By 1933, the national income had dropped by almost half; the average standard of living declined to the level of 1913. There were 14 million unemployed. The economy lay like a fallen giant as a feeling of hopelessness swept the land. What no respectable economist admitted could happen seemed a reality — a permanent depression.
In this situation, one would expect a radical like Marx to appear to attack the plight of the unemployed and to offer a drastic remedy. On the contrary, a respectable Englishman offered a solution. Well-schooled in the theories of orthodox economics, John Maynard Keynes (1883–1946) was Alfred Marshall's most brilliant pupil. Nevertheless, Keynes proved adaptable enough to make a practical attempt at solving the problem of permanent depression.
In contrast to Veblen, John Maynard Keynes' life was characterized by good fortune. Born into an old traditional English family, he attended the best schools. Reminiscent of John Stuart Mill's intellectual powers, Keynes studied the meaning of interest at age four. He won a scholarship to Eton, where he earned superior grades and won numerous prizes.
At King's College in Cambridge, his grasp of economics was such that Marshall urged him to follow an academic career — which he declined in favor of something more lucrative. He placed second in civil service examinations for a position in the India Office but despised the work.
Resigning his position, Keynes returned to Cambridge, where he began a thirty-three-year stint as editor of the Economic Journal, England's most influential economic periodical. Keynes' diverse interests made him the exception to the saying "jack-of-all-trades and master of none." Indeed, he mastered debate, bridge, mountain climbing, modern and classical art, currency and finance, and economics. In later life, he became Lord Keynes, Baron of Tilton, and while serving as a director of the Bank of England, he also operated a profitable theater.
