Bill Dunn
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The decline of Keynesianism and the prospects for return
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It is impossible to adjudicate definitely on the prospects for a return to Keynes. There are many interpretations and, as the first section argues, grounds for saying that Keynes never went away. Much of the economic practice of the post-WWII boom period endures. The second section argues, however, that structural shifts have weakened national bases of economic organisation, potentially limiting the scope and efficacy, and crucially also the institutional supports, of Keynesian intervention. The third section reflects on the experience of the global financial crisis of 2007–09, which confirmed that leading states retained the capacity to intervene effectively, before disappointing hopes of a more radical, long-term reorientation with policy reversals which brought severe austerity, particularly in Europe. The preceding argument suggests that there was an economic rationale for such a turn, which is misunderstood simply as bad policy. The fourth section considers arguments that the growing environmental crisis requires an interventionist green Keynesian response. There is a constituency for change in economic interests and a powerful social movement, but there are also dangers in a lowest-common-denominator approach which ‘greenwashes’ insufficiently radical reform, which can be undone by the dynamics of capitalist and interstate rivalry. The final section argues that reining in capital in more consistently Keynesian ways would require a leap of political faith beyond anything that Keynes’s own political philosophy would allow. This is not to discount the possibility of reform but suggests that its achievement requires going beyond Keynes.

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