Would capitalism have made it this far if it wasn't for the ideas of Keynes?

[Lobotomy]

Would capitalism have imploded and the bourgeoisie been replaced by a new ruling class? Or would there even have been a better chance for revolution at this point?

[W1N5T0N]

What specific point in history are you referring to?

[Dogs On Acid]

If it wasn't for Keynes the world would have a much worse distribution of wealth and the so called 1st world countries would have much higher poverty, and investment risks would of been much higher. All you have to do is compare pre-Keynes capitalism to modern day capitalism, which is heavily influenced by him.

So indirectly yes it has suppressed revolutionary tendencies at the expense of an average richer working-class and economic stability. Unemployment would also be much worse without Keynes.

His ideas partially transferred decision making in relation to the economy from the Capitalists to the Government. He supported government intervention in bailouts, unemployment and wages.

In Capitalist philosophy, Keynes is opposed to Neo-Classical economists and basically anybody promoting small government.

[Kuppo Shakur]

Would capitalism have imploded and the bourgeoisie been replaced by a new ruling class? Or would there even have been a better chance for revolution at this point?
Ideas don't cause social change, bro.

[Dogs On Acid]

Ideas don't cause social change, bro.

Yes they do, indirectly.

[S.Artesian]

Would capitalism have imploded and the bourgeoisie been replaced by a new ruling class? Or would there even have been a better chance for revolution at this point?


Wrong way of putting it. Would Keynes have made it as far as he did if capitalism hadn't defeated the proletariat in struggle after struggle from 1927 on?

[dude6935]

Keynesian economics is disastrous to any capitalist economy, IMO. "Stimulus" simply funnels cash into the hands of the well connected. It just moves money from taxpayers to political allies. In today's politics, that means to huge multinationals like GE, government employees, and labor unions. In tomorrow's politics, the well connected could be a totally different group.

[Common_Means]

To the OP, yes, I would argue that this is correct.

In times of crises, Keynes promoted a "prime-the-pump" solution - that is, government spending - opposed to letting the market correct itself - the supposed "laissez faire" approach. As a result, under Keynes the "innate" market is manipulated, stunting its natural tendencies - or contradictions - until it is stabilized.

Case in point: Had the current US regime not intervened in the auto industry, it could be argued that GM (and potentially others) would have gone bankrupt, resulting in thousands unemployed. Consequently, such high influxes of unemployment cause all sorts of crises within the capitalist system, not the least of which is a large abstraction from the consumer market. Hence, if the bail out did not occur, the inherent contradiction would have been arguably realized, and the tensions would shot to the forefront.

My very brief take on it anyways.

[Sir Comradical]

Someone else would have come up with Keynesian economic suggestions anyway. After all these ideas spring forth from the status of the economy itself, the status of the economy isn't a result of these ideas. I'm not saying individuals don't have agency, but if capitalism didn't run into crises then Keynes would have stuck with philosophy.

[Dumb]

Keynes wasn't actually all that influential during the Great Depression. FDR had no coherent philosophy for tackling the economic downturn; he was trying almost literally everything he could think of, and since he came into office at a time of rampant laissez-faire economics, "trying anything" was naturally going to lead towards a "bigger," more active state.

Besides, Keynes' magnum opus, The General Theory of Employment, Interest and Money, wasn't published until 1936 - the year FDR got re-elected after making impressive economic gains, and the year before FDR proceeded to undo all that progress by scaling back the New Deal.

EDIT: Keynes was, however, quite useful within capitalist economics for explaining after the fact how the state could have, should have, and eventually did shake off a downturn similar to the Great Depression. His influence peaked during the "Post-War Settlement" era.

[Zanthorus]

Would capitalism have imploded and the bourgeoisie been replaced by a new ruling class? Or would there even have been a better chance for revolution at this point?

The policies Keynes advocated were not exactly innovative. Several states had already moved towards 'Keynesian' style policies by the time his General Theory was published. Also, Keynes was not the only one pushing forward these ideas at the time. As a matter of fact, he was anticipated by the Polish economist Michal Kalecki.

[Lobotomy]

What specific point in history are you referring to?

Right now.

[Kiev Communard]

The policies Keynes advocated were not exactly innovative. Several states had already moved towards 'Keynesian' style policies by the time his General Theory was published. Also, Keynes was not the only one pushing forward these ideas at the time. As a matter of fact, he was anticipated by the Polish economist Michal Kalecki.

I would say the destruction of excessive production capacity during WW II was what put capitalism on the wheels again. After all, the Keynesian policies of the 1970s failed to prevent or abort the 1970s recession, so it is unlikely they would have stopped the Great Depression by themselves (as an actual resumption of the slump in the U.S. under Roosevelt in 1937-1938 shows).

[Jose Gracchus]

As pointed out, Keynesianism was 'discovered' by the bourgeoisie without him codifying it. There's a reason he wished he could've published the General Theory in German (point of fact, most of the make-work and economic improvements had been drafted under Hitler's predecessor; what Hitler supplied was the iron fist against the workers' movement).

[Common_Means]

Why is it that people are getting bogged down by whether it was Keynes who was directly
responsible for stimulus or not? It derails
the thread and, simply put, offers nothing to the essence of the discussion. Fine, Hayek, Keynes et al. had very little real impact... The point is, however, that state spending has slowed the general contradictions of capital. Of course, in Kapital Marx discussed how the state saved capitalists from themselves. Contemporary political economy has reaffirmed this.

[RadioRaheem84]

Yes, Keynes was not that influential until after the War but the whole Cambridge School of Economics was flirting with State spending anyways. It was obvious to most States that state spending will aid the economy in time of crises.

[S.Artesian]

Why is it that people are getting bogged down by whether it was Keynes who was directly
responsible for stimulus or not? It derails
the thread and, simply put, offers nothing to the essence of the discussion. Fine, Hayek, Keynes et al. had very little real impact... The point is, however, that state spending has slowed the general contradictions of capital. Of course, in Kapital Marx discussed how the state saved capitalists from themselves. Contemporary political economy has reaffirmed this.


Maybe that's the point-- that state spending has not "slowed the general contradictions of capital-- didn't work that way in the depression; didn't work that way in Germany. What did work in Germany in particular prior to the war, was the wage cap imposed, that held real wages at or below 1929 levels.

What did work was the war-- as comrade Kiev Communard pointed out-- the overwhelming destruction of productive capacity,itself based on the defeat of the working class.

And postwar? 1945- around 1970? Improved rate of profit, which peaked and turned down and has led to the bourgeoisie's offensive against workers living standards for the last 32 or so years-- not to mention the destruction of the productive capacity of the fSU and its former allied states.

[freya4]

No. Just purely in economic terms, capitalism would not be able to sustain itself without a government to constantly prop it up and bail it out after its numerous crashes, failures and bankruptcies. I wonder if the extreme laissez-faire advocates would really just sit by in a time of crisis while the economy destroys itself. It really isn't practical. Nowadays, nearly every politician is a Keynesian, even when they claim not to be.

[S.Artesian]

No. Just purely in economic terms, capitalism would not be able to sustain itself without a government to constantly prop it up and bail it out after its numerous crashes, failures and bankruptcies. I wonder if the extreme laissez-faire advocates would really just sit by in a time of crisis while the economy destroys itself. It really isn't practical. Nowadays, nearly every politician is a Keynesian, even when they claim not to be.


Except that's always been the case. Always. Look at the history of capitalist development in the US.

[Common_Means]

Maybe that's the point-- that state spending has not "slowed the general contradictions of capital-- didn't work that way in the depression; didn't work that way in Germany. What did work in Germany in particular prior to the war, was the wage cap imposed, that held real wages at or below 1929 levels.

What did work was the war-- as comrade Kiev Communard pointed out-- the overwhelming destruction of productive capacity,itself based on the defeat of the working class.

And postwar? 1945- around 1970? Improved rate of profit, which peaked and turned down and has led to the bourgeoisie's offensive against workers living standards for the last 32 or so years-- not to mention the destruction of the productive capacity of the fSU and its former allied states.

State spending has not slowed the 'general contradictions of k'? Honestly, you're going to even attempt to argue such a position? Not to sound glib, but this isn't even worth a debate. One would not even need to cite government employees to show the absurdity of such a position.

[Pretty Flaco]

Except that's always been the case. Always. Look at the history of capitalist development in the US.

A lot of Americans talk about the "golden age" of Reagan, while Reaganomics is pretty opposite of Keynesian economics. The fact is that a lot of politicians are particularly skilled at taking people's minds off of economic problems. You're living in a shitty apartment and you don't have healthcare or car insurance but HEY! Look! Osama's dead! Damn ain't it great to live in the land of freedom?

[Jose Gracchus]

And postwar? 1945- around 1970? Improved rate of profit, which peaked and turned down and has led to the bourgeoisie's offensive against workers living standards for the last 32 or so years-- not to mention the destruction of the productive capacity of the fSU and its former allied states.

Hell, much of the real production capacity in the U.S. has been destroyed and left to rust. Detroit is an epitaph to the old Fordist industrial base in the U.S.

[Common_Means]

Hell, much of the real production capacity in the U.S. has been destroyed and left to rust. Detroit is an epitaph to the old Fordist industria
l base in the U.S.

Production capacity? Can we please lose the dogmatic references and accept that this is no longer 1920.

2.

[Jose Gracchus]

Dogmatic? Uh, are you saying that there aren't abandoned factories and plants throughout the "Rust Belt" that have been left to rust, and the workers that formerly worked them left unemployed or in unproductive service jobs, that formerly had capacity to produce and were functionally used for that purpose? I don't see how what I said is factually wrong.

[Common_Means]

No, I am saying that citing the lack of productive capacity within the US as a symptom and so on us to be trapped in an early 20C analysis of Capatilsm; hence dogmatic.

[S.Artesian]

Well there's a whole lot of workers, who have been made into ex-workers, trapped in this capitalism.

US accounted for about 30% of world industrial output in 1996. Now it's about 19-20%.

Certainly that has been in part to growing output in other areas like Brazil and China, but you might want to consider what the basis for the growing output has been-- FDI in export production.

[Jose Gracchus]

That sentence is grammatically undecipherable so I'm not sure what you're saying. It is a symptom of "us" - meaning who, exactly, the bourgeois management of the economy?, workers?, militants pursuing communism? - being trapped in an early 20th c. analysis of capitalism?

Wouldn't that suggest that idealism trumps materialism in this case, that ideology has run away from the material base of the economy, how the contradictions of capital accumulation drive change? Or are you saying something entirely different?

[Common_Means]

Us was a typo...meant to read is. I'll leave my comments to that...

[Dumb]

If Keynesianism had solved all of capitalism's problems, or if Keynesianism had solved any problems without creating a new set of problems altogether, then Keynesianism would have remained the dominant state ideology to this day.

Alas, Keynesianism is likely responsible for at least part of the decrease in the rate of profit leading up to the stagflation of the 1970s and 1980s. That era of worldwide stagnation wreaked absolute havoc on the international economy, and I'm not sure what would have happened without the rise of neoliberalism. As much as I hate neoliberalism, its proponents were likely just as responsible for saving capitalism as was FDR.

So, it's a fair question whether or not capitalism would have survived without Keynesianism or similar ideologies, but it's an equally fair question whether or not capitalism would have managed to survive Keynesianism given an addition 10-15 years.

[Jose Gracchus]

Us was a typo...meant to read is. I'll leave my comments to that...

So you're saying we should not be focused on the volume of industrial capacity we have access to, because that's a early 20th c. fixation? I quite agree. I was just pointing out a fact.

[S.Artesian]

State spending has not slowed the 'general contradictions of k'? Honestly, you're going to even attempt to argue such a position? Not to sound glib, but this isn't even worth a debate. One would not even need to cite government employees to show the absurdity of such a position.


Yeah, that's just the sort of guy I am. I am absolutely ready to argue such a position-- to show how the expansion of US capital postwar was based on improved productivity, new sources of [cheaper] labor.

Glad you don't consider it worth debating. Shows how much you must really know about the last 60 years of US capitalism in particular.

[Vladimir Innit Lenin]

Keynes' theories were nothing special.

If the man himself didn't come along, then someone else would have come up with similar statist, demand-side ideas.

Keynesian policies, in recession, are the less nasty face of Capitalism. Reducing direct taxes + increasing government spending means that low paid workers will be effected a buffer in recession. Combined with the commitment to full (well, not really, but high) employment, it means a better life during recession than under neo-liberalism.

Whether Keynesianism could work as a viable theory in the material world of today is open to debate. It wasn't good to workers in the first world in boom times because it kept wages down in the long term and couldn't do the same for inflation, because the long-run Phillips Curve trade off between inflation and employment was a load of bullshit.

Ironically, the crises of the 1970s in Europe, caused partially by the disastrous attempt to exploit the Phillips Curve as a long run phenomenon, led to a period of political upheaval in Europe not seen since.

Still, it cannot be denied that even this bastard theory, when implemented during recession, provides a material benefit to the poorest in first world countries, in comparison to Chicago School economic policies.

Still, it's a very average theory which cares little for the workers themselves and is inherently anti-democratic, not making it suitable at all for anything beyond protecting workers from the worst of recession under Capitalism.

[Ilyich]

Ideas don't cause social change, bro.

No, they do not but the implementation of ideas can cause social change and I believe that what "bro" is asking about is the implementation of Keynesian ideas by the U.S. and other governments.

[Kiev Communard]

The political doctrine of Keynes himself was a perfect example of technocratic/managerialist approach towards social issues, as he claimed that from the point of his economic theory the exact political or social structure of the nation under consideration is irrelevant, and that "responsible economic policies" could be better implemented by the "authoritarian" state. This puts him actually in the same league with Monetarists, with the distinction between their policy proposals being based more on the specific interests of the capitalist class in the respective time periods, rather on some principled differences in world-view (see "Keynes and 'New Liberalism" in The Cambridge History of Twentieth-Century Political Thought (http://books.google.com.ua/books?id=N1h4_NqTOFoC&pg=PA51&dq=Political+ideas+of+Keynes&hl=ru&ei=fzsPTszyFcrPsgaH663nDg&sa=X&oi=book_result&ct=result&resnum=2&ved=0CDEQ6AEwAQ#v=onepage&q=Political%20ideas%20of%20Keynes&f=false) for the exposition of the similar argument).

[Die Neue Zeit]

There are at least three takes to the General Theory: Bastard Keynesianism / Neo-Classical Synthesis (what's deemed "Keynesianism" in mainstream parlance), Military Keynesianism, and Post-Keynesianism (a more left-leaning economic school that borrows from Kalecki).

[Armchair War Criminal]

The "hard Keynesianism" of the postwar era broke down in the 70s for political reasons - it's impossible to eliminate cyclic output gaps without placing too much upward pressure on wages.


A lot of Americans talk about the "golden age" of Reagan, while Reaganomics is pretty opposite of Keynesian economics.
Not quite - Reagan's administration (like Thatcher's, et al.,) worked off of a set of theories called "Monetarism," which, though often rhetorically opposing itself to "Keynesianism" and "government intervention," doesn't represent a return to the pre-interventionist dark ages - instead, it (ideally, theoretically) moves contracyclical policy from fiscal methods to monetary ones.

[Lobotomy]

I'm not sure why a few people have now said things along the lines of "If Keynes didn't come up with the ideas then someone else would have". Of course they would have, that's why I made a point to say "the ideas of Keynes" rather than Keynes himself, and as leftists I think we all pretty much reject the great man theory.

Also, a few have implied that Keynesianism is not the dominant theory in economics today. If not, what is? I only ask because it seems to have been highly influential over a few recent actions of the US at least, like Obama's stimulus plan, but I don't know.

[Dumb]

I'm not sure why a few people have now said things along the lines of "If Keynes didn't come up with the ideas then someone else would have". Of course they would have, that's why I made a point to say "the ideas of Keynes" rather than Keynes himself, and as leftists I think we all pretty much reject the great man theory.

Also, a few have implied that Keynesianism is not the dominant theory in economics today. If not, what is? I only ask because it seems to have been highly influential over a few recent actions of the US at least, like Obama's stimulus plan, but I don't know.

We still haven't shaken off neo-liberalism. Yeah, sure, Obama got his stimulus package, but the package was too small by half (and about 40% of it was wasted on ineffective tax cuts). Even that package, though, wasn't exactly a slam-dunk to get passed (with 59 Democratic senators and Alec Arlen, no less!)

Since then, Obama's been focused on "fiscal responsibility" and budget cuts. Just look at the debate over the current budget. It's not a question of whether or not to cut; it's a question of whether to cut by half a trillion or by multiple trillion dollars over the next decade.

[CAleftist]

The "hard Keynesianism" of the postwar era broke down in the 70s for political reasons - it's impossible to eliminate cyclic output gaps without placing too much upward pressure on wages.


Not quite - Reagan's administration (like Thatcher's, et al.,) worked off of a set of theories called "Monetarism," which, though often rhetorically opposing itself to "Keynesianism" and "government intervention," doesn't represent a return to the pre-interventionist dark ages - instead, it (ideally, theoretically) moves contracyclical policy from fiscal methods to monetary ones.

It should be noted that the Carter administration was a precursor in many ways to what Reagan did.

[Dumb]

It should be noted that the Carter administration was a precursor in many was to what Reagan did.

Ending detente with the Soviet Union, cutting capital gains taxes, starting the military buildup, deregulating the energy industry, organizing the evangelical Christians as a voting bloc...you're 100% right.

[Common_Means]

Yeah, that's just the sort of guy I am. I am absolutely ready to argue such a position-- to show how the expansion of US capital postwar was based on improved productivity, new sources of [cheaper] labor.

Glad you don't consider it worth debating. Shows how much you must really know about the last 60 years of US capitalism in particular.

I don't wish to get personal, so I'm not sure where
to take this. Because I do not agree with your absurd position, you deem me clueless.

If the past 60 years has proven anything it is this: those not bogged down with 20C analysis have witnessed the metamorphosis of K in advanced capitalist economies. This easily falls in line with Marx's thought. In fact, to take Kapital as gospel is to completely reject Marx's thinking.

Capital does not reside in a bubble. Productivity, within the US for example, may decline. However, to infer anything about the health of
Capital in it's entirety from this is, simply put, wrong. Moreoer, given the fact that capital flight still relies on N. American/W. Euro markets
proves this.

You can cite foreign direct investment ect
all you wish. The point however is that the decking working class
in the United States, and EU, still hold
the ability to consume the abdundance of wealth being
produced. I will leave it to you to decide why this is.

PS, read the late great Andrew
Glynn. You're already saturated
mind of late 21C K might learn a thing or two.

[Jose Gracchus]

I want to see what your point is, and what you're really getting at, but I really can't.

[Psy]

Alas, Keynesianism is likely responsible for at least part of the decrease in the rate of profit leading up to the stagflation of the 1970s and 1980s. That era of worldwide stagnation wreaked absolute havoc on the international economy, and I'm not sure what would have happened without the rise of neoliberalism. As much as I hate neoliberalism, its proponents were likely just as responsible for saving capitalism as was FDR.

So, it's a fair question whether or not capitalism would have survived without Keynesianism or similar ideologies, but it's an equally fair question whether or not capitalism would have managed to survive Keynesianism given an addition 10-15 years.

Keynesianism only brought staflation by expanding the productive forces that caused overproduction. Also Kyenesianism is mostly a evoluation of the ideas of Fredrick List that correctly stated the only way any nation (other then Britain as it was the first industrial nation) can industrialize was through complete state invention in the industrialization process that is how every bourgeoisie nation has industrialized.

Also the crisis of 1970's was nowhere as bad as now, what the ruling class was looking in the 1970's was a long stagnation and slow deterioration of the rate of profit while now they are looking at a rapid market crashes and that is with the world economy being subsidized by China's Kyenesianism. If China stopped subsidizing its economy the world economy would total collapse.

If you go back to Marx what we are looking at now is capitalism being a victim of its own success, now capitalism is faced with the crisis of the means of production being far too large to maintain enough scarcity thus capitalism has not need to build new means of production that industrial growth can't mop up surplus production. Thus it is not that Kyenesianism is wrong but capitalism was doomed to stagnation all Keynesianism did was get capitalism to this point faster.