![]() ![]() Keynes was far from being a big supporter of speculative finance and argued for the "euthanasia of the rentier." In the course of this downturn the United States has committed up to $10 trillion in aid to financial institutions, by such means as guarantees of bank debts and asset-backed securities, direct investments, the establishment of currency swap lines with central banks, and programs for the purchase of mortgage-backed securities. This has little to do directly with Keynesianism and in fact reflects the continued dominance of financial capital in the crisis. ![]() So in this sense too we can talk about a return to Keynesian economics.īut the real action right now is elsewhere, in the direct government salvaging of financial capital. Also Keynes clearly advocated government attempts to reflate the economy in the face of deflationary pressures, in the context of the banking crisis of the early 1930s. Keynes advocated expansive fiscal policy and deficit financing in a depression, and all governments are now seeking to put such expansive policies in place to some degree - although generally not on a big enough scale. JBF: I think there has been, as Paul Krugman says, a "return of depression economics," and in that sense we can talk about a revival of broadly "Keynesian" policies. John Bellamy Foster Interviewed by Brian AshleyĪmandla: As governments across the world spend trillions to help private capital survive the global financial crisis, is it not misleading to talk of a shift to Keynesian policies? ![]()
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