IMO, McCarthyism is one of the times when Americans did not live up to our stated ideals of freedom.

Here are some excerpts from The Age of McCarthyism (Schrecker, Ellen. Boston: Bedford Books of St. Marvin's Press, 1994. (pp. 92-94)

The Legacy of McCarthyism

"In the late 1950s a group of graduate students at the University of Chicago wanted to have a coffee vending machine installed outside the Physics Department for the convenience of people who worked there late at night. They started to circulate a petition to the Buildings and Grounds Department, but their colleagues refused to sign. They did not want to be associated with the allegedly radical students whose names were already on the document.

This incident and it is not unique exemplifies the kind of timidity that came to be seen, even at the time, as the most damaging consequence of the anti-Communist furor. Since political activities could get you in trouble, prudent folk avoided them. Instead, to the despair of intellectuals, middle- class Americans became social conformists. A silent generation of students populated the nation's campuses, while their professors shrank from teaching anything that might be construed as controversial...

Was McCarthyism to blame? Obviously the congressional hearings, loyalty programs, and blacklists affected the lives of the men and women caught up in them. But beyond that, it is hard to tell. The statistics are imprecise. Ten thousand people may have lost their jobs. Is that few or many? ...

Quantification aside, it may be helpful to look at the specific sectors of American society that McCarthyism touched. Such an appraisal, tentative though it must be, may offer some insight into the extent of the damage and into the ways in which the anti-Communist crusade influenced American society, politics, and culture. We should keep in mind, however, that McCarthyism's main impact may well have been in what did not happen rather than in what didthe social reforms that were never adopted, the diplomatic initiatives that were not pursued, the workers who were not organized into unions, the books that were not written, and the movies that were never filmed.

The most obvious casualty was the American left. The institutional toll is clear. The Communist party, already damaged by internal problems, dwindled into insignificance and all the organizations associated with it disappeared. The destruction of the front groups and the left-led unions may well have had a more deleterious impact on American politics than the decline of the party itself. With their demise, the nation lost the institutional network that had created a public space where serious alternatives to the status quo could be presented. Moreover, with the disappearance of a vigorous movement on their left, moderate reform groups were more exposed to right-wing attacks and thus rendered less effective...

In the realm of social policy, for example, McCarthyism may have aborted much-needed reforms. As the nation's politics swung to the right after World War II, the federal government abandoned the unfinished agenda of the New Deal. Measures like national health insurance, a social reform embraced by the rest of the industrialized world, simply fell by the wayside. The left liberal political coalition that might have supported health reforms and similar projects was torn apart by the anti-Communist crusade. Moderates feared being identified with anything that seemed too radical, and people to the left of them were either unheard or under attack. McCarthyism further contributed to the attenuation of the reform impulse by helping to divert the attention of the labor movement, the strongest institution within the old New Deal coalition, from external organizing to internal politicking...

The impact of the McCarthy era was equally apparent in international affairs. Opposition to the cold war had been so thoroughly identified with communism that it was no longer possible to challenge the basic assumptions of American foreign policy without incurring suspicions of disloyalty...

The nation's cultural and intellectual life suffered as well. While there were other reasons that TV offered a bland menu of quiz shows and westerns during the late 1950s, McCarthy-era anxieties clearly played a role. Similarly, the blacklist contributed to the reluctance of the film industry to grapple with controversial social or political issues. In the intellectual world, cold war liberals also avoided controversy"...

-snip-

Click http://www.writing.upenn.edu/~afilreis/50s/schrecker-legacy.html
for more of this bool excerpt.