by Mario Rizzo
My post below, “Keynes as Public Works Skeptic” elicited much comment. Some of these comments accused me of quoting Keynes out of context and of generally getting it all wrong. To set things straight requires much more than blog posting. I expect to be publishing an article with the American Enterprise Institute (AEI) shortly. I shall link to it.
In the meantime, I’d like to recommend to interested readers a working paper by Esteban Perez Caldentey, “Chicago, Keynes and Fiscal Policy,” Part 4 and following. I link to the entire paper here. I also recommend the books by Bradley Bateman, Keynes’s Uncertain Revolution (Michigan, 1996), especially Chapter 6 and Allan H. Meltzer, Keynes’s Monetary Theory: A Different Interpretation (Cambridge, 1988), especially pp. 182- 192.
At the very least, fair-minded readers will agree, I think, that the Keynes of the late 1930s and 1940s is far from the the Keynes of the 1920s and early 1930s insofar as his views of discretionary, temporary countercyclical fiscal policy had changed — I would say “soured.”. For the mature Keynes, the issue was permanently stabilizing investment, regardless of the cycle, through public direction of investment.