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KEYNES
AT
HARVARD
Economic Deception
as a Political Credo
A  Veritas  Study
2009 Web version transcribed from the
REVISED AND ENLARGED EDITION (1969)

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 V 

THE GENERAL THEORY
BY JOHN MAYNARD KEYNES

Since Keynes’ Treatise on Money was a failure he proceeded to formulate a new approach for his political beliefs. For five years he labored to put together a theory which would serve to indoctrinate the bulk of the world’s economists.(1) He calculated (and correctly) that if economists and economic instructors could be sold a politically inspired economic theory then these ideas would eventually percolate through to government, the schools and the general information media. Keynes summed up this aim with the observation that: “the ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else.”(2)

This time Keynes dropped his lone wolf role. He recruited some of Britain’s most outstanding left-wing economic experts to aid him. Joan Robinson, an internationally recognized Marxist (official Communist sources accept her opinions) was a key assistant on this project. R.F. Kahn, one of the world’s outstanding experts on Socialist eeconomic theories, collaborated with Keynes, and “his share in the historic achievement cannot have fallen very far short of co-authorship.”(3)

His new work was designed to give ideological sinews to the Fabian Socialist movement throughout the world. In writing to Fabian leader Bernard Shaw, Keynes boasted:

To understand my state of mind, however, you have to know that I believe myself to be writing a book on economic theory which will largely revolutionize—not, I suppose, at once but in the course of the next ten years—the way the world thinks about economic problems. When my new theory has been duly assimilated and mixed with politics and feelings and passions, I can’t predict what the final upshot will be in its effect on action and affairs. But there will be a great change, and in particular, the Ricardian foundations of Marxism will be knocked away.

I can’t expect you, or anyone else, to believe this at the present stage. But for myself, I don’t merely hope what I say—in my own mind I’m quite sure.(4)

Keynes’ opus was finally published under the title of The General Theory of Employment Interest and Money (1936). This work has since been embraced by Socialists all over the world as their basic theoretical guide. We do not intend to deal in detail with the technical, mathematical and statistical aspects of this work. This has been done very competently by others and especially by Henry Hazlitt in his Failure of the “New Economics” (an analysis of Keynesian fallacies.)(5) We are more interested in the social and political motives that impelled Keynes to put this work together. Hazlitt hit upon the heart of the matter when he wrote:

In the General Theory, in brief, Keynes did not suddenly discover that the traditional economic virtues were really vices and vice versa; he had practically always thought so. All that he hit upon was a new rationalization for his old bias.(6)

Harvard Professor Joseph A. Schumpeter, a Socialist economist, in speaking of the same matter, wrote:

The process stands out in this case with such unsurpassable clearness because we can read a formulation of the vision, as yet analytically unarmed, in a few brilliant pages of Keynes’ The Economic Consequences of the Peace (1919).(7)

In continuing on the same subject matter, Schumpeter said:

It is true that in economics, and still more in other social sciences, this sphere of the strictly provable is limited in that there are always fringe ends of things that are matters of personal experience and impression from which it is practically impossible to drive ideology, or for that matter conscious dishonesty, completely.(8)

It is clear from our own studies and those representing all shades of opinion from left to right that Keynes, like Karl Marx, started off with a Socialist concept and then proceeded to develop theories to butress his original leftist premises. Keynes’ political thinking throughout the years was primarily Fabian Socialist.

For years Socialists, Communists and Fascists used Keynes’ articles, books and speeches as authority in support of their cause. Margaret Cole, English Fabian revolutionary, has stated: “We Socialists used Keynes and the U.S.S.R. as touchstones” (Circa 1923).

Mrs. Cole presents an interesting parallel between Schumpeter’s reference to “conscious dishonesty” and her own and Keynes’ methods:

I, myself, as late as 1924, produced an elaborate calculation, published by the L.R.D. under the title The Condition of the Working Classes, which proved, by a combination of the official cost-of-living index of unemployment among Trade Unionists, that the working classes had been steadily worse off materially since the beginning of the century. My arithmetic was all right so far as it went; the only misfortune was that the conclusions were wrong, as I could have seen for myself if I had used my eyes and my common sense instead of barking up an ideological tree.(9)

In a footnote on the same question Mrs. Cole explains further how deception is used by left-wing theoreticians. She mentions Keynes and herself specifically:

This technique of using unquestioned but carefully selected facts to establish a decline in working-class standards, has been employed by other writers, of whom one at any rate has gone so far as to show that the British working-class has been getting steadily worse off ever since the Industrial Revolution. On which one can only comment: “If you can believe that you can believe anything.” I am not proud of this performance of mine; I will only plead that greater minds than my own have been guilty of special pleading under the influence of strong emotional ideas. Keynes for example.(10)

The above confession of the use of correct figures and statistics to draw untrue and dishonest conclusions brings to mind the old adage “figures don’t lie but liars can figure.”

Twisting of statistics as a propaganda weapon, rather than relying on scientific objectivity, was a common practice of Keynes and his Socialist cohorts. Henry Hazlitt pinpoints Keynes’ basic motives in the General Theory when he writes:

Like Marxism, this is a class theory of the business cycle, a class theory of unemployment. As in Marxism, the capitalists become the scapegoats, with the sole difference that the chief villains are the money-lenders rather than the employers.

And that, I suspect, rather than any new discoveries of technical analysis, is the real secret of the tremendous vogue of the General Theory. It is the twentieth century’s Das Kapital.(11)

We do not intend here to explore the labyrinthine super-structure that Keynes erected in order to sell his preconceived Socialist notions. We will deal instead with his motives and intentions rather than the vapory justification for his creed.

The clearest picture of Keynes’ General Theory as a weapon for Socialism can be found in books designed for Socialist readers. The chief interpreter of these methods today is John Strachey, British Fabian revolutionary who was War Minister of Britain in 1950 when the Labour Party was in power.

In counseling the Socialist movement on the use of Keynes’ system in the General Theory, John Strachey craftily shows how the world can be duped into a Socialist system:

Was not a horrid possibility visible behind and beyond his (Keynes-ed.) proposals, each of which looked so innocuous when taken separately? If once it were admitted that capitalism could be regulated and controlled in this way, might not the wage-earning majority of the population come sooner or later to the conclusion that the thing to do was neither to put up with things as they were nor to go through the fiery furnace of social revolution, in order to establish a wholly new system, but to harness—to bit and to bridle—capitalism in its own interest? Was it not apparent that Keynesism had only to be pushed a little further and a state of things might emerge in which the nominal owners of the means of production, although left in full possession of the legal title to their property, would in reality be working not for themselves, but for whatever hands had grasped the central levers of social control?

For Keynes had rashly shown that those levers had only to be pulled and pushed this way and that, in order to manipulate the system at will. And, in a democracy, would not those hands in the end almost certainly be those of the representatives of the wage-earning majority of the population? Might not the end of the story be that the once proud possessors of the means of the production would find themselves in effect but agents and managers on behalf of the community? If this was saving capitalism, its true defenders felt it was saving it in a most Pickwickian sense.(12)

Tongue-in-cheek claims that the original intent of the Keynesian theory was to save capitalism is one of the greatest hoaxes perpetrated in modern times. As can be seen above, Socialist leaders consider this approach not only very effective but also somewhat amusing. In the United States, Harvard Professor of Economics Seymour E. Harris, carries forward this illusion by editing a volume of Keynesian propaganda under the dubious title of Saving American Capitalism.(13)

Cold bloodedly, Strachey dissects the “saving capitalism” feature of Keynes’ General Theory:

But the capitalists have really had good reasons for their reluctance to be saved by Keynesian policies. If we look more closely at the remedies proposed, we shall find that their implications are much more drastic than they seem to be at first sight. And when we come in later volumes of this study to consider the results of the application of Keynesian measures in America, Germany and Britain, respectively, we shall find that in fact the changes effected by them have been subtle, but nevertheless far-reaching.(14)

Left-wingers quickly saw the Socialist intent behind the confusing maze of Keynes’ system. They realize that the entire Keynesian apparatus is based upon the principle of control and regulation by government. Strachey summed this up when he wrote:

The positive part of Keynes’ work (General Theory –ed.) was a demand that capitalism should now be regulated and controlled by a central authority. Such an authority need not, and indeed should not actually plan what should be produced in what quantities. But it must see to it that total demand is always enough to clear the market at remunerative prices, and yet not so great as to drive up prices in an inflationary spiral. This it must do by constantly taking counter-measures of a balancing character, designed to offset the oscillations of the system. The principal instruments of its policy should be variations of the rate of interest, budgetary deficits and surpluses, public works and a redistribution of personal incomes in the equalitarian direction. This positive side of Keynes’ work requires an authority to do the regulating and that authority can be, in contemporary conditions, nothing else but the government of a nation-state.(15)

One of the central themes in Keynes’ system is a condemnation of the principle of “savings.” Henry Hazlitt condenses this principle succinctly:

Here is the General Theory in a nutshell, with its trans valuation of all values. The great virtue in Consumption, extravagance, improvidence. The great vice is saving, thrift and “financial prudence.”(16)

In his attack upon the principle of savings Keynes merely echoed an old revolutionary stratagem of Fabian Socialists. At the Labour Party Conference in 1923 the Fabians “rejected the concept that private savings increase community national assets.”(17) Even earlier (1916) the Fabians declared “large savings by a wealthy class have an inherent evil; they increase and perpetuate a functionless, tribute-levying class of rentiers, which is already a dangerous element in the State.”(18)

The concept of eliminating savings is not an economic one but a political one. If there are no savings there is no private money for investment. Without private investors the government must provide investment capital. If the government provides for investment it has the power to dictate the conduct and processes of those who need investment capital. The trick is to get control of the government and then the road to socialism is automatically assured. This is the type of “social lever” that Stalin was fond of illustrating.(19)

The social devil in Keynes’ concept is the rentier. It is noted above that this is also the villain in the Fabian script. Henry Hazlitt sums up this phase brilliantly when he says:

How, then, would Keynes force down interest rates and even the return to the entrepeneur and still get his saving, investment, and production? What he really has in mind, apparently, is seizing the money through taxation and creating forced “investment” through the government. Does my assumption go too far? Then listen to this:

Though this state of affairs (just about enough return to cover cost of capital replacement) would be quite compatible with some measure of individualism, yet it would mean the euthanasia of the rentier, and consequently, the euthanasia of the cumulative oppressive power of the capitalist to exploit the scarcity value of capital (pp. 375-376). [Keynes’ General Theory –ed.]

For the light it throws on the heart of Keynes’ message and on the popularity of his ideas among leftists, this sentence is one of the most revealing in his book. Notice how patronizingly individualism (i.e., individual liberty) is treated. Keynes would graciously allow “some measure of” it. But he insists on “the euthanasia of the rentier.” Euthanasia means painless death. That is, the death of the rentier would be painless to Keynes. There is an old proverb that if you want to hang a dog you must first call him mad. If you want to knock a man down you should first give him a bad name. So Keynes uses the French rentier as a smear word. The rentier is the terrible fellow who saves a little money and puts it in a savings bank. Or he buys a bond of United States Steel, and uses his cumulative oppressive power as a capitalist to exploit the U. S. Steel Corporation.

All this is demagogy and claptrap. It differs from the Marxist brand only in technical detail.(20)

One of the practical political consequences of Keynes’ State socialism was the establishment of a “closed economy.” Strachey counsels the world Socialist movement that Keynes’ policies “could only work if the economy were not only controlled, but closed.”

Left-wing advocates of a closed or “stationary” system represent a reaction against the changing processes in a free economy whereby new products, changes in models and improved techniques constantly force a continuing readjustment to meet the new conditions. For example, Khrushchev criticizes our way of life as being wasteful and frivolous because the large variety of consumer goods to his mind is not basically useful from a Socialist point of view. A “closed system” would eliminate this “economic frivolity.” Curiously enough, this concept is a basic pattern in all Communist, Socialist, Fascist and Nazi type systems.

Professor David McCord Wright pinpoints the entire matter into a few sentences:

First of all, such a stationary state—any stationary state—must have some means of keeping itself stationary. But I believe that in every generation of every culture there will be found at the least a few people who speculate about other possibilities of doing things—both technologically and socially—and who are not content to rest at mere speculation. Such men must be quietly eliminated or forced into line if the static culture is to remain undisturbed. They cannot be allowed “freely” to compete for leadership, on any dangerous scale, or to upset the industrial routine by new methods. But our mores do not, in theory anyhow, as yet approve of such authoritarian smothering of novelty. Thus we have a dilemma which I have summed up elsewhere as follows: “If we make men ‘free’ they become creative (questioning), and if they become creative they create trouble, and also, in many cases, growth.” Thus the emergence of unstabilizing novelty is an almost inevitable concomitant of what in this country has been considered Freedom.(21)

Left-wing top leaders of all types have privately known that “freedom” must be curbed in order to have socialism. Professor Wright shows that any socialistic order requires that men who do things “both technologically and socially” must be “forced into line” or quietly eliminated. This question has been carefully kept out of print in agitational and propaganda literature not only to fool the public but also to mislead the rank and file radical membership. In the subsequent chapter we will show where some “mild socialists” not only intend that progressive thinkers be “eliminated quietly” but also plan to use methods that are not so quiet, i.e. “firing squads.”

Those who claim that Keynesism, socialism and communism possess all “progressive” and “advanced” theories and attitudes are thus unmasked as the real reactionaries who want to retard and freeze development in order to make their system more stable and easier to control.

Keynes used a technique in his General Theory to make it difficult for economists and sociologists to dissect his theory as they did when he wrote his Treatise on Money, in 1930.

Professor Samuelson, a prominent Keynesian teacher, considers that the General Theory “abounds in mares nests and confusions” and boasts “that the very obscurity of the book is an embarrassment, not to the disciple of Keynes, but chiefly to his critics: it bears repeating that the General Theory is an obscure book that would-be anti-Keynesians must assume their position largely on credit.”(22)

Keynes invented new definitions for old concepts, new words and phrases to replace those that have proved to be adequate. Hazlitt says that Keynes succeeds in “being involved and technical without being precise . . . One of the most striking characteristics of the book is looseness of many of the leading terms, and the constantly shifting senses in which they are used.”(23)

Henry Hazlitt performed a truly monumental service in cleaning out the Augean stables of Keynes’ semantic obscurities:

I have been unable to find in it a single important doctrine that is both true and original. What is original in the book is not true; and what is true is not original. In fact, as we shall find, even much that is fallacious in the book is not original, but can be found in a score of previous writers.(24)

Such semantic subterfuges although intellectually dishonest, do represent a great strategic advantage in driving towards socialism.(25)

In one fell swoop, the Keynesians have managed to side-track, by-pass and confuse all minds previously educated in economic thinking, relegating them, so to speak, to the scrap heap. The new terms, which are more abstract and vague than the time tested old ones, make it possible to indoctrinate an entire generation of college students exclusively with Keynesian dogma; while leaving it totally ignorant of the workings and benefits of our competitive free enterprise society.

Although the General Theory rests on a super-structure of confusing verbiage, the basic definition of “classical economists” is ascribed by Keynes as “a name invented by Marx.”(26) Keynes follows this revolutionary definition throughout his book. “Classical economists” are the dragons that Keynes sets out to slay.

It is an interesting feature that the basic authorities underlying Keynes’ major work are revolutionaries. He mentions that some of the basic concepts “only live on furtively, below the surface, in the underworlds of Karl Marx, Silvio Gesell or Major Douglas.”(27)

Keynes gives credit to Silvio Gesell (1862-1930) for his concept of “socialization of investment” in the General Theory. Gesell was a successful merchant who retired with a sizeable fortune and devoted himself to writing radical propaganda. In 1919 he became Minister of Finance of the revolutionary Soviet in Bavaria. He was court martialed for Bolshevik insurrectionism.(28)

Another major prop of Keynes’ theory is Mrs. Joan Robinson.(29) Keynes’ biographer writes “Mrs. (Joan) Robinson, who afterwards achieved international fame, deserves mention as an ardent disciple of Keynes; he had high regard for her intellectual powers.”(30) Keynes in his General Theory gives full credit to Mrs. Robinson for her contributions to his theory. What Keynesians do not say is that this lady is considered in international communist circles as one of the world’s outstanding Marxists.(31) Mrs. Robinson has widely publicized the fact that the differences between Marx and Keynes are only verbal. She later wrote; “The time, therefore, seems ripe to bridge the verbal gulf.”(32)

Among Mrs. Robinson’s accomplishments is an article on Marxism in the Communist magazine Science & Society.(33)

Keynes picked the brains of Knut Wicksell and other socialist theoreticians of Sweden, borrowing their economic theories for his major work. Hazlitt expresses the suspicion that Keynes’ so-called original contributions were largely borrowed when he writes:

Keynes was undoubtedly acquainted with Wicksell’s work. He refers to it frequently in his Treatise on Money. Even in the General Theory he devotes one footnote of a couple of lines to “the ‘natural’ rate of Wicksell” (p. 183), and another couple of lines to him in connection with the “natural” rate of interest (p. 242). But, mysteriously, he never mentions Wicksell at all when he is making the same criticisms of the “classical” theory of interest as Wicksell had made a generation before the appearance of the General Theory.(34)

Actually Keynes had been copying from Wicksell, both from published articles and in person, for many years. As early as 1916 Keynes entertained Wicksell in London, discussing economic questions with him.(35)

George Soule, a well known American socialist and an advocate of Keynesism admits the relationship of Keynes to the Swedish socialists when he states:

Wicksell stimulated a number of well-known living Swedish economists, for example, Myrdal, Lundberg, and Ohlin, to carry similar work further. They became known as the Stockholm School. Their doctrine, though parallel to that of Keynes, differs in detail and presents a less comprehensive theoretical system.(36)

The socialist economist Joseph Schumpeter, while at Harvard, indicated that Keynes’ General Theory was strictly a political stroke, brilliantly done, to palm off socialism on the world under the guise of saving capitalism. Professor Arthur Smithies, current chairman of the Harvard Economics Department, himself a Keynesian, points this out clearly:

Schumpeter did not credit Keynes with a single major improvement in the technique of economic analysis. His admiration was confined to the skill with which Keynes constructed a vehicle to convey his ideology—an ideology that, in Schumpeter’s views, rivals Marx in undermining the pillars of capitalism.(37)

When the General Theory (1936) appeared, the left-wing coterie in the Roosevelt administration seized upon it as the “Bible of the New Deal.” Communist elements within the Roosevelt administration resented the apparent downgrading of Marx, who according to the Kremlin was the ultimate authority on all socialistic matters. Communists declared at that time:

It is no secret that Keynes is persona grata at the White House, and that he whole-heartedly approves of an expansion of government investment both in this country and in the British Isles.

It is not surprising, therefore, to learn that the General Theory of Employment, Interest and Money has proved a best seller in Washington, where, the pundits of the government are working overtime at mastering Keynes’ proposals . . .(38)

As the saying goes in the criminal underworld “it takes one to know one.” The Communist hierarchy quickly saw through the Keynesian verbiage and described the processes as follows:

What is necessary in order to determine the amount of resources which shall be devoted to producing instruments of production? First, a supervisory body with power to take “resources” and put them where it wants them. The “resources” Keynes means are labor, equipment, and natural resources. You “take” them by giving one firm “money” to buy them with or, if it has the money, by seeing that it buys what you want it to buy them with, or, if it has the money, by seeing that it buys what you want it to buy and in the amount you want it to buy. If it hasn’t the money, you take it from another firm which has. But from which one? From a profitable one? Or from one which is declining and has no profits but which, you think, ought to decline more quickly? Someone may object that this individual treatment is not necessary—the state will control the sales receipts in whole or in part and determine what new investment is to be. But since wage and capital expenditures vary from firm to firm, the range of decisions must be made—no flat percentage is possible. Control of this sort must cope with prices and wages. If the state has forced investment in one direction so that goods cannot be sold at profitable prices, it still cannot allow prices to be raised if this would result in unused capacity and unemployment. It must make up the difference from somewhere else and take a hand in the price policy. Nor can it fail to take into account—and supervise—the wages as between firms and industries. Nor is this all. The specific things in which an entrepreneur invests must be supervised. Is it not plain that when the state allocates the funds, it largely determines who shall and who shall not make profits? It would mean saying which firms are to come into and which are to go out of existence, which ones are to grow and which to decline, and at what rates. This, with several hundred thousand corporations, is not a job of the same order as changing the discount rate or buying or selling government bonds or any of the other monetary controls Keynes formerly talked about.(39)

It has been a source of amazement to many observers to see heads of industry and leaders of finance flirting with the Keynesian concepts and enthusiastically supporting Keynesian pundits both in the government bureaucracy and in the academic world. However, if the government is to have the power arbitrarily to pick those in business who are slated for oblivion and those who are chosen for preferred treatment, then the smart thing for unprincipled opportunists to do is to court those who are in power or who may come into power; thereby getting on the “gravy train.”

The catch in the whole concept is something that the communists failed to mention. The Keynesian practices are merely the means to manipulate society by degrees towards complete socialism. It is a scheme to exploit the “dog eat dog” element in human nature in order to put over something which the average Keynesian entrepreneur considers rather remote, i.e. to use one set of capitalists to help bury their competitors and then apply the final coup de grace to the whole system of private enterprise. This, incidentally, is the principle that enabled the Bolsheviks to assume political power in Russia with ridiculously small forces.

Keynes’ General Theory tied the elements of Fabian Socialism in Britain and the United States into one ideological package. As pointed out previously, Keynesian theories had already been the backbone of British and American Fabian Socialist thinking for many years.


1  John Maynard Keynes, General Theory of Employment Interest and Money, Harcourt, Brace, 1936. Keynes declares in his preface: “. . . it is my fellow economists, not the general public, whom I must first convince.” p. vi.

2  Ibid., p. 383.

3  History of Economic Analysis, J.A. Schumpeter, p. 1172.

4  Life of John Maynard Keynes, p. 462.

5  Henry Hazlitt, Failure of the “New Economics,” D. Van Nostrand, Princeton, 1959.

6  Ibid., p. 98.

7  History of Economic Analysis, p. 42.

8  Ibid., p. 43.

9  Margaret Cole, Growing Up Into Revolution, 1949, p. 90.

10  Ibid., p. 90.

11  Failure of the “New Economics,” p. 287.

12  John Strachey, Contemporary Capitalism, Random House, N.Y., 1956, pp. 287-88.

John Strachey has had a most remarkable and erratic career. Born of an aristocratic British family he embraced the revolutionary movement at an early age. As a Fabian (1924) he became a disciple of Sir Oswald Mosley. When Mosley left the Fabian Society, in a disagreement over policy, Strachey followed him. Mosley soon gravitated to Fascism and eventually embraced the Nazi movement. Strachey, at this point, broke with Mosley and gravitated to the Communist camp. Becoming an enthusiastic partisan of Soviet Bolshevism, Strachey wrote The Coming Struggle for Power. This became a text book for Communists all over the world. In 1943 Strachey re-entered the Fabian Society and promptly became Under Secretary of State for Air in Clement Atlee’s Labour Cabinet. He was British Minister for Food from 1946 to 1950. He became British War Minister in 1950. Strachey’s exposition of Keynes’ theories as a means of sneaking into Socialism is accepted as a basic Socialist procedure all over the world. American Fabians operating through organizations such as the Americans for Democratic Action and the League for Industrial Democracy are largely guided by Strachey’s pronouncements.

13  Seymour E. Harris, Editor, Saving American Capitalism, Alfred A. Knopf, N.Y., 1948.

14  Contemporary Capitalism, p. 284.

15  Ibid., p. 310.

16  Failure of the “New Economics,” p. 127.

17  Fabianism in the Political Life of Britain, p. 54.

18  Ibid., p. 92, quoted from How to Pay for the War, Fabian research department, Fabian Society, Allen and Unwin, London, 1916, p. 270.

19  Joseph Stalin, Leninism, International Publishers, 1928, passim.

20  Failure of the “New Economics,” pp. 379-80.

21  Contemporary Capitalism, p. 305.

David McCord Wright, “Schumpeter’s Political Philosophy” in Schumpeter, Social Scientist, edited by S.E. Harris, p. 134.

22  Paul A. Samuelson, quoted in Failure of the “New Economics,” by Henry Hazlitt, pp. 2-3. Samuelson (Harvard 1941) is the author of Economics—An Introductory Analysis, McGraw-Hill, N.Y. This economics text book has been the most widely used source in the colleges and universities in the United States. Professor Samuelson’s skillful injection of Keynesian concepts in this work has brought many complaints from parents, instructors and businessmen.

23  Failure of the “New Economics,” p. 9.

24  Ibid., p. 6.

25  Life of John Maynard Keynes, p. 304.

The use of trick verbiage was not new to Keynes. In 1920 he worked on an abstract thesis called Treatise on Probability. He had started this work in 1914 and then laid aside his notes. Keynes had calculated to confound the philosophic world by inventing a new phraseology to cover his theme. However, he was “hoist with his own petard.” Keynes’ disciple Harrod writes “he found some difficulty in acclimatising himself once more to the complicated mathematical language of his own devising.”

26  General Theory, Keynes, p. 3.

27  Ibid., p. 32.

28  Ibid., pp. 354-355, 379.

29  Ibid., p. viii.

30  Life of John Maynard Keynes, p. 433.

31  Paul M. Sweezy, “John Maynard Keynes,” Science & Society, Fall, 1946, p. 405.

32  Science & Society, Winter, 1947, p. 61.

33  Joan Robinson, “The Labor Theory of Value,” Science & Society, Spring, 1954, Vol. xiii, No. 2, pp. 145-46.

SCIENCE & SOCIETY, cited as a Communist publication. (Special Committee on Un-American Activities Report, March 29, 1944, p. 96.)

Guide to Subversive Organizations and Publications – May 14, 1951, p. 149.

Science and Society was launched a little over a year ago. It entered the arena with an important and complex task to perform: to help Marxward moving students and intellectuals to come closer to Marxism-Leninism; to bring Communist thought into academic circles and to develop contributors from these circles; to stimulate the study of Marxism-Leninism; to bring Communist thought into academic circles and to develop contributors from these circles; to stimulate the study of Marxism-Leninism by demonstrating the integration of Communist theory and practice with American social life; to apply the dialecticmaterialist analysis to the natural and social sciences, and to cultural processes as a whole.” Ref: The Communist (Official organ Communist Party, U. S. A.) Dec., 1937, pp. 1148-49.

34  Failure of the “New Economics,” p. 215.

35  Life of John Maynard Keynes, p. 211n.

36  George Soule, Ideas of the Great Economists, Viking Press, N. Y., 1953, pp. 161-162. The Swedish Socialist Gunnar Myrdal, although an economist, was retained by the Carnegie Foundation to head a research study on the American Negro. This field, which was completely foreign to Myrdal (since he is a Socialist economist and there certainly is no Negro problem in Sweden), was entrusted to him apparently because of his left-wing bias and not because of his anthropological qualifications. Among those who worked in compiling the Carnegie report was James E. Jackson, Negro member of the national committee of the Communist Party of the U.S.A. and recent keynote speaker before the Russian Communist Congress in Moscow. Another researcher was Ralph J. Bunche, who at that time was well known as a follower of the Communist line and was a contributing editor of the Communist magazine, Science & Society. The results of this Carnegie study were published as An American Dilemma. Amazingly enough An American Dilemma was used as the main prop by the United States Supreme Court in its decisions on the Negro question. The decisions were applauded by the Keynesians and Communists in Washington and elsewhere. The fact that Felix Frankfurter has been an enthusiastic Keynesian supporter for many years and was a national officer of the N.A.A.C.P. did not prevent him from leading the Supreme Court in these decisions. Mention of the Carnegie grant brings to mind the fact that Frankfurter’s protege in Harvard, Alger Hiss, had at one time been President of the Carnegie Endowment for International Peace.

37  Arthur Smithies, “Schumpeter and Keynes” in Schumpeter, Social Scientist, Harvard University Press, 1951, p. 136.

38  Edward Mount “The Equilibrists and Mr. Keynes,” New Masses, (official communist magazine) vol. xx, No. 10, Sept. 1, 1936, Part I. p. 18.

39  Ibid., Part II, New Masses, September 8, 1936, pp. 17-18

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Chapter VI – KEYNESISM IN THE UNITED STATES