The grandmotherly woman strolls into the crowded lecture hall on the University of Massachusetts campus, her slight frame dwarfed by the lectern. She waits for the applause to die out. Then in a low but emphatic voice, she sets about condemning the economic state of the Western World and the economics profession that serves it.
When economist Joan Robinson speaks, other economists and their students listen. For the sharp-tongued, 74-year-old professor emeritus from Cambridge University, England, has earned a reputation from both her critics and her admirers as one of the great economists of this century and perhaps the greatest woman economist in the history of this male-dominated profession.
In her youth, Robinson was one of the handful of high-powered theorists at Cambridge in the 1930s who, under the leadership of John Maynard Keynes, set forth the theories of deficit spending and other forms of government intervention in the economy.Although these theories were considered heretical in the laissez-faire world that then prevailed, they eventually revolutionized economics and gave impetous to the modern mixed ecomony.
Robinson, returning from a recent trip to Canada, made a rare stopover in the United States to visit the University of Massachusetts where one of her cambridge disciples is a visiting professor. In two days of lectures, seminars and sherry-sipping receptions, she shared with her American colleagues the insights of one who helped to usher in the Keynesian Revolution.
"I think the capitalist world is in a very deep crisis," she said in an interview during her visit. "So many of the foundations of the economy are shaking lose." For example, she said, uneven growth rates the United States, Western Europe and Japan, and the debt burden of Third World countries have strained the international monetary system and fueled inflation, particularly in the United States.
Moreover, Robinson said that giant multinational corporations have confounded national economic policies because these companies can transfer their huge assets from one country to another so easily.
Eventually, she said, the capitalist world could face a period of deep depression reminiscent of the 1930s. She warned, however, that the next deep slump may be much more severe because the industrialized economies will face potential shortages of raw materials and energy that were not a problem in the great depression. Such shortages could spend prices soaring.
"We are up against the limit with our resources," she said. "At least prices fell during the depression and that made food cheap. Next time we won't be so lucky."
Despite her prediction that inflation could get out of control, Robinson still believes government policy makers spend too much time worrying about unemployment. She argues, for example, that government actions to raise interest rates only reduce incomes and raise unemployment by restricting the funds available to businesses and consumers.
She also believes that unemployment will worsen steadily as companies continue to replace workers with more efficient machines and technology in order to compete in world markets. Such high levels of long-term unemployment could lead to "class war," she warned.
Robinson blames her fellow economists for much of what ails capitalist economies. She calls the American Keynesians "bastard Keynesians," omy is essentially stable and, with the aid of simple government deficit spending, can achieve unending growth and prosperity.
For real world economic problems, however, she offered no remedies, conceding that, "At this point, it is not easy to find a way out of the mess." And, while she would like to see Western nations move toward a democratic form of socialism, the professor doubts that such fundamental economic change ever will take place. "I am an optimist by temperatment, but a pessimist by intellect," she said.