The Great Inflation and Its Aftermath
The Past and Future of American Affluence
Robert J. Samuelson
Random House, $26, 311pp.
Book publishing schedules are cruel. Robert J. Samuelson, a Newsweek columnist and self-confessed “slow writer,” most likely started on this book in 2005 or so when the economy was booming. He would have turned in the final manuscript about a year and a half ago as the yawning cracks in Wall Street’s underpinnings were first becoming clearly visible.
Samuelson’s primary topic is what he calls the “Lost History” of the great inflation of 1968-82, and its subjugation by the combined efforts of former Federal Reserve Chairman Paul A. Volcker and President Ronald Reagan. He overstates the extent to which the episode has been forgotten—the Wall Street Journal has used it as a bogeyman against all forms of government intervention ever since. But The Great Inflation may be the first popular book devoted entirely to the subject, and Samuelson is surely right that it is a critical period in recent economic history.
The history of the buildup of the inflationary infection and its eventual conquest is accurate and complete, although oddly organized. Through the first half of the book, Samuelson treats inflation as if it were solely a matter of government fiscal and monetary policy, as many conservative economists do. It is only after he has finished that story that he flashes back, a bit awkwardly and too briefly, to more fundamental causes relating to the privileged...