John Maynard Keynes

[DarkWaters]

Old Toad and Prometheus have requested that I summarize my thoughts on Keynes in a post. After reading a little further into economic thought, I am entertaining the notion that John Maynard Keynes is arguably the most evil intellectual of the 20th century.

Here are some of the horrific economic ideas that have been widely popularized by the Keynes. Needless to say, many of these are interrelated:

• Economic policies should be focused on the short-run since in the long-run, everyone is dead.
  
• If left unguided by government, a free market economy will inevitably grind to a halt.
  
• Capitalism caused the stock market crash of 1929 as well as the Great Depression in the United States.
  
• Federal deficit spending does not hurt the economy; it is often a stimulant.
  
• A gold standard is a shackle on economic growth.
  
• Saving money is bad for the economy.
  
• War is good for the economy.
  
• Any government project is good for the economy, no matter how pointless. (e.g., building pyramids, etc.)
  
• The government should take an active role in many "vital" sectors of the economy, not necessarily because it is to achieve social justice but because frankly people are too stupid to make informed choices in a free market.
  

Most of the arguments from Statist economics, from both of the Democratic and Republican parties, seem to be of Keynesian origin. On the Democratic side, there are arguments for increased in socialized medicine and education, mainly because citizens would not make good choices if left to their own devices. On the Republican side, there are the ideas that "deficits do not matter" (a direct Dick Cheney quote) and to some extent, the idea that going to war is good for the economy.

A few members on this forum have suggested that many Democrats are under Marxist influence. In terms of economic policies, I disagree. As an economist, Marx was widely discredited by Austrian economist Eugene Bohm-Bawerk soon after Marx published Das Kapital. Furthermore, it is rare to see many Democrats politicians advancing characteristically Marxist economic theories such as the Labor Theory of Value. That is, a product should be priced only according to the cost of labor to manufacture it.

Anyway, I would love to hear thoughts on this issue, especially from those of you who are significantly more well-versed in the history of economic thought than I am.

If anybody wants to read more on this issue, I recommend starting with Mark Skousen's The Big Three in Economics. Even though Mark Skousen has a sophomoric understanding of Objectivism, he does great work on the history of economic thought from a free-market economist's perspective.

As a digression, Keynes also seems to have had much horrible philosophical influence in other aspects of politics as well. According to John Lewis' Objective Standard article on Moral Paralysis and the beginning of World War II, John Maynard Keynes popularized the notion that the oppressive restrictions in the Treaty of Versailles led to the rise of Nazi Germany. Keynes is just reprehensible.

Edited November 18, 2007 by DarkWaters

[TheEgoist]

I learned of Keynes in my International Relations/World Politics class this past semester. Needless to say I was disgusted by what he said, and even more disgusted at my Professor, who claims to have just recently gotten off the " Objectivist Bandwagon ", as he endorsed Keynes and his ideas in class. I am the only vocal free market advocate in my class and spent a lot of times making my Professor and Keynes look like fools with simple logic. And yes, I think much of what the Statists now advocate was started not by Marx, but at the least popularized by Keynes and his ilk. It is not Communistic, but even more deceitful. His ideas were the driving force behind the New Deal. During the Summer I plan on reading up on him more.

[y_feldblum]

Keynes is reprehensible, yes. But it is not the dominant economic ideas a society holds which determines its future course: it is the dominant epistemological and moral ideas.

[DarkWaters]

Keynes is reprehensible, yes. But it is not the dominant economic ideas a society holds which determines its future course: it is the dominant epistemological and moral ideas.

I agree. Keynesian economics is a direct result of poor epistemology but it is not nearly as virulent as poor epistemology itself. In this regard, Keynesian thought should actually be easier to extirpate since he never seemed to advance a moral argument against Capitalism, he merely argued that it was impractical.

[adrock3215]

I have his book The General Theory of Employment, Interest, and Money and recommend anyone interested should read it. I've also wanted to read for some time the works written by his main influence, Wicksell.

Anyway, I concur that he was a horrendous economist. I think his problem was that he didn't think systematically enough to base his economic policies on a proper philosophical base. I think the idea of his that has been most widely accepted is that government deficit spending stimulates the economy. This can be seen across the political spectrum, within both parties. However, I disagree with you about him being the most evil intellectual of the 20th century, because we were already moving away from a proper economic policy before Keynes work was accepted, with the creation of the Fed and implementation of income tax.

As for the Treaty of Versailles I am aware that he predicted a number of economic consequences that were to result from the treaty that never occured, so Keynes was definitely wrong in this regard. Also I believe his opposition to the Treaty was unwarranted at the time. But in hindsight, whether or not Germany was treated fairly or unfairly in the Treaty (I believe fairly) isn't crucial for one to understand that the Treaty did, at minimum, contribute to creating a psychological wasteland that a man such as Hitler could exploit. I'm not familiar with what exactly Keynes didn't approve of in the Treaty (or maybe it was everything in the Treaty), as I have not read the work he wrote about it, so I withhold judgement on proclaiming this to be a major evil philosophical fault of his until I am more educated on his criticisms of the Treaty.

Even so, the other works he published give sufficient justification for one to denounce him as wrong.

[Steve D'Ippolito]

"John Maynard Keynes, Arguably the Most Evil 20th Century Intellectual"

I don't know about that, I have an even colder spot in my heart for Noam Chomsky (hmm, that mixed metaphor works very poorly). Who is unfortunately still breathing so maybe he counts as a 21st century intellectual.

Keynes was definitely evil regardless.

[DarkWaters]

I definitely despise the political writings of Noam Chomsky, but I am not sure if he would qualify as a more evil thinker than Keynes merely because his influence, although significant, is not as pervasive as Keynes. Noam Chomsky should certainly be in the running for one of the most evil 20th century thinkers. Maybe I would consider him to be the most evil if DaveOdden can convince me that Chomsky normal form grammars are leading us down a linguistic sewer.

Reflecting further, I think John Dewey might be able to beat out Keynes for the 20th Century Evily Award, but I honestly do not know enough about Dewey's Pragmatism to intelligently assess the damage he has done. I remember hearing that Dewey is the source of a lot of horrible ideas in modern education.

[softwareNerd]

I don't know about the "most evil" ranking, but Keynes is particularly important because of his impact. While others had the same "consumption-as-primary" theories, but Keynes managed to make his version into accepted doctrine. Even after all the assaults on Keynesianism, it is still alive today. I see Keynes as a "reactionary", in the sense that he caused a significant reversal of knowledge in his field. He managed to exploit the fact that the alternative theories, while better, were not yet fully developed, and therefore had weaknesses that could be attacked.

An analogy would be a philosopher who took the discredited theory on the efficacy of faith, and who found just the right arguments to punch his case through the chinks of better contemporary theories that had started to abandon faith, exploiting chinks where those new theories did not yet know how to fully reject faith and accept reason.

[Capitalism Forever]

An analogy would be a philosopher who took the discredited theory on the efficacy of faith, and who found just the right arguments to punch his case through the chinks of better contemporary theories that had started to abandon faith, exploiting chinks where those new theories did not yet know how to fully reject faith and accept reason.

I think that's quite a good analogy. I have said elsewhere that the primacy of consumption is to economics what the primacy of consciousness is to philosophy; it is interesting to observe that there is also a great deal of similarity between the modes of operation of their most notorious exponents.

[adrock3215]

Sorry to bring up an old topic. Was recently reading a small bit on Keynes. Can anyone confirm the fact that Keynes was a homosexual?

[tim3]

Sorry to bring up an old topic. Was recently reading a small bit on Keynes. Can anyone confirm the fact that Keynes was a homosexual?

Looks like he was -

http://www.glbtq.com/social-sciences/keynes_jm,3.html

http://www.users.muohio.edu/shermalw/honor...000/arling.html

http://www.managementtoday.co.uk/search/ar...nesian-thought/

But why does it matter?

[Robert J. Kolker]

Keynes is reprehensible, yes. But it is not the dominant economic ideas a society holds which determines its future course: it is the dominant epistemological and moral ideas.

True. But Keynes balderdash fit right in with the philosophical and moral ambiance of the 20th century. Philosophical debilitation left the body politic and the body intellect wide open to such infections. Many of the evils of the 20th century (and the body count too) can be attributed to the lack of critical thinking on the part of the citizens of the leading industrial nations. When thinking is paralyzed then the demagogues have a free run along with their intellectual allies and the citizens cheer them on. Think of Simeon Pritchett in -Atlas Shrugged-, for example.

In the long run and the medium run too (say the period of the human lifespan) ideas can be both the life of us and the death of us.

Bob Kolker