This book was written during a time hailed by the President of the United States as “the greatest upsurge of economic well-being in history.” Others, in other nations, spoke of an “economic miracle,” or else claimed that “we never had it so good.” Professional economists were overjoyed that their “dismal science” had finally turned out to be the hope of the world. They impressed governments and businessmen alike with their theoretical erudition and its practical applicability. With the unfortunate exception of an inarticulate minority, from the “High” down to the “Low” there was general agreement that business was excellent and that it would stay that way. There was some concern with a residue of poverty and with the few bottle-necks of unemployment which still marred the other wise beautiful face of Western prosperity; and there was something more than just concern with the unsolved problem of “underdevelopment” which prevented the large part of the world from partaking in the general prosperity. But some day the poor nations too would “take off” and emulate Western success, and the blessings of capitalism would spread over all the globe.

Although I have witnessed this period of “unprecedented prosperity,” I also experienced the Great Depression between the two world wars. At that time, confidence in the resilience of capitalism was at a low ebb and theories abounded regarding its decline and predicting its certain demise. Marxism was once again in the ascendancy, if only as an expression of a growing discrepancy between capitalist ideology and reality. The climate of despair was ended by government interventions in the economy and by World War II. Meanwhile, John Maynard Keynes had evolved his theory, which suggested monetary and fiscal policies capable of assuring full employment in a stagnating capitalist economy. Governments applied the Keynesian suggestions to secure some measure of social and economic stability in their nations. Because these endeavors proved successful, an old slogan was modified to proclaim that “we are all Keynesians now.”

It is my contention that the Keynesian solution to the economic problems that beset the capitalist world can be of only temporary avail, and that the conditions under which it can be effective are in the process of dissolution. For this reason the Marxian critique of political economy, far from having lost its pertinency, gains new relevance through its ability to comprehend and transcend both the “old” and the “new” economics. I shall subject Keynesian theory and practice to a Marxian critique, and beyond that, I shall try to elucidate political and economic events and trends with the aid of Marxian analysis.

This book is not presented as a consecutive narrative, however; various of its parts have been written on different occasions and at different times. These are necessary parts and all of them relate to the single theme of the mixed economy and to the differences between Keynes and Marx. There is some unavoidable overlapping and even repetition which, I hope, will enhance rather than encumber the book’s readability.