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years about what has gone wrong in particular sectors of the American economy as the result of the retreat of government from economic regulation, stabilization, and provision of public goods. The list alone would take several pages just for the blunders in the financial and monetary sectors. William Fleckenstein and Frederick Sheehan scathingly and succinctly document Alan Greenspan’s serial blunders in Greenspan’s Bubbles. Andrew Hacker powerfully addresses the collapse of the social safety net for middle-class Americans in The Great Risk Shift. George Halvorson, CEO of Kaiser Permanente, ably explains the failures of the American health care system in Health Care Will Not Reform Itself. Two leading economists, Claudia Goldin and Lawrence Katz, meticulously document the government sector’s underinvestments in education in The Race Between Education and Technology. The dangers of runaway public debt are thoroughly documented in This Time Is Different, by economists Carmen Reinhart and Kenneth Rogoff, who add a long and fascinating historical perspective to the dangers of budget profligacy.

The most stunning result of bad public policy has been the surge of income inequality, especially the soaring incomes of the super-rich. Globalization may have initiated the rise of inequality in the 1970s, but deliberate and inequitable government actions to cut top tax rates, deregulate finance, and in general cater to corporate interests have greatly exacerbated the inequalities. Part of the story is the spread of international tax havens used to shelter the incomes of the rich, a story told with uncommon vigor and insight by Nicholas Shaxson in Treasure Islands: Uncovering the Damage of Offshore Banking and Tax Havens. A closely related aspect of the inequality is the surge of CEO take-home pay, made possible by the weak corporate governance of American shareholders and boards of directors. The key reference work on unjustified CEO compensation is Pay Without Performance: The Unfulfilled Promise of Executive Compensation, by Harvard Law School professors Lucian Bebchuk and Jesse Fried.

Comparative Political Institutions

As I emphasize throughout the book, Americans will benefit by learning more about market-government choices made by other societies, most notably the successful social democracies of Scandinavia. The greatest analyst of Scandinavian social democracy is sociologist Gøsta Esping-Andersen, whose books include The Three Worlds of Welfare Capitalism and Why We Need a New Welfare State (co-edited). It is also important for Americans to understand U.S. performance on key dimensions (economic, social, and environmental) compared with other high-income countries. The Organisation for Economic Co-operation and Development, the World Economic Forum, Transparency International, and the United Nations Development Programme each offer a multitude of online data and rankings that help countries to benchmark their performance, and which are useful reference points for Americans as they contemplate the options for change.

American Political Values

Perhaps my most pleasant surprise in writing this book lay in my reacquaintance with the common sense and decent values of the American people. We are told daily by Fox News that America is a conservative country well represented by the Tea Party movement. The evidence is otherwise. America is a moderate and pragmatic country, with a generous commitment to helping the poor even as most Americans insist that the poor should take the lead in achieving their own economic betterment.

Political scientists over the years have done an excellent job in describing this “centrist” position. A recent valuable contribution is Benjamin Page and Lawrence Jacobs’s Class War? What Americans Really Think About Economic Inequality. A similar message can be found in Larry Bartels’s Unequal Democracy: The Political Economy of the New Gilded Age. Bartels shows that Americans are moderate even if the politics are extreme, in part because the views of the rich carry a hugely disproportionate weight in Congress.