Apparently, this is the book that saved Jonathan Franzen's belief in fiction.
While it did not have quite so extensive an effect on me, I do think it is an incredibly fine work, its pleasures more compact and directed than just about any other work of its era. Most critics remark upon its incredible concision and economy—the only real comparison there is Seize the Day, which might be a useful companion piece, perhaps.
At any rate, I remember reading—and being indelibly touched by—Paula Fox's novel for children Monkey Island when I was about nine or ten. My mother gave it to me to read to develop a sense of empathy—the novel is about a kid who becomes homeless in New York. One thing that both novels share is an exquisite sense of permanent crisis that avoids, almost uniquely in terms of 20th century American fiction, any dependence on the type of paranoiac intensity which pervades DeLillo, Pynchon, Cormac McCarthy, Coover, Gaddis, Roth, et al. (McCarthy sublimates it better than any of the others in a poetic lugubriousness that reaches into the heights of Melvillean metaphysical drama. The others are not quite so linguistically gifted, I feel.) The result for Fox's novel, however, is the same—an overwhelming sense of portentousness, an overdetermination of all actions which is not completely allegorical, but rather synechdochal. Essentially, the action of Fox's novel is both part of and presaging the terror which she evokes.
Desperate Characters is an incredible work of representational fiction, a masterful compression of the modern condition, and an innately wise observation of the way manners and mannerisms intersect.