We’ve all seen the mind-boggling charts demonstrating how income inequality has expanded to unprecedented levels in America since the late 1970s. We know that this ever-growing divide between the wealthiest one percent of all Americans and the rest of us was the result of a systemic trickle-down economic framework of tax cuts and deregulation promoted by conservative groups. (If you need a refresher, I wrote about the origins of that conspiracy earlier this summer.) So we know what happened to ruin the American economy, and we know who committed the heist, and why they did it.
But the funny thing is, not many progressives really understand much about the economic system that was in place for most of the 20th century. We know that up until the late 1970s, an ever-growing number of Americans were included in the economy — though of course racism and sexism held too many of our neighbors back from fully participating.
We know that tax rates for the wealthiest Americans were high in post-war America, and that investments in our infrastructure were at unprecedented levels for most of the last century. But the mechanics of that American prosperity — the philosophy behind why the economy worked as well as it did — have been largely forgotten.
In the latest episode of Pitchfork Economics, David Goldstein credits economist John Maynard Keynes as “without a doubt, the most influential economist of the first three quarters of the 20th century. It was his ideas that guided the policies of the New Deal and essentially defined American liberalism,” Goldstein said.
In the episode, Goldstein interviews Zach Carter, the author of a new bestselling book titled “The Price of Peace: Money, Democracy, and the Life of John Maynard Keynes.” Carter wrote the book to help demystify and add nuance to Keynes’s life and work.
While most Econ 101 classes simply, and truthfully, identify Keynes as “the economist who argued that governments should spend money during recessions to help pull the economy out of the doldrums and get employment moving again,” Carter said, much of the nuance and understanding of Keynes’s story has been forgotten as the neoliberal trickle-down crowd has taken hold.
Keynesianism, Carter argues, was “more a way of looking at the world than a specific set of policies or policy tools.” Keynes “was a social thinker, a philosopher, and a statesman whose intellectual project was concerned with the great problems of his day. And those problems in particular were World War II and the rise of authoritarianism all over the world of the 1920s and 1930s.”
At a time when authoritarianism and nationalism is on the rise again, Carter’s framing of Keynes as someone who sought to use economics to “prevent war and heal societies that have been torn apart or put under strain” seems more timely than ever…