Professor Steven Keen
Senior Policy Advisor on Economics
In Australia, I’m famous for getting house prices wrong. In the rest of the world, I’m famous for getting the Global Financial Crisis right. In fact, I got the cause right in both cases—accelerating private debt causes exciting but illusory booms, and crashing credit causes economic crises.
What I got wrong in Australia was the venality of its politicians. Both parties—Liberal and Labor, from Hawke and Keating on—have kept Australia’s house price bubble chortling along, by encouraging households to take on ever more debt, with every shonky scheme imaginable. As a result, while the USA and many other countries de-levered after the GFC, Australian households continued to borrow their way to prosperity. House prices rose as a result, but so did household debt, to six times what it was in the “Golden Age” of the 60s, when Australia had a substantial manufacturing sector, and unemployment averaged 2.3%. Now Australia’s manufacturing sector is rated as less sophisticated than Uganda’s (see https://atlas.cid.harvard.edu/rankings), and unemployment has averaged 5.5% between 2010 and 2020—without taking into account the vast numbers of discouraged workers today.
Given the complicity of both major parties in building Australia’s “sugar hit” economy, I’ve stayed out of Australian politics—until The New Liberals came along. Finally, there is a party that can transcend the shallow thinking on virtually all issues that characterizes the career politicians of the Liberal and Labor parties.
Professionally, after doing an Arts/Law degree at Sydney University in the early 1970s, I was variously a schoolteacher, overseas aid activist, conference organizer, computer programmer, computer journalist, public servant in the days of the Accord, and finally, an academic from 1987 until I retired from my position of Professor of Economics at Kingston University London in 2018. I am now a Distinguished Research Fellow at the Institute for Strategy, Resilience and Security at University College London.
I remain active as one of the world’s leading critics of mainstream economics—the textbook economics that Australia’s major political parties and its bureaucracy still treat as gospel—with books such as Debunking Economics, Can We Avoid Another Financial Crisis, and The New Economics: A Manifesto (forthcoming in September 2021). My constructive work includes developing Minsky, a new computer program that models the economy as a dynamic, complex system—see http://www.profstevekeen.com/minsky/. I am also working on the economics of climate change. You can follow my work at www.patreon.com/profstevekeen.