Monday, 9 December 2002 8:30 am
I bumped into my old friend John Keynes on a cold day in Georgetown last week.  “John” I said “I thought you were history.”  We were in a café, and Steely Dan’s Pretzel Logic was playing on the café’s stereo in the background: 

"The world that we used to know 

People tell me it don't turn no more "

John mumbled something about his demise having been somewhat exaggerated.  

“What are you doing back in town?” I inquired.  

“Oh, I am welcome here again” he replied.  “With Paul and Larry out of the way, it should be smooth sailing.”  

I couldn’t believe my ears.  “What about Alan?” I asked.  

“Alan’s changed.  This deflation thing has him and the other governors scared.  Not much more they can cut.  Ready to embrace some fiscal policy, I would say.” 

“George will embrace you?” I asked incredulously. 

“Just met with him. Couldn’t have been more welcoming,” John replied. 

“Your saying that George will declare himself a Keynesian?” I couldn’t help but ask. 

“Of course not. Dick Nixon did that, and then he implemented price controls and ended Bretton Woods for good.  Must have confused me with Ken Galbraith.  The association stuck nonetheless. Shame, really.”

I could hear in the background Steely Dan singing

“I hear it was you

talking about a world where all is free

it just couldn’t be

and only a fool would say that”

“What do you think about the Euro?” I asked, dying to know.  “Isn’t it Bretton Woods on steroids? Will it work?” 

“Nonsense,” John replied. “I designed Bretton Woods to make American expansionist monetary and fiscal policies drive the economies of the rest of the free world.  Which country will be the locomotive for the Euro? Germany? France? Hardly!  A bunch of railcars with no locomotive to pull them, in my opinion. Won’t work.  If you want to revive Bretton Woods, I would implement it between the Americas and the Asian tigers. Now that would be something to seriously consider.” John pulled out his pipe, lit it, and puffed away in deep contemplation. 

On the way out of the café, I walked by an old man with a huge gray beard, sitting in the corner and reading a book.  As I passed, he looked up and said “Guten Tag, Herr Vatz”.  

“Karl?  It can’t be. You’re back too?”