In The Long Run we are (not) all dead
The anti-Christian economics of John Maynard Keynes
by Ken Ewert
John Maynard Keynes (pronounced Canes) may not be a household name but he continues, even fifty years after his death, to significantly influence our lives. Keynes was an economist - without question the most influential economist of our century. His theories, culminating in the publication of The General Theory Of Employment, Interest and Money in 1936 accomplished an unprecedented sweep through the economics profession. The "Keynesian Revolution," as it came to be known, had an impact beyond academic economics: it provided the intellectual rationale for the transformation of the State from primarily an administrator of law and order (as the Bible teaches) into an economic manager with broad, open-ended powers.
Contrary to the popular saying, "the facts" never speak for themselves, but are always interpreted through an individual's personal religious grid - their individual system of thinking and evaluating things. This seems especially true when it comes to economics, in that, as the joke goes, when you have four economists looking at "the facts," you're likely to end up with four different interpretations, and maybe six!
Four different economists can interpret the facts differently because they each think through different grids. Each person's grid is ultimately a result of their faith. At the most fundamental level, a person either believes in the God of the Bible, by faith, or chooses not to believe in the God revealed in the Scriptures, also by faith. The entire remainder of an individual's worldview is built on the faith commitment he or she makes on the issue of who God is, and what God has revealed to man. Keynesian economics, like every other kind of economics or academic theory, is fundamentally religious. It is built on a worldview.
Although Keynes attended religious services until in his teens, as he once explained to a friend, he was confident that Huxley had exploded the whole Christian religion. He wrote another friend, telling him that Christians were irrational and exhibited stubborn pride: "They don't want to admit that a position they've taken up with confidence is untenable." According to Keynes, Christianity represented "tradition, convention and hocus pocus."
As a young man at Cambridge Keynes became involved with a secret society called the "Apostles" which included such notables as Lytton Strachey, Roger Fry, Clive Bell and Leonard Woolf. It was an association that was to last a lifetime. Many of the Apostles, including Keynes, were later to become regular members of the "Bloomsbury Group" named after the Bloomsbury district of London where the group regularly met.
The Apostles (and later the Bloomsbury group) were quite taken by the philosophy of G. E. Moore, a once fervent Quaker who, losing his faith, became a thorough philosophical sceptic. As Keynes's biographer, Robert Skidelsky, concluded, as far as the Bloomsburries were concerned, the value of Moore's book, Principia Ethica, lay chiefly in its "rational justification of a rearrangement of values." They were looking for an ethic which would release them from the duties required of Victorian gentlemen. And in their eyes, Moore's book provided just this.
Most of the Bloomsbury group were descendants of the intellectual aristocracy of nineteenth century England who, for the most part, had abandoned traditional religion but retained an outward moral and social ethic. Keynes and his friends had no use for such moral baggage: "There was one chapter in the Principia," he later recalled, "of which we took not the slightest notice. We accepted Moore's religion, so to speak, and discarded his morals. Indeed, in our opinion, one of the greatest advantages of his religion, was that it made morals unnecessary...." Keynes goes on to say:
We entirely repudiated a personal liability on us to obey general rules. We claimed the right to judge every individual case on its merits.... We repudiated entirely customary morals, conventions and traditional wisdom. We were, that is to say, in the strict sense of the term, immoralists.
In the first chapter of the book of Romans, the Apostle Paul describes the path a man travels if he is consistent in his rejection of God. Professing to be wise apart from God leads to "futile" thinking and "darkened hearts" and ultimately culminates in "a depraved mind" and "unnatural" sexual relations. There is an integral connection between a man's thinking and his sexual life. Keynes, along with many other members of the Bloomsbury group, was a homosexual. Virginia Woolf affectionately called the group "The society of buggers." Keynes' biographer, Robert Skidelsky, described the situation as a "sexual merry-go-round" as members commonly floated from one sexual partner to another. As Richard Deacon concluded, "Keynes himself was the chief protagonist of the homosexual cult, obsessed with the subject to an abnormal degree for one with a good intellect and wide interests."
The sexual perversions of Bloomsbury were a deliberate statement of moral autonomy. Homosexuality, according to Keynes and his sometimes lover Lytton Strachey, was the supreme state of existence, "passing Christian understanding," and superior to heterosexual relationships. The ethical superiority of homosexuality lay in its striking opposition to the external morals of the Victorian era, and the moral laws of God. As Deacon surmised, Keynes' homosexuality was ultimately a rebellion "against the Puritan ethic: he hated Puritanism in any form...."
Keynes' economics - like his religion and sexual perversion - are best understood as a reaction against the Christian worldview. That Keynes identified the 19th century advocacy of laissez-faire (free market) economics with the Christian worldview is clearly shown by an essay he wrote in 1926 called "The End of Laissez-faire." In it he disdainfully quotes from an 1850 Christian pamphlet entitled Easy Lessons for the Use of Young People which says that "true Liberty is `that every man should be left free to dispose of his own property, his own time, and strength, and skill, in whatever way he himself may think fit, provided he does no wrong to his neighbours'." Keynes goes on to write that Adam Smith's "simple system of natural liberty" was derived from "his theistic and optimistic view of the order of the world." He then discusses the "harmony of interests" assumed to exist by the classical economists and quotes from Fredric Bastiat's Harmonies Economiques:
I believe that He who has arranged the material universe has not withheld His regard from the arrangements of the social world. I believe that He has combined and caused to move in harmony free agents as well as inert molecules....I believe that all that is necessary to the gradual and peaceful development of humanity is that its tendencies should not be disturbed, nor have the liberty of their movements destroyed.
This, according to Keynes, was but an "extravagant and rhapsodical expression of the political economist's religion." He was correct. This was certainly an expression of religion. However, Keynes' real objection was that it was an expression of a religion different than his own. The Christian religion which so influenced Smith and Bastiat saw an all-powerful God governing the affairs of men. Keynes retorts a few pages later that "The world is not so governed from above...."
At the core of many of Keynes' writings was an obsession with the subject of savings (thrift). It is a prominent part of nearly all of his economic works, and it lies at the heart of The General Theory. He rightly understood that the "virtue" of saving was related to the Christian worldview. He wrote that "The morals, the politics, the literature, and the religion of the age [are] joined in a grand conspiracy for the promotion of saving."
Why the animosity towards thrift? The act of saving points to a cause and a purpose beyond oneself. It indicates a "purposiveness" - to use Keynes' own word - to life. And this puposiveness points inescapably to a source of values, a reference point outside of oneself. It ultimately points to the transcendent God as the only true source of purpose.
As Keynes realized, the action of saving reflects a "future orientation," a belief that there is something worth deferring present wants for. Deferring the present for the future represents a value being placed upon something or someone beyond one's own immediate desires. It is a statement of self-denial. Keynes wrote scornfully of the `purposive' man who is always trying to secure a spurious and delusive immortality for his acts by pushing his interest in them forward into time. He does not love his cat, but his cat's kittens; nor, in truth, the kittens, but only the kittens' kittens, and so on forward for ever to the end of catdom.
The purposive man, in Keynes' view, is one who takes actions that will ultimately not benefit himself (since he will someday die) but will be left for others. For "purposiveness" to be regarded as a virtue is particularly troubling to those who place a high premium on present gratification. A life of homosexuality is, by its very nature, an extremely present- orientated and selfish choice. It is a rejection of family, that institution through which we plough our energies and resources into others and into the future. A homosexual lifestyle is, in essence, a choice to focus on the present rather than the future, and a decision to live for oneself rather than for others.
The economist Joseph Schumpeter was insightful in connecting Keynes' "childless" and "essentially...short-run" philosophy of life. A person committed to homosexuality is without descendants, there is little to focus his attention on the future, on "the long run." It is appropriate that Keynes is popularly remembered for his quip "in the long run we are all dead." As his biographer, Robert Skidelsky noted, Keynes' had a "lifelong bias against long-run thinking" and "He was not prepared to risk too much of the present for the sake of a better future...." It is no wonder that he spoke derisively of "the hoarding instinct as the foundation...for the family and for the future"; for him thrift, family and concern for the future were inextricably linked.
According to Keynes (in an essay sardonically entitled "Possibilities For Our Grandchildren") an individual's concern for the future is a "disgusting morbidity," and a "semi-criminal, semi-pathological" propensity that should be treated as a mental disease. Is this the stuff that cold, hard, objective economic theories are made of? Hardly. These are the words of a man rebelling against what a concern for the future represents.
For Keynes the economist, the "abstinence" of people impedes the growth of wealth, and savings are always a potential threat to economic progress. He saw savings as a "leakage," a disharmonizing force which could easily throw the economy into a horrendous depression. The saver was an exploiter, by saving he "forced some other individual to transfer to him some article of wealth." Keynes looked forward to "the euthanasia" of the "functionless investor."
In "Possibilities For Our Grandchildren" Keynes contrasts the pathological savers with people who's materialism is sweet and virtuous, for they love money "as a means to the enjoyment and realities of life." It is they who will "teach us how to pluck the hour and the day virtuously and well."
The message is clear: for Keynes, self-denial is bad and self-indulgence is good. That this "immoralist" religious premise undergirds the Keynesian economic theory seems undeniable. For it is the same man, wearing his economist's hat, that tells us that "capital is brought into existence not by the propensity to save" but rather by "prospective consumption." His theories propose that consumption (at least under most circumstances) will actually lead to more capital accumulation, more employment and more prosperity! What stands in the way of economic paradise, according to Keynes the economist, is not a scarcity of resources but the inhibition to consume. The solution? Keynes proposed that governments spend and create credit. Government spending on anything - even digging holes in the ground - would do just fine since it mattered not what the consumption was for, but only that resources be consumed and not reserved for a future time. As Henry Hazlitt, one of Keynes's most thorough critics, summarized:The General Theory is a "transvaluation of all values. The great virtue is Consumption, extravagance, improvidence. The great vice is Saving, thrift, "financial prudence."
As a young Christian, I remember being amazed by the Biblical account of God's covenant with Abraham. The covenantal promises Abraham received - that he would father a multitude of nations, that his descendants would be as numerous as the dust of the earth and the stars in the heavens, and that the land would be given to his descendants forever - were primarily future and would be enjoyed not by him but by his descendants. Just why were these earthly blessings so valuable to Abraham when he was dead?
According to the Bible, in the long run we are not all dead. As a father I have physical descendants who will live on into the future. When my life ends, their lives carry on into "the long run." What I am and what I impart to my sons and daughters does in fact live on in my descendants - just as the fruit of Abraham's life of faith lived on in his descendants. Even those of us who do not have physical children influence others - sons and daughters in the faith, so to speak - who will carry on when we are gone. Although I will not likely be alive in the year 2050, my children probably will be. And my influence, by virtue of what I plough into them now, will "live on" through their lives. Through them, I will touch lives and things beyond my own time.
There is a reason to defer present gratification. The reason is our children's future; our motive is love and a desire to obey God.
It is significant that the Psalmist pictures children as being "like arrows in the hand of a warrior." In the "battle" each Christian fights, the goal is to see God's will done and His Kingdom come on earth as it is in heaven. In this battle we are the warriors and our children are the "arrows" that we project into the future. It is God's design that we extend our influence into the future for His glory. And, as the writer of the Proverb put it, "surely there is a future" for those who fear the Lord (Prov 23:17-18). We are philosophically tied to the future through our descendants - Mr. Keynes was not, and this is apparent in his economics.
It has been nearly sixty years since the Keynesian revolution. The effects of the "short- run" and "childless" philosophy of Mr. Keynes are clear: nearly all western governments have followed the Keynesian prescription of spending and consumption, and have run large annual budget deficits for decades. In Canada, the federal debt is now approaching a staggering 550 billion dollars, and the country is joining the ranks of Third World nations in terms of its level of public debt (we are just behind Burundi and just ahead of Morocco). Interest payments on the Canadian federal debt are now the largest single government expenditure.
Our public debt represents our lust to consume today without thought for tomorrow. We have, in large measure, spent our children's inheritance (as my least favourite bumper sticker reads). We have, to put it very bluntly, practiced homosexual economics, but we have not, as Mr. Keynes expected, spent ourselves into prosperity.
The long-run is now here. And while Proverbs 13:22 says "A good man leaves an inheritance to his children's children," the tremendous public debt and, perhaps more importantly, the short-run debtor mentality that we are passing onto our children is a sad inheritance indeed. If there is to be a future we must return to Wisdom. "Know that wisdom is thus for your soul; If you find it, then there will be a future, And your hope will not be cut off" (Prov 24:14).
This article was first published in U-Turn