100 years of Keynes Economic Consequences of Peace: Lessons for today?

Mark Carney, Governor Bank of England revokes Keynes (who else) to drive home gains from technology:

A century ago, John Maynard Keynes resigned as a delegate to the Paris Peace Conference over his concerns about the scale of reparations in what would become the Treaty of Versailles. He returned home to write The Economic Consequences of the Peace. In that seminal work, Keynes marvelled that before the war:

“The inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth… [or] adventure his wealth in the natural resources and new enterprises of any quarter of the world that fancy or information might recommend.”

Such global trade and portfolio management were made possible by new technologies ranging from the telegraph to the first transatlantic cable.

Replace “telephone” with “tablet” and “tea” with “turmeric latte” and you have not the start of the Twentieth Century but of the Twenty First. The second great wave of globalisation is cresting. The Fourth Industrial Revolution is just beginning. And a new economy is emerging driven by immense changes in technology, the reordering of global economic power, and the growing pressures of climate change.

Carney believes gains from technology would be better distributed this time:

When Keynes marvelled at new possibilities, a decade of wealth creation would follow, but its gains gave rise to imbalances in incomes and in trade. When combined with the Economic Consequences of the Peace,  disaster ensued.

Today, new technologies, the new economy and the new finance have the potential to unlock more sustainable and inclusive growth. Consumers can have greater choice and better-targeted services; small and medium sized businesses can access new credit to grow; banks themselves can become more
productive, and the financial system overall can become more resilient.

Most fundamentally, unlike in Keynes’ time, the gains from new technologies will not be limited to men or captured by denizens of the City. 

The new finance must be inclusive, allowing everyone to be better connected, better informed and more empowered.

By adapting our hard and soft infrastructure, the Bank of England will help create the conditions for such innovation to flourish to promote the good of all the people of the United Kingdom.

Hmm.. One can be only more hopeful here.

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