Political Economy and the Art of Controversy

This chapter examines Galbraith’ s work in the 1950s before the monumentally important The Affluent Society (1958). The books in question are a far cry from the integrated model of mature democratic capitalism that later emerged in the trilogy consisting of that classic plus The New Industrial State (1967a) and Economics and the Public Purpose (1973a), but the mature Galbraithian vision begins to take shape. A substantial portion of the chapter is devoted to Galbraith’ s first effort at constructing a broad picture of the American economy, American Capitalism: The Concept of Countervailing Power (1956), which greatly enhanced Galbraith’ s standing outside the profession. Second, in The Great Crash (1954) Galbraith analyzed the hysterical euphoria that tends to emerge in periods of sustained economic prosperity; this interest in manias and panics was to concern and entertain him for all of his professional life. His now classic treatment of the spectacular collapse of asset values in 1929 has often been reprinted; indeed it has remained continuously in print. One suspects it is probably selling rather well of late given its pertinence to the financial excess and Great Recession of our time. Third, we take our chapter title from Economics and the Art of Controversy (1955), in which Galbraith displayed his keen appreciation of the nature of American political culture and the political context of economics.