Paul Davidson – Keynes’s Forgotten Lessons

INET Executive Director Robert Johnson talks with Journal of Post Keynesian Economics co-founder Paul Davidson about Davidson’s book The Keynes Solution: The Path to Global Economic Prosperity.

Davidson discusses Keynes’s oft-forgotten insights into the foundational assumptions of economics. Classical economists were treated as “Euclidians in a non-Euclidian world,” Davidson says. “When they saw parallel lines intersecting they rebuked them for intersecting.” Keynes saw that the problem with Euclidean economics was what he called uncertainty, meaning the idea that the future cannot be predicted from the past — an insight that modern economics too often ignores.

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John Maynard Keynes: National Self-Sufficiency

“It is not intelligent, it is not beautiful, it is not just, it is not virtuous – and it doesn’t even deliver the goods.” Thus spoke the most influential economist of the 20th century John Maynard Keynes on the inter-war economic system.

Keynes had been a great believer in traditional economics, that is, until the Great Depression. Then everything changed. In the following essay Keynes explains the flaws in free market economics, his plan for the future, and the pitfalls that must be avoided.

In his argument for an expanded dialogue on economics, Tony Judt frequently references Keynes. Judt opines that we must also discuss economics in terms of justice; rather than purely in the terms of a narrow minded accountant. In this sense, Keynes’s work is the perfect antidote to the multiplied bray of the free market loudspeaker.
I was brought up, like most Englishmen, to respect free trade not only as an economic doctrine which a rational and instructed person could not doubt, but almost as a part of the moral law. I regarded ordinary departures from it as being at the same time an imbecility and an outrage. I thought England’s unshakable free trade convictions, maintained for nearly a hundred years, to be both the explanation before man and the justification before Heaven of her economic supremacy. As lately as 1923 I was writing that free trade was based on fundamental “truths” which, stated with their due qualifications, no one can dispute who is capable of understanding the meaning of the words.

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One More War, Please

by David Bromwich

Will the summer of 2010 be remembered as the time when we turned into a nation of sleepwalkers? We have heard reports of the intrusion of the state into everyday life, and of miscarriages of American power abroad. The reports made a stir, but as suddenly as they came they were gone. The last two weeks of July saw two such stories on almost successive days.

First there was “Top Secret America,” the three-part Washington Post report by Dana Priest and William M. Arkin on the hyperextension of private contracts, government buildings, and tax-funded expenditures in the secret surveillance economy. Since 2001, the new industries of data mining and analysis have yielded close to a million top secret clearances for Americans to spy on other Americans. Then at the end of July came the release of 90,000 documents by Wikileaks, as reported and linked by the New York Times, which revealed among other facts the futility of American “building” efforts in Afghanistan. We are making no headway there, in the face of the unending American killing of civilians; meanwhile, American taxes go to support a Pakistani intelligence service that channels the money to terrorists who kill American soldiers: a treadmill of violence. Both findings the mainstream media brought forward as legitimate stories, or advanced as raw materials of a story yet to be told more fully. This was an improvement on the practice of reporting stories spoon-fed to reporters by the government and “checked” by unnamed sources also in government. Yet, as has happened in many cases in the mass media after 2001 — one thinks of David Barstow’s story on the “war experts” coached by the Pentagon and hired by the networks — the stories on secret surveillance and the Afghanistan documents were printed and let go: no follow-up either in the media or in Congress.

We seem to have entered a moral limbo where political judgment is suspended and public opinion cannot catch its breath.

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