Nobel-Prize-winning Economist Amartya Sen Considers the Consequences of Austerity

Source: The New Statesman, June 4

Amartya SenAmartya Sen is Professor of Economics and Philosophy at Harvard University. He recalls Keynes’ book, The Economic Consequences of the Peace, after WWI.

“…The high-minded moral rhetoric in favour of the harsh imposition of austerity on Germany that Keynes complained about came particularly from Lord Cunliffe and Lord Sumner, representing Britain on the Reparation Commission, whom Keynes liked to call ‘the Heavenly Twins.’ In his parting letter to Lloyd George, Keynes added, ‘I leave the Twins to gloat over the devastation of Europe.’ Grand rhetoric on the necessity of imposing austerity, to remove economic and moral impropriety in Greece and elsewhere, may come more frequently these days from Berlin itself, with the changed role of Germany in today’s world. But the unfavourable consequences that Keynes feared would follow from severe – and in his judgement unreasoned – imposition of austerity remain relevant today (with an altered geography of the morally upright discipliner and the errant to be disciplined)….”

This is the final paragraph:

“Public knowledge and understanding are indeed central to the ability of a democratic government to make good policies. The Economic Consequences of the Peace ends by pointing to the connection between epistemology and politics, and arguing that we can make a difference to the world only by (in Keynes’s words) ‘setting in motion those forces of instruction and imagination which change opinion.’ The last sentence in the book affirmed his hope: ‘To the formation of the general opinion of the future I dedicate this book.’ In that dedication, there is enlightenment as well as optimism, both of which we strongly need today.”


One response to “Nobel-Prize-winning Economist Amartya Sen Considers the Consequences of Austerity

  1. Jan Krouzil

    Granting ‘the connection between epistemology and politics’, only the July 5th referendum in the birthland of ‘democracy’ may show whose ‘moral uprightness’ is likely to prevail.