John Maynard Keynes : VOLUME ONE, HOPES BETRAYED 1883-1920 by Robert Skidelsky (Elizabeth Sifton/Viking: $24.95; 447 pp., illustrated)

John Maynard Keynes is the contemporary biographer’s dream: the century’s most influential economist; an engaging figure striding across a world stage, against a background of glamorous art, important ideas and powerful men; and a secret life suppressed in a famous work of hagiography that provides a ready target for debunking. Add contemporary biographical candor about sexual mores to a body of letters that leave little of Keynes’ private life to the imagination, and the result is a unique opportunity for the modern biographer.

Robert Skidelsky has made the most of it, producing a work that will rank with Bernard Crick’s “Orwell” as a paragon of current British biography. Like Crick, Skidelsky rejects the traditional English biographer’s pretense of being able to enter into another person’s mind. Instead, he sets himself the attainable aim of telling us what we want to know about Keynes’ life.

Son of a Cambridge administrator, Maynard excelled early, though not without much parental handholding. His father coached him through every examination he ever took, from entry into Eton to the Civil Service.

At Cambridge, Keynes and his father decided he would study mathematics, but his real education lay elsewhere. Indeed, formal study of any kind pretty much ended with the mathematical exams at the end of his second year, when he came in an undistinguished 12th among the “wranglers,” as Cambridge mathematical scholars are called. Though he turned to economics, he never studied the subject in a formal way beyond eight weeks’ tutorials with Alfred Marshall.

Keynes’ real education was provided by the Apostle, a secret Cambridge society already 80 years old in 1900, and devoted originally to the cloistered search for a “philosophy of life.” Its membership reads like a pantheon of Cambridge’s most famous and infamous, from Bertrand Russell to Guy Burgess. (Oddly enough, it included few of Cambridge’s long line of great scientists.) In Keynes’ time and after, many of the society’s members were homosexuals. Together they sought to expound for themselves a set of values that, only half-jokingly, they called “the higher sodomy.”

Keynes’ generation of the Apostles emerged from Cambridge as the Bloombury group: Lytton Strachey, Duncan Grant, E. M. Forster, Demond McCarthy, Clive Bell, to which were added Vanessa Stephen, Virginia Woolf and a few others. It was the artists and writers of Bloomsbury who provided Keynes with a circle of lovers, friends, moral censors, and financial dependents.

Together with his Bloomsbury friends, Keynes left Cambridge for London in 1906. He decided on the Civil Service, and sailed through the required examination. His lowest marks were in economics.

The India Office, where he worked for a year or more, did not then place onerous demands on junior clerks: Work started at 11, ended at 5, with an hour for lunch, and at least two months holiday a year. Though Keynes made a mark in Indian finance that ensured his call to the Treasury in 1915, he found the work easy and uncongenial. So he turned his ample spare time to a study of probability. The result was submitted for the King’s College fellowship competition. This work eventually won renown in philosophy as the “Treatise on Probability.” But it failed on initial submission to secure Keynes a fellowship. To get back to Cambridge, he had to take a post as an adjunct lecturer in economics, paid out of the pocket of Alfred Marshall. It was another year before he could secure the fellowship.

During this period, Keynes’ economics was as conventional as his private life was unconventional. He steadfastly adhered to laissez-faire economic theory and politics. His liaisons were, however, far from steadfast, and at least once, he seems to have attracted the notice of a blackmailing London landlady.

Somehow, between Continental travels with the Berenson crowd, an addiction to the ballet inspired by the beauty of Nijinski’s legs, and the merry-go-round of Bloomsbury’s artists and writers, Keynes found time before the Great War to write a minor classic on Indian banking and finance. He also took part in a most unedifying exchange with the statistician Karl Pearson on the very possibility of quantitative social science. As Skidelsky notes, “had his criticism been accepted . . . practically all statistical investigation of social problems would have been ruled out of court.”

The day after war was declared in 1914, Keynes rushed up to London in the sidecar of a motorcycle. He spent the next four years in the Treasury, contriving to help keep afloat a war he increasingly came to despise, not for what it was doing to Europe, or Britain, but for what it was doing to his Bloomsbury friends: mainly turning them into conscientious objectors doing alternative service in the farmyards of their friends’ country estates.

Keynes’ task in the Treasury was to finance Britain and all its allies while maintaining financial supremacy over America. When this finally proved impossible, his efforts were turned to Britain’s mere survival. By the end, he was one of Lloyd George’s most influential advisers. Unlike many, he was quite unafraid to lecture the prime minister like a schoolboy. He paid for his contempt of Lloyd George when the P.M. personally struck him off an honors list.

Keynes’ hopes for European economic revival were dashed by politics at Versailles. After serving as Treasury representative to the Great Powers, he resigned in depression and rage, came back to England and wrote the book that made him famous, “The Economic Consequences of the Peace.” It made him richer too, since he personally bore all the publication expenses and took all the profits.

Keynes’ life was one of the mind, as well as the salon, the cabinet and the bedroom. And Skidelsky does not stint in tracing out the intellectual history of 19th- and early 20th-Century economics and philosophy needed to understand Keynes’ private life and public policy. Some readers will be put off by a biography that gives more than 50 pages to the moral philosophy of Henry Sidgwick, and the economic theory of Alfred Marshall, before even getting around to Maynard’s birth. Equally detailed is Skidelsky’s treatment of the Cambridge philosopher G. E. Moore, certainly the most salient intellectual figure for Bloomsbury’s Apostles. But what he does tell us about these figures, their ideas and influence, is correct beyond all but the most specialized quibble.

In 1951, Keynes’ student, Sir Roy Harrod, published the semiofficial biography of Keynes. The suppressions, euphemisms and misrepresentations of this famous work provide Skidelsky a dramatic foil. Much of his introduction is given over to itemizing the lengths to which Harrod went to protect the reputation, personal and political, of his patron, and spare the feelings of his family and friends. Harrod feared that candor would give hostages to the enemies of full employment, the mixed economy and the welfare state. Forty years on, Keynesian economics is too settled an orthodoxy for the reputation of its founder to matter very much. The hostages Harrod feared to give have become ornaments in one of the most learned and at the same time most entertaining biographies a famous man can have.