Synopses & Reviews
Synopsis
A groundbreaking debunking of moderate attempts to resolve financial crises
If, in liberal capitalism, political economy is the science of government, what is it for? Is it distributional, to realize the revolution without revolutionaries? Or is it to figure out how to forestall the revolution, to teach the masses to consent to remain poor? Keynesianism is the political economy that answers yes on both counts: the solution to crisis-induced liberal anxiety since the French Revolution, an anxiety for which political economy seemed a cure. If the financial crisis of 2007 2008 briefly resurrected a Keynesian sensibility long declared dead, its reluctant radicalism finds itself renewed not because Keynesian economics is palatable once more, but because the risks to civilization have posed themselves so aggressively it seems no one can afford not to listen."
Synopsis
A groundbreaking debunking of moderate attempts to resolve financial crises
In the ruins of the 2007 2008 financial crisis, self-proclaimed progressives the world over clamoured to resurrect the economic theory of John Maynard Keynes. The crisis seemed to expose the disaster of small-state, free-market liberalization and deregulation. Keynesian political economy, in contrast, could put the state back at the heart of the economy and arm it with the knowledge needed to rescue us. But what it was supposed to rescue us from was not so clear. Was it the end of capitalism or the end of the world? For Keynesianism, the answer is both. Keynesians are not and never have been out to save capitalism, but rather to save civilization from itself. It is political economy, they promise, for the world in which we actually live: a world in which prices are sticky, information is asymmetrical, and uncertainty inescapable. In this world, things will definitely not take care of themselves in the long run. Poverty is ineradicable, markets fail, and revolutions lead to tyranny. Keynesianism is thus modern liberalism's most persuasive internal critique, meeting two centuries of crisis with a proposal for capital without capitalism and revolution without revolutionaries.
If our current crises have renewed Keynesianism for so many, it is less because the present is worth saving, than because the future seems out of control. In that situation, Keynesianism is a perfect fit: a faith for the faithless."