The Economic Consequences of The Peace - Writing of The Book

Writing of The Book

Keynes left Cambridge University to work at the Treasury in 1915. He worked daily on financing the war effort during World War I. This disturbed many of the pacifist members of the Bloomsbury Group of which Keynes was a member. Lytton Strachey sent him a note in 1916 asking Keynes why he was still working at the Treasury.

Keynes quickly established a reputation as one of the Treasury's most able men and travelled to the Versailles Conference as an advisor to the British Government. In preparation for the conference, he argued that there should be no reparations or that, at worst, German reparations should be limited to £2,000 million. He considered that there should be a general forgiveness of war debts which he considered would benefit Britain. Lastly, Keynes wanted the US Government to launch a vast credit program to restore Europe to prosperity as soon as possible.

Keynes' general concern was that the Versailles conference should set the conditions for economic recovery. However, the conference focused on borders and national security. Reparations were set at a level that Keynes perceived would ruin Europe, Woodrow Wilson refused to countenance forgiveness of war debts and would not even let the US Treasury officials discuss the credit program.

During the conference, Keynes' health deteriorated and he resigned in frustration from his position on 26 May 1919. He retired to Cambridge and wrote The Economic Consequences of the Peace over two months in the English summer.