Where Keynes Went Wrong

“…[An] impassioned…and…much needed book. In plain prose,…Hunter Lewis...begins by patiently walking us through precisely what Keynes said…then reveals why Keynes's work is ‘remarkably unsupported by evidence or logic.’ Lewis does much more besides, showing how Keynesianism has lived in the minds and hearts of politicians, with disastrous results.”

“Lewis has exposed with unmatched clarity the lineaments of Keynes’s system and enabled us to see exactly its disabling defects. Keynes defied common sense, unable to sustain the brilliant paradoxes that his fertile intellect constantly devised. Lewis’s book is an ideal guide to Keynes’s dangerous and destructive economics. . . .

…As Lewis points out, the entire Keynesian edifice rests on a central paradox: impeding the central mechanism of the free market will restore prosperity. . . . [ In actuality,] Keynes's 'remedies' for depression paralyze [the] process of price adjustment. . . .

 Lewis brings out fully that Keynes had much more in mind than a cure for depressions. He thought that boom conditions could be permanently maintained by lowering the rate of interest nearly to zero. In that way, the scarcity of capital could be ended. In The General Theory, Keynes said: "The remedy for the boom is not a higher rate of interest but a lower rate of interest! For that may enable the boom to last. The right remedy for the trade cycle is not to be found in abolishing booms and thus leaving us in a semi-slump; but in abolishing slumps and thus keeping us permanently in a quasi-boom." (pp. 20–21)

Is this not an incredible doctrine? The interest rate is to be lowered by an expansion of credit. But production can increase only through an increase in capital goods. Putting pieces of paper designated "money" into circulation will not by itself increase prosperity, even if all the new money is, as Keynes wished, spent and not hoarded. To think otherwise is to indulge in magical thinking. . . .”

“Lewis (cofounder, Cambridge Assoc.; How Much Money Does an Economy Need?) sets out to refute Keynesian economics and show that it's what has brought the world to the present crisis. Through paraphrasing and verbatim quotations, he presents Keynes's economic arguments from his The General Theory and other writings and then offers counterarguments. Regarding Keynes's proposition that government needs to regulate fairness in the markets, Lewis asks how government officials influenced by politics can truly make things fairer. Lewis extends the debate to the current crisis and says that the low-interest-rate environment promulgated for years by governments was Keynesian and the very cause of the current credit crisis and recession. In the end, he dismisses Keynes as a promoter of false utopian theories. Lewis has done a service, even if in the negative, of concisely and critically summarizing Keynes's economic theories, and his book will make readers think.

…Lewis's…work is highly recommended to anyone seeking both to understand and to question Keynesian economics.”

"Hunter Lewis has written a splendid book called Where Keynes Went Wrong. The dissection of the English economist who died in 1946 is especially timely, given that the past two administrations and the current one are identical in believing wholeheartedly in…key Keynesian dogma."

"[This] compelling, powerful, and extremely readable book...is fantastic....'Must' reading for those who are concerned with the future of our country."

"[This] highly readable…book fills a missing niche in the literature: a debunking of Keynes for the general reader. . . . Lewis is an excellent writer [and] demystifies…a famously difficult author to understand. . . . The work contains so many gems that it would be impossible [to list them all]. Reading Lewis, it’s somewhat shocking to see how weak [Keynes's] arguments are and how poorly they stand up to any kind of logical examination."

"Defogs what Keynes said [in] terms that a layman can understand."

"Should one read Where Keynes Went Wrong by Hunter Lewis? My answer is yes."

“In the book Where Keynes Went Wrong and Why World Governments Keep Creating Inflation, Bubbles and Busts,  Hunter Lewis takes on one of the most influential Economists in the history of the modern world. . . .

As an example, Mr. Lewis takes on Keynes’ famous “Paradox of Thrift.” Keynes Paradox of Thrift is, stated very simply, that while in times of recession it may be good for the individual to save, but if everyone saves, then it is detrimental to the economy. The implication is that demand drives the economy and for demand to exist, money must be spent. Lewis debunks this in Chapter 10 with the following:

“The bad investments of the recent past need to be liquidated, or at least marked down in price. Until this happens, savers should build their cash positions and refuse to use them. To invest at the old, unrealistic asset price would just continue the old pattern of throwing away money.”

The obvious argument here is that there is no paradox. Spending savings in a recession does not address the economic problems and serves only to drag out the inevitable bubble burst. Or as Lewis puts it, “…consuming more alcohol will not cure the hangover.”

I…highly recommend this book.”

“I recommend this book; it is an eye opener.”

“In Where Keynes Went Wrong: And Why World Governments Keep Creating Inflation, Bubbles, and Busts, author and financial expert Hunter Lewis… begins by demystifying Keynes… revealing what he actually said in his General Theory of Employment, Interest, and Money and other works….[He] reveals the folly of creating policy based on unproven economic theories of the past, and dares us to question the policymakers that are shaping our future.”

“Where Keynes Went Wrong…is thoroughly readable. . . . Economists will find copious endnotes and citations, but general readers will find thought-provoking analyses and opinions about the economy and many historic examples.”

“Hunter Lewis . . . has . . . effectively showed . . . how Keynesian economic policy theories are significantly flawed, and in many cases completely . . . unfounded."

“[Makes] otherwise complex subjects altogether accessible and even enjoyable for any readers who are themselves neither academics nor economists. . . . Highly recommended for anyone who possesses so much as a casual interest in economics, history, or even contemporary politics."

“… May be the best book on Keynes [in half a century]."

. . . A very readable book that does not require a degree in economics to understand. . . . Highly recommended.