The Price of Peace
A page-turning biography of world-changing economist John Maynard Keynes and the big ideas that outlived him.In the spring of 1934, Virginia Woolf sketched an affectionate biographical portrait of her great friend John Maynard Keynes. Writing a full two years before Keynes would revolutionize the economics world with the publication of The General Theory, Woolf nevertheless found herself unable to condense her friend's already-extraordinary life into anything less than twenty-five themes, which she jotted down at the opening of her homage: "Politics. Art. Dancing. Letters. Economics. Youth. The Future. Glands. Genealogies. Atlantis. Mortality. Religion. Cambridge. Eton. The Drama. Society. Truth. Pigs. Sussex. The History of England. America. Optimism. Stammer. Old Books. Hume."Keynes was not only an economist, as he is remembered today, but the preeminent anti-authoritarian thinker of the twentieth century, a man who devoted his life to the belief that art and ideas could conquer war and deprivation. A moral philosopher, political theorist, and statesman, Keynes immersed himself in a creative milieu filled with ballerinas and literary icons as he developed his own innovative and at times radical thought, reinventing Enlightenment liberalism for the harrowing crises of his day--which included two world wars and an economic collapse that challenged the legitimacy of democratic government itself. The Price of Peace follows Keynes from intimate turn-of-the-century parties in London's riotous Bloomsbury art scene to the fevered negotiations in Paris that shaped the Treaty of Versailles, through stock market crashes and currency crises to diplomatic breakthroughs in the mountains of New Hampshire and wartime ballet openings at Covent Garden.In this riveting biography, veteran journalist Zachary D. Carter unearths the lost legacy of one of history's most important minds. John Maynard Keynes's vibrant, deeply human vision of democracy, art, and the good life has been obscured by technical debates, but in The Price of Peace, Carter revives a forgotten set of ideas with the power to reinvent national government and reframe the principles of international diplomacy in our own time.

The Price of Peace Details

TitleThe Price of Peace
Author
LanguageEnglish
ReleaseMay 19th, 2020
PublisherRandom House
ISBN-139780525509035
Rating
GenreBiography, Economics, History, Nonfiction, Politics

The Price of Peace Review

  • Mehrsa
    January 1, 1970
    This book is not just about Keynes. It is, as the author notes, an exploration about whether you can make changes through policy or through revolution. It gets at one of the greatest fissures in modern thought right now across the world--do you need to burn the system to the ground and start over and can you make technical fixes that improve people's lives, avoid inter- and intra-societal conflicts, and equality. Keynes was an optimist and a technocrat even though his ideas were debunked when hi This book is not just about Keynes. It is, as the author notes, an exploration about whether you can make changes through policy or through revolution. It gets at one of the greatest fissures in modern thought right now across the world--do you need to burn the system to the ground and start over and can you make technical fixes that improve people's lives, avoid inter- and intra-societal conflicts, and equality. Keynes was an optimist and a technocrat even though his ideas were debunked when his name became a byword for "radical communist." This is ironic because the neoliberal movement that swept away Keynesian was much more radical than the Keynesians. Hayek, Friedman, and Goldwater conducted a revolution in the name of incrementalism, conservatism, and technical-ism (sic). Where Keynes was the incrementalist. Anyway, this is a must-read. So well-written.
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  • Bob H
    January 1, 1970
    A magisterial and detailed (530 pp.) account of the work and legacy of John Maynard Keynes, the legendary economist whose writing and diplomacy -- public and private -- would influence economies and world policy in his time and beyond. Although it's a biography of sorts, it follows his adult life and career starting in the years before WWI and traces his influence beyond his death in 1946 -- indeed, the book's final pages concern the 2008 financial collapse and its aftermath.We learn of his pers A magisterial and detailed (530 pp.) account of the work and legacy of John Maynard Keynes, the legendary economist whose writing and diplomacy -- public and private -- would influence economies and world policy in his time and beyond. Although it's a biography of sorts, it follows his adult life and career starting in the years before WWI and traces his influence beyond his death in 1946 -- indeed, the book's final pages concern the 2008 financial collapse and its aftermath.We learn of his personal life, his time as a young man with the Bloomsbury Group, an almost communal group of intellectuals in pre-WWI London who traded soirées and love affairs as their varied careers and fame would grow (Keynes would shock his friends, after the war, by marrying a woman). Keynes' reputation as an economist in his early 30s would be enough for him to solve a currency crisis in London just as WWI was starting. He would remain in various important Treasury posts and serve an important role with the UK delegation at the 1919 Paris peace talks.Keynes witnessed considerable history and economic damage at war's end, and, out of government, would write of his disillusionment, and later his gathered theories on economics and government. Ignored at first, he would, we see, become more and more vindicated as Britain, and later the US, would see considerable economic calamity. Keynes would become an influence, both philosophical and personal, with FDR's administration after the Crash, and, through correspondence, with FDR himself. Keynes would be a key part of the economic response to the Depression and, later, in the Allied economic mobilization in WWII. His final act would be his crucial work at the Bretton Woods economic conference, an event that would be one of the decisive outcomes after the war.Much of the book traces his legacy. Keynes would inspire or influence generations of policy economists, particularly in the US, starting with John Kenneth Galbraith and ending up with the likes of Paul Krugman and Joseph Stiglitz. In one way or another, Keynesian economics would affect policy in the administrations of JFK, LBJ and Richard Nixon. We also see a rival, conservative school of conservative economics originating with a contemporary of Keynes, Friedrich Hayek, whose later disciples, starting with Milton Friedman, would be antagonists, even nemeses, to the Keynesians.The book traces the decline of Keynesianism in the Clinton years, a second gilded age that would seemingly retire Keynes' notions as quaint and outdated. The book does argue that all that changed under the demands of the 2008 crash and the new economic problems. It's no spoiler to say the book pretty much concludes toward the end of the Obama years. However, given the covid-19 pandemic and the sudden new Depression it has caused, this book may explain at least some of the economic ideologies shaping official policy now -- whether or not the officials have even heard of Hayek or Keynes, the dynamics are still at hand, and this book is a timely background to this day. In the long run, Keynes famously said, we're all dead; he also wrote that in the short run, we're alive. Highest recommendation.Read in advance copy from Amazon Vine.
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  • Sherrie
    January 1, 1970
    ***I won this book in a Goodreads Giveaway***So, for the first 350 pages or so this was going to be a strong 4 stars. A little bit biography, a little bit economics and philosophy history. Combined, this made for a very interesting read. John Maynard Keynes was not what we think of nowadays when we think of economists (sorry, friends, not an insult!) He was quirky and let his personal experiences and beliefs color his views on economic systems. And in many situations...he was right. I thoroughly ***I won this book in a Goodreads Giveaway***So, for the first 350 pages or so this was going to be a strong 4 stars. A little bit biography, a little bit economics and philosophy history. Combined, this made for a very interesting read. John Maynard Keynes was not what we think of nowadays when we think of economists (sorry, friends, not an insult!) He was quirky and let his personal experiences and beliefs color his views on economic systems. And in many situations...he was right. I thoroughly enjoyed how the author explained various financial systems and economic theories and how the different variables play against one another. I felt like I learned a lot. But then, Keynes died with like 150 pages left in the book...which is weird, but could have been OK. Instead, the book lost all semblance of direction. While the first 350 pages had dealt primarily with Great Britain and the issues that Keynes worked on directly, the latter 150 pages dealt entirely with America. Everything from the Cold War through Obama's presidency. It's too much, everything was disconnected and it just sort of fell apart. Instead of working through specific cases slowly and methodically, the author went through 50+ years in a blitz, only saying things that have been said in many other books/articles already, and only loosely connecting these back to Keynes (because, realistically, very little of American politics has been driven by Keynes ideas). The book would have been improved by cutting out that whole latter section to be replaced with something more consistent with the Keynes life and philosophy. I do recommend the first ~350 pages to readers who are curious about Keynes ideas. It was a fun and informative read. My only caveat is to keep the author's bias in mind...he's a senior reporter for HuffPost and is clearly a big fan of Keynes. He came across a little defensive at times.
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  • Dave
    January 1, 1970
    I had no idea that John Maynard Keynes was such an amazing guy. I vaguely knew him as an economist whose theories influenced FDR during the Depression. I had no idea that he was a journalist, philosopher, member of the Bloomsbury group of authors and artists among other things. And his economic ideas stemmed from a desire to halt war and help the little guys. Unfortunately, he wasn't always listened to.This isn't a traditional biography in two ways. First, we don't get the cradle-to-grave treatm I had no idea that John Maynard Keynes was such an amazing guy. I vaguely knew him as an economist whose theories influenced FDR during the Depression. I had no idea that he was a journalist, philosopher, member of the Bloomsbury group of authors and artists among other things. And his economic ideas stemmed from a desire to halt war and help the little guys. Unfortunately, he wasn't always listened to.This isn't a traditional biography in two ways. First, we don't get the cradle-to-grave treatment. Carter begins the bio in 1914 at the start of The Great War, when Keynes is called from his post at university to advise the British government on how to finance the war effort. That begins his lifelong goal to develop economic principles that would help make war less likely and fueled his frustration with the Versailles Treaty that he was convinced would lead to another war with Germany. Unfortunately he was right.The other way that this is not a typical biography is that roughly the last third of the book follows events after Keynes's death. Carter follows economists like Paul Samuelson, John Kenneth Galbraith and others who took Keynes's work and built on it - or evolved it into something quite different from what Keynes intended. Between the first half of the century when Keynes was alive and the second half, we get an economic history of the 20th century (and the opening years of the 21st - including economic decisions that led to the Great Recession). And Carter manages to make some of the complex theories downright readable.NOTE - I received an Advanced copy of this book from the publisher through a Goodreads giveaway.
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  • Peter
    January 1, 1970
    In spite of his one-time prominence, John Maynard Keynes ("Cains")isn't a household name today. So Zachary Carter's The Price of Peace: Money, Democracy, and the Life of John Maynard Keynes (2020) is an effort to fill that gap. I found the book wanting when compared to Lord Robert Skidelsky's three-volume The Economist as Savior: 1920-1937. But that's probably an unfair comparison—nuances that can be addressed in three volumes are elided in a single volume, and a single volume requires difficult In spite of his one-time prominence, John Maynard Keynes ("Cains")isn't a household name today. So Zachary Carter's The Price of Peace: Money, Democracy, and the Life of John Maynard Keynes (2020) is an effort to fill that gap. I found the book wanting when compared to Lord Robert Skidelsky's three-volume The Economist as Savior: 1920-1937. But that's probably an unfair comparison—nuances that can be addressed in three volumes are elided in a single volume, and a single volume requires difficult choices about what does and what doesn't deserve attention. Carter's eye is primarily on Keynes's social life—which was extremely active—and his personality—which was extraordinarily charming and witty. Carter does a good job reporting Keynes's professional work and it's impact on economic theory and policy, and that's what makes him a name worth remembering.Keynes's Personal Life: A Thumbnail SketchIt's well known that Keynes was homosexual. This was not unusual in his generation on Britain among prep school and university students. For Carter it is an up-front issue in Keynes's life, and Carter marvels at Keynes's successful marriage to an internationally-acclaimed Russian ballerina named Lydia Lopokova. Keynes was not a man to be stuck in his office. He was the antithesis of the notion of an economist as a dry and uninteresting person: a lively man at dinner parties, frequently at the theater, an avid dancer, and a stalwart in the Bloomsbury set of Britain's philosophical, literary, and intellectual elite. But all of that is in The Price of PeaceKeynes's Professional LifeIf one is interested in Keynes' professional work, Skidelsky is the better choice: he is an eminent economic historian at the University of Warwick while Carter is a reporter at HuffPost and a business journalist. I know that sounds elitist, but education and experience do matter in assessing complex economic matters. Still, if you don't want to plod through three volumes, Carter's contribution is a worthy choice, and Carter does write well, as in this beautifully phrased snapshot capturing the complexity of his subject: Keynes was a tangle of paradoxes: a bureaucrat who marries a dancer; a gay man whose greatest love was a woman; a loyal servant of the British Empire who railed against imperialism; a pacifist who helped finance two world wars; an internationalist who assembled the intellectual architecture for the modern nation-state; an economist who challenged the foundation of economics. But embedded in all of these seeming contradictions is a coherent vision of human freedom and political salvation. Keynes's Professional LifeJohn Maynard Keynes ("Maynard") was born in 1883, the son of Ada Keynes, a social reformer, and John Neville Keynes ("Neville"), an economist at King's College, Cambridge University. He attended Eton College and graduated from King's college in 1908 with a first in mathematics—Bertrand Russell extolled his brilliance. In the same year he took a civil service position at the India Office, where he worked on financial matters in India.Though his education was in mathematics, Maynard's primary interests were in political philosophy and economics. He was a liberal of his day, believing that that government could be the solution for many social and economic problems. He was a problem-solving optimist, an outlook that shaped his career and his work. Carter emphasized Keynes's social life and personality, but it's his impact on economic theory and policy that makes him a name worth rememberingIn 1909 Keynes was given a minor academic position as a lecturer at King's College. In 1911 he published Indian Currency and Finance, a result of his brief time in the India Office. That work argued that India should have a different monetary system for international and domestic transactions: a gold standard for international finance and a paper standard for domestic finance. This idea would pop up in his advice to the British government after the start of WWI.In 1911 Keynes was appointed editor of The Economic Journal, a position from which he could help shape the field by selecting papers worthy of publication. His particular expertise was in finance and monetary theory, and he would soon be tested. At the outbreak of the war in August 1914 Keynes was called to assist in managing the financial crisis facing Britain: speculative runs against the pound, both internal and external, were draining Britain's coffers of gold and of currencies convertible into gold. The result was increasing interest rates and a decline in the domestic money supply ("tight money"). A recession was in the headlights when in 1915 Keynes was appointed to an official position in the Treasury to manage the problem. This began a lifelong career with one foot in the academy and one foot in government, a career that continued until his death in 1946.The standard prescription for resolution of a financial crisis under the gold standard was to either devalue the pound (raise the price of gold in terms of pounds) or to suspend convertibility entirely (simply end the requirement that the Treasury buy or sell gold), thus letting the pound "float." In the absence of those steps, the only solution was price deflation to reduce the domestic price level relative to price levels for trading partners. Bankers, the Treasury, and the Bank of England objected to devaluation or suspension of convertibility because London's position as a financial center would be compromised. Instead they proposed a plan to end the sale of gold to foreigners—a suspension of external convertibility but a continuation of internal convertibility. This would reserve the British gold stock for internal use. Keynes opposed that idea and made a counter-proposal based on his work in India: end sales of gold to the public (suspend internal convertibility) but maintain external convertibility. The gold specie (coins) used in domestic transactions would be replaced by new Treasury notes not convertible into gold. The risk was that the public would reject the a new and inconvertible currency: the plan would fail, and the run on the pound would get worse.To almost everyone's surprise, Keynes's proposal was adopted, and it worked: the new paper currency was accepted and the external drain of gold stopped because foreigners now believed there was sufficient gold at the British Treasury to maintain convertibility. This Hail-Mary pass was the beginning of Keynes's reputation as not only a brilliant thinker, but also as pretty smart. In 1919 Keynes attended the Paris Peace Conference that hashed out the Versailles Treaty ending the war. From this vantage point he wrote The Economic Consequences of the Peace (1919), a book assessing the Treaty and predicting that the massive reparations in gold and resources like rolling stock levied by the Triple Entente (France, Britain, the U. S. and Russia) to reimburse them for the costs of the war would impoverish the Central Powers (Germany and Austria-Hungary) and set the foundations for another European war. He was, of course, correct: WWII would pop up twenty years later.The next serious crisis occurred in 1925 when Winston Churchill, the Chancellor of the Exchequer, decided to return Britain to the international gold standard. Once again, this was driven by a desire to enhance London's position as a financial center. The return to gold at prewar parity ($4.86) was a disaster—during the war the British price level had risen sharply relative to U. S. prices. At the pre-war parity the pound was greatly overvalued—the price to foreigners of British goods was much higher than before the war and, as a corollary, the prices of foreign goods were much lower. The return to pre-war parity created a sharp decline British exports and a correspondingly sharp increase in imports to Britain. The result was sizable net imports of goods, an imbalance that was financed by an outflow of Britain's scarce post-war gold supply to other countries. The only way to stem the gold outflow was to maintain high interest rates. The result was severe unemployment that lasted until external gold convertibility was suspended in 1931. The domestic economy's troubles from this self-inflicted wound left the British with over a decade of social unrest and unemployment, and left it ill-equipped for the arrival of WWII. The ramifications of Churchill's decision were international in scope. In spite of loans from the U. S. and an easy U. S. monetary policy to forestall the immediate necessity for devaluation of the pound, the British economy suffered. And the low-interest rate policy in the U. S. fed a stock market surge that ended with the 1929 crash. Ultimately, the world suffered from Churchill's poor judgement. But out of the ashes emerged another book by Keynes merging politics and economics: his The Economic Consequences of Mr. Churchill (1925) clearly forecast the British depression that would follow. And the Great Depression that took the world by storm in 1930 changed the direction of Keynes's thinking. He set out to explain why the world stayed in such a prolonged economic slump when the received economic doctrine—now called neoclassical economics—held that business cycles were self-correcting: a slump (or a boom) would initiate adjustments of relative prices, of the national price level, and of interest rates that would return the economy to a stable position of full employment. This would take time, but the common assumption was that any intervention by government would only slow the adjustment process. So, for example, during a recession the neoclassical course for economic policy was government spending austerity and tax increases to balance the budget. True, these steps might make things worse in the short-run but they would hasten the return to full employment. This idea shaped FDR's unfortunate tax increases in 1936, and it is still in vogue—consider the austerity adopted by the British government after the 2008 financial collapse, or the European Economic Community 's reaction to the financial collapse of weak Euro-region countries ("the southern tier"), particularly Greece! For a variety of reasons, Keynes thought that reliance on self-correction was dangerous. He argued that the process of natural adjustment could be very long, quipping that ïn the long run we're all dead." And he had the Great Depression as an immediate example. His analysis of the basis of the Great Depression was published in two books—A Treatise on Money (1930) and The General Theory of Employment, Interest, and Money (1936). The second was by far the most influential: it would kick-start the field of Macroeconomics and upend our understanding of the role of government in responding to a business cycle. Regrettably, The General Theory was anything but general, and the book was almost unreadable, even among economists, so it has taken many decades to flesh out its finer points. But they can be reduced to a few observations. 1. Capitalist economies suffer from high unemployment when aggregate demand is insufficient.2. Capitalist economies are is not homeostatic: there is no automatic adjustment mechanism that returns an economy to full employment within a reasonable time; an economy can get stuck at an "underemployment equilibrium."3. Economies stuck at an underemployment equilibrium require active government government policies to promote spending and get on the path to full employment.4. In an underemployment equilibrium, monetary policies are likely to be ineffective.Monetary policies rely on an increase in money supply or, equivalently, a decrease in interest rates. But when interest rates are very low, as is common in depressions, monetary policy is toothless because of a "liquidity trap" any additional money is willingly held and not spent or loaned.5. The only effective action is a depression is fiscal policy in the form of direct government spending or tax cuts designed to increase private spending. Keynes's last major appearance after WWII. The international financial system was in a shambles. All countries were off of the gold standard and exchange rates were floating. The notion of a world of floating exchange rates was abhorrent at the time, and some way of getting the advantage of fixed exchange rates without the burden of a gold link was sought. At the 1946 Bretton Woods Conference Keynes proposed a solution that worked for many years: a "Gold Exchange" standard. Under the Gold Exchange Standard the U. S. dollar would displace gold as the reference point for international exchange rates: Governments would hold U. S. dollars as "reserve currencies" and would promise to buy or sell dollars at a fixed price in their own currencies, while the U. S. would hold gold and maintain convertibility between gold at the dollar. The advantage was that it leveraged the world's monetary gold stock and allowed the world's international reserves (U. S. dollars held abroad) to grow as international trade grew. This was a sharp contrast with the almost fixed worldwide quantity of gold under the gold standard.Was Keynes "right"? Well, he was certainly right enough! The last few years have been a laboratory test for Keynes's macroeconomic ideas, and they have been generally supported. Keynes is as relevant now as he was then. His interpretation of the 1930s fits the 2010s well. The U.S. economy is now in the midst of its closest approach to the features defining the Great Depression that we've seen in eighty years—very low interest rates, toothless monetary policy, and U.S. government budget deficits that are out-of-sight as the government attempts to maintain full employment. So far it has been successful.Keynes died in 1946 at the very-young age of 63. In his fifty-year career he had essentially redesigned both the British and international financial systems as well as contributing to the advance of economic theory and policy. If the Nobel Prize in Economics was available to all ten of the top economists since the 1930s, he'd win all ten.
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  • Pat
    January 1, 1970
    I received a free copy of "The Price of Peace" by Zachary D. Carter through the "Good Reads First Reads Giveaway."Keynes is a brilliant and unique individual who is represented in this well researched history book. He had great insight in the economy of many countries in our time.This is not a fun read for those who are not interested in economics or world history and it is a long demanding work. The author tends to be liberal as does Keynes in his assessment about the work of FDR. Although I ha I received a free copy of "The Price of Peace" by Zachary D. Carter through the "Good Reads First Reads Giveaway."Keynes is a brilliant and unique individual who is represented in this well researched history book. He had great insight in the economy of many countries in our time.This is not a fun read for those who are not interested in economics or world history and it is a long demanding work. The author tends to be liberal as does Keynes in his assessment about the work of FDR. Although I have mixed emotions about the book, it is a great and interesting reference book for those interested in American History and the economics of world powers.
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  • Thefirebottle
    January 1, 1970
    Especially the last third of this book repaired the misconceptions I had about the " discrediting" of Keynes' theories. A very good read throughout.
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