Brad DeLong's Grasping Reality

I confess that "young adult political economy" was not a genre I had known existed...

:-)

But Reihan Salam is very generous to The End of Influence:

The Agenda on National Review Online: Stephen S. Cohen and J. Bradford DeLong have just published The End of Influence, and it's excellent. Cohen and DeLong are both left-of-center, yet they occupy the technocratic end of the progressive movement, which explains their obvious sympathy for the aspirations of economic neoliberalism.

One of the central virtues of the book is the sustained attention Cohen and DeLong give to some of the lazy assumptions we make about the American economy: they note that while postwar mixed economy model of the United States was very different from the models that took root in Europe, it was just as statist and interventionist. My takeaway is that the conflict over U.S. political economy is better understood as a conflict between rival industrial policies, one centered on spurring the growth of the defense industries and the Sunbelt and another centered on old-line manufacturing and the Rustbelt, than as a battle between libertarians and social democrats.

The key driver for Cohen and DeLong has been large American trade deficits that have poured resources into oil-producing states and East Asia's manufacturing powerhouses. Rather than consume the dollars they earn, these states have increasingly placed them in large state-controlled sovereign wealth funds that are becoming a crucial source of investment capital for firms around the world. The question is, will these sovereign wealth funds behave like conventional private funds that aim to maximize returns — or will they seek to serve other national interests? 

I wrote a far-from-flawless and rather pessimistic column on the book, which focuses on how the decline of American economic power is leading us to a new global equilibrium in which beggar-thy-neighbor mercantilism will become even more pervasive. I think of myself as a fairly upbeat person, but I can't imagine a worse state of affairs, not least because it will exacerbate the risk of great power conflict.

All in all, this is a really terrific book that does an excellent job of cutting through the confusion surrounding the broader meaning of the financial crisis, etc. If there is a bright high schooler or young adult in your family, this would make a great present. It helps that the book is mercifully short, weighing in at just over 150 pages.

When even one person likes your book so much, you feel as though it was all worth doing. Thanx.