This report examines the nature of the modern basal reader, its economics, and use. First, the report provides a history showing how the confluence of business principles, positivistic science, and behavioral psychology led to the transformation of reading textbooks into basal readers. Next, the report examines objectives and subjective factors which maintain the dominance in American reading instruction of a small number of very large publishers through their basal readers. The economics and ethics of marketing basals are also examined in the report. Then, the process of producing basals is described, drawing on investigative reporting. That leads to an examination of contemporary basals using a descriptive instrument. Finally, the report offers recommendations for progress in reading instruction within and without the basals. Eight pages of references conclude the report. (MS)