George Lennox Sharman Shackle · 1940
George Lennox Sharman Shackle’s December 1940 book review assesses John Strachey’s programme for maintaining full employment during a transition towards socialism. Its central judgment is favourable: Strachey understands Keynesian economics and develops a serious, politically attentive policy, although his exposition sometimes obscures its theoretical foundations. Shackle proceeds from the programme’s purpose and intellectual basis to its three principal policy divisions, then closes with qualifications about planning and consumer choice.
The programme addresses an immediate political problem rather than specifying the eventual form of socialism. As Shackle explains, Strachey believes a progressive government must sustain full employment during the transition or lose office. Economic success is therefore a condition of political survival. The book’s governing framework is explicit:
The theoretical basis of the policy is Mr. Keynes' General Theory of Employment, and the reader who proceeds fairly far into the book will conclude that Mr. Strachey fully understands the General Theory.
Shackle’s reservation concerns presentation, not ultimate comprehension. Strachey approaches Keynes through an attempted transition from orthodox socialist principles instead of stating the central ideas directly at the outset. Arguments that initially appear circuitous or misleading are subsequently resolved with exemplary clarity. Shackle interprets this partly as accommodation to the intellectual habits of Strachey’s audience, while crediting him with an independent determination to work problems through.
The policy proposals fall into three groups: increasing investment, raising the propensity to consume, and securing the political conditions necessary to implement these measures. The investment argument begins with slowing population growth and diminishing opportunities to exploit new lands. These changes threaten to reduce investment below the level required for full employment at a given propensity to consume. Strachey proposes substantial public enterprise in fields unattractive to private entrepreneurs, alongside lower interest rates to encourage private investment. Shackle particularly praises the detailed, sober treatment of how interest rates might be lowered and what consequences would follow.
Consumption nevertheless supplies the programme’s preferred lever:
It is the propensity to consume, however, which he regards as the most important and promising point of attack on the unemployment problem.
The practical measures are redistributive taxation to reduce income inequalities and a scheme modelled on J. E. Meade’s consumer credits. Shackle calls the explanation of the latter especially cogent and striking, without reproducing its mechanism. His account thus identifies both investment and consumption as routes to full employment while preserving Strachey’s emphasis on the second. Political feasibility forms a distinct third component: before implementing the programme, a progressive government must secure effective control of banking and of transfers of money abroad. Shackle praises Chapter XII for bringing these elements together into an integrated statement.
His strongest specific objection concerns the relationship between consumer freedom and advance planning. Strachey advocates allowing consumers to choose, yet also envisages an organised economy in which industries’ proportionate outputs are settled beforehand. Shackle does not declare these commitments irreconcilable:
Perhaps the two things are indeed compatible, but it would require some special machinery to bring them into combination.
This qualification exposes an institutional gap rather than rejecting planning as such. The review also notes unsatisfactory passages in Chapter IX on money and commodity production, balanced against particularly admirable passages elsewhere; it does not explain those local criticisms in detail.
The closing assessment gives the review its distinctive force:
The author's style is clear and compelling, and the book has appreciably affected my own frame of mind.
Shackle’s response combines analytical scrutiny with acknowledged persuasion. The review’s relevance lies in its appraisal of a socialist transitional programme through Keynesian categories, while insisting that sound economic reasoning must also address political control and institutional coherence. Its praise is strongest where Strachey makes the full-employment problem concrete; its reservations concern how that reasoning is introduced and how consumer choice would operate within planned production.
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