Latest Pajamas Media Column ('Keynesianism's Collapse') Is Up (Update: The Roots Of Keynes's Core Economic Beliefs, and His Apparent Useful Idiocy)

It's here.

It will go up here at BizzyBlog on Saturday (link won't work until then) after the blackout expires.

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Related (WARNING: Though obtained from “reputable” sources, what follows contains graphic content and subject matter, and links to items which are even moreso):

Two interesting things I learned about Keynes during column research, both from his fawning Wikipedia entry.

Here's the first:

Keynes's early romantic and sexual relationships were almost exclusively with men. Attitudes in the Bloomsbury Group, in which Keynes was avidly involved, were relaxed about homosexuality. One of his great loves was the artist Duncan Grant, whom he met in 1908; he was also involved with the writer Lytton Strachey. Keynes was open about his homosexual affairs, and between 1901 to 1915, kept separate diaries in which he tabulated his many homosexual encounters.

The first of a pair of underlying sources for this paragraph is a 1986 New York Times Book review of Robert Skidelsky's JOHN MAYNARD KEYNES Volume One: Hopes Betrayed 1883-1920. That review, written by Robert Heilbroner, elaborated on this and other aspects of Keynes's psyche:

Keynes had also been deeply involved in Bloomsbury's sexual – and homosexual – merry-go-round, the ardent lover of Strachey and Duncan Grant.

… What are we to make of the last phrase of a letter … written to Strachey at age 22: “I find Economics increasingly satisfactory, and I think I am rather good at it. I want to manage a railway or organise a Trust, or at least swindle the investing public.” (Note: This is later passed off as a “joke.” — Ed.)

… The aristocracy he regarded as absurd, in contrast to his father, who was thrilled to discover that he was sharing a railway train with Austrian royalty; the proletariat as ”boorish.”

… the double helix of Keynes's personality – the public Keynes, building on the traditions of his family and of Eton, and on the influence of Alfred Marshall, the great Victorian economist who took Keynes under his wing; and the private Keynes, emerging in the passionate homosexual involvements that would rule his emotional life until his marriage to the famous Russian ballerina Lydia Lopokova in 1925. Reviewing Mr. Skidelsky's book in The Times of London in 1983, Sir William Rees-Mogg asserted that Keynes's rejection of the norms that governed private life led to his eventual rejection of the norms that governed public life, in particular the gold standard.

… As Mr. Skidelsky writes, “Philosophy provided the foundation of Keynes's life. It came before economics; and the philosophy of ends came before the philosophy of means.”

… Keynes had a subversive attitude toward a whole range of Victorian morals and conventions, which enabled him to see economic problems in a very unusual way.”

The second underlying source concerns the sex diaries, and is from a 2008 Economist item by Evan Zimroth (warning: the underlying article is very graphic and will likely offend many readers):

Keynes was never a closeted homosexual, although his colleagues at Bretton Woods in 1945 didn't always realise it, perhaps because at those conferences he was accompanied by the Russian ballerina Lydia Lopokova, his wife of twenty years. By then he was the eminent economist and statesman, and possibly no longer on the prowl.

… The first diary is easy: Keynes lists his sexual partners, either by their initials (GLS for Lytton Strachey, DG for Duncan Grant) or their nicknames (“Tressider,” for J. T. Sheppard, the King's College Provost). When he apparently had a quick, anonymous hook-up, he listed that sex partner generically: “16-year-old under Etna” and “Lift boy of Vauxhall” in 1911, for instance, and “Jew boy,” in 1912.

… The other sex diary is more puzzling and, in a way, more informative. An economist to the core, Keynes organized the second sex diary also year-by-year, but this time in quarterly increments.

Unfortunately for us, however, this second sex diary is in code. And as far as I know, no one yet has been prurient enough to crack it.

Keynes's often promiscuous homosexuality, which as noted above may never have ended, even after his marriage, and which also as noted involved partners who would be considered underage in the U.S. today, is relevant for two reasons. The first is that several passages above relate his hedonistic, rebellious lifestyle to his determination that the current economic order was unacceptable, and needed to be radically changed. One cannot defensibly deny these underlying influences on the content of his “General Theory.” Please note: I'm not saying it; the authors cited above are.

The second reason why Keynes's lifestyle is relevant is the second of the “interesting things” I picked up at Wikipedia:

Keynes was a proponent of eugenics. He served as Director of the British Eugenics Society from 1937 to 1944. As late as 1946, shortly before his death, Keynes declared eugenics to be “the most important, significant and, I would add, genuine branch of sociology which exists.”

Keynes wasn't just a eugenicist because it was trendy, “progressive” thought; he was in management, so to speak.

1946, of course, was after the end of World War II, after the horrors of Hitler had become fully known. Germany was already forcibly sterilizing 5,000 people per month by 1934, and earning grand praise from eugenicists for doing so. Yet there was Keynes, still singing eugenics' praises. By the end of World War II, “over 400,000 people were sterilized against their will.”

Keynes's advocacy until his death of eugenics betrayed a fundamental lack of belief in humanity to order itself without being “guided” (or even allowed to have children) by those with supposedly superior knowledge, (racial) backgrounds, and skills. This ties directly to Keynes's fundamental belief that economies often can't pull themselves out of depressions or contractions and return to full employment without government fiscal intervention, because its players are too dumb to pull it off on their own — even though, as I noted in the PJM column, market-oriented cultures routinely turned around, and quite nicely, without the government's heavy hand, even as recently as the 1920-21 depression was followed by the Roaring '20s. If that fundamental belief of Keynes isn't valid, there's no need for Keynesianism. Well, that fundamental belief isn't valid. (Unless, I suppose, a society consciously chooses to poorly educate its students for several generations to the point where its adults really can't function effectively, as many of this country's public schools have arguably done for several decades.)

The supreme irony of Keynes's eugenics stance is that its practitioners wished to stamp out any supposed tendencies of those who might be born in the future towards homosexuality. It seems highly unlikely that Keynes was unaware of the movement's outlook, which saw homosexuals as “moral defectives.” So it would seem that in the eugenicists' perfect world, Keynes must have believed that “brilliant” people like him would still survive and/or be allowed to procreate if possible because, well, he was so obviously “brilliant.”

If this is where he stood, the correct term to describe him would be: Useful Idiot.