John Maynard Keynes
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John Maynard Keynes, 1st Baron Keynes of Tilton (5 June 1883 - 21 April 1946) was a British economist whose ideas, known as Keynesian economics, had a major impact on modern economic and political theory and on many governments' fiscal policies.
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- I work for a Government I despise for ends I think criminal.
- Letter to Duncan Grant (15 December 1917)
- Thus those reformers, who look for a remedy by creating artificial carrying-costs for money through the device of requiring legal-tender currency to be periodically stamped at a prescribed cost…have been on the right track; and the practical value of their proposals deserves considerations. ... It is a sound thought which lies behind the stamped money.
- John Maynard Keynes, in his General Theory
- The long run is a misleading guide to current affairs. In the long run we are all dead. Economists set themselves too easy, too useless a task if in tempestuous seasons they can only tell us that when the storm is past the ocean is flat again.
- A Tract on Monetary Reform (1923) Ch. 3; many have thought this meant Keynes supported short terms gains against long term economic performance, but he was actually criticizing the belief that inflation would acceptably control itself without government intervention.
- In truth, the gold standard is already a barbarous relic.
- Monetary Reform (1924), p. 172
- When the accumulation of wealth is no longer of high social importance, there will be great changes in the code of morals. We shall be able to rid ourselves of many of the pseudo-moral principles which have hag-ridden us for two hundred years, by which we have exalted some of the most distasteful of human qualities into the position of the highest virtues. We shall be able to afford to dare to assess the money-motive at its true value. The love of money as a possession — as distinguished from the love of money as a means to the enjoyments and realities of life — will be recognised for what it is, a somewhat disgusting morbidity, one of those semi-criminal, semi-pathological propensities which one hands over with a shudder to the specialists in mental disease ... But beware! The time for all this is not yet. For at least another hundred years we must pretend to ourselves and to everyone that fair is foul and foul is fair; for foul is useful and fair is not. Avarice and usury and precaution must be our gods for a little longer still. For only they can lead us out of the tunnel of economic necessity into daylight.
- "The Future", Essays in Persuasion (1931) Ch. 5, JMK, CW, IX, pp.329 - 331, Economic Possibilities for our Grandchildren (1930); as quoted in "Keynes and the Ethics of Capitalism" by Robert Skidelsy
- If economists could manage to get themselves thought of as humble, competent people on a level with dentists, that would be splendid.
- "The Future" Ch. 5, Essays in Persuasion (1931)
- Most men love money and security more, and creation and construction less, as they get older.
- "The Future", Essays in Persuasion (1931)
- Words ought to be a little wild for they are the assault of thoughts on the unthinking.
- New Statesman and Nation (15 July 1933)
- The decadent international but individualistic capitalism in the hands of which we found ourselves after the war is not a success. It is not intelligent. It is not beautiful. It is not just. It is not virtuous. And it doesn't deliver the goods.
- National self-sufficiency (1933) Section 3, republished in Collected Works Vol. 11 (1982).
- His peculiar gift was the power of holding continuously in his mind a purely mental problem until he had seen it through.
- On Isaac Newton, in Essays in Biography (1933)
- There is no harm in being sometimes wrong — especially if one is promptly found out.
- Essays in Biography (1933)
- Nothing mattered except states of mind, chiefly our own.
- On the "Apostles" group at Cambridge University. Essays in Biography (1933) Ch. 39
- The boys, who cannot grow up to adult human nature, are beating the prophets of the ancient race — Marx, Freud, Einstein — who have been tearing at our social, personal and intellectual roots, tearing with an objectivity which to the healthy animal seems morbid, depriving everything, as it seems, of the warmth of natural feeling. What traditional retort have the schoolboys but a kick in the pants? ...
To our generation Einstein has been made to become a double symbol — a symbol of the mind travelling in the cold regions of space, and a symbol of the brave and generous outcast, pure in heart and cheerful of spirit. Himself a schoolboy, too, but the other kind — with ruffled hair, soft hands and a violin. See him as he squats on Cromer beach doing sums, Charlie Chaplin with the brow of Shakespeare...
So it is not an accident that the Nazi lads vent a particular fury against him. He does truly stand for what they most dislike, the opposite of the blond beast — intellectualist, individualist, supernationalist, pacifist, inky, plump... How should they know the glory of the free-ranging intellect and soft objective sympathy to whom money and violence, drink and blood and pomp, mean absolutely nothing? Yet Albert and the blond beast make up the world between them. If either cast the other out, life is diminished in its force. When the barbarians destroy the ancient race as witches, when they refuse to scale heaven on broomsticks, they may be dooming themselves to sink back into the clods which bore them.- On the Nazis; written in October 1933 three months before the death of his friend Carl Melchior, murdered in an anti-semitic attack in December 1933; Skidelsky (1992:487) quoting Collected Writings volume xxviii pages 21-22
- Newton was not the first of the age of reason. He was the last of the magicians, the last of the Babylonians and Sumerians, the last great mind that looked out on the visible and intellectual world with the same eyes as those who began to build our intellectual inheritance rather less than 10 000 years ago.
- Address to the Royal Society Club (1942), as quoted in A Dictionary of Scientific Quotations (1977) by Alan L. MacKay, p.140
- The day is not far off when the economic problem will take the back seat where it belongs, and the arena of the heart and the head will be occupied or reoccupied, by our real problems — the problems of life and of human relations, of creation and behaviour and religion.
- First Annual Report of the Arts Council (1945-1946)
- They offer me neither food nor drink — intellectual nor spiritual consolation... [Conservatism] leads nowhere; it satisfies no ideal; it conforms to no intellectual standard, it is not safe, or calculated to preserve from the spoilers that degree of civilisation which we have already attained.
- On the Conservative Party; Skidelsky (1992:231) quoting Collected Writings Volume IX page 296-297
- There was an attraction at first that Mr Baldwin should not be clever. But when he forever sentimentalises about his own stupidity, the charm is broken.
- Skidelsky (1992:232) quoting Keynes Papers PS/6
- The book, as it stands, seems to me to be one of the most frightful muddles I have ever read, with scarcely a sound proposition in it beginning with page 45 [Hayek provided historical background up to page 45; after that came his theoretical model], and yet it remains a book of some interest, which is likely to leave its mark on the mind of the reader. It is an extraordinary example of how, starting with a mistake, a remorseless logician can end up in bedlam.
- On Friedrich Hayek's Prices and Production, in Collected Works, vol. XII, p. 252
- Ideas shape the course of history.
- As quoted in The Peter Plan: A Proposal for Survival (1976) by Laurence J. Peter, p. 97
- The avoidance of taxes is the only intellectual pursuit that still carries any reward.
- As quoted in A Dictionary of Scientific Quotations (1977) by Alan L. MacKay, p.140
- Education: the inculcation of the incomprehensible into the indifferent by the incompetent.
- As quoted in Infinite Riches: Gems from a Lifetime of Reading (1979) by Leo Calvin Rosten, p. 165
- If you owe your bank a hundred pounds, you have a problem. But if you owe a million, it has.
- As quoted in The Economist (13 February 1982), p. 11
- I don't really start until I get my proofs back from the printers. Then I can begin my serious writing.
- As quoted in The Guardian (8 June 1983). p. 82
- When the facts change, I change my mind. What do you do, sir?
- Reply to a criticism during the Great Depression of having changed his position on monetary policy, as quoted in Lost Prophets: An Insider's History of the Modern Eonomists (1994) by Alfred L. Malabre, p. 220
- It is better to be roughly right than precisely wrong.
- As quoted in Current Topics in Quantitative Finance (1999) by Elio Canestrelli, p. 37
- Capitalism is the astounding belief that the most wickedest of men will do the most wickedest of things for the greatest good of everyone.
- As quoted in Moving Forward: Programme for a Participatory Economy (2000) by Michael Albert, p. 128
- The importance of money flows from it being a link between the present and the future.
- As quoted in What Every Principal Would Like to Say... ...and What to Say Next Time: Quotations for Leading, Learning, and Living (2000) by Noah benShea
- You can't push on a string.
- Attributed by Varian, Hal R., "Dealing with Deflation", The New York Times, June 5, 2003. URL accessed on 2007-01-11.
- Successful investing is anticipating the anticipations of others.
- As quoted in Isms (2006) by Gregory Bergman, p.105
- The market can stay irrational longer than you can stay solvent.
- As quoted in The Politics of Public Fund Investing: How to Modify Wall Street to Fit Main Street (2006) by Ben Finkelstein
- I should have drunk more Champagne.
- Last Words, as quoted in Ben Trovato's Art of Survival (2007) by Ben Trovato, p. 196
[edit] The Economic Consequences of the Peace (1919)
- He had one illusion — France; and one disillusion — mankind, including Frenchmen.
- On Georges Clemenceau, in Ch. 3
- 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.
- On David Lloyd George, in Ch. 3
- 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.
- 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.
[edit] A Short View of Russia (1925)
- Originally three essays for the Nation and Athenaeum, later published separately as A Short View of Russia (1925), then edited down for publication in Essays in Persuasion (1931)
- Leninism is a combination of two things which Europeans have kept for some centuries in different compartments of the soul — religion and business. We are shocked because the religion is new, and contemptuous because the business, being subordinated to the religion instead of the other way round, is highly inefficient.
- Comfort and habits let us be ready to forego, but I am not ready for a creed which does not care how much it destroys the liberty and security of daily life, which uses deliberately the weapons of persecution, destruction and international strife. How can I admire a policy which finds a characteristic expression in spending millions to suborn spies in every family and group at home, and to stir up trouble abroad?
- How can I adopt a creed which, preferring the mud to the fish, exalts the boorish proletariat above the bourgeois and the intelligentsia who, with whatever faults, are the quality in life and surely carry the seeds of all human advancement?
- I can be influenced by what seems to me to be justice and good sense; but the class war will find me on the side of the educated bourgeoisie.
[edit] The End of Laissez-faire (1926)
- A study of the history of opinion is a necessary preliminary to the emancipation of the mind.
- Ch. 1
- I do not know which makes a man more conservative — to know nothing but the present, or nothing but the past.
- Ch. 1
- Capitalism, wisely managed, can probably be made more efficient for attaining economic ends than any alternative system yet in sight, but that in itself it is in many ways extremely objectionable.
- Marxian Socialism must always remain a portent to the historians of Opinion — how a doctrine so illogical and so dull can have exercised so powerful and enduring an influence over the minds of men, and, through them, the events of history.
[edit] The General Theory of Employment, Interest and Money (1935)
- The difficulty lies, not in the new ideas, but in escaping from the old ones, which ramify, for those brought up as most of us have been, into every corner of our minds.
- Preface
- Paraphrased variant: The difficulty lies not so much in developing new ideas as in escaping from old ones.
- Most, probably, of our decisions to do something positive, the full consequences of which will be drawn out over many days to come, can only be taken as the result of animal spirits—a spontaneous urge to action rather than inaction, and not as the outcome of a weighted average of quantitative benefits multiplied by quantitative probabilities.
- Chapter 12
- Paraphrased variant: The markets are moved by animal spirits, and not by reason.
- It is generally agreed that casinos should, in the public interest, be inaccessible and expensive. And perhaps the same is true of Stock Exchanges.
- p. 159
- Americans are apt to be unduly interested in discovering what average opinion believes average opinion to be...
- p. 159
- The social object of skilled investment should be to defeat the dark forces of time and ignorance which envelope our future.
- Bk. 4, Ch. 12, Sct. 5
- There are no intrinsic reasons for the scarcity of capital.
- Ch. 24 "Concluding Notes"
- It is better that a man should tyrannise over his bank balance than over his fellow-citizens and whilst the former is sometimes denounced as being but a means to the latter, sometimes at least it is an alternative.
- Ch. 24 "Concluding Notes"
- The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back.
- Ch. 24 "Concluding Notes"
- It is ideas, not vested interests, which are dangerous for good or evil.
- Ch. 24 "Concluding Notes"
[edit] Quotes about Keynes
- 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...
- James M. Buchanan, in The Consequences of Keynes written with Richard E. Wagner and John Burton (1978)
- 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.
- John Kenneth Galbraith in PBS interview (28 September 2000)
- No one in our age was cleverer than Keynes nor made less attempt to conceal it.
- R. F. Harrod in The Life of John Maynard Keynes (1951)
- We're all Keynesians now.
- US President Richard Nixon (1972)
[edit] External links
- Bio, bibliography, and links
- Bio at Time 100 - the most important people of the century
- Works by John Maynard Keynes at Project Gutenberg
- The end of laissez-faire (1926)
- National self-sufficiency (1933)
- Democracy in Deficit: The Political Legacy of Lord Keynes (1977) by James M. Buchanan and Richard E. Wagner
