Introduction

Abstract

JOHN Maynard Keynes was the most influential British economist of the twentieth century. He produced a new analytical framework through which economists and policy-makers could view the problems of unemployment and inflation. Although the Keynesian consensus which emerged in the economics profession in the 1940s has been challenged since the late 1960s by monetarist theories, the writer of this pamphlet is not alone in believing that Keynes was the best source of economic advice available during the interwar years and down to his death in 1946. Indeed, until recently most economic accounts of that period have been written from a more-or-less Keynesian point of view. However, this should not be taken to imply that there were no practical impediments to government acceptance of Keynes’s advice. This pamphlet seeks to contrast Keynes’s ideas with the alternative wisdom emanating from the Treasury, the department responsible for drawing up the budget, for controlling central-government expenditure and, in conjunction with the Bank of England, for managing the National Debt. There has been an extended debate in recent years about Keynes’s influence on the Treasury.