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Some time ago, Phyllis Deane pointed to “an inescapable tension between political economy and economic science”. Yet, the separation of positive economics (pure and empirical) on the one hand and normative economics (pure and applied) on the other is still common among neoclassical economists and has a long tradition. Moreover, Keynes "[wanted] to emphasize strongly the point about economics being a moral science", which implies that, in his view, the separation between science and ethics cannot be maintained either. In this paper we argue that an entirely different vision of society and of man is implied in the neoclassical approach and in the classical-Keynesian approach, which is associated with widely differing views on the great problems of economic theory: value, distribution, employment and money. The method employed in both approaches is also fundamentally different; this shows up in a differing relationship between theory and historical reality. Finally, the relationship between economics on the one hand and ethics and politics on the other is sharply opposed to the liberal and to the middle-way classical-Keynesian view. It is argued that in neoclassical economics a tension exists between economic science and political economy, between theory and history and between economics on the one hand and ethics and politics, and that such a tension does not exist in classical- Keynesian political economy. The clue to this state of affairs is provided by the differing visions of society and of man associated with both approaches and the implications of these visions.

I was very sad to learn today (7th August 2012) that my dear friend and long-time colleague, Phyllis Deane, had died. She and I were colleagues in the Cambridge Faculty in the 1960s. She supervised my Part I Trinity Hall pupils in economic history and I supervised her Part II Newnham pupils for the principles and applications papers in Part II. When I returned permanently to Cambridge in 1982 (I had been there on leave in 1972–73 and in 1980), Phyllis had just retired from her Personal Chair. We shared a room together in the Faculty. Shamefully, I cumulatively overflowed, as is my wont, onto her desk and she tactfully withdrew after a few years. I read a number of her later books in draft — I especially remember The State and the Economic System: An Introduction to the History of Political Economy (1989). Peter Kriesler commented to me that the book “was excellent in showing how economists’ views on the role of the state and economic policy are strongly tied to their overall economic outlook, to their underlying economic theory. [It emphasised] the fundamental nature of the relationship between theory and policy”. I went in the 1970s to the lectures that became The Evolution of Economic Ideas (1975). For many years, Maurice Dobb had lectured on the history of economic thought and Phyllis’s lectures continued this tradition. I loved Phyllis’s last major book, her biography of J.N. Keynes, The Life and Times of J. Neville Keynes: A Beacon in the Tempest (2001), one of the finest jewels in the crown of our profession. Phyllis much admired Neville Keynes for his integrity, hard work and good sense, like calling to like, I think.