Not so stagnant: are the good times really over for good?

• Author: Lindsey, Brink
• Position: The Great Stagnation: How America Ate All the Low-Hanging Fruit of Modern History, Got Sick, and Will (Eventually - Book review

The Great Stagnation: How America Ate All the Low-Hanging Fruit of Modern History, Got Sick, and Will (Eventually) Feel Better, by Tyler Cowen, Dutton Adult, $3.99

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BY THE TIME you make it through the fashionably prolix subtitle of Tyler Cowen's provocative new e-book, you'll have the gist of his argument.

In The Great Stagnation: How America Ate All the Low-Hanging Fruit of Modern History, Got Sick, and Will (Eventually) Feel Better, Cowen, a George Mason University economist, argues that since colonial times the American economy has benefited from"low-hanging fruit"--i.e., bountiful opportunities for growth. He singles out three in particular: free land, technological breakthroughs, and "smart but uneducated kids."

"Yet during the last forty years" Cowen writes, "that low-hanging fruit started disappearing, and we started pretending it was still there. We have failed to recognize that we are at a technological plateau and the trees are more bare than we would like to think. That's it. That is what has gone wrong." Cowen identifies the exhaustion of that low-hanging fruit as the main culprit behind the slowdown in growth during recent decades, rising inequality, the nastiness of present-day politics, and even the recent global financial meltdown. Looking for ward, he admits the possibility that innovation and growth will pick up again, perhaps catalyzed by the rise of China and India. Cultural change would help, he argues. Specifically, his chief prescription is that we somehow raise the social status of scientists.

Cowen is hardly the first boy to cry wolf. In previous periods of deep economic distress, other prognosticators have grabbed attention by claiming that innovation and growth are at long last winding down. During the Great Depression of the 1930s, the "secular stagnationists," led by Keynesian economist Alvin Hansen, argued that falling population growth and dwindling prospects for technological progress meant that "mature" economies could combat chronic underinvestment and unemployment only through massive government spending. And during the stagflation of the 1970s, the Club of Rome and many others warned that ecological constraints were finally imposing "limits to growth" So here we are: another macroeconomic crisis, another gloomy prophet.

We should remember, however, that at the end of this story the wolf actually does come. So could Cowen be right this time?

He certainly is correct in identifying a...