Monday, September 20, 2010

Keynes - The General Theory - Preface

Keynes tells us that, while he hopes the book "will be intelligible to others", his audience is his "fellow economists". (p. v) He is going to expose the fault with "orthodox economics"--the term is not defined; presumably he is referring to Alfred Marshall, the professor who taught the only economics class Keynes ever took. Specifically, he refers to "a lack of clearness and of generality in the premises." Whether or not his predecessors were at fault for these reasons, we have a measure by which to judge The General Theory. Rethinking the premises which led those who subscribe to "the classical theory"--also not defined--will entail "highly abstract argument and much controversy."

The second paragraph contains an interesting sentence: "But, if my explanations are right, it is my fellow economists, not the general public, whom I must first convince." If the economists grok his doctrine, they will be able to pitch it to those who run governments; when the beneficent policies have been implemented, the people will then benefit. Keynes is ruling out an attempt to convince the people to behave in a certain manner because his theory is dependent--as we shall see--on the people behaving in a certain way when certain economic conditions are present.

Keynes comments on the relationship between this book and his Treatise on Money. Since I've not read this previous work, its connection to The General Theory is of no interest.

The next paragraph is more interesting: "It is astonishing what foolish things one can temporarily believe if one thinks too long alone, particularly in economics (along with the other moral sciences), where it is often impossible to bring one's ideas to a conclusive test either formal or experimental" We could make a snide remark here about Keynesianism, but I'm more concerned with whether any conceivable test could be made to prove or disprove his theory. I would, following Ludwig von Mises, posit that no such test could be conceived. But for who do not follow Mises, the massive stimuli enacted by many of the governments throughout the world in 2008 may serve to indicate something about the doctrine of Keynes. One wonders what the man himself would think.

Finally, Keynes claims: "The ideas which are here expressed so laboriously are extremely simple and should be obvious." We shall see.

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