In simple terms, this quote suggests that economist John Maynard Keynes changed how economic theory was used by removing its role as a critic of inflationary and statist policies. Prior to Keynes's influence, economists often acted as cautionary voices against government intervention in the economy and excessive spending that could lead to inflation. However, Keynes's ideas opened up new avenues for economists to gain academic and political power.
On a deeper level, Rothbard argues that by shifting economic theory away from its traditional role of critiquing inflation and state control, Keynes paved the way for economists to become more influential within academia and politics. This shift allowed many economists to support policies they might have previously opposed, leading to significant changes in how economies are managed. It also implies that these economists gained substantial benefits—both intellectual prestige and political influence—from adopting Keynesian economic principles.
The quote is attributed to Murray Rothbard, an economist and academic who was a prominent figure in the Austrian School of economics and libertarian thought. Rothbard was known for his criticism of mainstream economic theories and government intervention in the economy, advocating instead for free-market principles. His views often clashed with those of Keynesian economists, making this quote particularly relevant to debates about the role of government in economic affairs.
