THE LOW American national saving rate has long been a serious concern to economic policymakers. Increasing national saving and investment was a principal objective of the Economic Recovery Tax Act of 1981 and of the supply-side economic policies that accompanied it. Yet the national saving rate, at least as measured in the National Income and Product Accounts, has declined sharply during the 1980s. Over the past five years, national saving has averaged only 2.3 percent of full-employment GNP, compared with 7.4 percent during 1960-80. In 1986, American net national saving was below 2 percent of GNP, less than half the rate in Britain, less than 30 percent of the rate in France and Germany, and only 10 percent of the rate in Japan. The unprecedented U.S. government budget deficits of recent years are often singled out for blame. Government dissaving as a share of fullemployment GNP indeed increased by 2.5 percentage points between 1960-81 and 1982-86. Still, rising deficits can account for only about half of the decline in the national saving rate between the two periods. The remainder is attributable to a roughly equal decline in the private saving rate. Much of that decline is in turn traceable to a fall in the personal saving rate. Low personal and private saving rates are especially striking given the widespread hope that the tax incentives enacted in 1981 would increase personal and private saving.