Words of warning

He believed that companies use advertising to induce consumers to want things they never dreamed they needed,that easy credit leads to financial catastrophe and that the best way to reinvigorate the economy was by making large investments in infrastructure. Not president-elect Barack Obama,but J.K. Galbraith,the tall,iconoclastic economist,diplomat and adviser to Democrat leaders from John F. Kennedy on. For years Galbraith’s most famous book was “The Affluent Society”,which came out in 1958. But the financial crisis has revived interest in an earlier work,”The Great Crash,1929″,in which Galbraith showed just how markets become decoupled from reality in a speculative boom.

© The Economist Newspaper Limited 2008