Monday, June 16, 2014

Keynes - Interesting?

The idea of an economist being interesting - other than to other economists - must be fairly difficult to swallow. The common perception would be of a man, who feels bound to say "On the one hand...On the other hand.." making you feel rather grateful that he is not a Ravan endowed with twenty hands. John Maynard Keynes, though, was rather an exception to this rule. To cite but one instance, though he belonged to the ilk of people who love saying, 'In the long run...", Keynes dismisses it with a pithy "In the long run, we are all dead."

Keynes is rated as one of the major figures in capitalist economics, being the originator of the idea of Government intervention to pull economies out of a depression AND, thus, the man whose ideas influenced the 'stimulus' packages in the recent past to pull economies out of the Recession. It is surprising to see his views on Capitalism - "Capitalism is the astounding belief that the most wickedest of men will do the most wickedest of things for the greatest good of everyone."

Capitalist economics places a huge premium on Stock Markets to direct the flow of funds into required investments. Keynes has this to say about the idea - “When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done”. Does not seem like a ringing endorsement of the basic premise. For speculators, who think that when the stock markets are irrationally high or low and wish to play for a reversal, Keynes' sage advice is “The market can stay irrational longer than you can stay solvent." Advice that quite a few would have wished to have received much earlier in life! Though there is a Keynesian silver lining -  “If you owe your bank a hundred pounds, you have a problem. But if you owe a million, it has.”  THAT will explain how YOU lose money in all those Stock Market bubbles but the chaps who set it all off do not!

Keynes was, by no means, uni-dimensional or bereft of pithy thoughts on subjects other than economics. Well, you could say that when Keynes says, "The avoidance of taxes is the only intellectual pursuit that still carries any reward", he is still talking economics but you cannot deny that it is a surprising viewpoint for an economist to hold.

Apparently, it was a period where people were REALLY down on education. Like Einstein, who was a contemporary, Keynes too seems to have had no high regard for education. Unless you can see something laudatory in "Education: the inculcation of the incomprehensible into the indifferent by the incompetent." But, then, the problem with education has always been that it propagated the existing ideas and fails, even today, to inculcate a spirit of thinking for yourself. A person like Keynes, who held that "The difficulty lies not so much in developing new ideas as in escaping from old ones" is unlikely to be very impressed by a system that freezes young minds into old ideas, making it impossible for them to escape from them.

I was surprised and gratified to see that I had been echoing Keynes, unconsciously, in a thought that forms the base of quite a few of my posts, though Keynes puts it far more caustically than I ever would have. He says, "When the accumulation of wealth is no longer of high social importance, there will be great changes in the code of morals." Further along, he is even more caustic when he mentions that, "The love of money as a possession - as distinguished from the love of money as a means to the enjoyments and realities of life - will be recognized for what it is, a somewhat disgusting morbidity, one of those semi-criminal, semi-pathological propensities which one hands over with a shudder to the specialists in mental disease."

That, though, is a sentiment that is likely to be discarded. After all, again as Keynes says, “Worldly wisdom teaches that it is better for (your) reputation to fail conventionally than to succeed unconventionally.” Particularly in a Society where the 'enjoyments and realities of life' have been so warped as to represent the mere possession of money!

34 comments:

  1. Enjoyed this wonderful lesson on Keynesian wisdom :) And somehow I feel thankful for all my education in Economics, otherwise wouldn't have found this so interesting :)

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    1. Hmm - this seems better than Einsteinian wisdom, though, going by the interest :)

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  2. now I felt I was sitting in an MBA classroom all over again :)

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    1. Things must have changed since my time. They NEVER told me that Keynes said these things in my time :)

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    2. hehehe not him per se...but its only in the classroom that we got this much of wisdom passed on to us :)

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    3. So, you disagree with Einstein and Keynes? :) Wisdom can come in a classroom? :)

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    4. :P I was wondering if you would catch on that, it was an intention statement on my part :P No, I don't disagree with them but they do remind me of the gyan that used to get distributed generously years ago :)

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  3. Excellent and insightful post sir. Though I love your humour like most other readers you have, you must try such posts, which do not have much scope for humour, more often. Just a personal tought..

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    1. Oh! I do both Adarsh! You must check out this link if you are really interested in such posts.

      http://jambudweepam.blogspot.in/p/philosophy.html

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    2. Hadn't noticed for so long :) Will go through them soon

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    3. My posts are all indexed, Adarsh! The tabs on top of my blog are for pages that have categorized links to all my posts.

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    4. Got it :) I am severely technologically challenged..

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  4. Enjoyable and enlightening post!
    It appears Keynes was not merely an economist; he was a philosopher-economist. His words on the distinction between owing your bank a hundred pounds and owing a million, and the difference between wealth as a possession and wealth as a means to an end are gems!!

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    1. Apparently Keynes wanted to study philosophy and wandered into economics. It shows in his writing

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  5. Loved how you wove Keyne's quotes so effortlessly in your reflections.

    I think I'll bookmark this article - its crammed with nuggets of wisdom.

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  6. To be honest Suresh, although I had heard most of these quotes before, I didn't know that they all came from Keynes. This has been quite a revelatory post in that sense.

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    1. Good that I added something to your knowledge base, Jairam! :)

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  7. I think I became wise after reading this one.

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  8. I think a post with quotes by Friedrich Hayek would be super-cool Suresh sir :)

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    1. Good to be gifted post ideas for free, Mahesh :)

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  9. That was indeed an insightful post, Suresh. Finally your blog readers are also getting a glimpse of your professor image that the IFW members were getting.

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    1. As opposed to the clown the have been seeing hitherto? :)

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  10. Again, those quotes, some of them I had no clue came from Keynes do really make a lot of sense. An intense post this, Suresh!

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    1. Hmm - I am leaving all the humor to the quotes in these, Rachna :)

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  11. //"In the long run, we are all dead."// I am loving Keynes Words of Wisdom.

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    1. That is the most famous of his quotes, Rajlakshmi!

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  12. This was a revelation, Sureshji.
    Wasn't aware of his views about money, that you have shared in the last but one para.

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    1. That on was a revelation to me as well. Never realized that the opinion I had always held was one that Keynes had held as well.

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