“Thus [in Keynesian economics] there is no need for any change in the mode of production for profit; just take control of the money machine to ensure an infinite flow of money and all will be well […] Well, capitalism is a monetary economy but it is not a money economy (alone). Money cannot make more money if no new value is created and realized. And that requires the employment and exploitation of labour power. Marx said it was a fetish to think that money can create more money out of the air. Yet this version of Keynesianism seems to think it can. When central banks expand the money supply through printing ‘fiat’ money or creating bank reserves (deposits), more recently so-called ‘quantitative easing’, this does not expand value. It would only do so if this money is then put to productive use in increasing the means of production or the workforce to increase output and so increase value.”

The above passage comes from a blog post by economist Michael Roberts. The post is titled: Keynes: revolutionary or reactionary? – part one: the economics. I’m looking forward to part 2!

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Painting above by Andy Warhol

Tags:capitalismeconomicsKeynesianismmarxian economicsmarxismMichael Robertsmoneyprofit