Keynes

[PikSmeet]

Why do some, who call themselves socialists, rate Keynes so highly and mistake his reformist economics for socialism?

It was claimed for Keynes in the Thirties that he saved capitalism; that was certainly his declared intention. Marx of course sought to replace capitalism by Socialism.

Every government that has tried to solve the problems of unemployment and inflation by using Keynesian methods has failed. Even the New Deal did nothing to reduce unemployment in America, as it only started to fall due to WW2. In the UK after 30 years of Keynesian economics by 1976 we had unemployment topping 1.5 million and double digit inflation.

Some on the left think that Keynes is against cuts or austerity measures, not so, as nothing could be further than the truth. When unemployment is rising Keynes said that governments should run a deficit, spending money to lower unemployment. But when inflation is rising, governments should run a surplus, making cuts and reducing spending so that inflation will fall. But what happens when inflation and unemployment are both rising at the same time?

Keynes was quite contemptuous of Marx, describing Capital as “an obsolete textbook which I know to be not only scientifically erroneous but without interest or application to the modern world” (A Short View of Russia, 1925)

So why is he so loved by socialists?

[PikSmeet]

Typed this in an e-mail and when I transferred it to her it went a bit wonky...sorry.

[Quail]

Typed this in an e-mail and when I transferred it to her it went a bit wonky...sorry.

Fixed for you

[Rudolf]

Why do some, who call themselves socialists, rate Keynes so highly and mistake his reformist economics for socialism?

Maybe that's the problem, that they merely call themselves socialist but they fall short of any break from bourgeois ideology.

Most people i come across in Britain that call themselves 'socialist' merely want the pre-thatcher 'golden age' thus loving keynes makes sense.

[Luís Henrique]

So why is he so loved by socialists?

I don't think this is true, unless by "socialists" you mean everybody to the left of Margareth Thatcher...

Luís Henrique

[PikSmeet]

Quail - thanks for fixing it!

I get that they may call themselves socialists but why Kenyes and not another capitalist economist like Friedman?
What is it about him that they love? I mean his theories have failed to stop prices rising and to bring about full employment anywhere. But still they don't get it and I understand that as the saying is how soon men forget. But I've yet to find a rational explanation as to why he has been choosen as a saviour of the left when they have their own economist; Marx.

[oneday]

I don't think many socialists actually supported Keynesian economics as a complete solution, however they may have supported some of the same reforms that "demand-side" Keynesians supported. Reforms which immediately benefitted the working class. They believed it would help raise awareness of the workers in their ability to change things and lead to an escalation towards socialism.

I get that they may call themselves socialists but why Kenyes and not another capitalist economist like Friedman?

I think it would be hard to rouse the working class under the banner of cutting minimum wage so they can get paid less, cutting the services they are dependent on, and cutting work safety standards so they can get killed, etc.

[hexaune]

Quail - thanks for fixing it!

I get that they may call themselves socialists but why Kenyes and not another capitalist economist like Friedman?
What is it about him that they love? I mean his theories have failed to stop prices rising and to bring about full employment anywhere. But still they don't get it and I understand that as the saying is how soon men forget. But I've yet to find a rational explanation as to why he has been choosen as a saviour of the left when they have their own economist; Marx.

Probably because under Keynesian economics there is at least a semblance of a support structure for the working classes (i.e. a welfare system) and some redistribution from the rich to the poor. Under Friedman influenced economics all those things go and life is substantially worse for those of us at the bottom.

Personally I don't think that Keynesian economics holds any of the answers and until we get rid of capitalism there will be no security for us even if there are temporary gains (which are quickly clawed back). But saying that, it is easier for the working classes to be militant and start to fight for the destruction of capitalism if they aren't cowed by the fear of having no job security, not being able to feed their families properly and working such long hours to try and keep shit together that there is no time for anything else, only for survival.

[Alet]

Because these days socialism is everything which does not seek to openly worship da power of da free marketz - or, to be more serious, which makes capitalism "more sufferable" for workers. Basically, you're right, the intention of keynesian politics is not to abolish but to support the circulation of capital (under certain conditions). As we use socialism and communism synonymously (or, for those communists who refuse to do so, at least meaningfully, that is not as abstractions), there is no reason for us to identify with keynesianism.

[PikSmeet]

So Keynesian economics in a sense are a cruel confidence trick on the working class? They promise to solve the problems they face but fail and only offer a semblance of hope and lifetime of welfare dependency? They may take a little from the rich and give to the poor but capitalism remains intact and if Keynesian works capitalism will end up stronger?
Whilst I get that people are putting a negative spin on Friedman he could equally turn around and say of the Keynes ideas what Callaghan did in 1976:

"We used to think that you could spend your way out of a recession and increase employment by cutting taxes and boosting government spending. I tell you in all candour that that option no longer exists, and in so far as it ever did exist, it only worked on each occasion since the war by injecting a bigger dose of inflation into the economy, followed by a higher level of unemployment as the next step."

If this is true and in 1976 it sure seemed that way why is this better than the alternative offered by Friedman? Granted his economics are not the answer either.

[hexaune]

So Keynesian economics in a sense are a cruel confidence trick on the working class? They promise to solve the problems they face but fail and only offer a semblance of hope and lifetime of welfare dependency? They may take a little from the rich and give to the poor but capitalism remains intact and if Keynesian works capitalism will end up stronger?
Whilst I get that people are putting a negative spin on Friedman he could equally turn around and say of the Keynes ideas what Callaghan did in 1976:

"We used to think that you could spend your way out of a recession and increase employment by cutting taxes and boosting government spending. I tell you in all candour that that option no longer exists, and in so far as it ever did exist, it only worked on each occasion since the war by injecting a bigger dose of inflation into the economy, followed by a higher level of unemployment as the next step."

If this is true and in 1976 it sure seemed that way why is this better than the alternative offered by Friedman? Granted his economics are not the answer either.

How do you expect the working classes to be able to organise and fight for communism if they are having to work 12h days 6-7 days a week (which is the outcome of getting rid of minimum wage and limits on working hours), can hardly afford to keep a roof over their heads, aren't allowed to organise/strike...

Those are some of the side effects that the working poor suffer under Chicago school economics.

[PikSmeet]

I doubt the end result of Chicago school economics is an 84 hr working week. Believe me there was terrible poverty in the UK between the years 1945 - 1975 which the welfare state could do nothing about.
As for the Kenyes, go tell the workers in Venezuela how good Keynesian economics are. This year their economy shrank by 4%, inflation is at 400%, 75% of the population live below the poverty line and unemployment is at 8%, even the monetarists didn't **** up this badly!

[oneday]

So Keynesian economics in a sense are a cruel confidence trick on the working class? They promise to solve the problems they face but fail and only offer a semblance of hope and lifetime of welfare dependency? They may take a little from the rich and give to the poor but capitalism remains intact and if Keynesian works capitalism will end up stronger?
Whilst I get that people are putting a negative spin on Friedman he could equally turn around and say of the Keynes ideas what Callaghan did in 1976:

"We used to think that you could spend your way out of a recession and increase employment by cutting taxes and boosting government spending. I tell you in all candour that that option no longer exists, and in so far as it ever did exist, it only worked on each occasion since the war by injecting a bigger dose of inflation into the economy, followed by a higher level of unemployment as the next step."

If this is true and in 1976 it sure seemed that way why is this better than the alternative offered by Friedman? Granted his economics are not the answer either.

Both economic policies lead to crisis, and the workers getting fucked. Capitalism can't solve it's problems, they're baked into the system - it only moves them around to explode another day.

[PikSmeet]

Thanks oneday, that was kind of my point, so when you see a socialist back Keynesian reforms you can point that out to them and tell them that when we back reforms we are not building socialism but supporting capitalism.
Yes, both economic doctrines end in tears but why is one favoured over the other? Well I suppose I have got an answer of sorts, some socialists hodwink the workers into believing that their reforms both work and are necessary to build socialism.

[Thirsty Crow]

I don't think many socialists actually supported Keynesian economics as a complete solution, however they may have supported some of the same reforms that "demand-side" Keynesians supported. Reforms which immediately benefitted the working class. They believed it would help raise awareness of the workers in their ability to change things and lead to an escalation towards socialism.

Strictly speaking, this isn't going to be on-topic that much but I can't help but wonder, was this belief (winning reforms --> raise in awareness of revolutionary ability --> escalation of class struggle and socialism) actually warranted? How did it fare when we examine the historical record today?

Is this even something that can be said to have stood the test in the first place?

[Alet]

So Keynesian economics in a sense are a cruel confidence trick on the working class?

No, it's not a "confidence trick". As far as economic policies are concerned, the government does not try to "fool" anybody. After all, even neoliberals believe that literally everybody would benefit from what they identify as neoliberalism. The well being of the working people, however, is merely the "ideological superstructure", if you will. The fundamental question is not to increase wealth but how to keep capitalist production running. That is to say, Keynesians do actually want to improve living standards, they might be "caring" and "socially aware" etc. - nevertheless, the actual point of Keynesianism is to sustain capitalist economy.

This does not mean that Keynesians intend to consciously suppress or "fool" the working class. In most instances, oppression under capitalism is not identified as such, for if neoliberal/Keynesian/... ideologues had the language to address it as oppression, they would already be beyond it. It's rather the case that they simply have no reason to oppose the capitalist order. It's not in their interest to be revolutionaries. This does not necessarily entail hatred against workers.

[PikSmeet]

No, it's not a "confidence trick". As far as economic policies are concerned, the government does not try to "fool" anybody. After all, even neoliberals believe that literally everybody would benefit from what they identify as neoliberalism. The well being of the working people, however, is merely the "ideological superstructure", if you will. The fundamental question is not to increase wealth but how to keep capitalist production running. That is to say, Keynesians do actually want to improve living standards, they might be "caring" and "socially aware" etc. - nevertheless, the actual point of Keynesianism is to sustain capitalist economy.

This does not mean that Keynesians intend to consciously suppress or "fool" the working class. In most instances, oppression under capitalism is not identified as such, for if neoliberal/Keynesian/... ideologues had the language to address it as oppression, they would already be beyond it. It's rather the case that they simply have no reason to oppose the capitalist order. It's not in their interest to be revolutionaries. This does not necessarily entail hatred against workers.

The same could be said of the neoliberals too, try arguing with them and they will tell you that the workers too are better off under their policies. Adopt their policies and taxes will be lower, growth will be higher and unemployment and inflation will be low. Now, I don't agree that this ever happens under their policies as capitalism obeys it's own logic and does not care what economic textbook the government is reading from.

Ok, so I get it that the Keynesians does not consciously hoodwink the workers but that is what they are nonetheless doing. They are trying to reform a system that works in the interests of minority and Marx should how futile that is.

But I've never heard right-wing capitalist economists say workers will be worse off under them. I presume you'll cry "ah, but they really do hoodwink the workers", whilst letting the Keynesians off the hook as they are trying to run capitalism with a human face.

[PikSmeet]

Strictly speaking, this isn't going to be on-topic that much but I can't help but wonder, was this belief (winning reforms --> raise in awareness of revolutionary ability --> escalation of class struggle and socialism) actually warranted? How did it fare when we examine the historical record today?

Is this even something that can be said to have stood the test in the first place?

It failed. As, firstly you were not building socialism and secondly any reform could and often was over-turned or watered down as time went on.
Sadly in the UK almost all socialists believe this, that you first vote the Labour party into office, then keep them left-wing and in 20 years time you get socialism.

[Alet]

The same could be said of the neoliberals too, try arguing with them and they will tell you that the workers too are better off under their policies. Adopt their policies and taxes will be lower, growth will be higher and unemployment and inflation will be low. Now, I don't agree that this ever happens under their policies as capitalism obeys it's own logic and does not care what economic textbook the government is reading from.

Ok, so I get it that the Keynesians does not consciously hoodwink the workers but that is what they are nonetheless doing. They are trying to reform a system that works in the interests of minority and Marx should how futile that is.

But I've never heard right-wing capitalist economists say workers will be worse off under them. I presume you'll cry "ah, but they really do hoodwink the workers", whilst letting the Keynesians off the hook as they are trying to run capitalism with a human face.

Don't get me wrong, I'm not an apologist of Keynesianism. I'm not saying that it "runs capitalism with a humane face" - the intention is merely to sustain capitalism and it should be criticized in this regard. Whether it is "humane" or not is completely beside the point. Still, there is a huge difference between "hoodwinking" workers and reproducing the conditions which happen keep them oppressed. That is to say, Keynesianism is not a reaction to a progressive workers' movement - it's just a way to overcome crises by reducing their damage to the economy.

[Luís Henrique]

I get that they may call themselves socialists but why Kenyes and not another capitalist economist like Friedman?

Keynes and Friedman are difficult to compare to each other, because they didn't deal with the same issues. But if you suppose they are comparable, it is difficult not to consider Keynes the "best" of the two, or at least the lesser evil.

Keynes dealt with the problem of cyclic crises, and proposed a series of anti-cyclical measures that cannot but improve the life conditions of workers - to the extent that they can be improved without destroying the capitalist relations of production.

Friedman dealt with the problems caused by Keynesian policies, and with overacumulation of capital. So what he proposes is the reversal of Keynesian policies, and an all-out bourgeois offensive against the working class.

So Keynes is associated with an era in which the working class was relatively powerful, and was making economic gains; Friedman is associated with an era of destruction of working class rights and organisations.

What is it about him that they love? I mean his theories have failed to stop prices rising and to bring about full employment anywhere.

It is not that his theories failed to stop prices rising and to bring about full employment. It is that the application of his theories led to further problems in the management of capital. They did bring about full employment - to the extent that "full employment" is possible under capitalism. But "full employment" - even in the limited sence that it was made possible by Keynesian policies (ie, workers between jobs are still "unemployed") is poisonous for capital in the long term.

But still they don't get it and I understand that as the saying is how soon men forget. But I've yet to find a rational explanation as to why he has been choosen as a saviour of the left when they have their own economist; Marx.

Again, I doubt that Keynes was been choosen as a saviour of the left, unless by "left" we mean something too broad to have an actual consistency. His policies were popular with the organised working class of central countries; they were never appliable in the periphery of the system, and were popular only to the extent that the working class was comfortable with its condition as a class of labourers, as opposed to a class of the dispossessed. He, himself, was never a leader of the working class, nor the reformist leaders of the working class referred to him as anything more than a practical problem-solver.

And, of course, Marx was not an economist; he was rather an anti-economist. He never had solutions for the problems of capitalism, because he considered capitalism to be the problem first place. His analysis cannot help in the management of capitalism; if the working class is to do that, it must resort to other theorethical frames, other than Marx's.

Luís Henrique