Does reality turn you into a statist?
By Alberto Mingardi
One of the rhetorical tricks in contemporary debates goes as follows: Present people who agree with you as if they were convinced of the validity of their (your) positions by reality, suggest people who disagree with you never put their nose out of their office.
I am reading a bit on “neoliberalism” (a tip: if it has neoliberalism is in the title, feel free to assume it’s a terrible book. There are exceptions, but only a handful). In particular, I am reading one of Oxford’s typically excellent very short introductions, this one written by Manfred Steiger and Ravi Roy.
They write (p.5):
The fury and longevity of the Great Depression convinced leading economic thinkers like John Maynard Keynes and Karl Polanyi that government was much more than a mere ‘nightwatchman’.
Now, I’m no native English speaker but it seems to me that the sentence suggests that Keynes and Polanyi were full-fledged champions of laissez faire, or at least moderate supporter of the market economy, until the Great Depression “convinced” them that such quaint ideas were an unhelpful leftover for the modern world.
Was it so? Then why did Keynes published “Am I a liberal?” in 1925 and “The end of laissez faire” in 1926? Sure, Churchill returned to the gold standard in 1925, an act that Keynes considered disastrous, but was he building his own political views on the evidence of such pieces of monetary history?
Before the Great Depression, Keynes was already convinced that society should start “exercising directive intelligence through some appropriate organ of action over many of the inner intricacies of private business”. No night watchman here. As it were, the Great Depression certainly helped him to sharpen his views and deepen his analysis, but he had, like all of us, political instincts. Is that too difficult to admit?