The Power Economy

This book is decidedly international in perspective, discussing the recent economic performance of the United States, Japan, West Germany, Great Britain, and France. All these nations face a similar set of problems in the 1980’s, including higher unemployment, increased foreign competition, and budget deficits.

John Oliver Wilson details the specific approaches taken to these common problems. The approaches vary from the supply-side policies of the United States to British monetarism to French socialism. Yet none of these nations has found the key to dealing effectively with its problems.

That key is the power economy that is described in the last one-third of the book. In general, the power economy is an enabling policy--one that will allow these nations to unlock their own potential. Specifically, Wilson recommends that protectionism be reduced, that industrial policy be used to guide investment, and that there be more coordination of economic policies among the industrial powers.

Wilson, senior vice president and chief economist of the Bank of America, has done an especially fine job in detailing the recent problems and policies of these nations. All readers will benefit from these insights. Even more important, the elements of economic interdependence and cooperation are stressed. This is a welcome antidote to the recent growth of protectionism.

Readers looking for a radical revision of the economy will not find it here. Wilson’s policies stress moderation, balance, and avoidance of economic experimentation. For precisely that reason, the book deserves to be read.