Plenty of Nothing: The Downsizing of the American Dream and the Case for Structural Keynesianism

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Plenty of Nothing: The Downsizing of the American Dream and the Case for Structural Keynesianism

By Thomas I. Palley
Princeton University Press, 1998
227 pp. $27.95
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The author, an economist at the AFL-CIO, issues a broadside on the U.S. economy since 1970, especially on how workers have fared. He also critiques the dominant intellectual framework that extols minimal government intervention, zero inflation, balanced budgets, and free trade. He points out that all economies work within a framework set by collective political decisions, and that noninterference by government is an oxymoron. Even free markets require a legal framework for enforcing private property rights. Palley sees the American economy -- in the process of dismantling the safeguards and automatic stabilizers developed in the 1930s and 1940s -- as highly fragile and at risk of serious depression. He advocates a more activist macroeconomic policy and measures to strengthen the bargaining power of labor. He urges new tariffs on goods from low-wage countries, with the revenues used to encourage higher labor standards. Unfortunately, the book is marred by a tendentious use of statistics. Nowhere is the reader told that real consumption per person has risen 70 percent since 1970.