Markets, Productivity, and Happiness in a Historical Perspective

Keynes, Hoover, Smuts and the Versailles negotiations: A forgotten story.

Kærgård Niels , University of Copenhagen

It is well known that John Maynard Keynes left the Versailles negotiations on June 7 1919 very critical to the negotiations and, in December, published the critical book entitled The Economic Consequences of the Peace. In this book Keynes had a very laudable footnote about Herbert Hoover: “Mr. Hoover was the only man who emerged from the ordeal of Paris with an enhanced reputation. This complex personality, with his habitual air of weary Titan (or, as others might put it, of exhausted prize-fighter), his eyes steadily fixed on the true and essential facts of the European situation, imported into the councils of Paris, when he took part in them, precisely that atmosphere of reality, knowledge, magnanimity, and disinterestedness which, if they had been found in other quarters also, would have given us the Good Peace (Keynes 1919 p. 257). The story is never the less often told as if Keynes was standing alone with his point of view when he left Versailles, but this seems not to be the whole story. In 2015, a Danish pension fund bought a package of letters on eBay which included an almost forgotten letter written by Keynes to Herbert Hoover on exactly the same date he left Versailles, June 7 1919. The letter, read together with the non-economic literature about Herbert Hoover and Jan Smuts, indicates, that these three men of almost the same age (36, 45 and 49) shared almost completely the same attitudes and talked intensively together. These were three remarkable men. Herbert Hoover (1874-1964) was in the American delegation in Versailles and became US President from 1929-1933. Jan Chr. Smuts (1870-1950) was head of the South African delegation, and became Prime Minister of South Africa from 1919-24 and again from 1939-48. It seems difficult to find differences between Keynes, Hoover and Smuts’ attitudes and feelings in 1919. That Keynes left the conference whilst Hoover and Smuts chose to stay seems more determined by the three men’s temperaments, which was indicated by their careers in the following decades. Hoover and Smuts were pragmatic politicians, whereas Keynes was a free intellectual with a strong belief on his own ideas.


Keywords: Keynes, Versailles Negotiations, Consequences of the Peace, an unknown Keynes letter

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