The Good Life and Its Discontents: The American Dream in the Age of Entitlement, 1945-1995.

Robert J. Samuelson, Times Books, $25

Robert Samuelson has a well-deserved reputation as one of die world's more thoughtful economic journalists. In a profession whose members are often partisan, ill-informed, or preoccupied with the latest headlines, Samuelson's columns for Newsweek and The Washington Post are exceptional in their combination of fair-mindedness, careful research, and understanding of the broader context. These same qualities are evident through much of his new book, The Good Life and its Discontents: The American Dream in the Age of Entitlement, 1945-1995. So I was surprised at how much I disliked the book. I expected to disagree with Samuelson about some things; I did not expect to be irritated and, in the end, actually angry.

Part of the problem is that the book is not exactly about economics. The Good Life and its Discontents is largely an essay about politics and society, topics on which it is easy to pontificate but very hard to achieve true wisdom. Samuelson's view of America may be summarized as You never had it so good." Despite all the negative publicity, he claims, Americans have a material standard of living that leaves little justifiable reason for complaint. We complain so much, he argues, because we expect too much from prosperity. We are disappointed that our material wealth has not brought more satisfaction because we have forgotten that money can't buy happiness. (It's true: He cites statistics to prove it. And we demand the impossible: economic growth without business cycles, freedom without inequality, and--most crucially--benefits without taxes. The American public has come to believe that we are entitled (hence "the age of entitlement") to more than society or government can ever guarantee. If we are to restore faith in our institutions, we must return to a realistic sense of what the economy and, in particular, the government can deliver--we need "responsibility, not entitlement."

The standard of living of the median American is, from a historical perspective, extraordinary. Samuelson is at his best when he is describing how much life has changed since the end of World War 11; it is a rare economics writer who can get beyond the dry statistics of GDP per capita to give you a sense of how primitive life was for most Americans 50 years ago. He rightly points out that the disenchantment and pessimism Americans express about the state of the nation are often strangely disembodied: Many are sure that the country is going to hell even while they feel pretty good about their own lives and prospects. And there is no doubt that the average voter is still unrealistic about what it costs to provide die benefits he expects--only in the last few months has it sunk in that the budget deficit cannot be eliminated by reducing foreign aid and the size of the White House staff.

Yet, Samuelson's paean to the median standard of living makes me uneasy. A two-income family that earns a combined $30,000 annually and is only a downsizing or reengineering away from losing both its middle-class status and its health insurance, may live very well by historical standards but is still closer to the edge than members of the professional elite can easily imagine.

Moreover, it seems strange how Samuelson insists on viewing American economic progress in terms of comparisons with 1945. Fifty years is a long time--two generations. While there has been immense progress over those two generations, the great bulk of that progress occurred during the first, not the second. Virtually every statistical measure of economic well-being--real wages, family income, poverty rates, and so on--shows a rapid improvement from 1945 to the early 1970s, but flattens out or declines thereafter.

Nor is the sense that economic progress has been spotty, at best, since around 1973 just a matter of possibly misleading statistics. At one point, Samuelson offers a list of 10 ways in which American life has changed fundamentally for the better, ranging from antibiotics to Social Security; it is hard not to notice that every one of those changes took place before 1970, with only marginal improvements since. During the first postwar generation, nearly everyone acquired a telephone; during the second, some of us got call waiting.

Samuelson's preference for comparing our current economic position with what it was two generations ago suggests a reluctance to face up to the reality that for more than 20 years economic progress has been uneven, and that in some important areas we have actually lost ground. Indeed, The Good Life and its Discontents seems to admit only grudgingly to the big failures of recent American economic development. The spectacular growth in inequality is given barely two pages, while a 15-page chapter is devoted to what Samuelson regards as excessive demands for equality. Rising poverty and homelessness are mentioned largely to question whether things are as bad as they seem in the statistics; the huge rise in poverty among children (a rise that is partly obscured in the overall poverty statistics by the decline in the number of elderly poor) goes unmentioned.

Samuelson's insistence on looking at the bright side of our economy is closely tied to his political analysis. And as his political analysis became clearer my annoyance at his excessively long-run vision gave way to dismay and anger. To put it bluntly: Samuelson writes about the politics of economic policy as if his views froze around 1984-just when it was becoming clear that the Reagan Revolution would not utterly transform the political landscape, but would lead to massive deficits (and before it was clear just how much richer the rich were becoming and how much poorer the poor).

In Samuelson's vision of American politics, the federal government is besieged by a host of special interest groups, often groups which "don't have solid power bases ... [whose] followers consist mainly of sympathizers who may, at most, pay modest dues. Such groups claim to represent --among others--women, blacks, Christians, environmentalists, family values' advocates, various ethnic groups, gun owners, and gay people." Because of the politics and psychology of entitlement, Samuelson argues, the government is able neither to say no to these groups' demands nor to convince voters at large that they should pay higher taxes. The result is both persistent budget deficits and an ever-growing burden of regulation, as the government tries to legislate results that it cannot pay for directly.

Now this is not a bad model for the politics of the 1970s, a decade when it did seem that Washington was vulnerable to demands from practically anyone who could afford a letterhead. But is this model a good picture of the politics of the 1990s? There are groups that have real power bases today --with large financial resources and deeply committed cadres of loyalists. And they are over-whelmingly on the right. That is, they do not seek new regulations and benefits on behalf of the groups they represent, as much as they seek to remove regulations and benefits that protect other groups. Samuelson seems not to have noticed, but the tide is running the other way.

This is not an accident. hi fact, it is in large part a delayed reaction to precisely the kind of interest-group politics that Samuelson describes. During the 1970s the forces of the right looked at the success of environmentalists, women's rights groups, and so on in driving the national agenda and set out self-consciously to organize themselves as a counterweight. And they have been overwhelmingly successful. On issue after issue, the newly powerful right has reversed the terms of debate and is within striking distance of reversing decades of policy. Samuelson seems oddly oblivious to this upheaval in the political landscape.

Take, for example, the environmental movement. The Good Life and its Discontents spends a fair amount of space taking on the excesses of that movement, pointing out that its leaders have been distressingly willing to embrace dubious science as long as it furthers their political agenda. Fair enough. But the peddlers of pseudo-science with influence in Congress these days are anti-environmentalists--and they have far more power than the eco-freaks ever did. Samuelson asserts that there is no "clamor to scrap environmental regulation." Really? What he means is that die general public does not want the regulations scrapped. Nevertheless, a determined majority in Congress is doing its best to get rid of as much environmental protection as possible (having already scored a notable victory against the nation's old-growth forests).

Or take the social safety net. Samuelson asserts that nothing important will change: "Although we may dismantle parts of government and redesign others, the end result will still be--by any historic standard--a huge government that spends about a fifth of our national income." If he means that Social Security and Medicare are not about to be abolished, he is right. But the spending that ensures a halfway tolerable life for unlucky Americans is on "means-tested" programs such as food stamps, AFDC, and Medicaid. This spending consumes less than three percent of GDP, less than 15 percent of the federal budget, but it is already slated for far more severe cuts than the rest of the budget and seems certain to bear a disproportionate share of further cutbacks. For millions of Americans, most of them children, things really are changing radically--for the worse.

In other words, Samuelson's picture of American politics--a weak-willed system unable to inflict pain and easily manipulated by anyone who can claim to be a victim--is strangely anachronistic. The political climate of 1995 is far more tough-minded than he allows; it is also immensely more mean-spirited and more than a bit scary.

Where Samuelson's selective vision becomes most conspicuous, however, is when he starts laying out scenarios for the future. He offers two alternatives. In one, the ethic of entitlement is replaced by one of "responsibility": The government does less, while there is a rebirth not only of the family but of "churches, professional societies, clubs, scouts, Little Leagues, self-help groups, neighborhood organizations." In the other, big government runs out of control: "Political paralysis ultimately overwhelms the private economy with high taxes, spending, and regulation."

Both scenarios are dubious. For one, it is hard to understand where Samuelson's fears about government taxes and regulation strangling the private economy come from. We are, after all, by far the least taxed and regulated of the major advanced nations, and the political currents are widening that gap. When people call for a federal government that does less--and especially when, as Samuelson does, they couple such calls with rhetoric about a restoration of freedom--I always wonder what particular areas of life they think the government should get out of. After all, once you account for interest payments and spending that is essentially about ensuring national security and public order, you find that the bulk of the remainder goes to

only a handful of programs-social Security, Medicare, veterans' benefits, Medicaid, and unemployment insurance. If by shrinking the government we mean cutting benefits to the elderly, that's a defensible proposal--but it has very little to do with the philosophical underpinnings of government's role. Similarly, most government regulation involves protections of the environment, health, and safety. The obvious examples of overdone pieces of regulation like the Americans with Disabilities Act, are relatively marginal parts of the federal enterprise. It is deeply misleading to suggest that reining them in would usher in a new age of personal responsibility, or even make a noticeable difference in most people's lives.

But the truly puzzling and, to me, infuriating thing about Samuelson's vision of die future is the scenario he doesn't mention, not even to reject it: the scenario of a future America ruled neither by entitlement nor responsibility, but by abandonment. This is the America in which government may still spend a lot of GDP on Social Security and Medicare, but it retreats not only from dubious commitments it has taken on in the last two generations but from functions we have taken for granted for a hundred years. What many of us fear is that we will become a society whose elite lives like expatriates in their own country--sending their children to private schools, living in gated communities protected by private security forces, even driving to work on private toll roads--while education, public order, and infrastructure for the population at large deteriorate even further. All this might well take place under the slogan of "personal responsibility," but it will have less to do with rediscovering Victorian morality than with recreating Dickensian poverty.

Now this abandonment scenario may not come to pass. But it is a vision that has become surprisingly pervasive in our culture: The image of a near-future dystopia in which high-tech luxury exists side by side with Third World poverty has become a staple not only of articles in intellectual magazines but of popular entertainment. I would not have thought that it was possible for a man of Samuelson's perceptiveness to write a book about the future of American society without even noticing that many people in this country (not just liberal intellectuals) think that the future will look like a scene from Blade Runner and at least feeling some obligation to say why they are wrong. Samuelson seems to have decided that the only thing we have to fear is that people will demand too much; we need not even consider that the powerless among us might be offered too little.

All of us have our blind spots. But when a commentator as intelligent and influential as Samuelson chooses to avert his eyes from the disturbing trends in our economy and, above all, our politics, it may do real harm. Reading this book, I was reminded of a grim old joke: "A while back, when I was feeling very depressed about the path my life was taking, a wise man spoke to me. 'Take it easy,' he said. 'Things could be much worse.' So I took it easy, and, sure enough, things got much worse."

Paul Krugman, an economist at Stanford University, is author of Peddling Prosperity and The Age of Diminished Expectations.