The Economic Legacy of Hyman Minsky, Volume I
Edited by Riccardo Bellofiore and Piero Ferri
Chapter 2: Cassandra as optimist
Victoria Chick This chapter explores an aspect of Hyman Minsky’s mind and work which I ﬁnd intriguing: the ability to embrace apparent opposites. We see the same absence of dualistic thinking (see Dow, 1996, pp. 16–18) in Keynes, for example where he portrays money as both protection against an unknown future and a cause of instability, or investment as the outcome of both cold calculation and animal spirits. The apparent contradiction in Minsky’s thought was his recognition of all manner of ‘downside risks’ inherent in advanced capitalism while retaining a belief that the worst effects of capitalism could be forestalled. This is not a review or assessment which aspires to the standards of the history of economic thought, partly because it is impossible in London to have access to the full range of Minsky’s works, partly because others have already written such assessments, comprehensive in scope and of a proper scholarly standard.1 Rather, my viewpoint is partial and personal, in order to explore an interesting apparent paradox. CASSANDRA When I ﬁrst met Hy, in the late 1950s at Berkeley, only the Cassandra aspect of the role I have given him in my title was clearly visible. In his lectures, whether on money and banking or on Keynes, the message was repeated over and over: there is a threat to the US economy of ﬁnancial collapse, a repeat of 1929, from which something like the 1930s Depression – ‘It’ – could easily happen again. (‘It’ was such a dire prospect, it seemed,...
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