ECONOMY-KEYNES (2)

''It is also obvious to the more thoughtful that the present system is intellectually and politically unstable,'' Lord Skidelsky said. Prof Skidelsky asked as to whether the world can still afford to go along with a system which crashes every few years, with increasingly serious social consequences. ''It is both impossible as well as undesirable to restore the trade unions as a'countervailing power' in the Anglo-American type of economies dominated by the service sector and high-tech manufacturing,'' he said. Lord Skidelsky said the liberal solution of breaking up concentrations of big business was unavailable in the increasingly integrated global market. ''The key to the restoration of a Keynesian political economy is thus the rehabilitation of the State as an instrument of public interest,'' he said.Prof Skidelsky said it can be argued that nation states cannot control global capital and that a world state was unavailable.''But a 'single world' model of globalisation was not the only one. It is far more plausible to think of global integration developing via regional integration. This offers a more feasible route to reinserting democratic oversight of the economy,'' he said.Prof Mundel spoke about the many sided genius that was Keynes and how he gave up his wealth and spent it on buying art and on many other interests he had.Prof Mundel said Lord Keynes was not the only one who gave up his wealth for more recently Warren Buffet, one of the richest men in the world, has given much of it in charity. Similarly, Bill Gates doles out huge sums for charity. Prof Mundel referred to the wide gulf between the rich and the poor in India, a bane of Indian economic policy and planning. Huge social spending would go some way in ameliorating the condition of the poor, he said. The concepts of social spending too has been borrowed from Keynes interventionist government policy. Born on June 5, 1883, Keynes, the British doyen, in the 1930s spearheaded a revolution in economic thinking, overturning the older ideas of neoclassical economics like Jean-Baptiste Say that held that free markets would automatically provide full employment as long as workers were flexible in their wage demands. Following the outbreak of World War II, Keynes's ideas concerning economic policy were adopted by leading Western economies. During the 1950s and 1960s, the success of Keynesian economics was so resounding that almost all capitalist governments adopted its policy recommendations.Keynes's influence waned in the 1970s, partly as a result of problems that began to afflict the Anglo-American economies from the start of the decade, and partly due to critiques from Milton Friedman and other economists who were pessimistic about the abilityof governments to regulate the business cycle with fiscal policy.However, the advent of the global financial crisis in 2007 has caused a kind of resurgence in Keynesian thought. Keynesian economics has provided the theoretical underpinning for the plans of US President Barack Obama, British Prime Minister Gordon Brown,Prime Minister Manmohan Singh and other global leaders to ease the recession.Keynes is widely considered as the father of modern macroeconomics. In addition to being an economist, Keynes was also a civil servant, a patron of the arts, a director of the Bank of England, an advisor to several charitable trusts, a writer, a privateinvestor, an art collector, and a farmer. Of towering stature, both metaphorically and physically. Keynes stood at six feet, six inches.Apart from being an exercise in intellectual delight, the debate on the resurgence of Keynesianism, brings home the relevance of the ideas of India's wise men. Much before Keynes and Warren Buffet, Buddha renounced his princehood to take to meditation. He gave to the world the middle path, popularly known as the eightfold path to attaining 'Nirvana' or salvation.While Keynes continues to dominate economic thinking, Buddha rules the hearts, minds and lives of many of the world. It is for this reason that he is worshipped.

By Gurdip Singh