David Frum

05.08.13

Was Keynes a Better Economist Because He Was Gay?

Bruce Bartlett asks, counter Niall Ferguson: Did being gay make John Maynard Keynes a better  economist?

Although Keynes’s theory was most appropriate to the Great Depression, his followers did indeed believe in its general applicability and the Keynesian medicine was overapplied and misapplied during much of the postwar era, leading to stagflation in the 1970s. Conservatives ... were right about that.

But in their rejection of Keynesian economics at a time when it needed to be rejected, conservatives threw the baby out with the bathwater and are now preventing its adoption when it is badly needed.

The criticism that Professor Ferguson implicitly leveled at Keynes of being excessively short-term oriented, therefore, has a grain of truth in it. But the much greater truth is that we are now holding the economy hostage to policies that are proper for the long-term – like stabilizing the debt-to-gross-domestic-product ratio – at a time when we face special circumstances that make such policies perverse.

In short, we are suffering from an excessive long-term focus that is crippling the economy in the short run, and the short run threatens never to end.

A friendly 1984 biography of Keynes by the economist Charles H. Hession acknowledged that his sexual orientation shaped his political philosophy. His homosexuality was “an independent element in his reformist tendency; as such, he was an outsider in a heterosexual world,” Professor Hession wrote.

I think this made Keynes more willing to think “outside the box,” as we say today, and consider ideas that ran counter to the conventional wisdom. But there is no reason to think he had any less concern for the long-run health of the economy or society than heterosexuals. Keynes understood that the long run is simply an infinite parade of short runs.