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1937 we beheld the painful ascent up the finicula of governmentspending and debt. Then, as 1937 ended, came another wave ofoptimism with predictions of the emergence of the nation into thefull sunrise of the greatest boom in our history—this at the verymomentwhen the feeble energy engendered by the emergencyalphabetical power units was already spent and we were actuallyon our way down again into what was called the "recession."I recall this to illustrate the arresting phenomenon that the ideawhich refuses most stubbornly to take root in the American mindis the realization of the fact that the economic system is in gravetrouble. We are not in just one of those cyclical depressions thathave always afflicted us. We are now arrived in that condition thatfor a good many years characterized the economies of Europeansocieties before World War I.I do not mean that the system is beyond repair and that we mustblunder along helplessly until we are sunk in the degrading conditionof communism or fascism. What I have in mind to say is thatafter long years of growth and vigor our system seems to havefallen into a condition of enervation. One thing at least we areaware of—that we have been in a depression for fourteen years.Yet we are not wholly weaned from the vain assumption that, whilebooms and crises follow each other up and down the business cycle,on the whole our normal condition is one of good times, interruptedat intervals by occasional crises.The issues before us are too grave for mere assumptions. Let uslook, therefore, swiftly at the last fifty years in America. I base thestatements which follow on the well-known chart of business activityprepared by General Leonard Ayres, economist of the ClevelandTrust Company. Some objections can be made to this chart. Itcannot presume to measure up to scientific accuracy. The same canbe said, however, of almost all such charts. But while they maydiffer, the general results, so far as the point I have in mind is concerned,will correspond. This chart reveals a fluctuating line whichrepresents the rise and fall of business activity. A straight linerunning through it represents General Ayres's conception of normalactivity. When the fluctuating index line rises above the straightline, the country is moving into prosperity. When it sinks below167