Two schools of thought dominate academic economics, the choice between which determines the policy stance of a given government. I will not indulge the reader as to the comparisons and contrasts regarding the assumptions, methods and implications of these two schools, except insofar as they are relevant to the present discussion. Suffice it to say that Keynesian economics generally assumes that individual behaviour is significantly shaped by prevailing customs and that future risk is irreducibly uncertain and thus cannot be estimated using past data, whereas Neoclassical economics assumes that individuals are rational maximisers of 'utility', a vague notion of egoism that has been equated with income, wealth, and GDP, subject to discounts of risk aversity and temporal impatience that can be precisely calculated. The implications diverge broadly in that Keynesians stress the importance of maintaining full employment through fiscal policy in order to minimise the disruption caused by uncertain events, whereas Neoclassicists believe in market supremacy and unfettered competition to most efficiently solve society's problems.
It is also interesitng to comment on the objective of economic growth in each case. Economists usually assume that economic growth is desirable. What they usually fail to acknowledge is that 'money' is only instrumentally and not constitutively desirable; that is, it is only a means to purchase real goods and cannot directly be consumed. Neoclassical economists fall into the trap of taking economic growth to be the ultimate goal of society, without a coherent explanation regarding its theoretical underpinning. Indeed, the high levels of human development in areas of lower GDP, such as Cuba and Kerala, attest to the over-generalisation present in Neoclassical thinking. For this reason, Keynes asserted that the positive aspect of economic growth is not that it makes society richer per se, but that in doing so it allows people to have more 'feliticious states of mind' and so act in a more socially desirable manner; the logic being that when one no longer feels the need to fend for one's survival, or even to increase the feasibility set through waged labour, a state of social equity can be arranged. So Keynes saw economic growth as a necessary evil; in fact, he was more than derragotory of the 'love of money' that has so pervaded capitalism, and indeed, has come to define it.
I argue that both schools, by eschewing the moral foundations of Christ, pursue the wrong goal, and moreover perform that endeavour using the wrong means. Because the Kingdom of God is not sought, 'these things' are not added.
Keynesian economics attempts to avoid God. It sees the future as inherently uncertain, and thus attempts to avoid volatility. Moreover, the ultimate goal of economic growth is to achieve 'the good life' through abundance, after which point Keynes argued capitalism should be discarded for a more socially benevolent system. But surely this point is arbitrary. He was right to assume diminishing returns in money to happiness, but abundance cannot be defined so long as scarcity exists - and in a physically limited world, that is always the case. In essence, Keynes attempts to construct an Aristotlean utopia based on human ethics, and is thus doomed. What do we see as a result of eras of adherence to Keynesian principles? Stagnation and a lack of progress.
Neoclassical economics, in its own way, also assumes a divine authority. If the future can be exactly calculated down to a probability function, if humans are predictably rational and markets perfectlye fficient, then selfishness is actually virtuous. Moroever, because money is taken to be the ultimate objective of life, a narrowly defined version of happiness is available to those who can pocket the most cash, and moreover, is ethically positive. For this type of economics, there is no horizon of abundance; the game goes on forever. Wat do we see as a result of eras of adherence to Neoclassical principles? Crises and revolution.
There are several points worth noting. First, the moral sentiments of these two man-made systems diverged, as underlying goals of economic growth. Second, the rationality employed to achieve those goals diverged, in the form of distinct assumptions about human behaviour and risk. Third, neither was able to reach their chosen goal through their chosen means: Keynesian economics reaches stagnation before abundance, and Neoclassical economics confronts crises that interrupt its incessant march.
Abundance of life is only available through Christ, and more importantly, so is satisfaction in that abundance. If our goal is Heaven, then we will experience the Kingdom of God.
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