Britain, Keynes, Slater discussed on The Ezra Klein Show

Automatic TRANSCRIPT

So that focus on real resources as opposed to the accounting that overlays real resources seems really important in a lot of Keynesian thought and then. Is really important for right now, I want to begin to continue following that thread through the rest of this conversation and maybe I should should ask it this way. Ensemble seems obvious that a country can do what it can actually do entity except money keeps track of it. Great. But the to the extent money is actually the thing preventing it from productively using the skills of its people or the resources it has access to. It's a real problem as canes begins to argue that the government can create productivity and prosperity. That goes beyond even the amount of money it's putting into the system. That's a big revolution. It's I. Think still the thing that we recognize him for today. But what was the the inside at the heart of that? What did he see there that other people are having trouble seeing? I think the first thing that he saw was just the political reality, he was a British. Citizen who wanted to alleviate all of these social ills in Britain but Britain was deeply indebted to the United States and so there was just no way to do what he wanted to do without bringing on deficits. So he starts just thinking about those deficits as maybe not such a bad idea and he becomes more emotionally committed to his social vision than to his his economic. Doctrine. When you get to the nineteen thirties though canes has been thinking about economics for a long time and he has advocated different reforms one after another that either have been rejected or have not worked. He thinks in the nineteen twenties that if they can just stabilize prices, for instance, that markets will work that that supply and demand will come to equilibrium and and democracy will flower. All over the world, they can't get people to even agree to manage the gold standard in such a way that it would stabilize prices they're looking at trade flows rather than than domestic prices because the world just becomes. So ungovernable canes thinks that there's there's a need to impose economic or that if you don't blame down the framework for people to have the sort of. Building blocks of a decent life decent society. Then you won't be able to do the sophisticated things that you want democracy to do, and so he he's looking at money as a tool of the state in he starts studying ancient currencies and and says, you know look we actually were wrong. We think that money started. In six hundred BC or so when people started stamping faces on coins, actually money is this older thing. It's an account keeping. System. That involves a debts and people are lending each other weakened in different resources much earlier, and and this is something that arises with the state itself, and so he starts to think about the state is something that in economics in general is something that arises out of statecraft itself that people don't exist in this world where they some sort of state of nature that you hear in a lot of you. Know sort of social contract liberal theory like cobs locker. So where we're I, there's there's the free exchange of goods and then then the sovereign sort of intervene slater and starts laying down the law instead canes starting to think about the economy as as an expression of statecraft, and then the question becomes well, how is the state legitimized because whether it's a dictatorship or democracy starts to matter quite a bit. Keynes doesn't dwell on that for very long during his lifetime because he's preoccupied with the problems of the depression and war, but galway does and so it's a sense much time and golfers in the book..

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