Customer Rating: 
Summary: Gretchenfrage: distribution equality
Comment: From the latest Nobel winner for economics a political statement and a historical overview of American politics since the early 20th century. Key themes of the story are the impact of race and racism on election results; the development of the 'compression', ie a more equal distribution of income from the New Deal to the 80s, and the more unequal trend since then; the take over of the Republican party by fundamentalist conservatives; the need for a radical health care reform.
This has been summarized by other reviewers. For me as an outsider looking in, it is always fascinating how terms have different meaning in America.
Consider this quote: "Even liberal economists have a healthy respect for the effectiveness of markets as a way of organizing economic activity."
This shows mainly how far the US has moved away from European languages. As a matter of fact, liberal economists are the ones who argue for the market in first place. What you call 'liberal' should be called different names. Maybe 'progressive'; Krugman discusses this term in the book.
Your conservatives would be 'neo-liberals' in Europe, and they are actually the real radicals in the game. Milton Friedman was as radical as Marx, and like Marx, he was a dangerous man with brillant insights (Krugman admits that Friedman deserved his Nobel regardless of political implications). There is nothing more dangerous than the belief in (any)absolute truth!
Since the book is essentially a political pamphlet, Krugman does not go very deep in most of his statements. I would wish for a more thorough analysis of the following:
"Middle class societies don't emerge automatically as an economy matures, they have to be created through political action."
That would be a starting hypothesis for a different book, that I would like to read from Krugman. Is the middle class society a means to an end? Is it a value in itself? What is the relation between sustainable growth and distribution structures? How do the 'values' of the opposing political camps relate to the implications of this question?
Customer Rating: Summary: Essential Reading
Comment: Krugman isn't concerned with narrowly defined economics. This is an historical perspective that incorporates the social and political forces that shape the economy. In fact, his thesis is that the increasing inequality in the United States, a feature which is more and more exceptional to this country when compared to other advanced Western countries, is a result of the policies brought upon by the movement conservatism ideology which took over the Republican Party since Ronald Reagan.
This movement has now (the book was published in 2007) been rejected by the majority of the electorate and it is up to Barack Obama's government the task of implementing a new New Deal that would reduce inequality and deliver a better economic future to the overwhelming majority of America's population.
Given the crossroads where we are now, it is essential to understand the powerful forces that will match each other, the interest groups lying beneath each one, and to see beyond wedge issues that have divided the electorate. Krugman does it masterfully. This is the best book I have read in a long time.
