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The Keynes Project: A Critical Analysis of the Economics of John Maynard Keynes from an Austrian School Perspective

Gary North

John Maynard Keynes was the most influential economist of the twentieth century. This speaks poorly of the twentieth century.

In October 2009, I wrote an article for Lew Rockwell in which I outlined a plan to refute Keynes, line by line. Austrian economists are not found on major university campuses. I wrote it for a younger, untenured academic economist at some private college or obscure university who is willing to devote his career to the task. I still hope such a person takes up my challenge. I am not optimistic, however.

I have shifted focus here. The Keynes Project is a model for a multimedia effort. It focuses on his 1936 book, The General Theory of Employment, Interest, and Money, but it is not limited to this volume. It considers his earlier writings as a prelude to The General Theory.

The Keynes Project project will be both offensive and defensive, as any comprehensive critique should be. It will show what was wrong with Keynes' economic theory, but it will use these critiques to provide an introduction to what is correct in economics -- specifically, Austrian School economics.

The project must be guided by a single principle, a single theme: to refute Keynes' single theme. The project must ask two questions.

1. If the problem is insufficient demand, where does the state confiscate the resources necessary to increase demand?
2. What would the original resource owners have done with these resources?

Keynes made the mistake that Bastiat warned against: the fallacy of the thing not seen. It is the broken window fallacy.

It goes back to one source: Bernard Mandeville's poem, The Grumbling Hive (1705). This is why Keynes in The General Theory quotes from it. Refute it. Start here: http://www.garynorth.com/public/13333.cfm.

Then go to J. B. Say. Defend him. Show that Keynes misrepresented Say's law.

Then go to the classic refutation of Keynes: Henry Hazlitt's The Failure of the "New Economics" (1959).

Always return to these two questions. Never let the reader forget these two questions.

This project is governed by this presupposition: You can't beat something with nothing. It is not just that Keynes was wrong. It is that he was wrong in specific ways, violating specific insights of generations of previous economists, but especially those of Ludwig von Mises and F. A. Hayek, Keynes' chief rival in 1935.

A full-scale critique involves the creation of multiple products:

Monographs on specific technical issues
Professional journal articles
Textbooks suitable for an upper-division course
Glossary for The General Theory: past usage, Keynes' usage
Line-by-line critique of The General Theory
Popular books aimed at non-economists
Study guides for general books
Magazine articles suitable for The Economist
Magazine articles suitable for The Atlantic Monthly
Newspaper articles suitable for The Wall Street Journal
On-line video/audio presentations suitable for an upper-division class
Shorter on-line video presentations suitable for YouTube
Blog sites on specific topics
Discussion forums on specific topics
Talking-head videos such as this PBS segment.
Rap videos as good as this one:

Here are some starter articles.

Keynes, the Great Depression, and the Coming Great Default
Gary North - June 26, 2015
Keynes won in the aftermath of the Great Depression. Who will win in the aftermath of the Great Default? keep reading

Undermining John Maynard Keynes
Gary North - February 19, 2015
Of necessity, this is a one-man project. Here's why. keep reading

Founders, Priesthoods, and Civilization
Gary North - February 13, 2015
No one has decided to begin the Keynes project. I am not surprised. keep reading

The Fable of the Bees Revised
Gary North - January 13, 2015
This is my response to the most influential poem in history. keep reading

On Replacing the Keynesian Establishment
Gary North - November 01, 2014
There is no plan or program to do this. keep reading

How 1936 Consolidated the Progressives' Triumph in 1913
Gary North - October 25, 2014
Answer: Because 1787 and 1865 had laid the foundations. keep reading

The International Gold Standard vs. the International Dollar Standard
Gary North - February 20, 2014
It's clear which the winner is. keep reading

How the Keynesians Won . . . And Will Lose
Gary North - February 17, 2014
There are perfectly good reasons. The main one is this: enlightened self-interest. keep reading

Keynes Torpedoed by PBS
Gary North - July 22, 2013
This is long overdue and well-deserved. keep reading

After Keynesianism, What?
Gary North - July 15, 2013
You cannot beat something with nothing. You cannot change just one thing. keep reading

Video: Keynesian Theory from a Wanna-Be Sit-Down Comedian Columnist
Gary North
He's not Seinfeld, but Keynesianism isn't very funny. keep reading

The Central Conceptual Error of Keynes in Half a Sentence
Gary North
A British Keynesian columnist lambasts Republicans in the House of Representatives for sabotaging the recovery, 2010-2012. keep reading

Krugman's Clones: Conservatives Who Hate the Free Market and Hate the Rich Even More
Gary North
The politics of plunder has a broad market. It is well-entrenched in the conservative movement. keep reading

The Keynes Project: No Takers So Far
Gary North
Keynesian policies are not working. Keynesian theories are ripe for the trash heap. Yet there is not one challenger -- no David to challenge an army of stumbling Goliaths. keep reading

Keynesian Economics and Austrian Economics in Just 8 Words
Gary North
You can remember this with the fingers on two hands. keep reading

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