John Maynard Keynes

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A study of the history of opinion is a necessary preliminary to the emancipation of the mind.

John Maynard Keynes, 1st Baron Keynes of Tilton (5 June 188321 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.


I work for a Government I despise for ends I think criminal.
  • That she [France] has anything to fear from Germany in the future which we can forsee, except what she may herself provoke, is a delusion. When Germany has recovered her strength and pride, as in due time she will, many years must pass before she again casts her eyes Westwards. Germany's future now lies to the East, and it is in that direction her hopes and ambitions, when they revive, will certainly turn.
    • A Revision of the Treaty (London: Macmillan, 1922), p. 186.
  • The real struggle today, just as in the second quarter of the nineteenth century, is between a view of the world termed liberalism or radicalism, for which the primary object of government and of foreign policy is peace, freedom of trade and intercourse, and economic wealth and that other view, militarist or rather diplomatic, which thinks in terms of power, prestige, national or personal glory, the imposition of a culture and hereditary or racial prejudice. To the good English radical, the latter is so unreal, so crazy in its combination of futility and evil, that he is often in danger of forgetting or disbelieving its actual existence.
    • published in Manchester Guardian (1922); in Collected Writings, Volume 17, p. 370
But this long run is a misleading guide to current affairs. In the long run we are all dead.
  • But this 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 long past, the ocean is flat again.
    • A Tract on Monetary Reform (1923), Ch. 3
  • Those who advocate the return to a gold standard do not always appreciate along what different lines our actual practice has been drifting. If we restore the gold standard, are we to return also to the pre-war conceptions of bank-rate, allowing the tides of gold to play what tricks they like with the internal price-level, and abandoning the attempt to moderate the disastrous influence of the credit-cycle on the stability of prices and employment? Or are we to continue and develop the experimental innovations of our present policy, ignoring the "bank ration" and, if necessary, allowing unmoved a piling up of gold reserves far beyond our requirements or their depletion far below them? In truth, the gold standard is already a barbarous relic.
    • A Tract on Monetary Reform (1923), p. 172
  • He was the nicest, and the only talented person I saw in all Berlin, except perhaps old Fuerstenberg … and Kurt Singer. And he was a Jew; and so was Fuerstenberg. And my dear Melchior is a Jew too. Yet if I lived there, I felt I might turn anti-Semite. For the poor Prussian is too slow and heavy on his legs for the other kind of Jews, the ones who are not imps but serving devils, with small horns, pitch forks, and oily tails. It is not agreeable to see civilization so under the ugly thumbs of its impure Jews who have all the money and the power and brains. I vote rather for the plump hausfraus and thick fingered Wandering Birds. But I am not sure that I wouldn’t even rather be mixed up with Lloyd George than with the German political Jews.
    • Notes after a meeting with Albert Einstein in 1926, The Collected Writings of John Maynard Keynes, Vol. 10, p. 383
  • The ignorance of even the best-informed investor about the more remote future is much greater than his knowledge, and he cannot but be influenced to a degree which would seem wildly disproportionate to anyone who really knew the future, and be forced to seek a clue mainly here to trends further ahead. But if this is true of the best-informed, the vast majority of those who are concerned with the buying and selling of securities know almost nothing whatever about what they are doing. They do not possess even the rudiments of what is required for a valid judgement, and are the prey of hopes and fears easily aroused by transient events and as easily dispelled.
    • A Treatise on Money, Volume II (1930), pp. 360–61
Words ought to be a little wild for they are the assault of thoughts on the unthinking.

Listen to a recording of another user reading this quote:

  • 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. In short we dislike it, and we are beginning to despise it. But when we wonder what to put in its place, we are extremely perplexed.
  • Nothing mattered except states of mind, chiefly our own.
    • On the Cambridge Apostles of Cambridge University, in Essays in Biography (1933) Ch. 39; also later used in My Early Beliefs, a memoir he read to the Bloomsbury Group's Memoir Club in 1943.
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.
  • 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 (? .or "he suffered from severe heart problems and in December 1933 died following a stroke" cf. "Melchior" in Wikipedia); Skidelsky (1992:487) quoting Collected Writings volume xxviii pages 21-22
  • It is a grand book worthy of one’s hopes of you. A most powerful piece of well organized analysis with high aesthetic qualities, though written more perhaps than you see yourself for the cognoscenti in the temple and not for those at the gate. Anyhow I prefer it for intellectual enjoyment to any recent attempts in this vein.
    • Letter to Abba Lerner, 1942, On The Economics of Control
  • The old saying holds. Owe your banker £1000 and you are at his mercy; owe him £1 million and the position is reversed.
    • "Overseas Financial Policy in Stage III" (unpublished memo distributed to the British Cabinet on 15 May 1945, in Collected Writings volume 24, p. 258).
  • If you owe your bank manager a thousand pounds, you are at his mercy. If you owe him a million pounds, he is at your mercy.
  • Variant reported in Time magazine, Monday, Feb. 17, 1947
  • 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
The day is not far off when the economic problem will take the back seat where it belongs...
  • 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 Writings, vol. XII, p. 252

The Economic Consequences of the Peace (1919)[edit]

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.
Men will not always die quietly.
Full text online
  • The power to become habituated to his surroundings is a marked characteristic of mankind.
    • Chapter I, p. 3
  • 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.
    • Chapter II, Section I, pp. 14-15
  • 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.
    • Chapter II, Section I, p. 15
  • 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.
    • Chapter II, Section III, p. 19
  • The duty of "saving" became nine-tenths of virtue and the growth of the cake the object of true religion.
    • Chapter II, Section III, p. 20
  • 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.
    • Chapter II, Section III, p. 21
  • 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.
    • Chapter III, p. 33
  • 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.
    • Chapter IV, p. 56
  • 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.
    • Chapter IV, Section I, p. 77
  • But the dreams of designing diplomats do not always prosper, and we must trust the future.
    • Chapter IV, Section III, p. 105
  • Men will not always die quietly.
    • Chapter VI, p. 228
  • 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.
    • Chapter VI, pp. 235-236
  • Perhaps it is historically true that no order of society ever perishes save by its own hand.
    • Chapter VI, p. 238
  • Economic privation proceeds by easy stages, and so long as men suffer it patiently the outside world cares little.
    • Chapter VI, p. 250
  • The forces of the nineteenth century have run their course and are exhausted.
    • Chapter VII, p. 254
  • If we aim deliberately at the impoverishment of Central Europe, vengeance, I dare predict, will not limp.
    • Chapter VII, Section 1, p. 268

Essays in Persuasion (1931)[edit]

Comfort and habits let us be ready to forgo, 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.

A Short View of Russia (1925)[edit]

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 forgo, 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?

Am I a Liberal? (1925)[edit]

  • 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.

The End of Laissez-faire (1926)[edit]

Full text online
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.
  • I do not know which makes a man more conservative — to know nothing but the present, or nothing but the past.
    • Ch. 1
  • The phrase laissez-faire is not to be found in the works of Adam Smith, of Ricardo, or of Malthus. Even the idea is not present in a dogmatic form in any of these authors. Adam Smith, of course, was a Free Trader and an opponent of many eighteenth-century restrictions on trade. But his attitude towards the Navigation Acts and the usury laws shows that he was not dogmatic. Even his famous passage about 'the invisible hand' reflects the philosophy which we associate with Paley rather than the economic dogma of laissez-faire.
    • Ch. 2
  • 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.
    • Ch. 3
  • For my part I think that 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.
    • Ch. 5

Clissold (1927)[edit]

Most men love money and security more, and creation and construction less, as they get older.
appeared in the Nation and Athenaeum (1927)
  • Most men love money and security more, and creation and construction less, as they get older.

The Great Slump of 1930 (1930)[edit]

appeared in the Nation and Athenaeum (1930)
  • This is a nightmare, which will pass away with the morning. For the resources of nature and men's devices are just as fertile and productive as they were. The rate of our progress towards solving the material problems of life is not less rapid. We are as capable as before of affording for everyone a high standard of life … and will soon learn to afford a standard higher still. We were not previously deceived. But to-day we have involved ourselves in a colossal muddle, having blundered in the control of a delicate machine, the working of which we do not understand. The result is that our possibilities of wealth may run to waste for a time — perhaps for a long time.

Economic Possibilities for our Grandchildren (1930)[edit]

appeared in the Nation and Athenaeum (1930)
When the accumulation of wealth is no longer of high social importance, there will be great changes in the code of morals...
  • 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 diseaseBut 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.
  • If economists could manage to get themselves thought of as humble, competent people on a level with dentists, that would be splendid.
  • For many ages to come the old Adam will be so strong in us that everybody will need to do some work if he is to be contented. We shall do more things for ourselves than is usual with the rich to-day, only too glad to have small duties and tasks and routines. But beyond this, we shall endeavour to spread the bread thin on the butter-to make what work there is still to be done to be as widely shared as possible. Three-hour shifts or a fifteen-hour week may put off the problem for a great while. For three hours a day is quite enough to satisfy the old Adam in most of us!

Essays In Biography (1933)[edit]


  • I have sought with some touches of detail to bring out the solidarity and historical continuity of the High Intelligentsia of England, who have built up the foundations of our thought in the two and a half centuries, since Locke, in his Essay Concerning Human Understanding, wrote the first modern English book. I relate below the amazing progeny of Sir George Villiers. But the lineage of the High Intelligentsia is hardly less interbred and spiritually inter-mixed. Let the Villiers Connection fascinate the monarch or the mob and rule, or seem to rule, passing events. There is also a pride of sentiment to claim spiritual kinship with the Locke Connection and that long English line, intellectually and humanly linked with one another, to which the names in my second section belong. If not the wisest, yet the most truthful of men. If not the most personable, yet the queerest and sweetest. If not the most practical, yet of the purest public conscience. If not of high artistic genius, yet the most solid and sincere accomplishment within many of the fields which are ranged by the human mind.
    • p. viii

Mr. Lloyd George: A Fragment[edit]

Originally published in The Nation and the Athenaeum, May 26, 1923.
  • If Mr. Lloyd George had no good qualities, no charms, no fascinations, he would not be dangerous. If he were not a syren, we need not fear the whirlpools.
    • p. 35

Trotsky On England[edit]

Originally published in The Nation and the Athenaeum, March 27, 1926.
  • All the political parties alike have their origins in past ideas and not in new ideas — and none more conspicuously so than the Marxists.
    • p. 91
  • The next move is with the head, and fists must wait.
    • p. 91

Robert Malthus: The First of the Cambridge Economists[edit]

  • Adam Smith and Malthus and Ricardo! There is something about these three figures to evoke more than ordinary sentiments from us their children in the spirit.
    • p. 148

Alfred Marshall[edit]

Originally published in The Economic Journal, September 1924.
  • The study of economics does not seem to require any specialized gifts of an unusually high order. Is it not, intellectually regarded, a very easy subject compared with the higher branches of philosophy and pure science? Yet good, or even competent, economists are the rarest of birds. An easy subject, at which very few excel! The paradox finds its explanation, perhaps, in that the master-economist must possess a rare combination of gifts. He must reach a high standard in several different directions and must combine talents not often found together. He must be mathematician, historian, statesman, philosopher – in some degree. He must understand symbols and speak in words. He must contemplate the particular in terms of the general, and touch abstract and concrete in the same flight of thought. He must study the present in the light of the past for the purposes of the future. No part of man's nature or his institutions must lie entirely outside his regard. He must be purposeful and disinterested in a simultaneous mood; as aloof and incorruptible as an artist, yet sometimes as near the earth as a politician. Much, but not all, of this many-sidedness Marshall possessed. But chiefly his mixed training and divided nature furnished him with the most essential and fundamental of the economist's necessary gifts – he was conspicuously historian and mathematician, a dealer in the particular and the general, the temporal and the eternal, at the same time.
    • p. 170; as cited in: Donald Moggridge (2002), Maynard Keynes: An Economist's Biography, p. 424
  • There is no harm in being sometimes wrong — especially if one is promptly found out.
    • p. 175
  • Jevons saw the kettle boil and cried out with the delighted voice of a child; Marshall too had seen the kettle boil and sat down silently to build an engine.
    • p. 188
  • Economists must leave to Adam Smith alone the glory of the Quarto, must pluck the day, fling pamphlets into the wind, write always sub specie temporis, and achieve immortality by accident, if at all.
    • p. 212
  • The general theory of economic equilibrium was strengthened and made effective as an organon of thought by two powerful subsidiary conceptions — the Margin and Substitution. The notion of the Margin was extended beyond [Utility]] to describe the equilibrium point in given conditions of any economic factor which can be regarded as capable of small variations about a given value,or in its functional relation to a given value.
    • p. 223
  • There were endless possibilities, not out of reach.
    • p. 253

Francis Tsidro Edgeworth[edit]

Originally published in The Economic Journal, March 1926.
  • The atomic hypothesis which had worked so splendidly in Physics breaks down in Psychics.
    • p. 286

F. P. Ramsey[edit]

Originally published in The Economic Journal, March 1930. and The New Statesman and Nation, October 3, 1931.
  • Logic, like lyrical poetry, is no employment for the middle-aged,
    • p. 296
  • I don't feel the least humble before the vastness of the heavens.
    • p. 310

Newton, the Man[edit]

address to the Royal Society Club (1942), read by Geoffrey Keynes at the Newton Tercentenary Celebrations (1946), and published in later edition of Essays in Biography
  • His peculiar gift was the power of holding continuously in his mind a purely mental problem until he had seen it through.
Newton was not the first of the age of reason. He was the last of the magicians...
  • 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 General Theory of Employment, Interest and Money (1936)[edit]

  • 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. I am sure that the power of vested interests is vastly exaggerated compared with the gradual encroachment of ideas. Not, indeed, immediately, but after a certain interval; for in the field of economic and political philosophy there are not many who are influenced by new theories after they are twenty-five or thirty years of age, so that the ideas which civil servants and politicians and even agitators apply to current events are not likely to be the newest. But, soon or late, it is ideas, not vested interests, which are dangerous for good or evil.
    • Ch. 24 "Concluding Notes" p. 383-384

How to Pay for the War (1940)[edit]

  • It is not easy for a free community to organise for war. We are not accustomed to listen to experts or prophets. Our strength lies in an ability to improvise. Yet an open mind to untried ideas is also necessary. No-one can say when the end will come. In the war services it is recognised that the best security for an early conclusion is a plan for long endurance.
    • Ch. 1 : The Character of the Problem
  • Courage will be forthcoming if tile leaders of opinion in all parties will summon out of tile fatigue and confusion of war enough lucidity of mind to understand for themselves and to explain to tile public what is required; and then propose a plan conceived in a spirit of social justice, a plan which uses a time of general sacrifice, not as an excuse for postponing desirable reforms, but as an opportunity for moving further than we have moved hitherto towards reducing in equalities.
    • Ch. 1 : The Character of the Problem
  • Nothing can be settled in isolation. Every use of our resources is at the expense of an alternative use.
    • Ch. 1 : The Character of the Problem
  • It is extraordinarily difficult to secure the right outcome for this resultant of many separate policies. It depends on weighing one advantage against another. There is hardly a conceivable decision within the range of the supply services which does not affect it.
    • Ch. 1 : The Character of the Problem
  • In peace time, that is to say, the size of the cake depends on the amount of work done. But in war time the size of the cake is fixed. If we work harder, we can fight better. But we must not consume more.
    • Ch. 1 : The Character of the Problem
  • The general character of our solution must be, therefore, that it withdraws from expenditure a proportion of time increased earnings. This is the only way, apart from shortages of goods or higher prices, by which we can secure a balance between money to be spent and goods to be bought.
    • Ch. 2 : The Character of the Solution
  • In order to calculate the size of the cake which will be left for civilian consumption, we have to estimate (1) the maximum current output that we are capable of organising from our resources of men and plant and materials, (2) how fast we can safely draw on our foreign reserves by importing more than we export, (3) how much of all this will be used up by our war effort.
    • Ch. 3 : Our Output Capacity and the National Income
  • The nature of unemployment today is totally different from what it was a year ago. It is no longer caused by a deficiency of demand. There is no longer a potential surplus supply of time timings we want. The transition to full employment is hindered by two obstacles. The first is due to time difficulty of shifting labour to the points where it is wanted. The second— and, for the time being, the chief—-obstacle is caused by the difficulties, other than time shortage of labour, in the way of existing demand becoming effective.
    • Ch. 3 : Our Output Capacity and the National Income
  • I have now reached a stage in time argument where I have to choose between being too definite or being too vague. If I set forth a concrete proposal in all its particulars, I expose myself to a hundred criticisms on points not essential to time principle of the plan. If I go further in the use of figures for illustration, I am involved more and more in guess-work; and I run time risk of getting time reader bogged in details which may be inaccurate and could certainly be amended without injury to the main fabric. Yet if I restrict myself to generalities, I do not give time reader enough to bite on; and am in fact shirking time issue, since the size, time order of magnitude, of time factors involved is not aim irrelevant detail.
    • Ch. 5 : A Plan for Deferred Pay, Family, Allowances and a Cheap Ration
  • For each individual it is a great advantage to retain time rights over the fruits of his labour even though he must put off time enjoyment of them. His personal wealth is thus increased. For that is what wealth is,—command of the right to postponed consumption.
    • Ch. 5 : A Plan for Deferred Pay, Family, Allowances and a Cheap Ration
  • For the Trade Unions such a scheme as this offers great and evident advantages compared with progressive inflation or with a wages tax. In spite of the demands of war, the workers would have secured time enjoyment, sooner or later, of a consumption fully commensurate with their increased effort; whilst family allowances and time cheap ration would actually improve, even during time war, the economic position of the poorer families. We should have succeeded in making the war an opportunity for a positive social improvement. How great a benefit in comparison with a futile attempt to evade a reasonable share of the burden of a just war, ending in a progressive inflation!
    • Ch. 5 : A Plan for Deferred Pay, Family, Allowances and a Cheap Ration
  • The appropriate time for time ultimate release of time deposits will have arrived at time onset of time first post-war slump.
    • Ch. 7 : The Release of Deferred Pay and a Capital Levy
  • The mechanism of reaching equilibrium by means of a rising cost of living, which is vainly pursued by a rising level of wages, will be described in the next chapter. But it is admitted on all hands that this is time worst possible solution.
    • Ch. 8 : Rationing Price Control and Wage Control


  • Capitalism is “the astonishing belief that the nastiest motives of the nastiest men somehow or other work for the best results in the best of all possible worlds.”
    • Attributed by Sir George Schuster, Christianity and human relations in industry (1951), p. 109
    • Recent variant: 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
When my information changes, I alter my conclusions. What do you do, sir?
  • 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 is the inculcation of the incomprehensible into the ignorant by the incompetent.
    • From hearer's memory in Jewish Frontier, vol. 29 (1962).
    • Alternate version: 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
  • 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 my information changes, I alter my conclusions. What do you do, sir?
    • Reply to a criticism during the Great Depression of having changed his position on monetary policy, as quoted in "The Keynes Centenary" by Paul Samuelson, in The Economist Vol. 287 (1983), p. 19; later in The Collected Scientific Papers of Paul Samuelson, Volume 5 (1986), p. 275; also in "Understanding Political Development: an Analytic Study" (1987) by Myron Weiner, Samuel P. Huntington and Gabriel Abraham Almond, p. xxiv; this has also been paraphrased as "When the facts change, I change my mind. What do you do, sir?"
I should have drunk more champagne.
  • Successful investing is anticipating the anticipations of others.
    • As quoted in Isms (2006) by Gregory Bergman, p. 105
  • Markets can remain irrational longer than you can remain solvent.
    • As quoted in When Genius Failed (2000) by Roger Lowenstein, p. 123; actually "Markets can remain irrational a lot longer than you and I can remain solvent." from A. Gary Shilling, Forbes (1993) v. 151, iss. 4, p. 236.
  • I should have drunk more champagne.
    • Last Words, as quoted in Ben Trovato's Art of Survival (2007) by Ben Trovato, p. 196
  • If farming were to be organised like the stock market, a farmer would sell his farm in the morning when it was raining, only to buy it back in the afternoon when the sun came out.
  • We will not have any more crashes in our time.
    • Conversation with Felix Somary in 1927, reported in Felix Somary, The Raven of Zurich, London: C. Hurst, 1986 (1960), 146-7.


  • It is better to be roughly right than precisely wrong.
    • Not attributed to Keynes until after his death. The original quote comes from Carveth Read and is:
    • It is better to be vaguely right than exactly wrong.
      • Logic, deductive and inductive (1898), p. 351 [1]

Quotes about Keynes[edit]

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. ~ Todd G. Buchholz
No one in our age was cleverer than Keynes nor made less attempt to conceal it. ~ R. F. Harrod
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He was an economist, of course — a Cambridge don with all the dignity and erudition that go with such an appointment; but when it came to choosing a wife he eschewed the ladies of learning and picked the leading ballerina from Diaghilev’s famous company. ~ Robert L. Heilbroner
Keynes's intellect was the sharpest and clearest that I have ever known. When I argued with him, I felt that I took my life in my hands, and I seldom emerged without feeling something of a fool. ~ Bertrand Russell
  • His [Keynes's] own leisure was admirably as it was variously employed: in inspecting his pigs; in attending a sale of pictures; in perusing (unlike some bibliophiles) a minor Elizabethan poet, his latest acquisition; in listening to a piano recital, recumbent in a box of the theatre he had built; in gossip and good talk and a glass of wine. ‘My only regret’, he said at the close of a College feast, ‘is that I have not drunk more champagne in my life.’ And so it was that he knew what leisure could give and desired that all should share the gift.
    • King's College (University of Cambridge). John Maynard Keynes, 1883-1946: Fellow and Bursar. King's College at the University Press, 1949.
  • Following the financial crisis of September 2008 when the American investment bank Lehman Brothers collapsed, threatening to engulf the entire banking system, the British economist John Maynard Keynes returned to center stage. In the popular press and in the writings of many economists, Keynes featured prominently as governments around the world urgently sought ways to avoid economic collapse. (...) After only a brief delay, critics of Keynes’s ideas also began to appear; but the emergence of such critics only served to emphasize the fact of his return, for only a few years earlier Keynes’s name would not even have appeared in public debate about economic policy: his ideas were seen as having so little relevance that it did not even seem necessary to mention his name when discussing the performance of the economy.
    • Roger E. Backhouse and Bradley W. Bateman, ch.1 "Keynes Returns, but Which Keynes?" Capitalist revolutionary : John Maynard Keynes (2011)
  • After careful research along these lines, I came to the annoying conclusion that Keynes had been 100 percent right in the 1930s. Previously, I had thought the opposite. But facts were facts and there was no denying my conclusion. It didn’t affect the argument in my book, which was only about the rise and fall of ideas. The fact that Keynesian ideas were correct as well as popular simply made my thesis stronger.
  • I think it is pretty hard to explain most governments’ responses to the crisis and recession without a healthy dose of Keynes.
    • Alan S. Blinder, "Teaching Macro Principlesafterthe Financial Crisis", The Journal of Economic Education (2010)
  • Keynes was no revolutionary, but his ideas revolutionized 20th-century economics.
    • Samuel Bowles, Richard Edwards, and Frank Roosevelt. Understanding Capitalism: Competition, Command, and Change (3rd ed., 2005), p.82
  • 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)
  • 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.
  • 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.
    • Todd G. Buchholz, "Keynes: Bon Vivant as Savior" in New Ideas from Dead Economists
  • 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.
  • 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.
  • 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.
  • 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.
  • We're all Keynesians now.
    • Milton Friedman, in the cover story of TIME (31 December 1965)
    • Time published a letter from Friedman (4 February 1966) saying: Sir: You quote me as saying: “We are all Keynesians now.” The quotation is correct, but taken out of context. As best I can recall it, the context was: “In one sense, we are all Keynesians now; in another, nobody is any longer a Keynesian.” The second half is at least as important as the first.
    • Often misattributed to President Richard Nixon.
  • 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.
    • Milton Friedman, "Comments on the Critics", Journal of Political Economy, Vol. 80, No. 5 (Sep. - Oct., 1972)
  • 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.
  • 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.
  • In judging Keynes’s overall influence on public policy, it is necessary to distinguish his bequest to technical economics from his bequest to politics. Keynes’s bequest to technical economics was strongly positive. His bequest to politics, in my opinion, was not. Yet I conjecture that his bequest to politics has had far more influence on the shape of today’s world than his bequest to technical economics. In particular, it has contributed greatly to the proliferation of overgrown governments increasingly concerned with every phase of their citizens’ daily lives. (...) 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.
    • Milton Friedman, "John Maynard Keynes." in Economic Quarterly (1997)
  • 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. Markets, the subject of a totemic worship by economists, continued to function as before. Private property, the social point of conservative passion, remained undisturbed except perhaps as taxes might, on some later occasion, be higher. Corporations and banks as well as trade unions were as before. And Keynes even made legitimate what the governments of all the industrial countries, including the United States, were already doing. Depression had reduced government revenues and forced increases in spending for welfare. The result was a deficit, and out of force of circumstance this was being covered by borrowing, exactly as Keynes urged.
  • Yet the Keynesian proposals also produced a wonderfully choleric reaction from the right. In consequence, you could be concerned with saving capitalism, be in the ultimate sense a conservative, and still be thought a vigorously innovative radical. Never was radicalism so safe. Keynes himself had made his career by attacking men in high position who join comfortably to reassure each other in their mutual commitment to error. Thus his onslaught on the great men at Versailles for their belief that Germany could somehow be made to bear the cost of World War I; and on Winston Churchill for yielding to the bankers and the high civil servants and returning the pound to gold at its old parity in 1925, with the resulting painful deflation in British prices and wages; and on the British and American financial and economic establishments for their failure to see that an active program of employing people on borrowed money would relieve the deprivation and suffering after 1929.
  • 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 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.
  • 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.
    • R. F. Harrod, "John Maynard Keynes", The Review of Economic Statistics (1946)
  • 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.
    • R. F. Harrod, "John Maynard Keynes", The Review of Economic Statistics (1946)
  • No one in our age was cleverer than Keynes nor made less attempt to conceal it.
  • It would seem logical that the man who would seek to solve this paradox of not enough production existing side by side with men fruitlessly seeking work would be a Left-Winger, an economist with strong sympathies for the proletariat, an angry man. Nothing could be further from the fact. The man who tackled it was almost a dilettante with nothing like a chip on his shoulder. The simple truth was that his talents inclined in every direction. He had, for example, written a most recondite book on mathematical probability, a book that Bertrand Russell had declared “impossible to praise too highly”; then he had gone on to match his skill in abstruse logic with a flair for making money—he accumulated a fortune of £500,000 by way of the most treacherous of all roads to riches: dealing in international currencies and commodities. More impressive yet, he had written much of his mathematics treatise on the side, as it were, while engaged in government service, and he piled up his private wealth by applying himself for only half an hour a day while still abed. But this is only a sample of his many-sidedness.
  • He was an economist, of course—a Cambridge don with all the dignity and erudition that go with such an appointment; but when it came to choosing a wife he eschewed the ladies of learning and picked the leading ballerina from Diaghilev’s famous company. He managed to be simultaneously the darling of the Bloomsbury set, the cluster of Britain’s most avant-garde intellectual brilliants, and also the chairman of a life insurance company, a niche in life rarely noted for its intellectual abandon. He was a pillar of stability in delicate matters of international diplomacy, but his official correctness did not prevent him from acquiring a knowledge of other European politicians that included their mistresses, neuroses, and financial prejudices. He collected modern art before it was fashionable to do so, but at the same time he was a classicist with the finest private collection of Newton’s writings in the world. He ran a theater, and he came to be a Director of the Bank of England. He knew Roosevelt and Churchill and also Bernard Shaw and Pablo Picasso. He played bridge like a speculator, preferring a spectacular play to a sound contract, and solitaire like a statistician, noting how long it took for the game to come out twice running. And he once claimed that he had but one regret in life—he wished he had drunk more champagne.
  • Keynes was — without any intention of slurring him — an opportunist and an operator, the glowing exception being his expression of moral outrage in The Economic Consequences of the Peace — and even that redounded to his personal and professional benefit. He was also — and this helped — a brilliant applied theorist; but the theory was applied when it was useful in supporting a proposal that might win current political acceptance, and dropped along with the proposal when the immediate purpose had been served or had failed. Thus Keynes realised fully, and exposed brilliantly in The Economic Consequences of Mr. Churchill, the adverse consequences for Britain of the return to the gold Standard. But once that decision had become a part of the order of things, he absorbed it and turned to advocating public works as a way of increasing employment; and in 1931 he came out in favor of protection. These gyrations frequently made him seem inconsistent to his contemporaries; actually, the examples cited can easily be reconciled by reference to the modern theory of second-best, but Keynes never spelled out such a theory. The General Theory represents the apotheosis of opportunism in this sense, in two ways. Mass unemployment had lasted so long that it appeared to the average man to be the natural state of affairs, which economics was powerless to explain and political processes powerless to alter; a new theory of its causes that promised an easy cure was thus virtually certain to sell, provided its author had impeccable professional credentials. But to be a new theory it had to set up and then knock down an orthodox theory, not merely explain what traditional theory really was and develop its application to the problem at hand — a procedure that Keynes had applied frequently in his younger days but which in this case would have required a major effort of theory construction and probably made the product unsaleable to the relevant public anyway.
  • Keynes was unmistakably a man formed by the previous century. In the first place, and like so many of the best economists of the earlier generations, from Adam Smith to John Stuart Mill, Keynes was primarily a philosopher who happened to deal in economic data. He might just as well have been a philosopher had the circumstances positioned him differently; indeed, in his Cambridge years, he wrote some properly philosophical papers, albeit with a mathematical bent.
    • Tony Judt, in Tony Judt and Timothy Snyder, Thinking the twentieth century (2012), Ch. 9. The Banality of Good: Social Democrat
  • Whatever the number of hours that Maynard, no time was wasted. His mind worked quickly and he possessed to a high degree the power of concentration. He also worked steadily at home and was allowed to share his father’s study, a tribute to the son’s habitual quiet attention to the subject in hand, for the father was extremely sensitive to any kind of disturbance.
    • Geoffrey Keynes, in "The Early Years" in Essays on John Maynard Keynes (1979) edited by Milo Keynes
  • Keynes himself was very much interested in monetary policy. He was a specialist all his life in the theory of money and interest rates. But this approach fell out of fashion and people concentrated on fiscal policy. Then, when monetary policy came back into fashion, people concentrated on the money supply and other monetary aggregates, such as M1 and M2, rather than interest rates, but that was not the way to go about it. Fortunately, I think interest rate policy is more effective now.
    • Lawrence Klein, "Keynsianism Again: Interview with Lawrence Klein", Challenge (May-June 2001)
  • Now I’m not saying that Keynes was right about everything, that we should treat The General Theory as a sort of secular bible - the way that Marxists treat Das Kapital. But the essential truth of Keynes’s big idea - that even the most productive economy can fail if consumers and investors spend too little, that the pursuit of sound money and balanced budgets is sometimes (not always!) folly rather than wisdom - is as evident in today’s world as it was in the 1930s. And in these dangerous days, we ignore or reject that idea at the world economy’s peril.
    • Paul Krugman, "Why aren't we all Keynesians yet?", Fortune (Aug. 3, 1998)
  • Keynes was no socialist – he came to save capitalism, not to bury it. And there’s a sense in which The General Theory was, given the time it was written, a conservative book.
    • Paul Krugman, Introduction to The General Theory of Employment, Interest, and Money (2006)
  • He was declaring that the trouble with the engine was not fundamental, that it was amenable to a technical fix. At a time when many of the world's intellectuals were convinced that capitalism was a failed system, that only by moving to a centrally planned economy could the West emerge from the Great Depression, Keynes was saying that capitalism was not doomed, that a very limited sort of intervention — intervention that would leave private property and private decision making intact — was all that was needed to make the system work. Confounding the skeptics, capitalism did survive; but although today's free-market enthusiasts may find this proposition hard to accept, that survival was basically on the terms Keynes suggested. World War II provided the jump start Keynes had been urging for years; but what restored faith in free markets was not just the recovery from the Depression but the assurance that macroeconomic intervention — cutting interest rates or increasing budget deficits to fight recessions — could keep a free-market economy more or less stable at more or less full employment. In effect, capitalism and its economists made a deal with the public: it will be okay to have free markets from now on, because we know enough to prevent any more Great Depressions.
    • Paul Krugman, in The Return of Depression Economics and the Crisis of 2008 (2009), Ch. 5 : Policy Perversity
  • Let us take the national debts. We know that the debts of the principal European states increased no less than sevenfold in the period between 1914 and 1920. I shall quote another economic source, one of particular significance—Keynes, the British diplomat and author of The Economic Consequenices of the Peace, who, on instructions from his government, took part in the Versailles peace negotiations, observed them on the spot from thc purely bourgeois point of view, studied the subject in detail, step by step, and took part in the conferences as an economist. He has arrived at conclusions which are more weighty, more striking and more instructive than any a Communist revolutionary could draw, because they are the conclusions of a well-known bourgeois and implacable enemy of Bolshevism, which he, like the British philistine he is, imagines as something monstrous, ferocious, and bestial. Keynes has reached the conclusion that after the Peace of Versailles, Europe and the whole world are heading for bankruptcy. He has resigned, and thrown his book in the government’s face with the words: “What you are doing is madness”.
    • Vladimir Lenin, The Second Congress Of The Communist International (1920)
  • The fundamental idea of Keynesianism is that state spending, a national budget deficit, can be used to combat economic crisis and recession.
    From a theoretical point of view, raising overall demand in a given country will facilitate a recovery insofar as there is disposable productive capacity (unemployed workers, stocks of raw materials, machines working below capacity). These unused resources are mobilized by the additional purchasing power created by the budget deficit. Only when these reserves are exhausted do you get the fatal onset of inflation.
    But there is a snag. In order for the budget deficit not to fuel inflation before full employment is reached, direct taxes must increase in the same proportion as income.
    Given that the bourgeoisie prefers to buy state bonds rather than pay taxes, and that tax evasion by the bourgeoisie is endemic, the higher tax burden implied by Keynesian policies falls on the workers.
    As the public debt grows, servicing this debt eats up a growing part of public spending, so there is a tendency for the budget deficit to grow without any corresponding beneficial effects on employment.
    So in the end Keynesian expansion tends to undermine itself through growing inflation and diminishing returns from the initial budget deficit-driven “push;” a new recession is the result. And the growing tax burden tends to redistribute income towards the bourgeoisie.
    The historical balance sheet of Keynesian policy is clear. The most extensive experiment, Roosevelt’s New Deal in the United States during the 1930s, ended in failure.
  • If you were going to turn to only one economist to understand the problems facing the economy, there is little doubt that the economist would be John Maynard Keynes. Although Keynes died more than a half-century ago, his diagnosis of recessions and depressions remains the foundation of modern macroeconomics. His insights go a long way toward explaining the challenges we now confront.
    • N. Gregory Mankiw, "What Would Keynes Have Done?" in New York Times (November 28, 2008)
  • Which brings us to a third group of macroeconomists: those who fall into neither the pro- nor the anti-Keynes camp. I count myself among the ambivalent. We credit both sides with making legitimate points, yet we watch with incredulity as the combatants take their enthusiasm or detestation too far. Keynes was a creative thinker and keen observer of economic events, but he left us with more hard questions than compelling answers.
    • N. Gregory Mankiw, "Back In Demand" Wall Street Journal (September 21, 2009)
  • Although Keynes’s General Theory provides the foundation for much of our current understanding of economic fluctuations, it is important to remember that classical economics provides the right answers to many fundamental questions.
    • N. Gregory Mankiw, preface in Macroeconomics
  • I think that if you went in for the Tripos, merely re-reading Economics in the ten days before it, you would probably get a first class: & that if you did not, you wd not injure your position, since it wd.. be known that you had had very little time free for economics.
  • I guess no one will be surprised that the story of Keynes’ life and thought makes me think about the “rhetoric” of economics. My thought is this: Keynes was a Sophist, not a Platonist. To read him as a Platonist, as economists mostly have, makes him nearly impossible to understand.
  • Keynes is misunderstood by modern Platonists, who keep trying to find his Truth, keep trying to stuff him into a stable Platonic theory. Right from the beginning Platonic thinkers like Friedrich Hayek and J. R. Hicks could not grasp his method. (...) The very title of the General Theory embodies this sophistic tactic.
    • Deirdre N. McCloskey, "Keynes Was a Sophist, and a Good Thing, Too" (1996)
  • There is a paradox in Keynes's fall in esteem. With respect to our economy, Keynes set out to explain two main problems: why our economy was given to fluctuations and whether it was possible to achieve a closer approximation of full employment than had been achieved thitherto. Keynes's answer to the policy question was that government expenditures and tax receipts could serve as a steering wheel, and that one requisite for such a steering wheel to be effective is that government be a bigger part of the economy than it was before the Great Depression. Our success since World War II in avoiding anything more severe than the recession of 1981-82 has been due in large part to the effects of our much bigger government.
    • Hyman P. Minsky, "The Legacy of Keynes", The Journal of Economic Education (1985)
  • Victorian changes in the University had brought his parents to Cambridge. The further transition from the last Victorian reforms of the 1880s to the modern state-supported institution that emerged after the First World War encompassed both Neville and Maynard Keynes’s connections with the administration of the University. For this reason it is necessary to provide some institutional background against which the Keyneses’ lives and times can be set.
  • Fascism entirely agrees with Mr. Maynard Keynes, despite the latter's prominent position as a Liberal. In fact, Mr. Keynes' excellent little book, The End of Laissez-Faire (1926) might, so far as it goes, serve as a useful introduction to fascist economics. There is scarcely anything to object to in it and there is much to applaud.
    • Benito Mussolini, as quoted by James Strachey Barnes (1929), Universal Aspects of Fascism, Williams and Norgate, London: UK, 1929, pp. 113-114.
  • A criticism of Keynes and Hayek would have to begin by pointing out the fact that in their theoretical systems there is no place for the uncertainty factor and anticipations. … It is good proof of Keynes’ intuitive genius that he reaches practical results that in many respects are very much superior to his deficient statements of certain theoretical problems.
  • [Keynes] was one of the great liberals of our time. He saw clearly that in England and the United States during the nineteen-thirties, the road to serfdom lay, not down the path of too much government control, but down the path of too little, and too late...He tried to devise the minimum government controls that would allow free enterprise to work. The end of laissez-faire was not necessarily the beginning of communism.
    • A. F. W. Plumptre, ‘Keynes in Cambridge’
  • Keynes was in his most lucid and persuasive mood; and the effect was irresistible. At such moments, I often find myself thinking that Keynes must be one of the most remarkable men that have ever lived—the quick logic, the birdlike swoop of intuition, the vivid fancy, the wide vision, above all the incomparable sense of the fitness of words, all combine to make something several degrees beyond the limit of ordinary human achievement. Certainly, in our own age, only Prime Minister is of comparable stature. He, of course surpasses [Keynes]. But the greatness of the Prime Minister is much easier to understand than the genius of Keynes. For in the last analysis, the special qualities of the Prime Minister are the traditional qualities of our race raised to the scale of grandeur. Whereas the special qualities of Keynes are something outside all that. He uses the classical style of our life and language, but it is shot through with something that is not traditional, a unique unearthly quality of which one can only say that it is pure genius.
    • Lionel Robbins, in The Wartime Diaries of Lionel Robbins & James Meade 1943–1945, ed. Susan Howson and Donald Moggridge (1990)
  • The consequences of Mr. Keynes's attack upon orthodoxy are very far reaching. First, it cuts the ground from under the pretended justification of inequality, and allows us to see the monstrous absurdity of our social system with a fresh eye.
  • The ‘bridge’ between Sraffa’s analysis of prices and Keynes’ analysis of production levels can be built along the following lines. In Sraffa’s analysis, which looks to conditions for reproduction of the economic system, the prices of commodities used as means of production are equal to the prices of the same commodities included in the product, and the technology is given. When the technology changes, if we rule out the entirely hypothetical case of a proportional reduction in all the coefficients of production, the relative prices also change. If the changes in technology were known ex ante, we would have continual arbitrage between current and future production, with a mechanism of forward prices and own interest rates which, significantly, constitutes a theoretical contribution by Sraffa (1932) taken up (and reworked, introducing expectations) by Keynes in the crucial Chapter 17 of his General Theory. In general, however, it is impossible to take changes in technology as known ex ante(particularly when referring not to productivity growth in the economy or in the manufacturing sector as a whole, but to sectoral technical changes, as is necessarily the case in the context of an analysis of relative prices). Indeed, we may argue that it is precisely here that there arises the major element –in so far as it operates continually and systematically, even in ‘normal times’ –of that all-pervasive uncertainty constituting a key feature of Keynes’ vision, leading him to grant expectations a central role in his theory. For this reason the two problems –Sraffa’s and Keynes’ –must be kept apart. Nevertheless, given Sraffa’s approach to his problem –isolating it from the problem of determination of quantities produced while avoiding any opening in the direction of ‘Say’s law’ –we may consider his analysis of the prices– distribution link conceptually compatible with Keynes’ analysis of employment, once the latter has been cleared of marginalist encrustations.
    • Alessandro Roncaglia, Piero Sraffa: His life, thought and cultural heritage (2000), Ch. 2. Production of Commodities by Means of Commodities
  • Later economists continued to hew a revisionist line, maintaining absurdly that Keynes was merely a benign pioneer of uncertainty theory (Shackles and Lachmann), or that he was a prophet of the idea that search costs were highly important in the labor market (Clower and Leijonhufvud).  None of this is trie.  That Keynes was a Keynesian—of that much derided Keynesian system provided by Hicks, Hansen, Samuelson, and Modigliani—is the only explanation that makes any sense of Keynesian economics.  Yet Keynes was much more than a Keynesian.  Above all, he was the extraordinarily pernicious and malignant figure that we have examined in this chapter: a charming but power-driven statist Machiavelli, who embodied some of the most malevolent trends and institutions of the twentieth century.
  • There are still many people in America who regard depressions as acts of God. I think Keynes proved that the responsibility for these occurrences does not rest with Providence.
  • Keynes's intellect was the sharpest and clearest that I have ever known. When I argued with him, I felt that I took my life in my hands, and I seldom emerged without feeling something of a fool. I was sometimes inclined to feel that so much cleverness must be incompatible with depth, but I do not think that this feeling was justified.
  • Maynard Keynes was a great Englishman of the first half of the twentieth century, and one of the world's three greatest economists of all time. Only Adam Smith and Leon Walras can be mentioned in the same breath with him.
    • Paul Samuelson, "The Keynes Centenary: Sympathy from the other Cambridge", The Economist Vol. 287 (1983),; later in The Collected Scientific Papers of Paul Samuelson, Volume 5 (1986), p. 275
  • Yes, Keynes was a genius. Yes, some of his ideas were inchoate and would not have lent themselves usefully to diagramming and symbolic manipulation. Yes, by the time of the Radcliffe committee many of his British admirers were still frozen in the Model T version of his system. And yes, Keynes resented excessive simplifying of his paradigms.
    Nevertheless, in science it is not the incoherent, inchoate and ineffable that has a cash value. If that were so, Goethe would be a greater scientist than either Einstein or Newton. What matters is the Kuhnian paradigm that people who are not geniuses can use. That which so many scholars independently agreed upon cannot be independent of the text that Keynes wrote down for them to read. What is remarkable is not the cogency of the case that Leijonhufvud manages to muster, which is rather flimsy, but rather how strong was the latent demand in the 1970s for a work to debunk Keynesianism. Harry Johnson put the same point in a different way.
    • Paul Samuelson, "The Keynes Centenary: Sympathy from the other Cambridge", The Economist Vol. 287 (1983),; later in The Collected Scientific Papers of Paul Samuelson, Volume 5 (1986), p. 277-278
  • Everyone understands now, on the contrary, that there can be no solution without government. The Keynesian idea is once again accepted that fiscal policy and deficit spending has a major role to play in guiding a market economy. I wish Friedman were still alive so he could witness how his extremism led to the defeat of his own ideas.
    • Paul Samuelson, "Don't Expect Recovery Before 2012" (16 January 2009)
  • Among economists John Maynard Keynes (1883–1946) did well over a lifetime. He had a high I.Q. and must have been a better-than-average bridge player. Apparently some of his triumphs in currency trading stemmed from his micro- and macroeconomic hunches. However, after scoring well on bets that Germany’s postwar inflation would cause the mark to depreciate, he did go virtually bankrupt when for a few months the mark reversed from its down trend. A kindly City friend enabled him to avoid bankruptcy, a fate worse than death in the post-Edwardian Age. (Again in 1929 a number of people incurred losses when a Keynes-Robertson speculative fund did badly. I learned this from Lionel Robbins. However, in autumn 1932, German Professor Hans Neisser heard Keynes give a lecture at Cambridge, in which he said, “Right now is your lifetime opportunity. Borrow and beg to invest in diversified common stocks that are going to recover now that the pound has ceased to be over-valued.” Not a shabby call.)
    • Paul Samuelson, "An Enjoyable Life Puzzling Over Modern Finance Theory" (2009)
  • The world in which we live today has been made much more secure by the economic wisdom that Keynes brought to us during the dark days of the Great Depression. When that wisdom is partly or wholly ignored in the making of economic policy, large numbers of people are made to suffer unnecessarily. I am afraid we have seen several depressing examples of that in the recent years, especially in Europe, with a huge human toll. Keynes was a great pathfinder, and it would have distressed — if not surprised — him to see how well-identified paths can be comprehensively neglected by policymaking that draws more on ideology than on well-reflected reasoning.
  • Keynes saw himself as overturning ‘‘classical’’ economics. He was less revolutionary than he thought. Large chunks of Marshallianism – particularly to do with the importance of time (short and long periods), the technique of partial equilibrium analysis, and the cash balances version of the quantity theory of money – were central to his economics and distanced it from the timeless simultaneous-equation general equilibrium theory of Menger and Walras which Hayek regarded as the supreme achievement of the marginalist revolution.
    • Robert Skidelsky, "Hayek versus Keynes: the road to reconciliation", in Edward Feser(ed.), The Cambridge Companion to Hayek (2006)
  • Keynes's habit of treating the state as a deus ex machina to be invoked whenever his human actors, behaving according to the rules of the capitalist game, get themselves into a dilemma from which there is apparently no escape. Naturally, this Olympian interventionist resolves everything in a manner satisfactory to the author and presumably to the audience. The only trouble is — as every Marxist knows — that the state is not a god but one of the actors who has a part to play just like all the other actors.
    • P. M. Sweezy, "John Maynard Keynes", Science and Society (1946)
  • Keynes undoubtedly exaggerates the simplicity of his own contribution — it is noteworthy that pride in theoretical virtuosity was utterly foreign to his nature — but I think that almost all teachers will agree that it is easier to get his essential ideas across to a beginner than to a student who has already been steeped in the doctrines of the neo-classical school. Historians fifty years from now may record that Keynes' greatest achievement was the liberation of Anglo-American economics from a tyrannical dogma, and they may even conclude that this was essentially a work of negation unmatched by comparable positive achievements.
    • P. M. Sweezy, "John Maynard Keynes", Science and Society (1946)
  • Keynes came on not as a socialist — far from that — but as an extraordinarily liberal experimental mind who was prepared to do whatever was necessary — he thought it could be done — under the property arrangements and class arrangements that existed at that time. I think he was dead wrong in a lot of the things he advocated, like redistribution of income, social control over investment, which were totally antithetical to the political and ideological structure of the society and would never get through without a very basic change in the nature of society. I still think that.
    • P. M. Sweezy, in interview (conducted on 24 September 1987), published in David C. Colander and Christian A. Johnson, The Coming of Keynesianism to America: Conversations with the Founders of Keynesian Economics (Edward Elgar Publishing, 1996)
  • It wasn't really that they were put into effect as ideas by the New Deal or by anybody else. As a matter of fact, paradoxically, many of the policies of Nazi Germany were very much in line with Keynesian recommendations for overcoming a depression, and the German depression in general was overcome. Hitler's Germany came out of the depression long before the United States did, and that was because they spent a lot of money, deficit financing, controlled investment, on a war program. As a matter of fact, the Great Depression never was over in the United States until the war. The New Deal did not act on Keynesian policies at all.
    The history of Keynesian theory and policy is full of paradoxes. It is important that you really understand the complexities of the history of the period.
    • P. M. Sweezy, in interview (conducted on 24 September 1987), published in David C. Colander and Christian A. Johnson, The Coming of Keynesianism to America: Conversations with the Founders of Keynesian Economics (Edward Elgar Publishing, 1996)
  • Keynes did not challenge the efficacy of price adjustment mechanisms in clearing particular markets in the Marshallian partial equilibrium theory on which he had been reared. He did challenge the mindless application of those mechanisms to economy-wide markets. Founding what came to be known as macroeconomics, he was modeling a whole economy as a closed system. He knew he could not use the Marshallian assumption that the clearing of one market could be safely described on the assumption that the rest of the economy was unaffected.
    • James Tobin, "Price flexibility and output stability: An old Keynesian view", Journal of Economic Perspectives (1993)
  • The central message is still that, as Keynes argued, fiscal policy is the answer to liquidity traps, financial or political. The arguments against fiscal policy in Japan, so far as I understand them are intellectually fallacious; they would receive failing grades in an undergraduate macro exam.
    • James Tobin, "Reflections on japanese political economy" (1999)
  • Keynes, I am sure, often interpreted his role as that of the prophet and the politician, and it was in such a period, I presume, that he once wrote: "Words are to be a little wild, for they are the assaults of thoughts on the unthinking." I do not challenge this for prophets and politicians, for they have special occupational license to promote their objectives free from stodgy inhibitions on the exercise of all their rhetorical resources for persuasion. I believe in the virtues of professional division of labor, however, and I am troubled, therefore, when economists adopt the role and the tactics of the prophet or the politician, especially when there is any ground for suspicion that what is involved is false prophecy.
    • Jacob Viner, "Comment on my 1936 review of Keynes' general theory." (1964)

See also[edit]


Works about Keynes

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