Academic journal article Journal of Markets & Morality

An End to Scarcity? Keynes's Moral Critique of Capitalism and Its Ambiguous Legacy

Academic journal article Journal of Markets & Morality

An End to Scarcity? Keynes's Moral Critique of Capitalism and Its Ambiguous Legacy

Article excerpt

Introduction

Is an end to scarcity attainable? John Maynard Keynes affirms this to be both a viable and attractive prospect in "Economic Possibilities for our Grandchildren" (henceforth EPG). (1) Technological progress will enable humans to work fewer and fewer hours, shrinking the production time needed to satisfy wants. Keynes thus predicts that the "economic problem" will become a matter of how to enjoy one's leisure time. Moreover, for Keynes the abrogation of scarcity is desirable because the pursuit of material abundance will be replaced by the opportunity to seek higher moral ends not realizable under capitalism.

Expressing an ambiguous perspective on market-driven economies, Keynes finds capitalism to be indispensable to achieving the full satisfaction of the absolute needs of society, yet also an economic system bound by moral shortcomings. Through an examination of the development of Keynes's moral evaluation of capitalism, this article explains how Keynes's critique of market-based economic activity is tied to his case for an end to scarcity. It also explores the tensions expressed in Keynes's moral criticism of capitalism and policy initiatives calling for a regulated capitalism. In his critique Keynes expresses particular hostility toward the reckless pursuit of economic gain (or "love of money") that he observes to be characteristic of modern capitalism. The connections between Keynes's ambiguous attitude toward Victorian-era morality and his conflicted thinking about capitalism are analyzed.

Keynes's claims in EPG have left an ambiguous legacy for modern critics offering economic, philosophical, and theological evaluations of market economies. This article considers representative current examples of such appraisals and offers brief reflections on them. Sharing Keynes's perception regarding both the moral and economic defects of capitalism, the economist and philosopher team of the Skidelskys (2) seek to extend his case for halting the pursuit of economic growth as an end in itself. To replace that search they offer the desirability of the provision of basic social goods. Keynes's legacy with respect to the economic prospect is also utilized by the theologian Daniel Bell. (3) Bell makes an ironic use of Keynes's concept of ending scarcity in depicting the possibility of alternative arrangements that are not aimed at satisfying the "insatiable desires" (4) generated by capitalism.

Keynes and the Economic Possibilities of Capitalism

Keynes produced both an economic analysis challenging the self-regulating features of capitalism and a moral critique of its foundational assumptions about human economic motivations. The former is more widely recognized. Keynes emphasizes the employment problem caused by inadequate private investment expenditure as chronically characteristic of capitalism. In an exposition fully developed in The General Theory of Employment, Interest, and Money, (5) he argues that insufficient levels of private investment expenditure stem from excessively high interest rates. This phenomenon produces rising involuntary unemployment. Confronting the great contraction of gross national output, income, and expenditure in major industrial economies in the 1930s, Keynes offers a highly influential policy recommendation to rescue capitalism in the short run through directed public-sector expenditures. Keynes's moral criticism of capitalism is less widely discussed in the literature. It forms an equally essential portion of his ambiguous evaluation of capitalism, as his moral critique informs the basis for his long-run prognosis for the economic prospects of humanity expressed in EPG.

When EPG first appeared in 1930, it was largely ignored as a futuristic essay not particularly relevant given the onset of the worldwide severe economic contraction at the time. Keynes's speculation about the prospects of ending scarcity was seen to be fanciful. Yet with hindsight, Skidelsky and Skidelsky observe that EPG "links up directly with Keynes's main preoccupation: the problem of persistent mass unemployment. …

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