Never before has a major stock market downturn been anticipated by so many Americans. And when Black Friday, April 14th, finished off the dot-com party, some people—who weren’t receiving angry margin calls or watching their options in pizzlestick.com turn from millions to toilet paper—even felt relief. It almost seemed that if America’s gorged upper and middle classes were forced to swallow just one more inflated valuation, then—like that final bon-bon that detonates Monsieur Creosote in Monty Python’s Meaning of Life—it might have been the end.
With all the evidence of new wealth across the land—and the lack of logic behind the hyperprosperity—many Americans have been left in a state of disorientation. For a while, it seemed that even the fundamental things like birth, death, and the business cycle weren’t going to apply.
Still, they might not have seen anything yet.
Here’s what one economist wrote 70 years ago: “I look forward, in days not so very remote, to the greatest change which has ever occurred in the material environment of life for human beings in the aggregate. But, of course, it will all happen gradually… Indeed, it has already begun. The course of affairs will simply be that there will be ever larger and larger classes and groups of people from whom problems of economic necessity have been practically removed.”
Was this some visionary academic? No, those kinds of guys didn’t get gigs as Directors of the Bank of England—although that was a minor detail in a career that’s made some people claim John Maynard Keynes was the 20th century’s most important economist. Keynes, no slouch at the prediction business, made his name in 1919 with a book, Economic Consequences of the Peace, insisting that the settlement the Allies imposed after World War I would cause economic collapse and war’s resumption. When the economic scene soured in the late 1920s, he began working out the ideas which went into his General Theory of Employment, Interest and Money and provided the rationale for Roosevelt’s New Deal spending programs. Then in 1944, presiding at the Bretton Woods conference (and elevated to the peerage as Lord Keynes), he pushed through creation of the International Monetary Fund and the World Bank. And just to underscore that this was a major dude, you should know our present free market triumphalism has a dirty little secret: Alan Greenspan’s Fed practices essentially the kind of fiscal and monetary policies which Keynes advocated to eliminate recessions and control economic booms.
Recently, some media stories—about the disturbances new wealth has brought to the lives of some of those who’ve cashed out from the Silicon Valley treadmill—were ringing bells with us. Back in 1930, giving himself a mental vacation from the Depression and from working on The General Theory, Keynes wrote an essay called “Economic Possibilities for Our Granchildren.” We pulled that essay off the shelves to reread it.
A Different Kind of Start-Up
In a distressed neighborhood at the
heart of the high tech revolution, a school gives real options to its
students.
CEO’s
Having a Baby
Can a pregnant entrepreneur get the
venture capital to keep her startup alive?
Escaping
the Corporate Cult(ure)
A former Silicon Valley dot com insider
lashes out against the technology industry's HR efforts.
Money
Changes Everything II
Economic futurists predict that, thanks
to technical innovation, the road ahead is paved with gold.
Money
Changes Everything
In a world free of personal economic
concerns, would you get bored?
The
E-Millionaire Show
Our London correspondent reports on the
next reality-based program sure to cross the pond.
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