This essay charts the development of two entwined intellectual threads during the 1950s: the translation of European existentialism into an American idiom and what Nathan Hale describes as the “golden age of popularization” for psychoanalysis in the United States. I argue that, in concert, these two movements contributed to the erosion of the New Deal regulatory state by elevating psychological—rather than structural or socioeconomic—explanatory templates for social phenomena. In contrast to the literature of the long Progressive Era, in 1950s works the ego and its vicissitudes become the dominant template for understanding society and the self. Patricia Highsmith's novels provide a nodal point for this political and intellectual history as she recasts representations of violence, murder, alienation, class envy, and social mobility in ways that both represent and helped define the legitimation crisis of the regulatory state. Highsmith repudiates a narrative world governed by structural or environmental conditions and—in contrast to literary naturalists like Theodore Dreiser and John Steinbeck—presents the darker corners of human experience as phenomena of the largely autonomous, internal arena of an existential psyche. These shifts in literary tastes, the essay argues, augmented the weakening intellectual purchase of an interventionist New Deal reform agenda during the 1950s.