he was john maynard keynes.the 1930s, his ideas spread from cambridge, england, to cambridge, massachusetts, to a generation of young economists waiting to spread the message. franklin roosevelt wasn't a young economist, but the leader of a nation with problems. in 1933, keynes was one among a babble of voices. his letter to the president would go unheeded. john maynard keynes had new ideas about the economy, and he rushed to get them before the public. dr. lorie tarshis, a student at cambridge in 1933, remembers the desperate rush to publish. why did keynes rush? i think the reason was the sense of urgency communicated to him by developments within britain and europe-- in germany where hitler had come to power, in the united states where revolution was in the air, and in other parts of europe and in britain, too, where the intellectual class was rapidly moving to the left. he felt he had an answer that was superior to marx as to analyzing capitalism's discomforts, an answer that was not only superior, but much

someone asked john maynard keynes if he could think of anything similar to this depression. , it was called the dark ages." what was so different about keynes' view of the economy? to realize what a revolutionary idea keynes had, we have to recall again the classical view which said supply creates its own demand. if consumers don't want to consume all their incomes, they can lend their savings to businesses who will invest it. the idea is that if consumption goes down, investment demand will go up. if investment demand goes down, consumption demand will go up. in either case, total demand remains high. keynes said if you had a fall in investment spending, this might lead to a fall in consumption spending. total demand-- consumption demand plus investment demand-- might fall. it might be a multiplied fall once the process got started. let me stress this was a shocking idea. when demand falls, it may not repair itself a la says law. it may fall further. there may not be enough total demand to provide markets for the goods or the labor that produces them. the economics professio

the rationale was very much influenced by the ideas of john maynard keynes, whose major work was published1936. keynes thought total private spending might be insufficient to sustain national income at the full employment level. the solution? increase government spending to fill the gap. we can illustrate this idea with a simple diagram. let's measure total spending by consumers, businessmen, and the government on this vertical axis, and national income, gnp, along this horizontal axis. in 1946, full employment gnp, when everybody who wanted jobs was able to find them, was probably around here at $300 billion in terms of 1946 dollars. this vertical line is equal to $300 billion. this line will tell us how much spending we'd need to sustain national income. keynes said private spending on consumers' goods, c, and business investment, i, might not be large enough to keep gnp at this level. he thought private spending would increase with income. the curve slopes up as gnp increases. it might end up here with this $50 billion gap between total private spending and full employment gnp. he said

treasury we should have pursued the plan of john maynard keynes keynes and the british to establish a new super national current c. now whereas china is not currently pushing in that direction they are pushing in the direction of weakening the influence of the u.s. dollar for example in recent years china has signed by loughner all agreements with russia turkey. japan and brazil to begin trading with us dollars as an intermediary vehicle right and there are sure to be votes to come we'd love to have you back here to talk about that sometimes in all those multi-vitamin trade agreements ben thank you so much for your time and your insight we have to have you back on very soon. thanks very much aaron. that was author and director of international economics at the council on foreign relations dr ben still turn out for today's big deal. time now for the big deal i'm joined by our team resident comedian that we have here and we can we thank you they're very very good now in today's big deal chevron attempts to put out some fires but they actually have only fan the flames now comedian and au

john maynard keynes, an intellectual hero of both of the sediment and 30 tech unemployment is at hand. the question is exactly right. knowing the history of the historical pattern should,, lot is at times utterly different products is the area finally here? the answer is it's too early to tell, but the data are not encouraging. there are good reasons to take this time really is different. for all of human history, if you want reported, you have to love a person not work. not anymore. if you wanted to listen to a person, under what they wanted, financing and spits back to them come you had to involve human being and not work. not anymore. we can go on and on. i guess it is used, drive a vehicle, answer telephone. any of the things we've always needed people for them. we don't anymore. the digital encroachment into human territory is brought, deep, fast and i think irreversible. to me that feels like this time is different. >> matches the deck elegy. economic statistics suggest something different is going on. as you pointed out, technology has already been creating jobs and they're so

there is a lovely little story about john maynard keynes also with a lot of insight and knowledge into the british economic statistics for the policy during the first world war how could you be more plugged in even once adopted based on forecasting the business cycle totally failed for nearly ten years underperformed in the market and finally switched to the warren buffet style investment and that turned out to be successful for him. the bank of england was about to change the base rate and if the forecasting is hard it should be the benchmark whether we understand the system or not. it' >> let me underline a few of the things one area which economists did go wrong is that especially in macroeconomics there came to be the feeling that there is only one way to do it. micro- foundations and so forth even if you think those are good things the idea that this is the only way you can get in the journals that was terrible so i agree entirely on that. on which way to go that is much less clear about the behavioral economics and psychology versus the standard econ. maybe that will turn out to

john maynard keynes in the aftermath of the great depression was the one you propose what he called counter-cyclical spending, stimulus programs to bring the economy out of a recession art russian at a time when private investment is not there in the government needs to invest and that's the basic idea and still is the basic idea. you had a whole countervailing point of view which culminated in ronald reagan and friedman was one of the leading champions of the view that stimulus spending never works. you can't stimulate an economy and accumulate debt to do that. that is really what was lying underneath this so when you hear people like ted cruz or marco rubio saying that it was a complete failure reflecting that huge debate going on for decades. >> host: stephanie and highland california, democratic caller. >> caller: good morning. one thing i want to say is i can't believe five years later we are still looking at the stimulus. when there was tarp and when there were tax cuts that weren't paid for it and the wars that weren't paid for and there was the pharmaceutical bill or whatever that wasn't pai