2013년 3월 7일 목요일

[발췌: Maynard Keynes 24장] How to Pay for the War

출처: Donald Moggridge, Maynard Keynes: An Economist's Biography, (Routledge, 2002)

자료: 구글도서

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※ 발췌(excerpts): 


Chapter 24_ How to Pay for the War

On the outbreak of war, the Keyneses left Tilton for London and them Cambridge. Keynes did not see himself playing a major part in public affairs. He reiterated what he had told Richard Kahn when war threatened a year earlier, with adjustments for the fact that he was now far more fit: he would go up to Cambridge and by taking over more of the College bursaring and teaching in both the Faculty and College release those who could be more active for Government service. He also recommended Kahn to the Treasury. He told Josiah Stamp that he might be fit for committee work which involved a few meetings in London and quiet drafting on his own.[1]

He began his quiet drafting without committee work. On 14 September he produced a memorandum on the general principles of Government price policy which he sent on Stamp and Hubert Henderson (both already in Government service on the Survey of Economic and Financial Plans) and to the Treasury on 15 September.[2] This led to meetings with Sir Richard Hopkins and Sir Frederick Phillips and a request from the latter for his suggestions on exchange control. He complied on 24 September with his 'Notes on Exchange Control' which combined a brief memoir of his First World War experience in managing Britain's overseas position without controls with modest suggestions for current controls. He pointed out:

It is well, therefore, to remember that we did get through after a fashion without blocking the exchanges; and this policy was not without considerable advantages of simplicity and efficiency.[3]

He did not now recommend complete control: he recommended controls over the most important transactions, leaving the less important to the free market, as long as recourse to this market did not cost the authorities too much foreign exchange net. He advised the Treasury 'to be cautious and cagey with its control system, and to cultivate turning a blind eye with the other one open'[4] Later in changed circumstances he was to change his mind on the extent of controls.

Late in September he found another outlet for his desire to be involved in a limited way, when he and a number of similarly aged administrators from First World WarㅡWalter Layton(formerly of the Ministry of Munitions), William Beveridge (...)ㅡwho had not yet found the wartime niches that some, particularly Beveridge, desperately desired, began to meet at 45 Gordon Square to discuss and co-ordinate their attempts to influence the war effort.[5] (...) In the early period Keynes produced memoranda on the operation of the blockade and a series of notes on the war for President Roosevelt which included a proposal for the finance of post-war European reconstruction.[6] Keynes also started to move more widely in London. On 12 October he went to the Other Club for the first time since his illness and tried without success to persuade Winston Churchill, then First Lord of the Admiralty, to remove wheat from the list of contraband goods, partly to influence German and world opinion and partly to dissipate Germany's foreign exchange reserves. (...)

There were pressures for him to appear on a wider stage. (... ...)

In the first months of the war, Keynes's public comments on war finance were limited to two letters to ^The Times^. He first commented on Sir John Simon's War Budget of 27 September, which among other measures raised the standard rate of income tax from 5s. 6d. to 7s. (and announced it would go to 7s. 6d. in the next Budget), increased surtax and introduced Excess Profits Tax(EPT) at 60%. Keynes remarked on the 'utter futility of the old imposts' to solve the budgetary problems of war and described the Budget, except for EPT, as 'chicken-feed to the dragons of war'[9] To emphasis this point and the need for low interest rate, he noted that the gains to the Chancellor from raising loans at 2.5% rather than 3% would be double the proceeds of all the tax increases announced in the Budget. His second letter replied to critics of the first, including J.R. Hicks. As he continued to correspond privately in early October with Hicks on the problems of war finance and inflation, Keynes made it clear that he had 'not quite made up my mind' on the exact balance between increase taxation and 'special measures of an unorthodox kind' to meet the budgetary problem.[10] Within a fortnight, he was on his way to a solution and, as important, to a method which would highlight the size of the problem and revolutionise subsequent budgetary practice.

On 20 October Keynes 'gave a brilliant lecture', according to Lydia's diary, to the Marshall Society in Cambridge under the title 'War Potential and War Finance'. He worked the material up for publication in ^The Times^ under the title 'The Limitation of Purchasing Power: High Prices, Taxation and Compulsory Savings' and sent copies of his draft to Sir John Simon, Clement Attlee, Lord Stamp, R.H. Brand and Hubert Henderson, as well as to the editor of the newspaper, who agreed to print it after Keynes had completed his initial discussions. He also spoke on the subject to a dinner meeting of officials, MPs and Ministers on 27 October and discussed it with Sir Richard Hopkins of the Treasury over lunch at 46 Gordon Square on 1 November.

With a 'reasonably encouraging' initial reaction, he refined his proposals into two articles, improving the balance, and altered some details, such as an indexing compulsory savings on the advice of Henry Clay and others who believed it would divert discussion from his main proposal.[11] Owing to a leak through a neutral correspondent, his proposals appeared first in the ^Frankfurter Allgemeine Zeitung^ on 7 November. The articles appeared in ^The Times^ under the title of 'Paying for the War' on 14 and 15 November 1939.

To appreciate the issues that Keynes was dealing with, it is necessary to consider the principles of war finance. Any policy proposal during a total war, as Professor Sayers suggested,[12] must in some way satisfy one or more of four (... ...)

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