What is defined as temporary employment?

Can anyone please explain what John Maynard Keynes is saying in his Book The General Theory of Employment Inte?

• Can anyone please explain what John Maynard Keynes is saying in his Book The General Theory of Employment Interest and Money below ? John Maynard Keynes The General Theory of Employment, Interest and Money Book III The Propensity to Consume Chapter 10. The Marginal Propensity to Consume and the Multiplier II It follows, therefore, that, if the consumption psychology of the community is such that they will choose to consume, e.g., nine-tenths of an increment of income,[2] then the multiplier k is 10; and the total employment caused by (e.g.) increased public works will be ten times the primary employment provided by the public works themselves, assuming no reduction of investment in other directions. Only in the event of the community maintaining their consumption unchanged in spite of the increase in employment and hence in real income, will the increase of employment be restricted to the primary employment provided by the public works. If, on the other hand, they seek to consume the whole of any increment of income, there will be no point of stability and prices will rise without limit. With normal psychological suppositions, an increase in employment will only be associated with a decline in consumption if there is at the same time a change in the propensity to consume — as the result, for instance, of propaganda in time of war in favour of restricting individual consumption; and it is only in this event that the increased employment in investment will be associated with an unfavourable repercussion on employment in the industries producing for consumption. III We have been dealing so far with a net increment of investment. If, therefore, we wish to apply the above without qualification to the effect of (eg.) increased public works, we have to assume that there is no offset through decreased investment in other directions,-and also, of course, no associated change in the propensity of the community to consume. Mr. Kahn was mainly concerned in the article referred to above in considering what offsets we ought to take into account as likely to be important, and in suggesting quantitative estimates. For in an actual case there are several factors besides some specific increase of investment of a given kind which enter into the final result. If, for example, a Government employs 100,000 additional men on public works, and if the multiplier (as defined above) is 4, it is not safe to assume that aggregate employment will increase by 400,000. For the new policy may have adverse reactions on investment in other directions. V It is also obvious from the above that the employment of a given number of men on public works will (on the assumptions made) have a much larger effect on aggregate employment at a time when there is severe unemployment, than it will have later on when full employment is approached. In the above example, if, at a time when employment has fallen to 5,200,000, an additional 100,000 men are employed on public works, total employment will rise to 6,400,000. But if employment is already 9,000,000 when the additional 100,000 men are taken on for public works, total employment will only rise to 9,200,000. Thus public works even of doubtful utility may pay for themselves over and over again at a time of severe unemployment, if only from the diminished cost of relief expenditure, provided that we can assume that a smaller proportion of income is saved when unemployment is greater; but they may become a more doubtful proposition as a state of full employment is approached. Furthermore, if our assumption is correct that the marginal propensity to consume falls off steadily as we approach full employment, it follows that it will become more and more troublesome to secure a further given increase of employment by further increasing investment. http://www.marxists.org/reference/subject/economics/keynes/general-theory/ch10.htm

• Answer:

  I didn't read all of that because honestly Keynes is what I read when I have insomnia and as it happens I just woke up. I can tell you what Keynes believed that set him apart from other economist. If this is for school and your expected to memorize Keynes than this won't be great help. Basically Keynes differed from what at his time was standard free market ideas. He believed that government spending was an important part of economic growth and health. The idea is if the government hires a man than that man will have money and become a consumer. He will create demand which puts other people in the private sector to work. Even though he cost the tax payer his wage every month, most of that wage will return to the economy and enrich other people. It will build the tax base and return more than it cost. Say you, as a part of the government, decide to build a bridge. The bridge is good and it improves trade and shortens transport times and makes peoples lives generally better. But it does more. The materials for the bridge make jobs for steel workers, the tools make jobs for machinist. The workers themselves buy goods from the local community and buy houses and use services and all of those things create more jobs and justify more companies. Those companies compete and find better methods and create better products and cheaper products and your one project can have far reaching effects on the economy. So imagine what 10 projects do or 100 or more. The more the government spends within it's own economy the more it can make by expanding the tax base and strengthening the economy. To a point of course. Like the Laffer curve on taxation, spending will have a diminishing result if taken to far. There are flaws with this theory. One simple one is that government spending is by no means guaranteed to stay with our own economy in a global market. The steel for the bridge may come form Canada. The tools may come form Germany. The workers themselves may purchase foreign products so it might be that government spending ends up bleeding into other economies and the net result is just a big loss of money from our own perspective. That is one flaw and it is arguable. These days Keynes is kind of the standard or at least that was the case when I was taking economics a few years ago. I hope this helps and if in the time it took for this long explanation someone gave you a better answer than I hope theirs helps. Added: I think this particular sampling of Keynes is about employment more than tax base. Keynes was working to address the problems of the great depression. At the time they were more worried about stability than profit. For his time I think his methods were correct but if you want a bit of history. Roosevelt didn't spend near enough to end the depression. Congress would have never approved the amounts needed. The second world war justified massive government spending in the industrial sector and put millions to work and that ended the depression. In a round about fashion Keynes was proven correct but not the way he would have wanted.