The American people no longer view the government budget deficit as a significant problem. This represents a radical change in the attitude of Americans from thirty years ago, when even small deficits were viewed with great concern. People are not much concerned about our long string of trade deficits, either. Moreover, there is no perception of the linkage between the federal budget deficit and the trade deficit.

The author describes the factors that have produced this change in American values, drawing on his own experience in government. He goes on to assess the consequences, past and future, for the U.S. economy, noting that society's values help to shape the macroeconomic options open to a democratic government.