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The Initial Embrace of Keynesianism in Australia

  • Battin Tim 

Abstract

By placing the emergence and subsequent practice of Keynesianism into its historical and theoretical perspective, we may very well be able to fathom how it became unravelled.1 The present discussion, however, is not exclusively a focus on the extent or nature of the Keynesian consensus;2 more pertinent is the connection between the context of the acceptance and prominence of Keynesian social democracy, on the one hand, and the problems encountered and foreseen at the time in the new enterprise, on the other. If there is to be an insight into why there was abandonment — or at least substantial revision — of the Keynesian experiment, it is necessary for there to be an appreciation of the factors which brought it into being in the first place.

Keywords

White Paper Full Employment Capital Expenditure Royal Commission Labor Party 
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Notes

  1. 2.
    In Australia there is very little published material dealing with the nature of the Keynesian consensus: E. Jones, ‘Who Won the Post-War? The Legacy of Keynes’, Journal of Australian Political Economy, no. 22, February 1988, pp. 73–90.Google Scholar
  2. G. Whitwell, ‘The Power of Economic Ideas? Keynesian Economic Policies in Post-War Australia’, in Stephen Bell and Brian Head (eds), State, Economy and Public Policy in Australia (Melbourne: Oxford University Press, 1994).Google Scholar
  3. Selwyn Cornish, ‘The Keynesian Revolution in Australia: Fact or Fiction?’, Australian Economic History Review, vol. 33, no. 2, 1993, pp. 42–68.Google Scholar
  4. 4.
    J.M. Keynes, The General Theory of Employment, Interest and Money (London: Macmillan Press, 1973).Google Scholar
  5. 5.
    H.C. Coombs, Trial Balance (Melbourne: Macmillan Company, 1981), p. 3.Google Scholar
  6. 6.
    L.F. Crisp, Ben Chifley: A Political Biography, (Croydon: Longmans Australia, 1961), pp. 186 and 194.Google Scholar
  7. R. Kuhn, ‘Labour Movement Economic Thought in the 1930s: underconsumptionism and Keynesian economics’, Australian Economic History Review, vol. 28, no. 2, September 1988, pp. 53–74.Google Scholar
  8. 18.
    H.V. Evatt, Post-War Reconstruction: A Case for Greater Commonwealth Powers (Canberra: CGP, 1942), p. 57.Google Scholar
  9. 25.
    This is the view of some of the neo-marxist critiques. One lawyer of the period, by way of contrast, has described the Evatt Bill as one of ‘breathtaking boldness’. See K.H. Bailey, ‘The Constitution and its Problems’, in C. Hartley Grattan (ed.), Australia (Berkeley: University of California Press, 1947), p. 102.Google Scholar
  10. 41.
    A.J. Millmow, ‘The Evolution of J.M. Keynes’ Wage and Employment Theory 1920–1946’, History of Economics Review, no. 17, Winter 1992, p. 66.Google Scholar
  11. 49.
    J.B. Chifley, Social Security and Reconstruction (Canberra: CGP, 1944).Google Scholar
  12. 52.
    See, for example, Carol Johnson, The Labor Legacy (Sydney: Allen & Unwin, 1989).Google Scholar
  13. 53.
    Oxford University Institute of Statistics, The Economics of Full Employment (Oxford: Basil Blackwell, 1944).Google Scholar
  14. 55.
    Laurel Black, ‘Social Democracy and Full Employment: The Australian White Paper, 1945’, Labour History, no. 46, May 1984, pp. 34–51.Google Scholar
  15. 58.
    Indeed, this is something that Coombs has conceded, but he explains that the political imperative was that unity be valued above all else. See, H.C. Coombs, From Curtin to Keating (Darwin: North Australia Research Unit and Australian National University, 1994).Google Scholar
  16. 62.
    D.H. Merry and G.R. Bruns, ‘Full Employment: The British, Canadian and Australian White Papers’, Economic Record, December 1945, pp. 226-7. See also, Seymour Harris (ed.), The New Economics (Robson: London, 1948).Google Scholar
  17. 64.
    W.J. Waters, ‘Australian Labor’s Full Employment Objective, 1942-45’, Australian Journal of Politics and History, vol. 16, no. 1, 1970, p. 61.Google Scholar
  18. E.R. Walker, The Australian Economy in War and Reconstruction (New York: Oxford University Press, 1947).Google Scholar
  19. 66.
    M. Kalecki, ‘Political Aspects of Full Employment’, Political Quarterly, vol. 14, no. 4, 1943, pp. 322–31.CrossRefGoogle Scholar

Copyright information

© Tim Battin 1997

Authors and Affiliations

  • Battin Tim 
    • 1
  1. 1.University of New EnglandArmidaleAustralia

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