often lacked refinement. He could be a show-off and a know-all. This emanated from his remarkably quick and piercing mind, his ability to ‘gut’ books in a few hours (not that this did not show now and then) and an insatiable curiosity about all manner of things. Keynes had the class and racial prejudices of his time, expressed in distasteful, often disgraceful terms to modern eyes and ears, yet rarely acted upon in his actual relationships. For at his core he was a deeply serious person, still a Victorian as well as an Edwardian, seeking for a philosophy by which to live in both private and public life."

"Keynes himself had in his day been known to make some fairly radical noises, for instance, calling for the complete elimination of that class of people who lived off other people's debts—"the euthanasia of the rentier," as he put it—though all he really meant by this was their elimination through a gradual reduction of interest rates. As in much of Keynesianism, this was much less radical than it first appeared. Actually, it was thoroughly in the great tradition of political economy, hearkening back to Adam Smith's ideal of a debtless utopia but especially David Ricardo's condemnation of landlords as parasites, their very existence inimical to economic growth."

"Did Keynes create a sense of hope? Oh, unquestionably. There was this breath of hope and optimism, and I came back from Cambridge to find a whole group of people here who had also read The General Theory."

"Keynes was quite frequently in Washington during the war on some negotiating mission. Anybody who's had experience with diplomatic negotiating matters knows that it's an exercise in idleness. You're waiting for instructions from your government, you're waiting for the others to be instructed; you're waiting for a meeting. Keynes filled in those times by moving into the American meeting. By this time there was a sizable group of younger people, of whom I was one, who were devoted to his ideas ― a much larger group, as he has said, in Washington than he had in London. His vanity was not above being touched by this effect, so he brought around him a group of younger Washington people for discussion of wartime policy, and I was naturally in that group."

"By the autumn of 1936 Keynes had reached Harvard with tidal force, There had been no such excitement among the younger economists before; there has been none such since. Here was a solution to depression and unemployment, the most urgent problem of the time. It was also a conservative one. Keynes showed that the government, by offsetting the excess of savings -- the short fall in purchasing power -- could prop up the economy so that it functioned at or near full employment instead of at some painful and socially demoralizing level down below."

"Keynes never sought to change the world out of any sense of personal dissatisfaction or discontent. Marx swore that the bourgeoisie would suffer for his poverty and his carbuncles. Keynes experienced neither poverty or boils. For him the world was excellent."

"For handling problems such as those facing the British or French treasuries during the war, there are no miracle men. Either current earnings from exports, salable assets, loans or credits... or gold exist for paying foreign suppliers, in which case the officials are a success. Or these assets do not exist, in which case those involved are a failure. However, nothing comes so easily to the press and public mind as the vision of financial genius. Both wish to believe that... there are individuals of transcendental insight and power, men who can make something out of nothing. In Britain during the war (and after) the popular imagination settled on the thirty-one-year-old (in 1914) Treasury official, John Maynard Keynes. His papers of the period, recently published, suggest that he was a hard-working, competent and resourceful man who matched resources to payments with attention and skill and who extended his mind to the similar problems of the French and the Russians. That was all."

"Keynes's views shocked orthodox sensibilities, then and now. The ideas that consumption is the goal of economic life, that savings could be pathological, that public-sector deficits are necessary and virtuous in a slump, that interest rates should be kept low have always conflicted with respectable banker and business views. Yet the Depression and World War II appeared to prove him right, and at the end of his life in 1946 his ideas were enshrined in national income accounts, at the root of the Bretton Woods monetary system, and ascendant in the academy. One group of followers – technically advocates of a “neoclassical synthesis” – rose to power, with ultimately unhappy consequences for the reputation of Keynesian theory. In the 1970s a counter-revolution got underway: monetarism, supply-side economics, rational expectations, deregulation. By the 2000s it was complete – just in time for the Great Crisis of 2007 to demonstrate, once again, the enduring relevance of his views."

"I am a great admirer of Keynes. I think he was a great human being and a great economist. I don't agree with the particular hypothesis he offered about the Depression, but advances in every science come from people offering hypotheses that turn out to be wrong. No, I think Keynes's objective was to promote the well being of his countryman, of his fellow citizens and of the rest of the world."

"I conclude that Keynes’s political bequest has done far more harm than his economic bequest and this for two reasons. First, whatever the economic analysis, benevolent dictatorship is likely sooner or later to lead to a totalitarian society. Second, Keynes’s economic theories appealed to a group far broader than economists primarily because of their link to his political approach."

"John Maynard Keynes (1883–1946) is the latest in a line of great British economists who had a profound influence on the discipline of economics. (...) In listing “the” classic of each of these great economists, historians will cite the General Theory as Keynes’s pathbreaking contribution. Yet, in my opinion, Keynes would belong in this line even if the General Theory had never been published. Indeed, I am one of a small minority of professional economists who regard his Tract on Monetary Reform (1923), not the General Theory, as his best book in economics. Even after sixty-five years, it is not only well worth reading but continues to have a major influence on economic policy."

"Keynes’s heritage was twofold—to technical economics and to politics. I have no doubt that Keynes’s bequest to technical economics was extremely beneficial, and that historians of economic thought will continue to regard him as one of the great economists of all time, in the direct line of succession to his famous British predecessors, Adam Smith, David Ricardo, J. S. Mill, Alfred Marshall, and W. Stanley Jevons.(...) The situation is very different with respect to Keynes’s bequest to politics, which has had far more influence on the shape of today’s world than his bequest to technical economics. In particular, it has contributed substantially to the proliferation of overgrown governments, increasingly concerned with every aspect of the daily lives of their citizens."

"There was nothing in these views to repel a student; or to make Keynes attractive. Keynes had nothing to offer those of us who had sat at the feet of Simons, Mints, Knight, and Viner."

"We're all Keynesians now."

"We can say that around Keynes, around the economic interventionist policy perfected between 1930 and 1960, immediately before and after the war, all these interventions have brought about what we can call a crisis of liberalism, and this crisis manifests itself in a number of re-evaluations, re-appraisals, and new projects in the art of government which were formulated immediately before and after the war in Germany, and which are presently being formulated in America."

"Keynes was a homosexual and had no intention of having children. We are not dead in the long run... our children are our progeny. It is the economic ideals of Keynes that have gotten us into the problems of today"

"John Maynard Keynes first raised the question of what can be done to stabilize the economy when it has fallen into a liquidity trap-when interest rates have fallen to a level below which they cannot be driven by further monetary expansion-and whether monetary policy can be effective at all under such circumstances. Long treated as a mere theoretical curiosity, Keynes's question now appears to be one of urgent practical importance, but one with which theorists have become unfamiliar."

"For Keynes unemployment could never be a "natural" disaster, like an earthquake or a flood. He knew that it is a failure of social and economic organization, a failure by society and social institutions to achieve a desirable goal. Quite simply, when millions of people are out of work, we have failed to organize our society so that full employment is secured. And being a problem of social organization, there must be a solution if only society is willing to take the steps necessary. This doesn't mean that either finding or implementing a solution will be easy. Our society and our economy are complicated institutions, linking a multitude of firms and people at home and abroad, each with their own goals and their ways of doing things. Moreover, achieving full employment may conflict with other goals we consider to be important. But it is irrational simply to accept unemployment, as if it were a fact of nature. Unemployment is our failure. At the very least, we must spell out clearly the choices that must be made if we are to attain full employment."

"Keynes was chief economic adviser to the British government and largely responsible for keeping the British economy afloat at a time when more than half of our gross national product, and all of our foreign exchange, was being spent on the war. ...I was lucky to be present at one of his rare appearances in Cambridge, when he gave a lecture with the title "Newton, the Man." …Four years later he died of heart failure, precipitated by overwork and the hardships of crossing the Atlantic repeatedly in slow propeller-driven airplanes under wartime conditions."

"I was lucky to hear the economist John Maynard Keynes, a few years before his death, give a lecture about the physicist Isaac Newton. Keynes was at that time himself a legendary figure, gravely ill and carrying a heavy responsibility as economic adviser to Winston Churchill. He had snatched a few hours from his official duties to pursue his hobby of studying Newton's unpublished manuscripts. Newton had kept his early writings hidden away until the end of his life in a big box, where they remained until quite recently. Keynes was speaking in the same old building where Newton had lived and worked 270 years earlier. In an ancient, dark, cold room, draped with wartime blackout curtains, a small audience crowded around the patch of light under which the exhausted figure of Keynes was huddled. He spoke with passionate intensity, made even more impressive by the pallor of his face and the gloom of the surroundings."

"I suddenly realized that Keynes and all the brilliant economic students in the room were interested in the behavior of commodities... while I was interested in the behavior of people."

"Keynes did not believe that political freedom and economic efficiency, for which he hoped, would suffice to bring about a better world. It was also necessary to guarantee social justice. The problem of articulating between these various ends is far from being satisfactorily resolved. In his tireless search for a solution to this challenge, Keynes figures among the great humanists and social thinkers whose work merit closer understanding and meditation. For Keynes, the problems of poverty, inequality, unemployment and economic crises are neither exogenous accidents nor punishments for excess, but rather the result of a poorly organized society and human error. It is these up to individuals united in the polis to attenuate or end them by carrying out major reforms. Are such reforms possible within the context of the capitalist economies known to us today? Keynes believed or at least hoped they were. The setting up of the Welfare State seemed to prove him right, but the tide has turned and his diagnosis of capitalism's state of health, put forward now more than half a century ago, is more relevant than ever. No one can claim to know what the future holds. It is up to us, however, to construct it. This is perhaps the main message of John Maynard Keynes."

"Keynes’s central concerns for his own time ring true today. He was worried about the fragility of our collective prosperity, and the grave tensions between nationalism and the rootless cosmopolitan attitudes underpinning a peaceful and flourishing global society. He focused on how to organize our activities and use our prosperity to create a world fit for the good life. He sought to expose the bankruptcy of ascendant ideological nostrums: laissez-faire, spontaneous order, collective cooperation, central planning. And he thought deeply about the technocratic problems of economic management – and about the social, moral, and political disasters that would follow from failing to address them."

"The belief that monetary instability--inflation and deflation--is the principal, or at least a principal, cause of other economic evils; the hope that sound monetary principles can be identified and, when identified, would greatly diminish uncertainty and risk; the focus on the job of the public sector being to provide the private economy with a stable measuring-rod and a stable environment--all these are core ideas of whatever we choose to call monetarism. Keynes believed these ideas very, very strongly in the mid-1920s. And his Tract on Monetary Reform is a review of economic theory and a look at the economic problems of post-WWI Europe through this set of monetarist spectacles."

"The great service of Keynes to recent history is that we now know, in the way that governments did not know in the 1930s, how full employment can be maintained."

"I can tell you — I was helping when Britain was trying to get a loan from the United States immediately after the war, and I was talking to one of Keynes's assistants. And Keynes came in the room and walked over to us and the man I was talking to us said, "This is Coase, who is helping us with the statistics. I don't think you know him." And Keynes said, "No, I don't." And walked off. And that's my life with Keynes."

"In a book which gained a vast publicity, particularly in the United States, he exposed and denounced "a Carthaginian Peace." He showed in successive chapters of unanswerable good sense the monstrous character of the financial and economic clauses. On all these matters his opinion is good. Carried away, however, by his natural indignation at the economic terms which were to be solemnly enacted, lie wrapped the whole structure of the Peace Treaties in one common condemnation. His qualifications to speak on the economic aspects were indisputable; but on the other and vastly more important side of the problem he could judge no better than many others."

"What do you think of J. M. Keynes's book? ... The condemnation of the work of the Conference as a whole is none too severe. I remember few cases in history where negotiators might have done so much good, and have done so much evil."

"No one embodied the Cambridge spirit of culture, fun, and public duty so much as Maynard Keynes. No one was more brilliant or charming. No economist in this century influenced politicians or the course of economics more."

"Keynes is largely responsible for elevating employment (and/or output) to a position as an explicit objective for policy. As I have emphasized, Keynes sought to change the basic perception of the economic process; he sought to bring employment, as such, onto center stage as a variable subject to direct manipulation. He sought to overthrow the classical model of market equilibrium in which employment is determined only as an emergent result or consequence of the interaction among the demand and supply choices made by market participants. Once again in this respect, Keynes was too persuasive. By elevating full employment to explicit consideration as a policy target, and thereby generating neglect of both monetary and market institutions, the Keynesian emphasis ensured the eventual stagflation that we experienced in the 1970s. The scenario might have been quite different if the Keynesian effort had been recognized for what it was rather than for what it was not."

"Why does Camelot lie in ruins? Intellectual error of monumental proportion has been made, and not exclusively by the politicians. Error also lies squarely with the economists. The "academic scribbler" who must bear substantial responsibility is Lord Keynes..."

"Without Keynes, government budgets would have become unbalanced, as they did before Keynes, during periods of depression and war. Without Keynes, governments would have varied the rate of money creation over time and place, with bad and good consequences. Without Keynes, World War II would have happened, and the economies of Western democracies would have been pulled out of the lingering stagnation of the 1930s. Without Keynes, substantially full employment and an accompanying inflationary threat would have described the postwar years. But these events of history would have been conceived and described differently, then and now, without the towering Keynesian presence. Without Keynes, the proclivities of ordinary politicians would have been held in check more adequately in the 1960s and 1970s. Without Keynes, modern budgets would not be quite so bloated, with the threat of more to come, and inflation would not be the clear and present danger to the free society that it has surely now become. The legacy or heritage of Lord Keynes is the putative intellectual legitimacy provided to the natural and predictable political biases toward deficit spending, inflation, and the growth of government."

"I work for a Government I despise for ends I think criminal."

"The power to become habituated to his surroundings is a marked characteristic of mankind."

"The great events of history are often due to secular changes in the growth of population and other fundamental economic causes, which, escaping by their gradual character the notice of contemporary observers, are attributed to the follies of statesmen or the fanaticism of atheists."

"The disruptive powers of excessive national fecundity may have played a greater part in bursting the bonds of convention than either the power of ideas or the errors of autocracy."

"The immense accumulations of fixed capital which, to the great benefit of mankind, were built up during the half century before the war, could never have come about in a Society where wealth was divided equitably."

"The duty of "saving" became nine-tenths of virtue and the growth of the cake the object of true religion."

"In writing thus I do not necessarily disparage the practices of that generation. In the unconscious recesses of its being Society knew what it was about. The cake was really very small in proportion to the appetites of consumption, and no one, if it were shared all round, would be much the better off by the cutting of it. Society was working not for the small pleasures of today but for the future security and improvement of the race,—in fact for "progress." If only the cake were not cut but was allowed to grow in the geometrical proportion predicted by Malthus of population, but not less true of compound interest, perhaps a day might come when there would be at last be enough to go round, and when posterity could enter into the enjoyment of our labors."

"I seek only to point out that the principle of accumulation based on inequality was a vital part of the pre-war order of Society and of progress as we then understood it, and to emphasize that this principle depended on unstable psychological conditions, which it may be impossible to recreate. It was not natural for a population, of whom so few enjoyed the comforts of life, to accumulate so hugely. The war has disclosed the possibility of consumption to all and the vanity of abstinence to many. Thus the bluff is discovered; the labouring classes may be no longer willing to forgo so largely, and the capitalist classes, no longer confident of the future, may seek to enjoy more fully their liberties of consumption so long as they last, and thus precipitate the hour of their confiscation."

"He had one illusion — France; and one disillusion — mankind, including Frenchmen, and his colleagues not least."

"The glory of the nation you love is a desirable end, — but generally to be obtained at your neighbor's expense."

"To see the British Prime Minister watching the company, with six or seven senses not available to ordinary men, judging character, motive, and subconscious impulse, perceiving what each was thinking and even what each was going to say next, and compounding with telepathic instinct the argument or appeal best suited to the vanity, weakness, or self-interest of his immediate auditor, was to realize that the poor President would be playing blind man's bluff in that party."

"The future life of Europe was not their concern; its means of livelihood was not their anxiety. Their preoccupations, good and bad alike, related to frontiers and nationalities, to the balance of power, to imperial aggrandizements, to the future enfeeblement of a strong and dangerous enemy, to revenge, and to the shifting by the victors of their unbearable financial burdens on to the shoulders of the defeated."

"The division of the spoils between the victors will also provide employment for a powerful office, whose doorsteps the greedy adventurers and jealous concession hunters of twenty or thirty nations will crowd and defile."

"But the dreams of designing diplomats do not always prosper, and we must trust the future."

"Men will not always die quietly."

"Lenin is said to have declared that the best way to destroy the capitalist system was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth. Those to whom the system brings windfalls, beyond their deserts and even beyond their expectations or desires, become 'profiteers,' who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished, not less than of the proletariat. As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery. Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose."