INTRODUCTION

Will a “permanent loss of vitality” be the defining characteristic of the economic history of late-twentieth-century America? Not very long ago, during the Great Depression of the 1930s, many economic experts had wondered if capitalism would survive at all. Today many of them fear that the American economy is weak and failing, destined to be a secondechelon participant in a new twenty-first-century world economic order. That sense of foreboding is shared by the public. Most Americans, at least of the lower and middle classes, believe that their children will not sustain a standard of living equal to their own.

After World War II, the views of those who had argued that the Great Depression was symptomatic of a profound weakness in the mechanisms of capitalism appeared hysterical and exaggerated. As the industrialized nations sustained dramatic rates of growth during the 1950s, the economics profession itself became increasingly preoccupied with the development of Keynesian theory and the management of the mixed economy.