More precisely Noah gives us a survey of the work of academic economists on this topic, and his book has the advantages and some limitations of that genre.  Among the advantages are a neutral  tone and a balanced treatment of many controversial questions. A limitation is that the surveyor brings nothing of his own to the table – neither critical perspective nor new information. This is a very good book about what other people think.

After preliminaries dealing with mobility, Noah, a staff writer at the New Republic, offers a short discussion of race, gender and family structure. He takes it as a given that civil rights, female liberation and changing marriage norms did not actively bring about income changes for the groups involved in those movements.  Instead, Noah accepts the prevalent view of economists that larger forces were at work and that minorities, women and families were affected by, but not principal actors in, the drama of rising inequality.

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Like our own, the European banking crisis is the product of over-lending to weak borrowers, including for housing in Spain, commercial real estate in Ireland and the public sector (partly for infrastructure) in Greece.  The European banks leveraged up to buy toxic American mortgages and when those collapsed they started dumping their weak sovereign bonds to buy strong ones, driving up yields and eventually forcing the whole European periphery into crisis. Greece was merely the first domino in the line.

In all such crises the banks' first defense is to plead surprise – “no one could have known!” – and to blame their clients for recklessness and cheating.  This is true but it obscures the fact that the bankers pushed the loans very hard while the fees were fat.  The defense works better in Europe than in the U.S. because national boundaries separate creditors from debtors, binding the political leaders in German and France to their bankers and fostering a narrative of national-racism  (“lazy Greeks,” “feckless Italians”) whose equivalent in post-civil rights America has been largely suppressed.

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The debt deal is bad economics, dishonest government, and surrender to blackmail. The alternative is not default, but government under the Constitution.

On the economics: by slowly choking off public services, public investment and regulation, the deal sets the economy on a path to strangulation. Every dollar cut from the budget, now or later, is a dollar less of private income. Less private income means less consumption, less private business investment, fewer jobs. Tax revenues will fall, and the deficits and debt will in the end not be reduced. The so-called “cloud of debt” will not lift. Contrary to the foolish claim made by the White House today, there is no magic by which “lifting a cloud of uncertainty” produces growth. There is no confidence fairy.

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News reports hold that President Obama scored a political victory by agreeing to put Medicare and Social Security on the chopping block to achieve a "go-big" $4 trillion deficit reduction. Speaker Boehner had to concede that Republicans won’t vote for any package that includes tax increases -- and the deal died. So the gambit worked and the President emerged with a solid image as the alpha deficit hawk.

To which one can only say: how nice for him.

We’re in a summer that only Salvador Dali could paint, a reality so twisted that one almost yearns for the simple verities of the War on Terror or even the invasion of Iraq. Then as now, to be serious one must be a "hawk." (The dove is a weakling, a loser, and the owl for practical purposes does not exist.) So let’s review some of the strange and mysterious faces of this ugly, vicious bird.

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The Fiscal Solutions Tour is the latest Peter G. Peterson Foundation effort to rouse the public against deficits and the national debt — and in particular (though they manage to avoid saying so) to win support for measures that would impose drastic cuts on Social Security and Medicare. It features Robert Bixby of the Concord Coalition, former Comptroller General David Walker and the veteran economist Alice Rivlin, whose recent distinctions include serving on the Bowles-Simpson commission. They came to Austin on February 9 and (partly because Rivlin is an old friend) I went.

Mr. Bixby began by describing the public debt as "the defining issue of our time." It is, he said, a question of “how big a debt we can have and what can we afford?" He did not explain why this is so. He did not, for instance, attempt to compare the debt to the financial crisis, to joblessness or foreclosures, nor to energy or climate change. Oddly none of those issues were actually mentioned by anyone, all evening long.

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I want to raise a hard question -- a question on which Americans are divided. It seems to me, though, we will get nowhere unless we realize where we are, what has actually happened, and what the future most likely holds.

Recovery begins with realism and there is nothing to be gained by kidding ourselves. On the topics that I know most about, the administration is beyond being a disappointment. It's beyond inept, unprepared, weak, and ineffective. Four and again two years ago, the people demanded change. As a candidate, the President promised change. In foreign policy and the core economic policies, he delivered continuity instead. That was true on Afghanistan and it was and is true in economic policy, especially in respect to the banks. What we got was George W. Bush's policies without Bush's toughness, without his in-your-face refusal to compromise prematurely. Without what he himself calls his understanding that you do not negotiate with yourself.

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"Greenspan said most leading economists at the time had expected large surpluses to stretch into the future ... 'I don't think that the issue is a question of taking a wholly different view ... It turns out we were all wrong [about the surplus forecasts],' Greenspan said, but added he would take the same position again faced with similar circumstances."

Yes, most economists agreed that the surpluses of the 1990s would continue. But not all. Six years ago, in the Wall Street Journal, Paul Davidson and I warned, correctly, that the surpluses could not be sustained, that an effort to do so would produce recession. We wrote:

"This plan assumes that full employment will be maintained independent of federal spending, which will be strictly restricted in order to create surpluses. This assumption is foolhardy, for tight budgets depress economic growth and raise unemployment. Japan's recent experience illustrates the point: Strong economic growth plus a tight budget strategy produced a budget surplus by 1990 that then led to a decade of stagnation and recession ... The depressing effect of tight budgets means that the promised surpluses will probably never materialize."

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In Washington, former National Security Advisor Zbigniew Brzezinski demanded that the results be set aside and a new vote taken, under the eye -- no less -- of the United Nations. In the New York Times, Steven Lee Myers decried "the use of government resources on behalf of loyal candidates and the state's control over the media" -- practices, he said, that were akin to those in "Putin's Russia."

Personally, I don't know whether the Ukrainian election was really stolen. I don't trust Lugar, Powell or the National Democratic Institute. It's obvious that U.S. foreign policy interests, rather than love of democracy for its own sake, are behind this outcry. Russia backed the other candidate in Ukraine. For Brzezinski, doing damage to Russia is a hobby.

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Why such a line? Yes, turnout was a factor. But the real problem was a grotesque shortage of voting machines. Finland Elementary serves three precincts: Ward 37, A, B and C. The election officer at the door told me that the smallest of these precincts has some 400 registered voters, the middle-sized one has more than 800 and the largest "thousands." Because of the length and complexity of the ballot, voters were being limited to five minutes to finish their ballot, and most were using all that time.

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On Bush's approval, I've always argued that the voters are smart. They have rallied to Bush in times of emergency, but otherwise they've paid very little attention to anything he says or does. They simply come to their senses, sooner or later, as the reality about the man sets in. Here's what I wrote last February:

"Measured by a number of different techniques ... Bush's monthly loss of approval appears to be a little less than 1.6 percentage points -- every month, on average ... We cannot say that the erosion will continue as Bush's approval slips into "red" territory -- below the 48 percent or so who supported him to begin with. Indeed, there is no evidence that Bush's Republican base has eroded at all. What we can infer, reasonably, is that there is a strong tendency in the electorate to revert, over time, to the sharp and narrow division of the last election. Tick, tock."

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Now 53, Bartlett said this the other day to Ron Suskind, as he reported in his New York Times magazine story:

"Just in the past few months, I think a light has gone off for people who've spent time up close to [President] Bush; that this instinct he's always talking about is this sort of weird, Messianic idea of what he thinks God has told him to do ... This is why George W. Bush is so clear-eyed about Al Qaeda and the Islamic fundamentalists. He believes you have to kill them all. They can't be persuaded, that they're extremists, driven by a dark vision. He understands them, because he's just like them ... This is why he dispenses with people who confront him with inconvenient facts ... He truly believes he's on a mission from God. Absolute faith like that overwhelms the need for analysis. The whole thing about faith is to believe things for which there is no empirical evidence ... But you can't run the world on faith."

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Social Security is not running out of money. Here are the facts.

1. Social Security is part of the government. It cannot run out of money unless the whole government also runs out of money. And the government of the United States cannot run out of money. That is not my opinion, it's an economic fact.

2. Social Security is an entitlement. Not even Congress can easily interfere with its payments. Congress would have to vote to default on the bonds Social Security holds for benefits to fail over the next 40 years. It would have made more sense for Schieffer to say, "We all know that the Pentagon is running out of money" -- military spending must be appropriated each year. But we all know that the Pentagon won't be permitted to run out of money. Ditto Social Security, in spades.

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But the news does not merely confirm that grim narrative about Bush's presidential term. It also points to an ongoing reality. It's not just that job growth has been miserable in the past four years. It's that it continues to be miserable right now and has actually gotten worse since the spring. Job creation since June is 150,000 short of the minimum required to keep up with population growth. This isn't a "jobless recovery." It's jobless, yes. But is it a recovery?

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The key to understanding Cheney is that he is a throwback -- to a brand of strategic thinking that bedeviled the Cold War. He is part of the legacy that runs back to Generals Curtis LeMay and Thomas Power of the Strategic Air Command in the late 1950s. The two tenets of this legacy are absolutely consistent: 1) Overestimate the enemy and govern through fear, and 2) hit the enemy before it can hit you. In four words: "missile gap" and "first strike."

That school never quite seized control of American strategic policy while the Soviet Union existed, though it came close on several occasions, including the Cuban missile crisis. It often won budget and political battles through trickery, such as the CIA Team B exercise of the early 1980s, which led to the "Star Wars" missile defense program. But the first strike never happened. In the end cooler and wiser heads, from Eisenhower, Kennedy and Johnson through Nixon and Reagan, always saw the advantages of working with Soviet leaders to prevent war.

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The chart above, presented at a conference in Paris by economists Luc Mampaey and Claude Serfati, shows what has happened since then. With the Afghan war the arms index surged, gaining over 25 percent by April 2002. Then it slumped, along with the rest of the market. If you had invested $1,000 in a defense portfolio at the peak of the Taliban boomlet, by March 2003 you would have lost a third of your stake.

But then came Iraq. And it's been clover for contractors ever since. Total gains since March 2003 are above 80 percent. Even if you'd put your money in at the beginning, in September 2001, you'd be up over 50 percent. That isn't bad, considering.

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The chart shows that "W" entered office on a rough note. Real GDP growth had already slumped in the summer and fall of 2000. It bounced on the edge of recession for several quarters and then fell into one in the third quarter. Much of that, no doubt, came in the three weeks following Sept. 11. (I've always said Bush should get a pass for his first year.)

In the fourth quarter beginning on Oct. 1, 2001, investment collapsed. But the overall economy did not. Instead, it rebounded. Why? Tax rebates went out, interest rates fell and automakers (among others) cut their prices. Auto and home sales soared. Federal government spending also surged -- on reconstruction, homeland security and the military. The stock market had recovered almost all its losses by year's end.

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Up to last Friday, Sept. 10, Bush's September approval ratings clocked an average of exactly 50 percent, measured across six polls (Newsweek, Fox, ABC/Washington Post, Zogby, CBS/New York Times and Gallup/CNN). That could be a little high, because early September results were probably distorted by the Labor Day weekend -- Newsweek's 52-41 Bush lead and 50 percent approval, which slipped back to 49-43 and 48 percent approval one week later, are a case in point. Also, Fox News shifted the basis of its poll from registered to likely voters -- and Bush got a five-point jump in that poll. Still, to give Bush the benefit of the doubt, I'll factor into the equation a 47.2 percent average approval rating for August and 50 percent for September so far. This represents a gain of about 2.8 percent, which is Bush's sixth-largest monthly gain.

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The Democratic Party is a coalition of rich and poor. It has Robert Rubin alongside Charles Rangel, Nancy Pelosi alongside Maxine Waters. Urban professionals generally vote Democratic. So do working people, ethnic minorities and immigrants, for the most part.

Residents of the suburbs and the countryside generally vote Republican. They are, however, far from contented. Not being rich, they didn't get much from the Bush tax breaks -- and their property taxes went up. They pay for services that, they believe, flow to people unlike themselves. Meanwhile they make ends meet by borrowing against their houses. Their politics is fueled by resentment -- which is fed, of course, by drive-time radio on the commute to work.

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Then they did what they did. The result was two conventions about Kerry, none about Bush. There was virtually nothing about the past four years, nothing about the four that lie ahead. The Bush motto: Nice guys finish last.

Now Bush will close in for the kill. Next up: Kerry and the antiwar radicals. Brace for it.

As it happens, I knew John Kerry back in 1971 -- the only time our paths have crossed. We had small offices next to each other in an old building in Cambridge, Mass. I was organizing college students for George McGovern. He was organizing Vietnam Veterans Against the War.

Here's one truth about those days: There were lots of big-mouthed radicals around. There were street corner Marxists with Viet Cong flags. They had big revolutionary dreams. And they got a lot of attention.

Kerry wasn't one of them. Like the McGovern kids, he had a serious political goal -- to end the war. Only, by organizing veterans, he was doing it the hard way.

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The ground has been carefully prepared. New books by Peter G. Peterson -- the relentless Cassandra whose Thirty Years' War against Social Security can wear down skepticism even at Salon -- and by Laurence Kotlikoff and Scott Burns are softening up opinion leaders. (See my not-very-favorable review in the Texas Observer.)

More important, Alan Greenspan is again neglecting his day job to lend respectability to a scare campaign. Speaking at the annual Federal Reserve retreat in Jackson Hole, Wyo., last weekend, Greenspan noted the "abrupt and painful" changes required to both Social Security and Medicare, arguing that the 77 million baby boomers set to retire will simply pose too great a burden otherwise.

Greenspan said, "If we have promised more than our economy has the ability to deliver, as I fear we may have, we must recalibrate our public programs so that pending retirees have time to adjust through other channels."

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