This was part of a trilogy that began with *The Affluent Society* (1957), and continued with *The New Industrial State* (1967). However, as Galbraith readily concedes, he learned a great deal in the intervals between writing these books. In 1958, Galbraith's political career was on an upward trajectory; by 1967 he had ruptured with Pres. Johnson over the Vietnam War, and in 1974 he had become reconciled to life in the political and academic wilderness.
For strangers to Galbraith's views, it is necessary to understand that he was first and foremost a student of what was, rather than idealized systems. Hence, many of his critics, faced with a dualistic world view, will accuse him of favoring a command economy, on the grounds that he was critical of the pretensions of capitalist economies. I hope readers will immediately see the error of this way of thinking: a clear-sighted analysis of a system that embraces the whole of a society's transactions cannot possibly be reduced to a dualistic judgment.
Second, Galbraith was an institutionalist. While orthodox schools of economics tend to emphasize the inherent, automatic nature of all economic transactions regardless of the nature of the agents, institutionalists such as T. Veblen, J. Commons, C. Ayres, and Galbraith identify the economic agents--viz., institutions in the society--as the decisive factor. Galbraith frequently aroused a lot of ire by pointing out the shortcomings of a social science (economics) being dominated by political demagogues, although he preferred to say this using dry wit.
In this book, he unites several concepts into an explanatory system. One of these is the concept of the "convenient social virtue," the tendency of people to profusely admire traits in other people they are not prepared to compensate; hence, the admiration of workers whose sense of duty and self-sacrifice transcends any rational economic explanation. He applies this analysis to women, who remain an undercompensated cadre of the workforce. Another concept is that of "the market system" as distinct from the "planning system"; usually economists and demagogues speak of the public sector [bad] versus the private sector [good], as if there were nothing but kinship between the multinational corporation and the corner espresso cart.
Galbraith explains that, while the giant industrial firm has very different needs and wants from small shops, it is likely to be very closely aligned to the needs and wants of those holding political power. Hence, the boundary between public and private sectors is less meaningful than that between the planning and the market systems. While the market system is admired, it is also punished with far greater danger and with "self-exploitation" by desperate proprietors.
The illusion that we live in an economy that is a free market, with an adversarial relationship to the state, is a dangerous one. First, it leads to people assuming that problems of waste and unemployment will solve themselves once an obvious regulatory obstacle is removed. In reality, we live in a planned economy ridden by systems of price controls and monopoly, and that planning is designed to serve industrial management. Assuming the opposite, of course, will only make such problems worse.
Second, it is dangerous because we overlook the influence of the planning system on the basic purpose of the state. The insistence of economist-demagogues is that the state is miraculously devoted to the toiling masses, and intent on expropriating the creative fountainhead, John Galt and Henry Reardon. Militarism is assumed to be therefore a rational response to a genuine foreign threat; whereas if the influence is understood to be symmetric, or even understood to flow the other direction, then one will expect militarism to serve the planning system and one will be skeptical of it.
There's a lot more in this book, and I believe it deserves a far better review than I've supplied. But I hope this gives a taste of the issues that Galbraith addresses.