I think that you ought to read this first, it might help you to understand what Keynes actually said rather than what you believe he said. I think that your whole problem is centred around a belief that he was left wing or socialist or even worse European and that clouds your judgement.
http://www.aaronsw.com/weblog/generaltheory
http://www.aaronsw.com/weblog/keynes
I found this:
http://www.bidstrup.com/economics.htm
Into that gap of understanding stepped John Maynard Keynes. Keynes explained that government had a legitimate role in economic management, and in the regulation of "natural monopolies," whether by direct ownership or by tight regulation of private ownership. By engaging in deficit spending during contractions, and running budget surpluses during inflation, business cycles could be reined in and the misery of business panics could be avoided. Further, he argued among other things that business cycles had the effect of transferring vast sums of wealth from the poor to the rich, as a result of the fact that the poor had few means of defending themselves from the effects of a business panic or a monetary inflation, and the rich not only could defend themselves, but could even exploit the business cycle. This is why unregulated markets always created societies with a tiny, rich elite and a vast, disposessed lower class.
Keynes' ideas became known as "Keynesian economics." They became the cornerstone of Franklin D. Roosevelt's policies in dealing with the effects of the Great Depression. Roosevelt could see that the Crash of '29 had transferred truly vast amounts of wealth from the poor to the rich, leaving a whole nation impoverished, and so he sought to tax that wealth and allow access to it by means of government make-work policies. The idea was to not only create a middle class, but transfer most of the poor into it my providing them the opportunities to uplift their circumstances. In doing so, he earned the undying emnity of the wealthy, whose money he was taxing to pay for it. They sought their revenge. They got it by the "invention" of "neoliberalism."
"Neoliberalism" is not based on Adam Smith, as is often claimed for it by the libertarian propaganda, but is, in reality, based largely on the ideas of an Austrian economist, Friedrick Hayek, who had written in the 1930's that the control of an economy by a government is the "road to serfdom," as he titled his treatise. Asserting that human rights sprang from property rights, he claimed that a society could be no more free than its economy. The two principal failures of his analysis, were of course, first, the premise that human rights are a function of property rights, and that a society that planned its economy was doomed to serfdom. What Hayek never considered is that the obverse of such a policy is obviously that someone who has no property, has no rights, which means that person is, quite obviously, vulnerable to the very serfdom that Hayek claimed to fear. Witness the millions in debt-slavery in India and much of the rest of the world - the very serfdom that Hayek claimed to be repulsed by. The second major error was the assumption that corporations were entitled to the same property rights as individuals, and yet somehow deserved an exemption from liability that individuals do not enjoy - a basic inequality of rights. But nevertheless, his ideas had a great deal of resonance among social libertarians, who were highly enamored of an economic theory that corresponded to their social theories. It also found additional resonance in the writings of the Russian philosopher and popular novelist, Ayn Rand, and became the basis of her philosophical celebration of what can only charitably be described as selfishness.
The conservatives of the Republican Party in the U.S. in the 1960's and 1970's used that period of slow economic growth as a means of persuading policymakers that Keynesian economics had somehow failed, and that only a turn to the deregulation advocated by Hayek could solve the problems of "stagflation" that had become such an intractible problem. So, claiming that Keynes was dead, "neoliberal economics" was born, brought to life in America by a bald, mousy-looking economist from the University of Chicago, by the name of Milton Friedman. Friedmand knew that Hayek's ideas were functionally anti-egalitarian, regardless of the title of his most famous book, yet Friedman privately, but freely admitted that he was not an egalitarian and didn't care about fairness. This made him the instant darling of the "neo-liberals."
Friedman was the undying, sworn enemy of Keynesian economics. He widely publicized what he considered to be a need to return to the "unseen hand" of the market to cure the "stagflation" of the time. His ideas were exactly what the right-wing rich elites needed in an economic theory. It was simple, easy to understand, superfically reasonable and logical, and above all else, suited their need for an economic theory, which, if implemented, would enable them to accumulate wealth and thereby transfer its accompanying power to themselves without restraint. It suited their desire for revenge and their greed and avarice beautifully. Friedman very quickly became their darling, lavishly gifted, and being driven around the University of Chicago campus in a chauffered limosine. Paul Samuelson, Friedman's long-time rival and the principal advocate of careful, sensible regulation of business and government intervention in the market in the Keynesian mold, tirelessly warned of the anti-eglaitarian dangers of Friedman's approach, but amidst the propaganda, he was largely forgotten, even though it was his ideas that had not only prevented a return to business cycles, but had created a vast middle class in America in just a couple of decades following world war II. And ultimately, it was Samuelson's ideas which in the end saved the Chilean economy.
