dChan - Q Origins Project Archive

https://www.armstrongeconomics.com/research/economic-thought/by-author/keynes-john-maynard/

Excerpt:

'Consequently, the General Theory adopted an activist economic role for government to stimulate demand in times of high unemployment while ignoring supply. One proposal was to increase spending on public works. “Let us be up and doing, using our idle resources to increase our wealth,” he wrote in 1928. “With men and plants unemployed, it is ridiculous to say that we cannot afford these new developments. It is precisely with these plants and these men that we shall afford them.” However, no attention was paid to not merely supply, but also to the unproductive forces of wealth. If the object is simply to spend money and you go spend it on a fancy dinner or go buy a fine piece of jewelry, the former is gone while the latter can still be resold to recoup some portion of that spending. To advocate public spending on anything, even unnecessary items, fails to build an economy. Merely building roads that will not facilitate trade is a waste of money and will not improve economic conditions.

His General Theory is often viewed as the foundation of modern macroeconomics – the age of “New Economics” where the same core issue of Karl Marx (1818–1883) controls that it is the state that should manage the economy not the private sector to eliminate the business cycle. At the time, few senior American economists agreed with Keynes and neither did Roosevelt’s Brains Trust. through most of the 1930s. Once economists realized that they could become the master of the world with politicians manipulating society, the majority jumped on board.

Keynes himself had only very limited participation in all the theoretical debates that followed the publication of the General Theory as he suffered a heart attack in 1937, requiring him to take long periods of rest. It has been argued that Keynes’ ideas were hijacked and transformed much closing to Marxism behind the curtain. Indeed, looking at the tax rate in the United States rising to 94% by 1945 and the definition of the rich that has migrated downward from $5 million, one must wonder who was the driving force – Marx or Keynes. Keynes began to recover in 1939, but Keynes seems to have spent the rest of his life and his professional energies in trying to reverse the socialism and address the practical side of economics.'