This chapter examines Gunnar Myrdal’s An American Dilemma as an expression of the shifting parameters and ultimate limitations of racial liberalism in the post-war United States. In framing the so-called ‘Negro problem’ as a pathology of white racial prejudice and behaviour, Myrdal challenged widely held precepts of ‘scientific’ and popular racism while skirting the degree to which racism was structurally and institutionally embedded in American politics and capitalism. An American Dilemma also calibrated its reform vision to the confines of the New Deal welfare state, which Myrdal recognized as itself the product of racial compromise and highly contingent ideas about the rights of social citizenship. Ironically, it was An American Dilemma’s politically appealing yet pragmatically circumscribed racial liberalism, which rested on access to political rights and economic opportunities as sanctioned by the American Creed, that overshadowed Myrdal’s own professed allegiance to a fuller vision of economic rights and planning as vehicles for reform. That broader economic reform project was left up to civil rights, and later, welfare rights activists who would make it a centrepiece of their organizing activities on behalf of racial democracy for decades to come.