Keynes the Man.pdf - The Ludwig von Mises Institute

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Murray N. Rothbard 45wages, not money wages, and that he assumed only flexible wagerates (Keynes 1936, pp. 19–20, pp. 272–79).But, as Andrew Rutten notes, Pigou conducted a “real” analysisonly in the first part of his book; in the second part, he notonly brought money in, but pointed out that any abstraction frommoney distorts the analysis and that money is crucial to any analysisof the exchange system. Money, he says, cannot be abstractedaway and cannot act in a neutral manner, so “the task of the presentpart must be to determine in what way the monetary factorcauses the average amount of, and the fluctuation in, employmentto be different from what they otherwise would have been.”Therefore, added Pigou, “it is illegitimate to abstract moneyaway [and] leave everything else the same. The abstraction proposedis of the same type that would be involved in thinking awayoxygen from the earth and supposing that human life continues toexist” (Pigou 1933, pp. 185, 212). Pigou extensively analyzed theinteraction of monetary expansion and interest rates along withchanges in expectations, and he explicitly discussed the problem ofmoney wages and “sticky” prices and wages.Thus, it is clear that Keynes seriously misrepresented Pigou’sposition and that this misrepresentation was deliberate, since, ifKeynes read any economists carefully, he certainly read suchprominent Cantabrigians as Pigou. Yet, as Rutten writes, “Theseconclusions should not come as a surprise, since there is plenty ofevidence that Keynes and his followers misrepresented their predecessors”(Rutten 1989, p. 14). The fact that Keynes engaged inthis systematic deception and that his followers continue to repeatthe fairy tale about Pigou’s blind “classicism” shows that there is adeeper reason for the popularity of this legend in Keynesian circles.As Rutten writes,There is one plausible explanation for the repetition of thestory of Keynes and the classics. … This is that the standardaccount is popular because it offers simultaneously an explanationof, and a justification for, Keynes’s success: without the
46 Keynes, the ManGeneral Theory , we would still be in the economic dark ages.In other words, the story of Keynes and the Classics is evidencefor the General Theory. Indeed, its use suggests that itmay be the most compelling evidence available. In this case,proof that Pigou did not hold the position attributed to him is… evidence against Keynes. … [This conclusion] raises the …serious question of the methodological status of a theory thatrelies so heavily on falsified evidence. (Ibid., p. 15)In his review of The General Theory, Pigou was properly scornfulof Keynes’s “macédoine of misrepresentations,” and yet suchwas the power of the tide of opinion (or of the charisma of Keynes)that, by 1950, after Keynes’s death, Pigou had engaged in the sortof abject recantation indulged in by Lionel Robbins, which Keyneshad long tried to wrest from him (Pigou 1950; Johnson and Johnson1978, p. 179; Corry 1978, p. 11–12).But Keynes used tactics in the selling of The General Theoryother than reliance on his charisma and on systematic deception.He curried favor with his students by praising them extravagantly,and he set them deliberately against non- Keynesians on the Cambridgefaculty by ridiculing his colleagues in front of these studentsand by encouraging them to harass his faculty colleagues. Forexample, Keynes incited his students with particular viciousnessagainst Dennis Robertson, his former close friend.As Keynes knew all too well, Robertson was painfully andextraordinarily shy, even to the point of communicating with hisfaithful, longtime secretary, whose office was next to his own, onlyby written memoranda. Robertson’s lectures were completely writtenout in advance, and because of his shyness he refused to answerany questions or engage in any discussion with either his studentsor his colleagues. And so it was a particularly diabolic torture forKeynes’s radical disciples, led by Joan Robinson and Richard Kahn,to have baited and taunted Robertson, harassing him with spitefulquestions and challenging him to debate (Johnson and Johnson1978, pp. 136ff.).
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Page 5 and 6: © 2010 by the Ludwig von Mises Ins
Page 8: ContentsKeynes, the Man . . . . . .
Page 12 and 13: Murray N. Rothbard 11Born to the Pu
Page 14 and 15: Murray N. Rothbard 13The Cambridge
Page 16 and 17: Murray N. Rothbard 15Or, as Maynard
Page 18 and 19: Murray N. Rothbard 17BloomsburyAFTE
Page 20 and 21: Murray N. Rothbard 19The Moorite Ph
Page 22: Murray N. Rothbard 21aspect of Keyn
Page 26: Murray N. Rothbard 25The Economist:
Page 29 and 30: 28 Keynes, the ManAnother aspect of
Page 31 and 32: 30 Keynes, the Manhad managed to do
Page 33 and 34: 32 Keynes, the Manspeculations” (
Page 35 and 36: 34 Keynes, the ManDespite his rise
Page 37 and 38: 36 Keynes, the Manwas unable to con
Page 39 and 40: 38 Keynes, the Manthe contrary , it
Page 41 and 42: 40 Keynes, the Manworld. For a cent
Page 43 and 44: 42 Keynes, the Manthis attitude, as
Page 45: 44 Keynes, the Manoverinvestment in
Page 50 and 51: Murray N. Rothbard 49and robotic co
Page 52 and 53: Murray N. Rothbard 51could still re
Page 54 and 55: Murray N. Rothbard 53“Russian com
Page 56 and 57: Summing UpWAS KEYNES, as Hayek main
Page 58 and 59: Murray N. Rothbard 57book … moral
Page 60 and 61: Murray N. Rothbard 59have examined
Page 62 and 63: BibliographyBrunner, Karl. 1987.
Page 64 and 65: Murray N. Rothbard 63______.1930a.
Page 66: Murray N. Rothbard 65Trescott, Paul

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