Mortgaging the Next Generation

John Maynard Keynes was born in Cambridge, England in 1883, to a privileged elitist academic family.

Keynes became an influential economist and he is best known for his economic theories on the causes of prolonged unemployment, and for his most influential work, The General Theory of Employment, Interest and Money, which was first published in 1935.  This work was strongly influenced by the overwhelming economic crisis of the day, the Great Depression. In his General Theory, Keynes advocated for government spending ”to prime the economic pump” of the general economy as a remedy for prolonged economic recession.  Keynes felt that his pump priming was needed to stimulate full employment and general economic recovery.

In truth Keynes’ General Theory is riddled and rife with internal contradictions. When he drills down on specific examples of economic conditions his solutions often obviously contradict themselves. In that respect Keynes’ General Theory allows the reader to pick and choose the ideas the reader likes best, and then to quote Keynes as the authority to support his/her personal biases.

In all fairness, I must also point out that Keynes’ “prime the economic pump” statement was only asserted as the proper response to an economic depression or recession. He did not actually advocate government spending beyond its revenue sources as a routine practice. Hence the real father(s) of the all too common, modern practice of perennial government deficit spending is the nefarious politicians who use that practice to buy the votes of the working and the impoverished classes of society.

Keynesian Economics, is the avidly adhered to dominant economic theory and policy of the US Federal Reserve System (along with the even more irresponsible and knavish pro-government spending concept which is called Modern Monetary Theory).

Comments on Continuous Deficit Spending:

While a general economic collapse can and generally does benefit from increased government spending and from a loose monetary policy (low interest rates produced by increasing the amount of circulating cash released by the central bank) on the short term (for six months or a year or two at the most), this policy is harmful to the general economy on the long term.

Many of the statements Keynes makes in his General Theory are routinely mis-quoted by politicians and government employed economists to support the false virtue of government deficit spending practices and low interest rate policies. Chronic deficit spending by government is clearly harmful to the well being of the people and to the national economy in general.

Sadly, there really is “no such thing as a free lunch.,” Sooner or later somebody has to pay the piper. Deficit spending is the sole source of the US National Debt. At the end of 2025 that debt exceeded the literally unfathomable amount of 38.5 trillion dollars. The interest payment of that was almost a trillion dollars, which makes the National Debt, the 3rd largest expenditure in the US budget. The only greater expense items being Social Security and Medicare payments.

The vast weight of the tax payment burden of modern societies does not fall on the wealthy, it falls on the already struggle middle classes, who perennially do more than their shares of the paying.