Now comes Keynes and proves that Say's Law is nonsense (so did Marx, of course, but my supervisor never drew my attention to Marx's views on the subject). Moreover (and that is where I am a left-wing Keynesian instead of the other kind), I see at a glance that Keynes is showing that unemployment is going to be a very tough nut to crack, because it is not just an accident – it has a function. In short, Keynes put into my head the very idea of the reserve army of labour that my supervisor had been so careful to keep out of it.
I was brought up at Cambridge, as I told you, in a period when vulgar economics had reached the very depth of vulgarity. But all the same, inside the twaddle had been preserved a precious heritage – Ricardo's habit of thought.
When I am reading a passage in Capital I first have to make out which meaning of c Marx has in mind at that point, whether it is the total stock of embodied labour (he does not often help by mentioning which it is – it has to be worked out from the context) and then I am off riding my bicycle, feeling perfectly at home.
Ricardo was followed by two able and well-trained pupils – Marx and Marshall. Meanwhile English history had gone right round the corner, and landlords were not any longer the question. Now it was capitalists. Marx turned Ricardo's argument round this way: Capitalists are very much like landlords. And Marshall turned it round the other way: Landlords are very much like capitalists. Just round the corner in English history you see two bicycles of the very same make – one being ridden off to the left and the other to the right.
Keynes turned the question back again. He started thinking in Ricardo's terms: output as a whole and why worry about a cup of tea? When you are thinking about output as a whole, relative prices come out in the wash – including the relative price of money and labour. The price level comes into the argument, but it comes in as a complication, not as the main point. If you have had some practice on Ricardo's bicycle you do not need to stop and ask yourself what to do in a case like that, you just do it. You assume away the complication till you have got the main problem worked out. So Keynes began by getting money prices out of the way. Marshall's cup of tea dissolved into thin air. But if you cannot use money, what unit of value do you take? A man hour of labour time. It is the most handy and sensible measure of value, so naturally you take it. You do not have to prove anything, you just do it.
Well there you are – we are back on Ricardo's large questions, and we are using Marx's unit of value. What is it that you are complaining about?