Can Maynard Keynes do it?

Peter Clarke

  • The Collected Writings of John Maynard Keynes: Vol. XIX. Activities 1924-9: The Return to Gold and Industrial Policy edited by Sir Austin Robinson and Donald Moggridge
    Macmillan, 468 pp, £40.00, October 1981, ISBN 0 333 10727 6
  • The Collected Writings of John Maynard Keynes: Vol. XX. Activities 1929-31: Rethinking Employment and Unemployment Policies edited by Sir Austin Robinson and Donald Moggridge
    Macmillan, 675 pp, £20.00, December 1981, ISBN 0 333 10721 7
  • The Collected Writings of John Maynard Keynes: Vol. XXI. Activities 1931-9: edited by Sir Austin Robinson and Donald Moggridge
    Macmillan, 645 pp, £20.00, March 1982, ISBN 0 333 10728 4

‘The question what Keynes would be advocating today is, of course, a nonsense question.’ So Lord Kahn warned us in a brilliant lecture in 1974, invoking Keynes’s propensity – ‘apart from the fact that he would be 91 years old’ – to develop new answers for new questions, rather than to make a fetish of consistency. The impact of Keynes’s thought has nonetheless suffered many attempts to encapsulate it within a cut-and-dried formula. In the 1950s and 1960s it was usually the redeemer theory, whereby Keynes was held to have supplied us with a box of tricks uniquely guaranteed to ensure permanent prosperity. When the long post-war boom, of which he was allegedly the ‘onlie begetter’, was succeeded in the 1970s by the disconcerting phenomenon of stagflation, the devil theory caught on, whereby Keynes was in turn arraigned as the architect of our misfortunes. A further variant was to say God is Dead, suggesting that the Keynesian revolution was a comprehensively over-inflated promise of general salvation from what turned out to be the peculiar and transient difficulties of one offshore island at an awkward corner in its history.

It may be time for another spin of the wheel in the 1980s, with the revival of doctrines of sound money and good housekeeping under Reagan and Thatcher. Now Keynes has admittedly not been getting any younger in the meantime, so the hypothetical views upon economic conditions in 1983 of a centenarian, who would have rivalled the longevity of other members of his immediate family, are hardly the real point. Yet, in his writings of the interwar period, the resonance for our present concerns is inescapable. Many of the positions he was attacking, so far from being evacuated dug-outs of purely historical interest, have been confidently reoccupied in our own day by fresh troops with an unimpaired confidence in the traditional weapons and ammunition.

The Collected Writings of John Maynard Keynes, produced under the auspices of the Royal Economic Society, is among the glories of modern publishing. Printed at the Cambridge University Press, these handsome volumes maintain aesthetic standards in book production which are in themselves a fitting memorial to a notable bibliophile, the more so since they enhance the functional attributes of accuracy, legibility and ease of reference. Volumes XIX to XXI cover Keynes’s activities in the period from the fall of the Lloyd George Coalition in 1922 to the outbreak of war. They are edited with exemplary authority and lack of fuss by Donald Moggridge, who has joined Sir Austin Robinson as joint managing editor of the project. The internal distribution of material is by no means arbitrary since Keynes’s thinking falls into three phases, each represented by a different volume.

In Volume XIX the focus is on the significance of Britain’s return to the Gold Standard. Keynes took a prominent role here, both in public and in private, in urging the folly of this step. It made British prices even more uncompetitive in a world which had already shown itself less accommodating to British amour-propre than the lost era of normalcy before 1914. Keynes was strongly moved by his fear of deflation, and felt that the deflationary consequences of a return to Gold were perversely neglected by those who advocated it. In particular, he thought that they refused to assess the costs and benefits in a rational and dispassionate way. Keynes had already written, in his Tract on Monetary Reform,‘that many conservative bankers regard it as more consonant with their cloth, and also as economising thought, to shift public discussion of financial topics off the logical on to an alleged “moral” plane, which means a realm of thought where vested interest can be triumphant over the common good without further debate.’

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