Keynes was no antimonopolist.
One of the most interesting and unnoticed developments of recent decades has been the tendency of big enterprise to socialise itself. A point arrives in the growth of a big institution – particularly a big railway or big public utility enterprise, but also a big bank or a big insurance company – at which the owners of the capital, i.e. its shareholders, are almost entirely dissociated from the management, with the result that the direct personal interest of the latter in the making of great profit becomes quite secondary. When this stage is reached, the general stability and reputation of the institution are the more considered by the management than the maximum of profit for the shareholders. The shareholders must be satisfied by conventionally adequate dividends; but once this is secured, the direct interest of the management often consists in avoiding criticism from the public and from the customers of the concern. This is particularly the case if their great size or semi-monopolistic position renders them conspicuous in the public eye and vulnerable to public attack. The extreme instance, perhaps, of this tendency in the case of an institution, theoretically the unrestricted property of private persons, is the Bank of England. It is almost true to say that there is no class of persons in the kingdom of whom the Governor of the Bank of England thinks less when he decides on his policy than of his shareholders. Their rights, in excess of their conventional dividend, have already sunk to the neighbourhood of zero. But the same thing is partly true of many other big institutions. They are, as time goes on, socialising themselves.John Maynard Keynes, The end of laissez-faire (1926).
In Robert Skidelsky’s great three-volume intellectual biography of Keynes, there is but a single reference to antitrust—an entreaty by Felix Frankfurter that Keynes should lend some support to the antitrust project.
Keynes opposed the early New Deal’s state-sponsored cartels because they restricted output when the economy required more investment. But, like many in the early 20th century, Keynes viewed monopoly as an inevitable and possibly salutary adjunct to industrial progress.
Indeed, Skidelsky suggests that Keynes found debates over market structure—including self-righteous antimonopolism—dumb.
Keynes used to come away from Manchester with feelings of ‘intense pessimism’, provoked by the short-sighted individualism of the Capulets and Montagues, . . . the sermonising of those who wanted to put the industry through the wringer, the ingrained dislike of any suggestion of monopoly.Robert Skidelsky, John Maynard Keynes: The Economist as Saviour, 1920-1937 262-63 (1995).
(This post originally appeared as a Twitter thread.)