‘Socialization of Investment’ and ‘Euthanasia of the Rentier’: The Relevance of Keynesian Policy Ideas for the Contemporary US Economy

Robert Pollin

Chapter 4 in The Relevance of Keynesian Economic Policies Today, 1997, pp 57-77 from Palgrave Macmillan

Abstract: Abstract Evaluating the current relevance of Keynesian economic policies first depends, of course, on what one means by such policies. In the USA today, for example, economists often considered to be mainstream Keynesians are among the prominent exponents of the view that the most fundamental macroeconomic problem facing the country is its inadequate saving rate, due to both public and private profligacy. However, this ‘Keynesian’ perspective is actually consonant with the central tenets of pre-Keynesian thought, which, reaching its apogee during the 1930s as the British ‘Treasury View’, held that the pursuit of full employment policies was necessarily constrained by an economy’s level of saving. Perhaps the fundamental innovation of Keynes’s General Theory and the subsequent Keynesian revolution was to overthrow the Treasury View, and to put in its place the argument that, as Joan Robinson said, ‘firms are free, within wide limits, to accumulate as they please, and the rate of saving of the economy as a whole accommodates itself to the rate of investment that they decree’ (Robinson 1962: 82–3).

Keywords: Monetary Policy; Financial Market; Financial System; Pension Fund; Real Interest Rate (search for similar items in EconPapers)
Date: 1997
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-349-25425-5_4

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DOI: 10.1007/978-1-349-25425-5_4

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