John Maynard Keynes - Timeline
Date
5 June 1883
Event
John Maynard Keynes is born at his parents' home - 6
Harvey Road, Cambridge. He is born into comfortable
circumstances, into a household staffed with domestic
servants.
His father, John Neville Keynes, is an Economics
lecturer at Cambridge University. His mother, one of the
first female graduates of Cambridge University, is active
in charitable works for less-privileged people. She will
later serve as mayor of the city. His parents, who
ultimately survived him, lived at 6 Harvey Road
throughout Keynes's life.
1888
A four and a half year old Keynes is asked what interest
is and replies, "If I let you have a halfpenny and you kept
it for a very long time, you would have to give me back
that halfpenny and another too."
1890
Keynes attends the Perse School Kindergarten while
receiving elementary educational instruction at home.
1892
Keynes becomes a pupil at St Faith's preparatory school.
He attends as a day boy (a non-boarder). His academic
performance is uneven. He is recognised to be quick at
arithmetic and algebra. His large vocabulary is also
noted. He is criticised for carelessness.
1893
Keynes's father writes in his diary that St Faith's is
driving Keynes too hard. There are lengthy sickness
absences from school - Keynes's constitution seems to be
rather frail.
June 1894
Keynes is now top of his class at school.
December 1894
A mathematics teacher comments that Keynes, "does
really brilliant work" but that he "soon tires and has not
perseverance in the face of difficulty."
Late 1896
St Faith's headmaster writes that Maynard is "head and
shoulders above all the other boys in the school." He is
confident that Keynes could get a scholarship to Eton.
Early 1897
Keynes is preparing for Eton's scholarship exam,
beginning work at 7 a.m. each day - the same starting
time as the Eton exam.
July 5 1897
Three days of examinations for Eton begin.
July 12 1897
Twenty scholarships for Eton are awarded. Keynes
ranks tenth out of twenty overall, and first in
mathematics.
September 25 1897
Keynes begins at Eton three days late, following a fever.
Keynes is taller than his classmates, his voice has broken
and he is intellectually self-confident. His classmates
look to him for leadership - he is a natural leader.
December 1897
At the end of his first term at Eton, Keynes places first
in classics and second in mathematics.
Early 1898
Ill-health strikes in Keynes's second term at Eton,
including a bout of measles. There are frequent absences
from classes.
Mid 1898
1899
Keynes wins Eton's Junior Mathematical Prize.
Keynes scores full marks for his essay 'Responsibilities of
Empire'. His examination results are considered
outstanding - 1,156 out of 1,400.
A teacher writes of him, "in his work there is absolutely
nothing of the mercenary, mark-getting feeling... He
takes a real interest in anything which it is worthwhile
to be interested in."
Keynes tops the select list in the Senior Mathematical
Prize.
4 February 1900
The new century sees Britain engaged in the Boer War.
Keynes does not join the "Eton Shooters" for military
training. He writes to his father, "Some say that
patriotism requires one to join the useless Eton shooters,
but it seems to me to be the sort of patriotism that
requires one to wave the Union Jack."
Mid 1900
Eton's Senior Mathematical Prize is won by Keynes.
25 November 1900
Keynes competes for and wins the Richards English
Essay Prize.
26 January 1901
Keynes is elected to the College Pop - Eton's prestigious
debating society.
July 1901
The Tomline, Eton's principal mathematical prize, is
added to Keynes's ever-growing bag of honours.
July 1902
Keynes wins the Chamberlayne Prize, worth £60 a year
for four years, by placing first in the Higher Certificate
Examination. He placed first in mathematics and
history and first for English essay.
1902
A teacher at Eton, Geoffrey Young, later wrote of
Keynes, "His reading had been immense, his selection
was admirable, and wit and some well-calculated
indiscretions illuminated an astonishingly mature
performance. We were listening to something much
beyond the range of the normal clever sixth-form boy..."
October 1902
John Maynard Keynes begins at King's College,
Cambridge as an undergraduate.
He spends most evenings engaged in social activities,
ending each night in endless intellectual arguments with
his friends, going to bed at about 3 a.m.
In his first year at university, he joins or is invited to
join
several highly prestigious debating and intellectual
societies. Throughout his undergraduate years Keynes is
a frequent speaker at the Union - Cambridge's renowned
debating society.
His intellectual and social activities will shape Keynes's
development more than his formal studies will.
Although he is an intellectual, Keynes does not abandon
sport. He wins a cup when his boat wins in the Trail
Eights. He plays tennis and golf and is fond of horse
riding.
May 1904
Keynes is elected Secretary of the Union, which will lead
to his becoming President. He is also elected President of
the University Liberal Club. He is awarded a first class
in mathematics from King's College.
1904 - 1905
Keynes prepares for Cambridge's Tripos examinations in
mathematics while continuing to pursue his other
intellectual interests.
June 1905
In the Tripos list, Keynes is ranked in twelfth place, a
highly creditable result. For Keynes, however, while
some offered congratulations, others offered condolences.
Summer 1905
Keynes spends summer enjoying a mountain climbing
holiday in Switzerland and with his family. He also does
some serious reading - Marshall's Principles of
Economics.
Autumn 1905
Keynes returns to Cambridge to attend economics
lectures by Marshall, the author of his summer time
reading. Marshall writes to Keynes's father:
"Your son is doing excellent work in Economics. I have
told him that I should be greatly delighted if he should
decide on the career of a professional economist."
Keynes writes to Strachey:
"I find Economics increasingly satisfactory, and I think I
am rather good at it. I want to manage a railway or
organise a Trust, or at least swindle the investing
public."
February 1906
In one of his frequent letters to his friend G.L. Strachey
Keynes writes, "I am studying Ethics for my Civil
Service." (Keynes is preparing for the Civil Service
entrance examinations.)
August 1906
Keynes sits the Civil Service examinations in London
between 3 August and 25 August.
October 1906
The results of his civil service exams infuriate Keynes.
He writes to Strachey:
"I have done worst in the only two subjects of which I
possessed a solid knowledge - Mathematics and
Economics. I scored more marks for English History
than for Mathematics - is it credible? For Economics I
got a relatively low percentage and was eight or ninth
in order of merit - whereas I knew the whole of both
papers in a really elaborate way. On the other hand, in
Political Science, to which I devoted less than a
fortnight in all, I was easily first of everybody. I was
also first in Logic and Psychology and in Essay."
He was later to say: "I evidently knew more about
Economics than my examiners."
Late 1906
Keynes is offered and accepts a position in London with
the civil service, working in the India Office. He will
work there for the next two years while probing
probability theory in his spare time. Much of this "spare
time" seems to occur at work where he says, "I have not
averaged an hour's office work a day this week so that I
am well up to date with the (probability) dissertation."
April 1907
Keynes is now working hard in the Revenue, Statistics
and Commerce Department of the India Office, which he
enjoys. He writes, "I really believe that I have written
almost every despatch in the Department this week."
September 1907
"I'm thoroughly sick of this place and would like to
resign. Now the novelty has worn off I'm bored ninetenths of the time and rather unreasonably irritated the
other tenth whenever I can't have my own way," Keynes
writes.
October 1907
Hoping to obtain a fellowship at King's College, Keynes
spends a fortnight in Cambridge working on his
probability dissertation. He fails to obtain a fellowship.
June 1908
Keynes resigns from the India office to work on
probability theory in Cambridge. He will receive £100
each year from his father and the same amount, paid
privately, from Pigou, the chair of Economics at
Cambridge.
19 January 1909
Keynes begins lecturing at Cambridge University three
times a week on Money, Credit and Prices.
2 February 1909
In a letter to his friend, Duncan Grant, Keynes writes, "I
have received today the offer of an appointment - to be
representative of H.M.'s Government on the Permanent
International Commission for Agriculture at Rome.
Salary £500 increasing; duties practically nil. Shall I
accept?
March 1909
On the basis of his dissertation in Probability, Keynes is
elected a Fellow of King's College - adding £120 per
annum to his income.
Spring 1909
The Economist publishes a series of letters from Keynes
arguing that estimates of British investments in India
are exaggerated.
May 1909
Keynes wins the Adam Smith Prize (£60) for an essay on
Index numbers.
15 October 1909
"I seem to spend most of my time seeing pupils. I have
already got eighteen of these, which will be rather hard
work, but ought to bring in nearly £60."
7 November 1909
Keynes reports to his father that his income has reached
£700 per annum, including the money his father gives
him.
January 1910
In the General Election campaign Keynes travels to
Birmingham for five days to support his old friend
Edward Hilton Young who is standing for East
Worcester as a Liberal.
September 1911
After a tour of Ireland with Liberal politicians, Keynes
writes to Duncan Grant, "You have not, I suppose, ever
mixed with politicians at close quarters. They are
awful... their stupidity is inhuman... The rest of them
had minds and opinions as deplorable as their
characters."
Autumn 1911
Keynes becomes the editor of the Economics Journal - a
considerable honour.
Autumn 1912
Keynes is elected to 'the council' the body that governs
King's College. He was elected the previous year to the
Estates Committee and now has motions attacking the
amount of cash held by the college and querying the
running of the college carried. His motion calling for a
pay increase for College Fellows is defeated.
Early 1913
Keynes completes his first major work on Economics -
Indian Currency and Finance. He persuades MacMillan,
his publisher, to share profits from this and other books
50/50. (By 1942 4,900 copies have sold, netting Keynes
£295.)
3 April 1913
Before his book is published, Keynes is offered and
accepts a seat on a Royal Commission to enquire into
Indian Finance and Currency.
12 August 1913
Austen Chamberlain writes to Keynes, "You will
certainly be considered the author of the Commission's
report... I am amazed to see how largely the views of the
Commission... are a mere repetition of the arguments
and conclusions to which your study had previously led
you."
August 1914
World War 1 Begins
Chancellor of the Exchequer David Lloyd George reads
a memorandum written by Keynes urging resistance to
demands being made by bankers for the creation of new
assets and suspension of liabilities.
Basil Blackett, working in the Treasury, writes in his
diary, "Lloyd George has at last come down on the right
side ... He has clearly imbibed much of Keynes's
memorandum and is strong against suspension of specie
payments..."
November 1914
News of the deaths at the front of friends and
undergraduates comes to Keynes who is back at work
in Cambridge.
He writes to G.L. Strachey, "I am absolutely and
completely desolated. It is utterly unbearable to see day
by day the youths going away, first to boredom and
discomfort, and then to slaughter."
In April 1915, he writes to Duncan Grant, "It is horrible,
a nightmare to be stopt anyhow. May no other
generation live under the cloud we live under."
January 1915
Keynes joins the Treasury to assist Sir George Paish,
whose role is to provide advice to David Lloyd George
independent of that given by civil service officials.
Soon after his appointment, Keynes is asked by Lloyd
George to comment on Lloyd George's views on the state
of affairs in France. Keynes replies, "With the utmost
respect, I must, if asked for my opinion, tell you that I
regard your account as rubbish."
May 1915
Reginald McKenna replaces Lloyd George as Chancellor
of the Exchequer. Keynes's role at the Treasury is
formalised and he joins No. 1 Division, which deals with
finance. Following this, he makes rapid progress in the
Treasury.
Sir Otto Niemeyer and Sir Richard Hopkins wrote
later:
"His quick mind and inexhaustible capacity for work
rapidly marked out a kingdom for itself, and, before
long he was a leading authority on all questions of
external, and particularly inter-allied finance... It was
Keynes who developed and applied the system of allied
war loans... When America came into the war, the
American Treasury found the system fully fledged and
itself adopted a similar practice.
26 March 1916
Despite the war, Keynes - who is now based in London
while working for the Treasury - continues to lead an
active social life. He writes to his mother:
"I have been leading such a giddy life lately that there
has been no time to write letters - only two evenings in
the last fortnight when I haven't dined out."
Early 1917
Keynes's takes authority for Treasury 'A' Division,
carved out of No. 1. Division. He is now in the key
position at the centre of the inter-allied economic effort.
His success in this role is universally acclaimed. This is
as high as Keynes will rise in a formal administrative
role in Government.
30 March 1917
In a letter to his mother, Keynes writes, in support of
the Russian Revolution:
"I was immensely cheered and excited by the Russian
news. It's the sole result of the war so far worth
having... I see not the remotest chance, however, of any
pro-Tsar counter-revolution..."
6 May 1917
In another letter to his mother, Keynes writes:
"Work has not been overwhelmingly heavy and the
negotiations with the U.S., which occupy a good deal of
my time, are going extremely well. If all happens as we
wish, the Yanks ought to relieve me of some of the most
troublesome of my work for the future. Relations with
Russia, on the other hand are not what they should be.
That's a piece of diplomacy over which we have
blundered hopelessly, with our ridiculous tears for the
Tsar and the rest of it."
24 December 1917
Keynes writes to his mother - again in a pro-Russian
revolution, anti-British establishment tone:
"My Christmas thoughts are that a further prolongation
of the war, with the turn things have taken, probably
means the disappearance of the social order we have
known hitherto. With some regrets I think I am not on
the whole sorry. The abolition of the rich will be rather
a comfort and serve them right anyhow. What
frightens me more is the prospect of general
impoverishment. In another year's time we shall have
forfeited the claim we had staked out in the New World
and in exchange this country will be mortgaged to
America.
"Well the only course open to me is to be buoyantly
bolshevik; and as I lie in bed this morning I reflect with
a good deal of satisfaction that, because our rulers are
as incompetent as they are mad and wicked, one
particular era of a particular kind of civilization is
very nearly over."
October 1918
Keynes and his future wife Lydia Lopokova are guests
(independently of one another) at a party to celebrate
the Russian Ballet in London.
Autumn 1918
Victory over Germany seems close. Keynes and 'A'
Division begin to look in earnest at reparations - the
financial compensation Germany should pay other
countries for the war.
Looking at the performance of the German economy
they conclude that Germany might possibly be able to
pay £3,000 million, but £2,000 million is a more likely
figure.
Charging £2,000 million at 5 percent interest would
lead to annual interest payments of £100 million from
Germany.
Meanwhile, an independent committee estimates the
full cost of the war at £24,000 million and, at 5 percent
of this sum, they conclude Germany should pay £1,200
million per year until the capital is paid off. (By way of
contrast, to see how huge a sum this was, in 1931 Britain
claimed it was economically impossible to pay off just
£35 million per year to the U.S.)
11 November 1918
The war ends with an armistice.
January 1919
No food gets into Germany for four months - against
the terms of the Armistice. The Germans must pay for
food in gold but the French are blocking this - they
want the gold as part of German reparations. British
troops are sickened by the sight of sick and hungry
children.
14 May 1919
Keynes writes:
"I have been as miserable for the last two or three weeks
as a fellow could be. The Peace is outrageous...
Meanwhile there is no food or employment anywhere,
and the French and Italians are pouring munitions into
Central Europe to arm everyone against everyone else."
28 May 1919
Harsh reparations are going to imposed on Germany.
Harold Nicholson writes:
"Lunch with Maynard Keynes... Keynes is very
pessimistic about the German Treaty. He considers it
not only immoral but incompetent."
AND
"...Keynes has been too splendid about the Austrian
Treaty. He is going to fight. He says he will resign."
5 June 1919
Keynes writes to Prime Minister David Lloyd George:
"I ought to let you know that on Saturday I am slipping
away from this scene of nightmare. I can do no more
good here. I've gone on hoping even through these last
dreadful weeks that you'd find some way to make of the
Treaty a just and expedient document. But now it's
apparently too late. The battle is lost."
June 1919
Keynes seeks to have a wider influence on public
opinion than a return to his pre-war life lecturing in
Cambridge will allow him. He informs the University
he will lecture once weekly on 'The Economic Aspects
of the Peace Treaty'. He also requests an involvement
in King's College's finances.
June 1919
Acting on the advice of friends, Keynes turns down
£2,000 per annum (10 to 20 times his academic
remuneration) for one day's work per week acting as
Chairman of a foreign bank. His friends believe such
an appointment might jeopardize other City
appointments. Keynes also has concerns about whether
he would truly be in control or merely a figurehead.
25 June 1919
"On Monday I actually began writing a book about the
economic condition of Europe, but may not persevere
with it."
14 August 1919
Keynes opens a trading account to begin speculating in
the currency markets on his own behalf. He trades on
high margin, initially making large profits.
August,
Keynes writes The Economic Consequences of Peace,
September 1919
castigating the allies for the punitive reparations they
had imposed on Germany at the end of the war.
In one passage of the book he writes chillingly of what
might be unleashed in Europe:
"If we aim deliberately at the impoverishment of
Central Europe, vengeance, I dare predict, will not be
limp. Nothing can then delay for very long that final
Civil War between the forces of Reaction and the
despairing convulsions of Revolution, before which the
horrors of the late German war will fade into nothing,
and which will destroy, whoever is victorious the
civilization and progress of our generation."
(The subsequent rise of Adolf Hitler in an economically
desperate Germany is held by many observers to
justify Keynes's condemnation of the punitive actions
taken by the allies against Germany following World
War One.)
September 1919
Keynes accepts and invitation to join the Board of
Directors of the National Mutual Life Insurance
Company. (He will become chairman in 1921.)
December 1919
Keynes's The Economic Consequences of Peace is
published in Britain and in January it will be
published in America. The left welcome the book. The
centre and right are hostile - they believe it is right
that German criminality should be punished. With
time, this view will change to one of 'I suppose this
fellow is right; I suppose we have made a fearful hash
of things.'
The book brings fame to Keynes but also turns him into
a figure the establishment will be wary of for a
considerable period of time.
May 1920
Keynes loses disastrously in his currency speculating.
His brokers - treating Keynes more favourably than
the norm - request £7,000 to keep the account open.
Keynes is given £5,000 by a financier and obtains
£1,500 in advance for future sales of The Economic
Consequences of Peace.
July 1920
Keynes is back in the currency markets, speculating
again - this time successfully. He wants to be
independently wealthy - his authorship of The
Economic Consequences of Peace - seen as an antiestablishment work - has ruined his chances of
obtaining a position on the board of any of the great
British banks.
November 1920
Keynes is appointed Second Bursar at King's College
with a stipend of £100 per year. As a Supernumerary
Fellow, his academic activities are now unpaid.
1921
It is a busy year - and in fact it will be a busy decade as Keynes juggles a multiplicity of jobs and
responsibilities.
Friday to Tuesday each week Keynes is at King's
College, tutoring pupils, lecturing and presiding over
his Monday evening club.
His bursarial duties grow and he takes increasing
responsibility for the College's investment policy.
He writes to the Cambridge Review, supporting the
cause of women, and continues as Editor of the
Economic Journal.
With a view to increasing his personal wealth, Keynes
forms or joins a number of investment syndicates while
continuing to speculate on his own behalf.
In London, he becomes a financial consultant and
follows the markets daily.
He decides he will write a new book on the German
reparations problem and has frequent correspondence
with people connected with this issue.
Keynes is also writing frequently for newspapers,
particularly the Manchester Guardian. He sells his
articles overseas and earns a significant income from
journalism.
He is a member of the Liberal Committee on Industrial
Policy.
Meanwhile, he continues to be a main player with his
Bloomsbury friends in London where the concerns
revolve around the finer things in life - the arts, good
conversation, gossip about friends, literature and
parties.
Easter 1921
On vacation in Algeria and Tunisia, Keynes returns to
his earlier dissertation on probability, preparing it for
publication with the title Treatise on Probability.
In North Africa, he and a friend have their shoes
polished by a street-boy. Keynes believes he knows how
much the boy should be paid and refuses to pay more.
Natives throw stones at Keynes as he makes his way
from the scene. Keynes comments, "I will not be a
party to debasing the currency."
Later in 1921 Treatise on Probability is published. It is
Keynes's first and last major work in Mathematics,
exploring the foundations of knowledge.
Keynes argues against the validity of probabilities
based on the frequency of past occurrences where
probabilities may be subject to interpretation by
people. He argues that probability is a logical relation
and so it is objective. A statement involving
probability relations has a truth-value independent of
people's opinions. He says:
"Perception of probability, weight, and risk are all
highly dependent on judgement," and "the basis of our
degrees of belief is part of our human outfit."
May 1921
Keynes loves the Ballet and he begins to fall under the
romantic spell of the well-known Russian ballerina,
Lydia Lopokova. Lydia is separated from her husband,
who lives in America. Keynes persuades Lydia to move
to a flat closer to his Bloomsbury friends and begins to
advise her financially.
January 1922
A Revision of the Treaty, Keynes's second work on
German reparations is published. The book documents
the course of events since his previous work and argues
again for a reduction in payments demanded from
Germany.
1922
Keynes publishes his views - and those of many other
distinguished authors - on Europe's economies in twelve
Manchester Guardian supplements. These run to 810
large three-column pages. Keynes argues for currency
devaluation in all but a few European countries and a
new Gold Standard.
1923
Keynes begins contributing monthly articles - mainly
on reparations - to the Nation, the Liberal weekly. He
also writes regular 'Notes on Finance and Investment'
for the Nation.
7 July 1923
The Bank of England, amid falling prices and rising
unemployment, increases the base rate from three to
four percent in preparation for Sterling's return to its
pre-war gold parity.
14 July 1923
Referring to the increased interest rate, a horrified
Keynes writes in the Nation:
"The Bank of England acting under the influence of a
narrow and obsolete doctrine has made a great
mistake."
November 1923
Keynes publishes A Tract on Monetary Reform, calling
for an end to the Gold Standard, which he refers to as
"a barbarous relic". He states that devaluation is
preferable to deflation. On the question of whether it is
preferable to manage a currency to achieve a stable
external value or stable internal prices, Keynes
concludes that stable internal prices are preferrable.
12 April 1924
British unemployment has reached one million. Lloyd
George writes to the Nation demanding the
Government should intervene to fund a large program
of public works to create jobs.
1924
Keynes become First Bursar at King's College, taking
control of the College's finances.
24 May 1924
Keynes's Does Unemployment Need a Drastic
Remedy? is published in the Nation. He proposes
Government capital spending of £100 million per
annum to stimulate the economy, specifically spending
on housing, roads and electrical power distribution. He
further proposes National Savings should be spent on
works in Britain rather than invested overseas.
Second Half 1924
Sterling is appreciating on the currency markets.
Speculators are buying Sterling anticipating it will rise
to its pre-war value when it rejoins the Gold Standard.
November 1924
Keynes gives the Sydney Ball Foundation Lecture at
Cambridge. The title he chooses for his lecture is The
End of Laissez-Faire and he says:
"I believe that in many cases the ideal size for the unit
of control and organisation lies somewhere between the
individual and the modern State. I suggest, therefore,
that progress lies in the growth and the recognition of
semi-autonomous bodies within the State-bodies whose
criterion of action within their own field is solely the
public good as they understand it, and from whose
deliberations motives of private advantage are
excluded..."
"One of the most interesting and unnoticed
developments of recent decades has been the tendency
of big enterprise to socialise itself. A point arrives in
the growth of a big institution... at which the owners of
the capital, i.e. its shareholders, are almost entirely
dissociated from the management, with the result that
the direct personal interest of the latter in the making
of great profit becomes quite secondary. When this
stage is reached, the general stability and reputation of
the institution are the more considered by the
management than the maximum of profit for the
shareholders."
"We must aim at separating those services which are
technically social from those which are technically
individual... The important thing for government is
not to do things which individuals are doing already,
and to do them a little better or a little worse; but to do
those things which at present are not done at all."
"For my part I think that capitalism, wisely managed,
can probably be made more efficient for attaining
economic ends than any alternative system yet in
sight, but that in itself it is in many ways extremely
objectionable. Our problem is to work out a social
organisation which shall be as efficient as possible
without offending our notions of a satisfactory way of
life."
December 1924
By virtue of astute speculation in the financial
markets, Keynes's assets have grown from nil (virtual
bankruptcy) in May 1920 to £57,797. He has achieved
his objective of becoming a wealthy man.
April 1925
Keynes, almost on his own, continues to argue against
the Gold Standard. He writes in the Nation of his
concerns about the over-valuation of Sterling.
29 April 1925
Winston Churchill, acting on the advice of his economic
advisers, returns Sterling to the Gold Standard. Keynes
continues to protest that Sterling is overvalued.
(Churchill would later admit that rejoining the Gold
Standard at the prewar level was one of the greatest
mistakes he ever made.)
4 August 1925
Lydia Lopokova becomes Keynes's wife and the
married couple travel to Russia to meet Lydia's family.
1925 - 1926
British coal exports become uncompetitive because of
Sterling's high value. Mine owners decide coal miner's
wages should be cut.
Stanley Baldwin's Conservative government intervenes
and provide a nine-month subsidy to maintain the
miners' wages.
February 1926
Keynes calls for a working agreement between the
Liberal and Labour Parties in order to rid the country
of the Conservative Government.
May 1926
A general strike in support of the miners causes
widespread disruption. The aftermath of the strike is
highly damaging and Britain's industrial development
between 1925 and 1929 lags most of its competitors.
1927
Keynes continues working in his academic and
bursarial duties at King's College, a variety of business
roles and his editorial and journalistic activities. He
takes a less prominent role in public life as he develops
ideas and drafts his next major work - A Treatise on
Money.
Summer 1929
Keynes is made Fellow of the British Academy.
October 1929
Led by Wall Street, the world's stock markets crash,
heralding an economic depression.
4 November 1929
Keynes joins the government's Macmillan Committee
of Enquiry into Finance and Industry.
30 January 1930
Keynes joins the Economic Advisory Council, set up to
report to the government on economic policy.
10 May 1930
Keynes writes in the Nation:
"The fact is - a fact not yet recognized by the great
public - that we are now in the depths of a very severe
international slump, a slump which will take its place
in history amongst the most acute ever experienced. It
will require not merely passive movements of bank
rates to lift us out of a depression of this order, but a
very active and determined policy."
September 1930
A large, long-lasting, world-wide cut in interest-rates is
required, Keynes writes in Svenska Handelsbanken
Index.
December 1930
A Treatise on Money is published in two volumes. The
central thrust of the treatise is the distinction between
Investment and Saving. If Investment exceeds Saving,
there will be inflation Keynes says. If Saving exceeds
Investment there will be recession. One implication of
this is that, in the midst of an economic depression, the
correct course of action should be to encourage
spending and discourage saving. This runs contrary to
the prevailing wisdom, which says that thrift is
required in hard times. In Keynes's words:
"For the engine which drives Enterprise is not Thrift,
but Profit."
May/June 1931
At the invitation of the University of Chicago, Keynes
travels to America to give a lecture on the Harris
foundation. His chief desire is to study America's
economic conditions at first hand. He has interviews
with senior people in the Federal Reserve and with
President Hoover. He his happy with the Federal
Reserve's attitude that it should promote economic
expansion.
September 1931
The British Government, reeling from the depression,
abandons the Gold Standard and devalues sterling by
twenty percent. In doing so, it finally acts as Keynes
has been advocating since the mid-1920s.
September 1931
Keynes attacks Ramsay MacDonald's National
Government's budget - in particular the wage cut for
school-teachers and the reduction in the road building
and house building programmes. He warns the budget
will cause both deflation and unemployment to worsen.
1932 / 1933
Keynes continues to advocate that the government
should borrow money and undertake large-scale public
works to stimulate the economy.
June 1933
The BBC broadcasts a transatlantic conversation
between Keynes and Walter Lippmann - the first ever
broadcast of a transatlantic conversation.
17 April 1934
Walter Lippman writes to Keynes from America about
the effect a letter from Keynes to the New York Times
has had:
"...I do not know whether you realize how great an
effect that letter [viz. that in the New York Times]
had, but I am told that it was chiefly responsible for
the policy which the Treasury is now quietly but
effectively pursuing... reducing the long-term rate of
interest."
June 1934
Keynes visits America again. He studies its economy
and its stocks and bonds for personal investment
purposes. He concludes that share prices - particularly
of public utilities - are priced for exceptional value and
he invests a large part of his own funds - with great
success.
He meets President Roosevelt who writes to Felix
Frankfurter, "I had a grand talk with K and liked him
immensely..."
Keynes wins the enmity of American advocates of
laissez-faire economics who believe Roosevelt is
allowing American economic policy - The New Deal to be influenced by a foreign economist.
Late 1934
Keynes finishes writing his first draft of The General
Theory of Employment, Interest and Money - an
analysis of the causes of unemployment. Keynes argues
against the classical economic theory that full
employment could always be reached by making wages
sufficiently low.
January 1935
In a letter to George Bernard Shaw, Keynes writes:
"... you have to know that I believe myself to be writing
a book on economic theory which will largely
revolutionize - not, I suppose, at once but in the course
of the next ten years - the way the world thinks about
economic problems."
Early 1935
Keynes sends copies of the first draft of The General
Theory of Employment, Interest and Money to a
variety of figures whose views he respects and engages
in a significant amount of detailed correspondence
with these people as he works to perfect the book. In a
letter to George Bernard Shaw, Keynes writes:
"The city of Cambridge has always lacked a first class
theatre. Keynes, as First Bursar of King's College,
releases land for the construction of a theatre and
funds much of the construction personally."
June 1935
Copies of the second draft are sent out, again resulting
in vigorous correspondence.
February 1936
The General Theory of Employment, Interest and
Money is published. Keynes proposes that economies
are made up of aggregate quantities of output
resulting from aggregate streams of expenditure unemployment is caused if people don't spend enough
money.
1936
As Hitler's Germany grows ever more menacing
Keynes who, in the 1920s, had favoured disarmament,
speaks and writes in favour of a militarily strong
Britain.
He travels to Russia and to Europe and continues with
his normal duties.
Summer 1937
Keynes suffers life-threatening illness, with thrombosis
of the coronary artery. He moves to Ruthin Castle in
Wales for rest and reduces his workload dramatically.
February 1938
Keynes makes his first public appearance since he fell
ill, at the Annual General Meeting of the National
Mutual Life Assurance Society.
October 1938
In an article in the New Statesman, Keynes writes of
the Munich agreement between Neville Chamberlain
and Adolf Hitler:
"Neither the Prime Minister nor Herr Hitler ever
intended for one moment that the play-acting should
devolve into reality."
September 1939
Germany invades Poland and Britain declares war on
Germany. World War Two has begun. Keynes,
although continuing to suffer ill health, resumes his
work in Cambridge and London.
October 1939
Keynes attacks the attitude of the intellectual Left to
the war, writing in The Times:
"The intelligentsia of the Left were the loudest in
demanding that the Nazi aggression should be resisted
at all costs. When it comes to a showdown, scarce four
weeks have passed before they remember that they are
pacifists and write defeatist letters to your columns,
leaving the defence of freedom and civilization to
Colonel Blimp and the Old School Tie, for whom Three
Cheers."
November 1939
Party politics have more or less ceased and Keynes is
offered the (likely to be uncontested) position of
Member of Parliament for Cambridge University. He
turns this honour down, in order that he can remain
aloof from government and take his own individual
stance on issues.
February 1940
Keynes publishes a small book entitled How to Pay for
the War, which sells 35,000 copies. He actively
promotes his proposals that interest rates should be
kept low and that compulsory saving (deferred pay)
should be used as a mechanism to prevent the inflation
that occurred during World War One.
7 June 1940
Keynes's doctor says he is now, "fit for any moderate
activity."
July 1940
Enemy aliens are rounded up and sent to the Isle of
Man, including a number of academics who have fled
Nazi Germany. They will later be released but
meanwhile Keynes writes, "I can remember nothing
equal to what is going on for stupidity and callousness."
He writes a stream of letters to various authorities on
behalf of internees.
Keynes is given a room in the Treasury and becomes a
government economic adviser. He receives no pay for
his duties, but now spends most of his time in London
in this capacity.
September 1940
A German bomb falling on London smashes windows in
Keynes's house and there's an unexploded bomb in the
neighbourhood. Keynes commutes into London for
three weeks from his Tilton vacation home.
May 1941
Keynes makes the first of several very important visits
he will make to America between now and 1946. The
good personal relationships he has developed in past
visits to America - and he will continue to develop will make it easier for Keynes to negotiate with
America on Britain's behalf. On this occasion, Keynes
is concerned mainly with arrangements for Lend-Lease
and to explain in detail Britain's financial
predicament after two years of war.
29 May 1941
Anthony Eden makes an important speech on Britain's
war objectives - the economic thrust of which is based
on Keynes's ideas.
October 1941
Keynes is elected to the Court of the Bank of England.
He has grave concerns for Britain's post-war economy
and wonders about the possibility of applying
"Keynesian" solutions on a world-scale. He writes his
first draft of an international 'Clearing Union' of a
non-political character, to aid and support other
international institutions concerned with the planning
and regulation of the world's economic life.
1942 - 1944
Keynes is heavily engaged in making proposals for and
engaging in discussions about what will later become
the International Monetary fund (IMF), the World
Bank, and the Breton Woods system for international
currency management.
1942
Keynes gives his broad support to proposals from Sir
William Beveridge for a large-scale expansion of social
insurance - later to be called the welfare state and the
National Health Service. Keynes is confident the
proposals are affordable but persuades Beveridge to
cut down on overall costs in the first five years. This
results in a postponement of the right to higher
pensions until contributions had been accumulated.
May 1942
Manchester University makes Keynes an Honorary
Doctor of Laws.
June 1942
Keynes is awarded a peerage, bringing him a seat in
the House of Lords. His title is Baron Keynes of Tilton.
He chooses to take a seat with the Liberal Party in the
Lords.
September 1943
Keynes makes his second wartime visit to the United
States, refusing to be deterred by his poor health. He
meets Harry Dexter White, Chief International
Economist at the U.S. Treasury, who he will cross
swords with frequently on the post-war economic
settlement. (Harry Dexter White will later be exposed
as a Soviet agent.) Whatever Keynes's abilities as a
negotiator, Britain's weak economic position means
that America holds the trump cards in most
negotiations. Nevertheless, close co-operation between
the British and Americans on economic matters is
established and Keynes manages to shift White's
position closer to his own in many important respects.
March 1944
Illness prevents Keynes attending an important series
of economic meetings with the Dominions - Australia,
Canada and New Zealand.
June 1944
Keynes sets sail for Bretton Woods for further talks
with American negotiators about the post-war
economic settlement. In his journal, one of the British
contingent at the talks, Professor Robbins, writes:
"In the late afternoon we had a joint session with the
Americans, at which Keynes expounded our views on
the Bank. This went very will indeed. Keynes was in
his most lucid and persuasive mood: and the effect was
irresistible. At such moments, I often find myself
thinking that Keynes must be one of the most
remarkable men that have ever lived - the quick logic,
the birdlike swoop of intuition, the vivid fancy, the
wide vision, above all the incomparable sense of the
fitness of words, all combine to make something several
degrees beyond the limit of ordinary human
achievement."
July 1944
Emmanual Goldenweiser writes of Keynes's
chairmanship of the Bank Commission:
"He shone in two respects - in the fact that he is, of
course, one of the brightest lights of mankind ... and
also by being the world's worst chairman."
Dean Acheson, America's representative tells the
Treasury Secretary that Keynes was rushing things,
"in a perfectly impossible and outrageous way ... He
knows this thing inside out so that when anybody says
section 15-C he knows what it is. Nobody else in the
room knows. So before you have an opportunity to
turn to Section 15-C and see what he is talking about,
he says, 'I hear no objection to that', and it is passed.
Well, everybody is trying to find 15-C. He then says, we
are talking about Section 26-D. Then they begin
fiddling around with their papers, and before you find
that, it is passed."
Keynes suffers a heart attack while in the United
States, but it does not seem too serious.
September -
The cost of fighting the war has pushed Britain's
November 1944
external debt to enormous levels. Anticipating the
defeat of Germany, Keynes travels to the United States
for a fourth time, to negotiate Lend-Lease for the war
against Japan after Germany's defeat. He spends over
two months in Washington, taking every opportunity
to describe Britain's dire financial position to the
Americans.
August 1945
Churchill has been replaced by Atlee and Roosevelt is
dead, replaced by Truman. The bomb has been dropped
on Hiroshima. Keynes is deeply engaged in
negotiations with the Americans again. Fighting the
war for six years has bankrupted Britain. Keynes is
engaged in the task of eliciting American assistance to
keep Britain solvent in the post-war years, when the
Americans may feel less well disposed to helping a
country it is no longer fighting shoulder-to-shoulder
with.
America announces that Lend-Lease to the United
Kingdom has been stopped. Mainstream American
opinion is that, with the war over, if the British are
not starving, they should not need further assistance.
Keynes will need to fight hard to secure further
American assistance for Britain.
September 1945 to
Keynes travels to the United States again, hoping to
December 1945
secure a loan to help Britain rebuild its economy. If he
does not succeed, food rations in Britain will have to be
cut severely.
Keynes speaks at the Federal Reserve for three days,
presenting facts without embellishment. All present
agree it is the finest presentation of a case they have
ever heard.
Members of the British and American delegation break
into separate commissions to discuss individual
problems - over a period of three months.
The British obtain a loan from America, which will be
interest free for six years and then charged at two
percent. Also, Britain's huge potential Lend-Lease
obligations to America will be remitted in their
entirety. It is likely that Keynes's efforts for Britain
have been rewarded with more generous terms than
might have been obtained otherwise.
December 1945
Keynes returns to Britain, his health poor with
fatigue, to find a significant degree of malcontent with
the loan agreement he has negotiated with America. In
Parliament and in the country at large there is a
growing anti-American feeling, spurred by the belief
that Britain is being forced into too many concessions
to America in order to obtain the loan.
Unfortunately, most people are not acquainted with
the economic facts. Keynes gives a masterful
performance in the House of Lords, explaining the
terms of the loan agreement and how Britain could not
reasonably expect more.
February 1946
Keynes finds time to return to Cambridge and to dine
amongst friends in his old Monday Evening Club.
20 February 1946
Keynes suffers a slight heart attack while visiting the
ballet at Covent Garden.
24 February 1946
Keynes sets sail for New York, from where he travels
to Savannah, Georgia for what will prove to be his
final visit to the United States. He anticipates a
pleasant time at the inaugural meetings of the World
Bank and the International Monetary Fund and plans
to enjoy a vacation afterwards in Savannah, a place
he has previously found to be highly agreeable.
In fact, the meeting proves to be difficult and illtempered. In Keynes's view, the Americans are taking
advantage of their strong economic position to force illconceived decisions on the IMF and Bank. Nations in
debt to the Americans are voting with America, not
because they want to but because, owing to their
dependence on American aid, they feel they have no
other option.
Until now, Keynes has always spoken strongly in
favour of Americans - he has always found them to be
pragmatic, ready to look at issues from all angles and
ready to compromise. Now it seems they merely wish
to dictate. When the meeting is over, Keynes abandons
his plans for a vacation in Savannah. The place now
has bitter associations and, on March 18 he leaves on
the night train for Washington.
19 March 1946
On the train to Washington Keynes suffers a severe
heart attack.
11 April 1946
Over lunch at the Bank of England, Keynes tells Henry
Clay of his hopes that Adam Smith's 'invisible hand'
can help Britain out of the economic hole it is in:
"I find myself more and more relying for a solution of
our problems on the invisible hand which I tried to
eject from economic thinking twenty years ago."
21 April 1946
John Maynard Keynes dies at home, in bed.
22 April 1946
The Times obituary writes of Keynes:
"To find an economist of comparable
influence, one would have to go back to
Adam Smith."
Sources:
→ R.F. Harrod, The Life of John Maynard Keynes, 1951
→ J. Maynard Keynes, The End of Laissez-Faire, 1926
→ Against The Gods, Peter L. Bernstein, 1996.
→ Robert Skidelsky, John Maynard Keynes Volume One:
Hopes Betrayed 1883-1920.
→ Robert Skidelsky, John Maynard Keynes 1883 - 1946,
2003
→ John Maynard Keynes, J. J. O'Connor and E. F.
Robertson, October 2003