What is clear is that when it came to the crunch, as policy-makers searched for ways to save the financial world, the tools they used were stock-standard traditional Keynes. In many respects, it was as if the frontier of macroeconomics had not changed from the Neoclassical synthesis of the 1950s. The pump is being primed and liquidity is being injected into markets — by both traditional means and nationalisation. Keynes himself must be bouncing up and down with joy in his grave.
I must admit, there are times where I think that I was the last one out on reading Keynes and, in the mainstream, being schooled in post-Keynesian thought. When I arrived at graduate school at Stanford 18 years ago, none of my classmates had read the General Theory — let alone actually studied it — and I am sure they have not picked it up since then. Macroeconomics would talk about discretionary policy and that it could have benefits but it was very theoretical and it was just not clear it was the stuff of serious policy anymore.
The last two months have proved that not to be the case. The amazing thing is not that we are all apparently Keynesians but that there were some Keynesians around in positions of power to actually have that influence. But they must have been there.
I only write this by way of curiousity. Perhaps some historian who looks at this moment in history will be able to track the flow of ideas.