First I lost faith in Marx. Now I’m losing faith in Keynes. Marshall, Humes, Mill, Smith and all them classical folk that I used to dislike are turning me towards the dark side. I had no idea those guys were so subversive.

I’m politically liberal so I was always big into the government intervening. When I first studying political economy, I fell for Marx and his awesome beard. I wanted there to be global revolution, an egalitarian society, and witness the inevitable collapse of capitalism that Marx predicted. I mean the working people having nothing to lose but their chains? That’s one helluva pick up line.

My love for Marx slowly dissipated when I met other Marxists who turned out to be pompous elitist assholes who were more interested in showing off their intellectual superiority and how ‘down with the people’ they were with their communist-chic style of dress instead of actually contributing anything to society. So instead, I turned to Polanyi who said there was a big role for the government in protecting the people from the market. I liked that idea because I saw in my mind this image of the corporate machines and the invisible hand crushing the life out of poor starving children before Uncle Sam and Captain America swoop in to save them with social safety nets and injections of liquidity.

And from that, I naturally became a Keynesian. I mean all the economics that we learn as an undergrad,  unless you got to one of them special schools that teach neo-classical stuff, is based on Keynes. You know, all those IS-LM curse, AS-AD stuff. The reason why I liked Keynes was because he was so cool. Like he didn’t give a shit about what the social norms were. I mean he pissed on the grave of all those dead white classical economists AND he was an equal opportunity employer of sexual partners. Oh, and instead of telling an unemployed hardworking Mexican in the Central Valley that he was gonna be unemployed because there’s a economic downturn and that’s just the way the market worked, he would have said that the market is fucked up and the government should do something that helped that Mexicano y su familia. That was pretty cool in my eyes.

However, the more I learn about Keynes, the more I begin to see him as someone who just had a personal grudge against the classics instead of someone who truly found error in the old market theories. Just a couple examples that have been pointed out by my professor is that Keynes believed that ‘capital’ in the classical sense meant industrial goods and machinery. He also believed that savings = hoarding. And then there was his argument that changes in credit supply or demand would lead to changes in  income instead of the proportion of income saved/consumed. He didn’t have a basis for what he was arguing. He just said that the oldies were wrong and he was right. When other people tried to tell him he was interpreting the literature wrong, he just brushed them off and gave these half-assed excuses.

Now I still think Keynes’ idea hold strong in times of major economic crisis. Like during the Great Depression, massive money creation by the central bank might have been able to dampen the crisis in the short run. But his overly-quoted statement that we’re all dead in the long run is kind of short sighted. It’s like instead of building a good house and ensuring that it’ll last for a thousand years without much maintenance, you build a shoddy house and constantly patch it up.

I haven’t finished all my re-reading of Keynes yet, but after reading Humes and Mill, I’m starting to turned more and more towards the dark side of economic liberalism - which is usually associated with rich white folk like that duck that swam in piles of gold coins and gun-toting libertarians like Moses. Scary shit.