===== PAGE 1 =====

"REMAN

Ideas On (Ideas On Liberty

December 1998 Vol. 48, No. 12

FEATURES

$710 East Asia’s Crises: Toward a New Growth Paradigm? by Christopher Lingle
Overcoming political and institutional flaws.

713 Glory Be! by Leonard E. Read
Striving for moral and intellectual height.

$718 Pound Scum by Andrew P. Morriss
~The perils and pleasures of becoming a dog owner.

720 Market Reforms Score Big in Soccer by L. Jacobo Rodriguez
Why European teams dominate the sport.

724 The Golden Age at Risk by Bruce Yandle
Can we surmount new rising taxes, increased regulation, and diminished rights?

731 The “Human Rights” Deception by Richard W. Stevens
The Bill of Rights, not the U.N.’s Declaration of Human Rights, deserves celebration.

736 The Culture of Classical Liberalism by Tadd Wilson
Going beyond economics—in the company of Hayek, Rand, and Nock.

741 Spanish-American War: Death, Taxes, and Incompetence by Burton Folsom
Remembering the misadventure that came after The Maine.

743 The Conquest of the United States by Spain by William Graham Sumner
Sumner’s classic appraisal of the Spanish-American War.

COLUMNS

Center NOTES from FEE—The Constitution’s New Defenders by Donald J. Boudreaux

716 IDEAS and CONSEQUENCES—The Trade Deficit: Much Ado About Nothing
by Lawrence W. Reed

722 POTOMAC PRINCIPLES—Service Muddles in Washington by Doug Bandow
729 PERIPATETICS—No Credit Due by Sheldon Richman
$734 ECONOMIC NOTIONS—Price Floors, Surpluses, and the Minimum Wage by Dwight R. Lee
749 ECONOMICS on TRIAL—Everything Is Cheap—and Getting Cheaper by Mark Skousen
$757 THE PURSUIT of HAPPINESS—The Tyranny of the Proper by Jon Sanders

DEPARTMENTS

706 Perspective—Reports of the End of History Are Grossly Exaggerated by Sheldon Richman
708 It Just Ain’t So! by Thomas J. DiLorenzo
751 Book Reviews

*How I Found Freedom in an Unfree World by Harry Browne, reviewed by George C. Leef;, More
Guns, Less Crime: Understanding Crime and Gun Control Laws by John R. Lott, Jr., reviewed
by Dave Kopel; Medical Warrior by Miguel A. Faria, Jr., M.D., reviewed by Conrad F. Meier;
Public Policy Toward Cable Television: The Economics of Rate Controls by Thomas W. Hazlett
and Matthew L. Spitzer, reviewed by Robert B. Ekelund, Jr.; The Ethics of Liberty, by Murray N.
Rothbard, with a new introduction by Hans-Hermann Hoppe, reviewed by Sheldon Richman.

760 Index



===== PAGE 2 =====

FREEMAN PERSPECTIVE

Published by
The Foundation for Economic Education Are Grossly Exaggerated

Irvington-on-Hudson, NY 10533

Phone (914) 591-7230 FAX (914) 591-8910 The disintegrating Russian economy has

E-mail: freeman@fee.org emboldened the Bolshevik remnant. There’s
FEE Home Page: http://www.fee.org been talk in the duma of re-nationalizing
President: Donald J. Boudreaux industry. Could Francis Fukuyama have been
Editor: Sheldon Richman wrong when he declared that, with the fall of
Managing Editor: Beth A. Hoffman communism, history had reached its end?
Editor Emeritus I think so. But I thought he had erred even
Paut L. Poirot before the Russian communists began their
Book Review Editor latest agitation. Contrary to the “end of histo-
George C. Leef ’ .
.. ry” school, the fall of communism at the turn
Editorial Assistant . . .
Mary Ann Murphy of the decade did not end a great ideological
Columnists debate. It began one. Or should have.
Charles W. Baird The debate we need is between individual-
Doug Bandow ism and statism. It should have taken place

Dwight R. Lee
Lawrence W. Reed
Mark Skousen
Walter Williams

much earlier in this century, but communism
distracted us. The opponents of communism
were a disparate lot who agreed on little else
* but that total state control of economic affairs,

Contributing Editors . ..
Peter J. Boettke and its attendant political terror, were bad
Clarence B. Carson things. When communism disappeared, the
Thomas J. DiLorenzo disagreements within the opposing coalition
Burton W. Folsom, Jr. revealed themselves. Before, the contest was
Joseph S. Fulda | between communists and anti-communists

Bettina Bien Greaves
Robert Higgs
John Hospers

(including a variety of “mild” socialists);
today, the contest is between mild socialists
and libertarians, or true liberals—between

Raymond J. Keating .
those who would use organized force for

Daniel B. Klein

Wendy McElroy something other than simply defending indi-
Tibor R. Machan vidual rights (including, of course, property
Ronald Nash rights) and those who oppose all such non-
Edmund A. Opitz defensive use.

James L. Payne The terms “left” and “right” are not helpful
William H. Peterson here. It is too easy to find people who embrace
Jane S. Shaw those labels advocating coercion against those

Richard H. Timberlake

who themselves do not violate rights. The left
Lawrence H. White

wants to stop people from smoking tobacco.

The Freeman is the monthly publication of The Foundation for Eco- The right wants to stop people from smoking

nomic Education, Inc., Irvington-on-Hudson, NY 10533. FEE, ..

established in 1946 by Leonard E. Read, is a non-political, educational marijuana. The left wants to stop so-called

champion of private property, the free market, and limited government. . h ] d

FEE is classified as a 26 USC 501(c)(3) tax-exempt organization. hate speech. The right wants to stop so-calle
Copyright © 1998 by The Foundation for Economic Education. Per-

mission is granted to reprint any article in this issue, provided credit is obscene speech. The left wants to regulate

given and two copies of the reprinted material are sent to FEE. what people can do with their land. The right
The costs of Foundation projects and services are met through dona- . .

tions, which are invited in any amount. Donors of $30.00 or more wants to regulate what people can do with

receive a subscription to The Freeman. For foreign delivery, a donation : : : .

of $45.00 a year is suggested to cover mailing costs. Student subscrip- their persons. Sometimes, as in the Microsoft

tions are $10.00 for the nine-month academic year; $5.00 per semester. : 1 1 ] _

Additional copies of this issue of The Freeman are $3.00 each. antitrust case, they agree to unite 1n their per
Bound volumes of The Freeman are available from The Foundation secution of peaceful conduct.

for calendar years 1972 to date. The Freeman is available in microform
from University Microfilms, 300 N. Zeeb Rd., Ann Arbor, MI 48106.

706


===== PAGE 3 =====

In contrast, the libertarian proposes to let both sides of the ledger and wonders if a new
people go about their peaceful business golden age lies ahead.
unmolested. He doesn’t do so in a fog of This month is the anniversary of the Amer-
moral agnosticism. On the contrary, freedom, ican Bill of Rights and the United Nations
properly conceived, is grounded in a moral Declaration of Human Rights. The two docu-
certainty: that each individual owns himself ments are often lumped together, but Richard
and therefore should be free to think and act Stevens shows they could hardly be more
peacefully—and even to err—without shift- different.
ing the consequences to others. Do libertarians care only about economics?
It’s time to get on with the real debate. That’s a common criticism made by intellec-
tuals of the left and right. Using three promi-
nent examples, Tadd Wilson demonstrates
You can’t open a newspaper without read- that the criticism is unfounded.
ing about the economic woes of the Asian This year was the 100th anniversary of the
countries. Predictably, much of the commen- Spanish-American War, America’s first large-
tary blames those woes on an excess of capi- scale foray into imperialism. Historian Burt
talism. Christopher Lingle, who's spent time Folsom recounts the government’s ineptitude
in that part of the world, says the problem, and scheme to fund the war. He sets the stage

* k ¥

alas, is too little capitalism. for William Graham Sumner’s passionate
We close our observance of the 100th protest and warning that is still worth reading.
anniversary of the birth of FEE’s founder, Our columnists again have come up with

Leonard E. Read, by reprinting his article riveting topics: Lawrence Reed wonders
elaborating the nature of true glory as defined what all the trade-deficit fuss is about. Doug
by Pliny the Elder. Bandow warns against letting the military

The contrast between how private and gov- move into civilian service. Dwight Lee
ernment agencies treat “customers” can be explains how enforced minimum prices cre-
dramatic. When Andrew Morriss and his wife ate surpluses. Mark Skousen marvels that
decided they wanted a dog, they got a first- goods are getting cheaper all the time. In
hand lesson that left a lasting impression. “The Pursuit of Happiness,” guest columnist

The benefits of true liberalism can be found Jon Sanders catalogues what’s wrong with
in the unlikeliest places. European countries legislating the “proper” And Thomas
have dominated world soccer in recent years. DiLorenzo reads a Harvard professor’s
Jacobo Rodriguez traces that success to pro- description of the tobacco industry and cries,
market reforms on the continent. “It Just Ain’t So!”

We live in a time of contradiction. The pri- Our reviewers scrutinize books on such
vate market’s unprecedented wealth and issues as personal freedom, gun control, med-
progress exist side by side with government icine, cable TV, and the ethics of liberty.
depredation and threat. Bruce Yandle surveys —SHELDON RICHMAN

707


===== PAGE 4 =====

FREEMAN

deas On Liberty)

* 9
It Just Ain't So!
of Cigarette Advertising Past” (Regulation
magazine, Summer 1997) and his 1997 book,
arvard University law professor Einer Fear of Persuasion: A New Perspective on
Elhauge argued in the Washington Post Advertising and Regulation. In the 1950s,
last summer that free-market economists who before the Federal Trade Commission (FTC)
oppose the multibillion-dollar tobacco litiga- started regulating cigarette advertising, the
tion have made a big mistake. Professor tobacco companies used health as an effective
Elhauge writes that opponents are apparently means of promoting one brand over another.
unaware that for the past 40 years the tobacco This competition led to rapid improvements
companies conspired in order “not to inde- in cigarettes in light of the new research on
pendently market safer tobacco products” and the health effects of smoking that was being
“to withhold product safety information” developed in the 1940s and ’50s.
(August 4, 1998). According to Calfee, cigarette ads from the
This “market failure” supposedly justifies 1920s to the early 1950s included such slo-
the political plundering of the tobacco indus- gans as “Not a cough in a carload”; “Not a
try through war-on-drugs—style regulation of single case of throat irritation due to smoking
tobacco products, extortionate tax increases, Camels”; “Smoking’s more fun when you're
and having the government instruct jurors in not worried by throat irritation or smoker’s
tobacco liability cases that they are to assume cough”; “Lowest tar of all low-tar cigarettes”;
that smokers bear no responsibility for their “Today’s Marlboro—22 percent less tar, 34
smoking-related health problems. To Elhauge, percent less nicotine”; “Why risk sore
a free market is not really a market free of throats?” and “less tar and more taste . . . they
government intervention; it is a market in said it couldn’t be done.” This kind of adver-
which antitrust regulation is pervasive and tising was so pervasive that in 1953, Business
stands in the way of price-fixing, quantity- Week wrote that the tobacco companies were
fixing, or quality-fixing conspiracies. But the “screaming at the top of their lungs about
history of the cigarette industry proves that nicotine, cigarette hangovers, smoker’s cough
Elhauge’s assertions could not be farther from ... and kindred subjects.”
the truth; the free market did lead to better The industry’s claims were not just talk. Tar
quality cigarettes until the good professor’s and nicotine levels declined by nearly 40 per-
cherished regulation put an end to decades of cent between 1957 and 1959, Calfee writes.
vigorous quality competition. Nothing like that has happened since. In the
1950s both Consumer Reports and Readers
. . e Digest published monthly health ratings on
Cigarette Advertising cigarettes that carefully noted which brands
That the cigarette companies vigorously had improved. Epidemiological studies in
competed on quality before regulation imped- later years showed that these tar and nicotine
ed them has been painstakingly documented reductions led to roughly proportionate
by economist John E. Calfee, a fellow at the declines in death rates from smoking-related
American Enterprise Institute, in “The Ghost disease.

708


===== PAGE 5 =====

709

Regulation Ruins When the FTC further regulated cigarette
Health-Based Advertising advertising, it reduced the degree of competi-
tion and the amount of health-related adver-
It was the arrogant heavy-handedness of tising, and slowed the decline in U.S. smoking
FTC bureaucrats, not the free market, that was rates.
responsible for the decline in health-based In 1960 the FTC ruled that all tar and nico-
advertising in the cigarette industry over the tine advertising was illegal, eliminating such
past four decades. In the early 1950s the ads for several years. After making this decla-
bureaucrats convinced themselves that all ration, Calfee writes, the FTC also deceptive-
brands of cigarettes were identical and filed ly announced that the industry had adopted a
numerous “deceptive advertising” claims “self-imposed Cigarette Advertising Code.”
against the tobacco companies for their ads Of course, it was not “self-imposed”; the FTC
that made reference to coughing, lung health, would have sued the industry had it not adopt-
and the like. ed the government-sanctioned code. Conse-
Incredibly, Calfee points out, in 1950 the quently, during the early 1960s all cigarette
FTC declared that smoking cigarettes “is not ads spoke only of flavor and pleasure.
appreciably harmful” and that health-based After the Surgeon General’s Report on
advertising was therefore fraudulent. The smoking and cancer in 1965, the FTC
FTC also decided it was technically impossi- changed its position again and permitted
ble to manufacture a cigarette with less tar advertising references to tar and nicotine—
and nicotine than another. It ordered the but it was illegal to link these substances to
tobacco companies to “cease and desist” such health. In 1970 Congress banned all cigarette
advertising. advertising on television and radio, ending
But the FTC rule prohibited health-based once and for all the free market in cigarette
advertising claims only for existing brands of advertising.
cigarettes. The tobacco companies ingenious- In sum, Professor Elhauge is dead wrong.
ly evaded this restriction by creating new low- When the free market was allowed to work,
tar and low-nicotine brands. That fierce quali- there was vigorous quality competition in the
ty competition came to be known in industry cigarette industry, which produced an enor-
circles as the “tar derby.” mous amount of information about the health
By the late 1950s, as scientific evidence on hazards of smoking. The FTC’s interventions
the link between smoking and lung cancer may well have been part of a conspiracy, how-
mounted, the tobacco companies responded ever: the industry’s “fear advertising” was
by increasing the share of the cigarette market causing a drop in the incidence of smoking,
accounted for by filtered brands from 1 to 10 which the industry wanted to reverse. If the
percent and advertised “healthier” filtered industry did in fact conspire with FTC
brands heavily. Individual companies sought bureaucrats to eliminate health-based adver-
to gain market share with their advertising by  tising, the lesson is that such conspiracies can
scaring smokers about their competitors’ only work if they are organized by corrupt
brands. government regulators; they are impossible in
That so-called “fear advertising” was suc- the free market. Professor Elhauge, read your
cessful for some firms, but overall cigarette history.
sales began to fall—an outcome that the —THoMAS J. DILORENZO
industry certainly wanted to avoid. It was Professor of Economics
free-market competition that led to that result. Loyola College, Maryland


===== PAGE 6 =====

¥ Economics

FREEMAN

deas On Libert

East Asia’s Crises:
Toward a New Growth Paradigm?

by Christopher Lingle

he current crises affecting much of in the region was evidence of a superior polit-
Southeast and East Asia are rooted in the ical system. Another related notion was also
failures of political and corporate governance fatally damaged by the turmoil that began
in the region. While this observation may with the devaluation of the Thai baht in July
point to a simple truth, the solutions will not 1997. In the future, suggestions that political
be easy to implement. This is because the connections can substitute for commercial
financial and currency crises reflect deeply risk analysis or can inoculate investments
rooted institutions that themselves reflect against market realities will have little credi-
local cultural conditions. In turn, there can bility. Just ask anyone with business dealings
be little hope for speedy implementation of in Indonesia who sought partnerships with the
the fundamental changes that will be neces- Suharto clan.
sary to make operation of the economies of
the region compatible with the requirements
of a free and open international marketplace. A Common Thread
Consequently, restoration of stability to the While there may be no single “Asian
region’s economies will not come quickly, model” associated with the rise of East Asia’s
while recovery may be many years off and is economies, a common thread in the political
likely to result in much slower growth. culture in these diverse countries can offer
The recent turbulence in regional markets insights into their recent problems. Specifical-
sharply contradicts the World Bank’s report ly the economic and political institutions
on East Asia’s “miracle” economies suggest- throughout the region are insufficiently
ing that their governments “got the basics responsive to the demanding climate of the
right” If economic and political fundamentals global economy. The dominant political cul-
had been sound for the countries in the region, tyre that guided economic and administrative
there would be no discussion about financial structures reflected the specific agenda of a

and currency crises there. oo given ruling party or regime and was rooted in
One likely casualty of these crises is the conservative local traditions.
myth that interventionist or authoritarian gov- To generalize the ungeneralizable, political

ernments can effectively shepherd economic arrangements in most of East Asia relied on a
development. Until recently, advocates of collectivist, or communitarian, approach to
“Asian values” insisted that the rapid growth governance. As such, the interests of the

ST —— reater community, mostly as interpreted b
Christopher Lingle, an independent economist and g lit B. I i b P divid o
consultant, is the author of The Rise and Decline of some elite, were placed above u

the Asian Century (University of Washington Press, rights and freedoms. In turn, expressions of
1998). His e-mail address is cri@po.cwru.edu. individualism were deterred by such admoni-

710


===== PAGE 7 =====

711

tions as “the exposed nail is hammered down” allowed their economies to weather the com-
and “society above self.” petitive storms that have washed over the
The dominant sense of the collective is seen region. Most governments purposely sought
in assertions that Asian governments and to control credit allocation, which was prin-
regional institutions rely on principles of con- cipally directed through banks. Restraints
sensus-building and a strong preference for on the emergence of free and open capital
harmony. At the same time, success in life or markets better fit the policies of directed
commerce depends on personal and political development.
connections rather than commercial viability Financial markets in most of the region
or economic rationality. These relationships were underdeveloped, inefficient, and weak
readily give way to corruption and cronyism. because the visible hand of government pre-
Indeed, surveys of business leaders involved empted the invisible hand of market forces.
in global commerce by Transparency Interna- Consequently, there was little disclosure and
tional indicate that the most corrupt regimes almost no scrutiny of institutions that were

are in Asia. under the protection of the ruling govern-
ments. The real cost of non-economic trans-
Out of Sync with actions or unsound loans could be more read-
Ll Ld i 1 -
Global Capitalism ily concealed

Some of the political ang sconomic Government’s
arrangements in East Asia have a venerable : : .
history and may have served noble purposes Misleading Signals
in the past. Like institutions in other parts of There were several operational conse-
the world, they emerged out of local condi- quences of East Asia’s underdeveloped
tions and were appropriate for the times. domestic financial markets. One consequence
Unfortunately, the current crises imply that was that much of the internal financing of
those institutions do not mesh well with the commercial and development projects was
requirements of global markets. Such markets channeled through the domestic banking sys-
work best in the presence of individualist- tem. Another was the greater dependency on
based institutions that operate in conditions of foreign capital to provide liquidity to the
greater corporate accountability and political domestic financial system.
openness. Even in a market-based society, Government-directed investment mislead-
reliance on personal relationships limits the ingly signaled domestic financial institutions
extent of economic exchange and opportuni- that the projects involved low-risk or no-risk
ties. In a modern political context, depen- commitments of capital since they would bear
dence on political connections invites endem- the imprimatur of ranking officials. A heavy
ic corruption and may allow for extensive reliance on bank lending instead of capital
nepotism. At the same time, authoritarian markets is problematic since bank managers
regimes attempt to justify repression on the or directors can be more easily swayed by
basis of enforcing cultural traditions of har- political pressure. In contrast, large numbers
mony and respect for authority. of independent private investors in capital

The most demanding components of the markets demand greater access to information
ongoing globalization of the economy are free and require greater accountability before
and generally unfettered international capital offering up funds. In essence, financial mar-
flows and competitive markets. These are the kets in most of East Asia were politicized and
outgrowth of the Thatcher Revolution and the so commercial risks were ignored because of
“Big Bang” reform of London’s financial a promise of protection by political connec-
markets in 1982. Unfortunately, the political tions. This may have worked while growth
and corporate culture in most East Asian rates were high over past decades, but it is
countries militated against the development now painfully clear that political connections
of domestic capital markets that might have cannot protect investors from downside risk.


===== PAGE 8 =====

712 THE FREEMAN « DECEMBER 1998

As suggested, the inhibitions of capital prices to export their way out of their predica-
markets were consistent with the political cul- ments, but other producers both in and out-
ture of the region. Authoritarian governments side of the region will contest their traditional
sought to exercise tight control over the flow markets. Meanwhile, foreign investors will
of economic information. Most countries in impose higher standards before committing
the region followed or enforced traditions of funds to East Asia.
collectivist institutions; governance by con- The shared aspects of East Asia’s political
sensus often created an illusion of harmony. culture created flaws in the institutional infra-
In these settings, criticisms of economic con- structure of the “miracle” economies. Conse-
ditions or policies tend to be suppressed, and quently, they were ill prepared to withstand
independent corroboration of government the external shocks generated by inevitable
data was unlikely or impossible. When global capital flows. The rigidity of conserva-
investors and traders have difficulty getting tive political institutions led to policies that
information, markets are more prone to interfered with the self-adjusting mechanisms
rumors and misinformation. Greater volatility of local economies. While restoration of sta-

results. bility in the East Asian economies will be dif-
ficult, the slow pace of institutional change
Tough Battle Ahead will make recovery an even longer process.

Indeed, it may take a generation before some

Faced with deep and intractable problems East Asian economies can achieve the institu-
in putting their economic and financial hous- tions required for the sustainable economic
es in order, East Asian economies have a dif- growth demanded by the increasingly effi-
ficult uphill battle. Most will seek to cut cient global capital market. 0

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===== PAGE 9 =====

Anything That's
Peaceful

Glory Be!

by Leonard E. Read

“True glory consists in doing what deserves to be written;
in writing what deserves to be read; and in so living as to
make the world happier and better for our living in it.”

—PLINY THE ELDER

he Roman naturalist Pliny the Elder was True glory consists in doing what deserves to
born in 23 A.D. When he passed away at be written. It consists in noble deeds worth
the age of 56, he had written 37 books on the recording. This is to be distinguished from
nature of the physical universe—including blatant notoriety. History presents far more
geography, anthropology, zoology, botany, writings of the latter sort than the former.
and other related subjects. Alexander the Great, Charlemagne, Napoleon,
Pliny did, indeed, leave the world happier Hitler, Stalin, and countless other great
and better for having lived in it. He lived destroyers loom too large in written history.
every moment of his life with zest—enthusi- Why these lopsided recordings? It is the
asm—perhaps the greatest stimulus for bad, not the good, that attracts the public eye.
noble works. Wrote Emerson: “Every great Observe today’s media and the preponderance
and commanding movement in the annals of of reporting that does not deserve to be either
the world is the triumph of enthusiasm. written or read, spoken or heard.
Nothing great was ever accomplished with- In my study of writing that deserves to be
out it.” written, I’ve been surprised that most of the
The following is an attempt to think world’s great writers—past and present—
through and to understand Pliny’s three parts never kept a daily journal. Obviously, they
of True Glory. If even partially successful, I had other disciplines that brought out their
will make a small contribution to the dis- remarkable writings. We are all different in all
placement of that which should be neither respects. As for me, I have kept a journal for
written nor read. nearly 27 years without missing a day—cap-
- turing every thought that comes to mind or
Leonard E. Read established FEE in 1946 and served that | have learned from others—a rewarding

as its president until his death in 1983. This article is experience. What a discipline—writing such
excerpted from an essay that originally appeared in tries fi Iv 10.000 days!
the December 1978 issue of The Freeman. It is the entries tor nearly 1U, ays:

twelfth (and last) in a monthly series commemorating Recently I came upon my entry of August
the 100th anniversary of Mr. Read’s birth. 11, 1955, long since forgotten:

713


===== PAGE 10 =====

714 THE FREEMAN e DECEMBER 1998

If it were not for the gravitational force sands of books, articles, and commentaries
pulling us down, there would be no such that deserve to be read. The vast majority of
concept as “up.” these writings are known to a mere handful of

people. I shall refer to only one that is an

inspiring and instructive example: You Are

Extraordinary by Roger J. Williams.

If there were no evil, we would have no Professor Williams, a noted biochemist,
awareness of virtue. became convinced that his wife’s death was

caused by the doctor treating her as “an

equal,” rather than as an individual. This led
the professor to his first study in human vari-

If there were no troubles, there would be no ation, having to do only with the variation in
aspirations. taste buds in different people. The findings,

published in Free and Unequal, are fantastic.
Having an unusually inquiring mind, he

began an investigation into ever so many other

If there were no blindness, we would not be forms of variation. The findings appeared in
conscious of perception. 1956: Biochemical Individuality, somewhat

technical for lay readers. Nevertheless, I read it

with avidity, because it contained an important
key to the freedom philosophy. It was this book

If no man ever imposed restraint on others, that led to my acquaintance with the author.
there would be no striving for liberty and We corresponded, and after answering a
the term would not exist. question of mine he added that he had just

written a book, to be entitled You Are Extra-
I now recall discovering, just a few days ordinary, designed, he said, for lay readers.
later, while reading Dagobert Runes’s 7rea- The manuscript was enclosed.

sury of Philosophy, that around 500 B.C. Professor Williams was extraordinary. So

Heraclitus was saying the same thing: “Men are you and so am I and so is each human

would not have known the name of justice if being. Indeed, no one is the same as a moment

there were no injustice.” This made me laugh ago. Variation is a rule of all life—plant, ani-
at my “originality” and brought to mind mal, and man.

Goethe's assertion: “All truly wise ideas have Once variation is recognized as a fact of

been thought already thousands of times.” life, there can be no endorsement—none
Assuming the above observations to be whatsoever—of know-it-alls controlling the

valid, then “doing what deserves to be writ- creative actions of you or me or anyone.
ten” is learning how to cope with and over- Authoritarianism dismissed as utter non-
come life’s countless obstacles. It is an sense! We would witness hosts of public offi-

If there were no darkness, we would have no
sense or appreciation of light.

If there were no ignorance, we would not
know intelligence.

If there were no insecurity, we would not
know of security.

If there were no poverty, we would not expe-
rience riches.

observed fact that the art of becoming— cials reduced to a mere fraction thereof. All
human development—is composed of acts of but a few would return to that wonderful sta-
overcoming. tus of self-responsible citizens—America’s

Obstacles are assuredly the source of aspi- miraculous performance on the go again.
rations. Human frailties—which lead to such
things as governmental interventions of the True glory consists in so living as to make
kinds that destroy creative activities—inspire the world happier and better. How do we live
their own overcoming. Why, then, do errors to make others happier and better? Here are a
have their value? Their overcoming leads to few guidelines, mostly gleaned from others:
evolution—human liberty!

+ Stand for and staunchly abide by what is

True glory consists in writing what believed to be righteous—seeking approval

deserves to be read. There are countless thou- from God, not man.


===== PAGE 11 =====

GLORY BE! 715

« Strive for that excellence in the understand- is in the offing. The world is not going to
ing and explanation of freedom which will the dogs as the prophets of doom proclaim.
cause others to seek one’s tutorship. This Optimism increases happiness for it is
brings happiness to both the striver and the contagious.
seeker—and the world!

To serve truth and freedom is as high as we
can go. When more of us than now attain this
intellectual and moral height, the path toward

» Live with zest and enthusiasm. Nothing
great was ever accomplished in the absence
of such spirit.

glory will open:
* Be optimistic. This does not mean a blind-
ness to dictocrats lording it over us. Glory to God in the highest, and on earth
Rather, it is self-assurance that a turnabout peace, good will toward men. OJ

Anything That's Peaceful
by Leonard E. Read

Any

“Leonard Read said so much, so well, long

before any of us began to try to think clearly

about it. How much better would life be if

laws were simple — if people were allowed to
do Anything That's Peaceful.”

I» By Leonard E. Read —]JoHN StosseL, ABC News

Anything That's Peaceful is vintage Read:
insightful, clear, entertaining. To celebrate
the 100th anniversary of Read's birth, FEE
has issued a beautiful new reprint of this
important work.

In his inspiring new introduction,
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political philosophy of libertarianism.”

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do anything he pleases, so long as it is peaceful: the role of government,
then, is to keep the peace.” Let anyone do anything that’s peaceful, because
otherwise we inevitably do harm. This is Read in a nutshell.

Beyond the nutshell, Read analyses the ways in which socialism leads to
harm. He discusses the many wonders of the free market and he tells his
marvelous tale, “I, Pencil.”

As well as any of FEE's 181 titles, Anything That's Peaceful captures the
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===== PAGE 12 =====

Ideas and Consequences by Lawrence W. Reed

The Trade Deficit:
Much Ado About Nothing

have a dirty little secret that I want to share able to buy from others, which will only

with readers of The Freeman. It’s about a increase their trade deficits.
nagging problem I have had for a long time. It * I could get Congress to force J.C. Penney
just never seems to go away. Heretofore, I to cut its prices so that I won’t have to
have not wanted to admit to this problem in spend as much to get what I want. I thought
public because the newspaper headlines that might at least reduce my deficit, but at
remind me monthly that this sort of thing is lower prices I might actually be tempted to
bad and it’s embarrassing. But I’m going to buy more. Or J.C. Penney might come
come clean, hoping that maybe someone out under fire from the antitrust people for
there can help me. dumping its goods below cost.

My problem is this: I have a trade deficit * I could simply quit buying from J.C.
with J.C. Penney. That’s right. Month after Penney. That would really teach them a les-

month, I buy more from J.C. Penney than J.C. son. But then, doggone it, I like what I've

Penney buys from me. been buying from them. If I boycott them,
In fact, J.C. Penney has never yet bought wouldn’t that be like cutting off my nose to

anything at all from me. It’s been a one-way spite my face?

street right from the day I got my credit card

in the mail. And I don’t expect that this is Of course, I don’t really mean any of this.

going to change any time soon because the As a free-market economist, I know that
retail chain shows no interest in buying my there’s a fourth option here and it’s the only
chief export, which is columns like this one. It one that makes any sense: I should ignore this
just doesn’t seem fair. “problem” and never pay any attention again

Pve actually considered several options. to whatever the trade situation is between
Each one would probably reduce or eliminate J.C. Penney and me, except to pay my bills on
my trade deficit with J.C. Penney, but some time. America as a whole should do essential-
wise guy always points out new problems ly the same thing. We should fire the people in

each of these scenarios might create: Washington, D.C., who compile the numbers,
and the problem will go away.
* I could get Congress to force the compa- Every month, the U.S. Commerce Depart-

ny to buy enough of my columns to offset ment releases the official “balance of trade”

what I spend in its stores. But the more JC. figures showing the difference between the

Penney buys from me, the less it will be yajye of merchandise that enters the country
—_— d the value of merchandise that leaves the
Lawrence Reed is president of the Mackinac Center an If rt cha d rts. Ameri
Jor Public Policy (www.mackinac.org), a free-market country. If imp 0! § excee exports, erica
research and educational organization in Midland, has a trade deficit, which sets off alarm bells
Michigan, and chairman of FEE’s Board of Trustees. in Washington. If exports are greater than

716


===== PAGE 13 =====

717

imports, we’re all supposed to celebrate keep doing it. The folks at J.C. Penney benefit
because that’s a trade surplus. as well because they would rather have my

By this logic, draining the country of all money than the stuff they sell me. We’re both
goods and accepting none from abroad would better off because we have a trade relation-
be the best possible trade news. We wouldnt ship, which is why neither party ever com-
be able to celebrate, however, because we'd all plains about it. This would be no less true if
starve. But at least the government’s books J.C. Penney happened to be a company from
would register one heck of a trade surplus. Japan or Uganda.

This trade-deficit silliness is a throwback to America’s trade deficit with the rest of the
the less enlightened times of sixteenth- world made headlines regularly in 1998
century mercantilists. They argued that a because it broke at least one quarterly
nation must never buy more from foreigners record. The Asian depression was one rea-
than it sells to them because that would pro- son. Plagued by weak economies, Asians
duce an “unfavorable balance of trade” that purchased fewer American goods. The fall in
would have to be settled by an outflow of gold the value of many Asian currencies made
or silver. The mercantilists wrongly assumed goods from places like Japan and Indonesia
that gold and silver were the real wealth of a cheaper here, where a relatively strong econ-
nation, not goods and services. They were omy had already boosted American demand
also wrong to render value judgments about for foreign goods. No one who actually
other people’s trading activities. The fact is engaged in the transactions that produced the
that there can be nothing “unfavorable” about trade flows between the United States and
voluntary trade from the point of view of the Asian countries did so because they wanted
individuals actually doing the trading, other- to hurt themselves, yet the trade deficit
wise they would not have engaged in it in the alarmists say that those traders somehow
first place. hurt this country.

The principle that both sides benefit from Ultimately, the dollars that went abroad to
trade 1s readily visible when it involves two pay for imports will come back to buy Amer-
parties within a country; it somehow becomes ican exports. But even if they didn’t—in other
confused when an invisible political barrier words, even if goods come here and dollars go
separates the parties. Neither the mercantilists there to simply stuff foreign mattresses—
of yesteryear nor those who fuss about the Americans with their supposedly harmful
trade deficit today have ever satisfactorily trade deficit would have the better end of the
answered this fundamental question: Since deal. We would get goods like VCRs and
each and every trade is “favorable” to the automobiles, and foreigners would be stuck
individual traders, how is it possible that these =~ with slips of paper decorated by pictures of
transactions can be totaled up to produce dead American politicians.
something “unfavorable”? Forget the trade deficit. We should occupy

To return to my initial example, 1 benefit ourselves with more important things, like the
when I buy from J.C. Penney or I wouldn’t next sale at J.C. Penney’s. Cl



===== PAGE 14 =====

¥ Government

FREEMAN

deas On Libert

Pound Scum

by Andrew P. Morriss

We 7.5 million dogs and cats eutha- The staff was friendly and helpful but the
nized each year in U.S. animal shelters, APL didn’t have any dogs that fit our needs.
it’s hard to be turned down when you try to So we left and headed down the street to the
save one from the gas chamber. But my fami- county pound.
ly managed to be turned down, making us
Found scum.” Our trip through the world of The World of Bureaucra cy

og adoptions and purchases teaches some
valuable lessons about private and public Although just a few hundred yards away,
enterprises. the county pound was worlds apart from the

When we set out to adopt a dog we thought APL. Uniformed employees wandered aim-
we were just the types of owners anyone lessly about, chatting with one another and
would want: my wife is a veterinarian, we are ignoring the people peering into cages.
experienced dog owners, and our schedules Nonetheless we found a dog we liked. Five or
often allow one of us to be at home so our dog six pound employees were milling about in
would not be a “latchkey” pet. Because we the hall, but it took several minutes to find one
didn’t want our future pet to become a stray, willing to help us, a sharp contrast to the
we needed a fence. After investigating several friendly, helpful folks next door at the APL.
alternatives, we settled on an invisible fence. An animal-control officer finally gave me a
A wire is buried around the perimeter of the form to fill out; after I completed it, he sat me
property; a collar worn by the dog administers down in the hall to interview me.
a mild shock if the dog tries to cross the wire. One of the questions on the form asked if
We spent hours talking about the product with our yard was fenced. When the animal-
the salesman who, hoping for referrals, control officer noticed our plans for the fence,
worked hard to persuade my veterinarian wife he refused to continue the interview. “I really
that the fence was safe, effective, and got chewed out for letting someone with one
humane. With the fence on order, we were of those adopt a dog,” he told me. “You’ll
ready to get a dog. have to talk to my supervisor.” We pointed out

Our first stop in our search was the Animal that officials of the National Association of
Protective League (APL), a private charity. Humane Societies use this type of fence, but
Their building was clean, the walls lined with he was unmoved. We offered to cancel the
photos of pets and plaques honoring donors. order for the fence. Didn’t matter.

Ironically, it turned out we didn’t need a

Andrew Morriss is a professor of law and associate fence at all—it appears that just about any-

professor of economics at Case Western Reserve body except those who mentioned the words
University in Cleveland, Ohio. “invisible fence” could adopt a dog. Once you

718


===== PAGE 15 =====

719

said those words, however, there was nothing
you could do but talk to a supervisor. Of
course, there was no supervisor available on
Sunday; she was away until Tuesday. (When
our fence salesman talked to the pound super-
visor later that week, she denied there was a
policy against the product.)

The Private Breeder

Our final stop was a private dog breeder.
What a difference! She spent about an hour
talking with us, evaluating how we interacted
with her dogs, and discussing our plans for
the puppy. Only then did she agree to sell us a
pup, an Australian Shepherd whom we call
Cinnamon.

Our experience says a great deal about the
differences between private and public enter-
prises. At the pound we were treated like
obstacles to a quiet day; at the private charity
and the business we were treated like cus-
tomers. The county employee arbitrarily
enforced a non-existent rule and preferred means, from welfare to education. The same
leaving a dog at risk of death to getting incentives that made us “pound scum” threat-
“chewed out.” The APL and the breeder want- en our neighbors in the welfare system and
ed to know about the kind of home we would our children in public schools. Whenever we
provide the dog. While I’m sure most folks at have the opportunity to rely on private means
the pound love animals or they wouldn’t be to provide services, we ought to do so in order
working there, bureaucratic incentives get in to keep others from being treated as we were.
the way—avoiding reprimand, not saving While my family is fortunate enough to have
dogs, becomes the goal. With over 60 percent the economic means to escape such treatment
of dogs in U.S. shelters euthanized, that’s a usually, others are not. We need to be open to
disgrace. alternatives to public enterprises. Unless we

But it’s not just dogs and their owners we are willing to condemn the least fortunate
need to worry about. Our society regularly among us to treatment as “pound scum,” we
faces choices between public and private can’t afford not to be. []

Cinnamon now happily resides with the Morriss family.

The apple icon @ identifies Freeman articles that are appropriate for teaching high-
school students several major subjects—including economics, history, government, phi-
losophy, and current issues.

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and in written form. Teachers and homeschooling parents need only to visit our Web site
or request written lesson plans to take advantage of this unique service.



===== PAGE 16 =====

FREEMAN

deas On Libert

Market Reforms Score Big
in Soccer

by L. Jacobo Rodriguez

Lx summer, European nations once again superstar status. That was not always the case.
asserted their dominance of world soccer Pelé, the greatest soccer player of all time,
at the World Cup in France. That dominance never played for a European club team.
culminated with a surprise win by France over What accounts for Europe’s recent domi-
Brazil in the final game. Since 1986, when the nance of the sport? Organized soccer has been
World Cup adopted its current playoff system, played on the old continent for about a centu-
only four non-European teams have made itto ry now, and teams have well-organized farm
the quarterfinals of the quadrennial tourna- systems in which players acquire from an
ment: Mexico (1986), Argentina (1986, 1990, early age the discipline and physical fitness
and 1998), Cameroon (1990), and Brazil necessary to play competitive soccer. But
(1986, 1994, and 1998). while that may account for the emergence of
At the club team level, European domi- European stars, it does not explain why non-
nance is even more impressive. European European players want to go to Europe to
leagues—in particular, those of England, prove themselves. At least part of the answer
Italy, Germany, and Spain—are by far the lies in market-oriented reforms, particularly
most competitive in the world, attracting the in the media and immigration.
best players from around the globe. For
instance, the whole starting lineup for the
Argentine team plays in either the Spanish or
the Italian leagues; six of 11 starters for the For starters, clubs need money to sign the
Brazilian team also play in Europe, and best players, foreign or domestic. Until the
another three played in the continental mid-to-late 1980s, only a handful of teams in
leagues until recently. One of the best Euro- Europe could hire the top players from South
pean club teams, Barcelona, sent 11 playersto America and from other European countries.
the World Cup. The European leagues have Today almost any team playing in the first
become to soccer what the National Basket- division of a top European league has the
ball Association is to basketball: the only resources to sign world-class players.
place where players can get an accurate mea- Teams today get the lion’s share of their
sure of their talents and skills and achieve revenues from television contracts, advertis-
ing fees, and merchandise marketing. In addi-
tion, some English teams have gotten an infu-

ject on Global Economic Liberty at the Cato Insti- sion of capital by becoming publicly traded

tute. This article is a revised and expanded version of Corporations, an example that other European
an article published in the Wall Street Journal teams are following. The lucrative TV con-

Europe on July 16, 1998. tracts became possible because of the emer-
720

The Commercial Spirit

L. Jacobo Rodriguez is assistant director of the Pro-


===== PAGE 17 =====

721

gence of private television networks in many ply of talented foreign players more in line
countries of continental Europe. Networks with the demand for them.
always had been exclusively government TV networks have also profited from the
owned and operated. However, beginning in removal of artificial barriers to hiring foreign
the mid-1980s, the proliferation of direct- players. Fans in the players’ home countries
broadcast satellites put a de facto end to that avidly follow the action. The European
monopoly. leagues and networks have been able to sell
Thus, technological advances—and the broadcasting rights to networks in those coun-
spread of satellite dishes—Iled to the deregu- tries, especially in South America. Of course,
lation of television, which opened the door the greater exposure has probably had the
for soccer leagues to negotiate lucrative con- effect of driving up advertising fees, provid-
tracts with different TV networks, much as ing additional revenues to the networks and
professional sports leagues in the United the leagues.
States do. In the case of Spain, for instance, The third factor is cultural, not political.
deregulation occurred in 1990, and one of the Talented players are willing to move from one
private networks immediately signed a deal team to another, even if the latter team is in
with the Spanish first-division league for another country. That is a simple but crucial
exclusive broadcast rights of Sunday night fact. Not only are South American, eastern
games in an attempt to gain a significant mar- European, and African players going to west-
ket share. ern Europe to play against the best, but play-
Second, as revenues increased, the artificial ers also move around within the European
barriers to the hiring of foreign players were Union, which is very unusual for EU labor
for the most part removed. Today, players markets, where institutional and cultural bar-
from any European Union country can play in riers to labor mobility are well documented.
the league of another EU country and count as Market-oriented policies such as TV dereg-
domestic players. And non-EU players who ulation, flexible labor markets, and salaries
have been playing in an EU league for a num- determined by the interplay of market forces
ber of years also count as nationals, often tak- have allowed Europeans to be in a league of
ing advantage of liberal naturalization laws their own when it comes to soccer, an activity
that apply to players from former colonies of they are very passionate about. One can only
a European country. Finally, the maximum hope EU leaders, realizing what freer markets
number of non-EU foreign players per team have done for soccer, will push for more
has been increased from two to three or four, reform to help other sectors of their often
depending on the league. All in all, such mea- rigid economies and to stop the drain of
sures have had the effect of bringing the sup- human capital. 0

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===== PAGE 18 =====

Potomac Principles by Doug Bandow

Service Muddles
in Washington

or presidents and generals, the Cold War The search for new tasks is bureaucratical-
made military policy easy. The U.S. ly awe-inspiring. NATO is viewed as a means
armed forces had to contain the Soviet Union; of integrating former Warsaw Pact members
everything else was secondary. into the West. U.S. troops in Okinawa are said

But no more. The world may be dangerous, to help stabilize South Asia. The U.S.-South
but it isn’t particularly dangerous for Ameri- Korean alliance is now touted as a check on
ca. With the Pentagon still at Cold War lev- China.
els—adjusted for inflation, U.S. defense Then there’s the Selective Service System.
spending is as high as in 1980—what should Created to conduct a speedy mass mobiliza-
the armed services do? That was the question tion, Selective Service has been left without a
posed at a recent West Point conference onthe purpose by the collapse of the Soviet Union
relationship between civilian and military and the Warsaw Pact. Even the Pentagon has
service. said that it could do without registration.

As if further evidence of the accuracy of But Selective Service is nothing if not
public choice economics was needed, the pro- creative in coming up with new reasons to
ceedings showcased proposals for coopera- survive. The administration says registration
tion, coordination, and perhaps much more provides insurance—against what is not
between the Pentagon and civilian “national clear. Advocates declare that it deters despots
service” programs, particularly AmeriCorps. from using nuclear weapons—apparently
Why not deploy the armed services to deal 7,000 nuclear warheads are not enough. And
with all manner of other “national security” the program supposedly promotes civilian-

problems, such as education? military relations—as if signing a card at the
This debate is possible only because we are Post Office generates patriotism.
living in a post-Cold War world where the Still, Selective Service realizes its vulnera-

Pentagon doesn’t have much important work ble position. Last year it admitted that “with
to do. The United States and its allies account the downsizing of the Federal government, the
for 80 percent of the globe’s military spend- Selective Service System can no longer dwell
ing; Washington’s enemies are few and pathet- on its proud past or bet on the threats of
ic; America’s prosperous allies can defend tomorrow. The System must be of proven
themselves; the failed foreign societies around value to America today and every day.”
the globe pose no threat to our own. Thus, the agency proposed a half-million-
dollar “Serve America” initiative to publicize
Doug Bandow, a nationally syndicated columnist, is AmeriC orps. Argued Selective Service Direc-
a senior fellow at the Cato Institute and the author tor Gil Coronado, the “traditional role of

and editor of several books, including Tripwire: Selective Service offers a natural opportunity
Korea and U.S. Foreign Policy in a Changed World. to promote voluntary service to America in

722


===== PAGE 19 =====

723

AmeriCorps, as well as in our military” dangerous, even life-threatening, conditions
Apparently we now need military registration anywhere. Third, they voluntarily accept
to encourage civilian “service.” Congress restrictions—such as the prohibition on quit-
refused to appropriate the money, but Selec- ting—that apply to no other job. Finally,
tive Service still hands out the AmeriCorps defense is one of government’s few mandato-
phone number to young men forced to register. ry functions; paying people to work in chari-
Mixing military and civilian service is far ties is not. Even if the latter seems cost-
more likely to promote a bureaucratic empire effective (and funneling funds through gov-
than meet citizen needs. The problems with ernment certainly is not), it should not be
the AmeriCorps approach go beyond the allowed to interfere with the government’s
usual government waste. Federal funding is performance of its defense function.
likely to warp even the best groups, causing Joining the military has always been
them to lobby for additional assistance and to viewed as an act of citizenship, and not just
shape their programs to win government service. Establishing an alternative form of
support. government service dilutes the unique quality
Moreover, AmeriCorps further shifts of military service. Obviously the civilian
decision-making from average people across marketplace already creates significant com-
the country to the political process. As Mar- petition for the military. AmeriCorps and its
vin Olasky has pointed out, the definition of siblings would go further, offering an official
“compassion” was once to “suffer with” by alternative to young people who want the
becoming actively involved in the lives of challenge of “service,” while reducing the
those one was attempting to assist. likelihood they will enlist in the armed forces.
In this century the definition changed, first This is especially true when military service
.to mean writing a check, which absolved peo- means constant deployments away from their
ple of the painful requirement of human inter- families in order to implement a foreign poli-
action, then to making other people write cy of social work. It is one thing to accept the
checks. While AmeriCorps may be a better cost and risk of military service to help
means of assisting the poor than the panoply defend America from a foreign threat. It is
of past welfare programs—what wouldn’t quite another to join, say, to maintain a unified
be?—it further distances people from those Bosnian state against the wishes of most of its
they are supposed to be serving. Instead, peo- inhabitants. Even the patriotic-minded are
ple should directly fund and oversee private less likely to join in those circumstances.
organizations. True, the military is too big today, but even a
These are all good enough reasons to smaller force would suffer the loss of a few
oppose government “national service,” no thousand high-quality recruits.
matter how well intentioned. But another rea- Civilian service is important, but it needn’t
son for caution is the likely impact on the mil- be organized and funded by government. At
itary from expanded civilian service and the same time, military service should contin-
“cooperation” between the two. ue to be recognized for its unique role. The
Military service differs from civilian ser- armed services should be downsized to reflect
vice in several key ways. First, it is service to the diminishing threats to America and the
the national community. It is seen as almost Pentagon should focus on defense.
the definition of patriotism. Civilian service, Separating civilian service from govern-
in contrast, is service to a particular person, ment is likely to give us more service, the
although there may be social benefits from, kind that more effectively meets critical indi-
say, teaching literacy. Second, soldiers have vidual and national needs. And it will provide
what is essentially unlimited liability any- service in a manner that best reflects our her-
where around the world. They can be sent into itage of liberty. OJ


===== PAGE 20 =====

The Golden Age at Risk

by Bruce Yandle

hat a wonderful world! Wait a minute. markets for things as diverse as natural gas,
What about the Asia meltdown and electricity, stock market averages, and even
declining stock market values? What about permits to emit sulfur dioxide. We go online
horrible ongoing civil wars and terrorism that to buy automobiles, airplane tickets, and
plague large numbers of people on the planet? financial derivatives.
What about scandals in high public office? We can swap e-mail messages in the dead of
Impeachment? Wonderful? the night. In split seconds, contracts are nego-

In spite of all this, we know that more peo- tiated, deals are made, and the rights of con-
ple are experiencing freedom than ever tracting parties are respected in the rough and
before. Think about it. Just a short time ago, tumble of the marketplace. Goods, capital, and
Eastern Europe was a walled community; people move to the four corners of the globe
ordinary people were unable to move their with less government interference and friction
families from one province to another, let than ever before. Incomes are rising rapidly;
alone to cross country lines or venture forth wealth is being created. Life expectancies are
to the land of the free. increasing, and the world is getting cleaner.

I shall never forget seeing Czech families
making their way on the autostrada in Italy in The Other Side
1991, proudly displaying cardboard signs
telling the world that they were free. The This is one side of the ledger. But, alas,
story has been repeated for millions. there is another side.

Free markets are burgeoning where com- While we can design, build, and sell new
mand and control once dictated the who, products with relative ease, we must think
what, and when of production and consump- more than twice before cutting down a juniper
tion. The power of contracts, property rights, tree that may be listed as potential habitat for
and gains from trade are lifting and spreading an endangered species. The wiser course of
incomes and wealth. action says we should first get permission

Consider our routine activities. We have from a federal agent. Unloading a truck of
almost unlimited access to information, builder’s sand on a new home construction
goods, and travel. There are spot and futures site can land us in the federal penitentiary,

unless we first have federal permits. Building

Bruce Yandle is Alumni Professor of Economics at duck ponds without permission can yield

Clemson University and Senior Associate at PERC :
(Political Economy Research Center). This article is penalties oo severe than ma Sagan,
adapted from a lecture given at the April 25, 1998, ending a small amount of chemical waste to

Chicago meeting of the Philadelphia Society, later a local recycler can generate liability for
reprinted in Vital Speeches of the Day. cleaning up an entire landfill.

724


===== PAGE 21 =====

725

Taking steps to build a home on land ini- human life, instincts lie buried calling for sur-
tially zoned residential but later rezoned can vival, reproduction, and conservation of ener-
lead to an uncompensated loss of the entire gy and resources. Over the millennia, human
investment. Making an effort to plow and beings who survived and prospered devised
plant a dry field that was temporarily covered rules, customs, and traditions that protected
by a flooding river can lead to lessons learned the stuff of life. The rules were simple: You do
about wetlands violations. Setting aside land not reap where you have not sown. You do not
for a retirement home can be frustrated if eat unless you have contributed. You do not
there is a possibility that a golden-cheeked impose unwanted costs on your neighbor, nor
warbler may decide to locate there. he on you. Property rights formed the founda-

While we live in a veritable Garden of Eden tion for moral behavior and markets. And
on the one hand, we live as peasants on a feu- government was invented for the purpose of
dalistic manor on the other. And the baneful protecting those rights.
lord of the manor is not bashful when it comes The Founders did not put a happy face on
to command and control. government as we do now. They knew that

Superfund, wetlands, endangered species. government was not Santa Claus. They under-
How did the lord of the manor become so stood that self-interest—the natural human
powerful? What happened to property rights? desire to improve position and family—could

What happened to liberty? be channeled beneficially by rules of law,

property rights, and free-market forces. They
Property Rights and the knew from experience that those same moti-
Constitutional Order vations are perverted by the rule of politics.

Special-interest groups driven by self-interest

Time prevents a complete rendering of the will tilt the hand of government in their direc-
story. Understanding what happened requires tion. Instead of working the soil, factory, and
us to reconsider the important and precious field to produce new wealth, the special-
foundation stones of this wonderful republic, to interest groups will work the halls of Con-
remember the vital constitutional constraints gress and transfer wealth to themselves from
that set in motion the most powerful story of the unorganized, unwitting common man.
human action the world has ever witnessed.
Our Founders knew much that is now seem- 1 aviathans One and Two
ingly forgotten. They knew from bitter experi-
ence that for human beings to be free, for the The constitutional containment delivered
free spirit of man to soar, there must be basic by the Founders lasted for almost 100 years.
protections that limit the powers of the gov- Then, at the turn of the century, roughly 100
ernment. They understood the difference years ago, the rules changed. Marked by the
between rules of law based on just conduct 1887 Act to Regulate Commerce and the rise
and wisdom of the ages, and rules of politics of the Interstate Commerce Commission, then
based on expediency, concentrated power, and by rules for regulating food and other prod-
special-interest struggles. ucts, the federal government took on new

They knew that for markets to flourish—for powers that limited competition, provided
wealth to be created, preserved, and accumu- monopoly protection, and transferred wealth
lated—property rights had to be protected. across special-interest groups. The genie was
More than words on parchment, the Constitu- out of the bottle. The first American Leviathan
tion they penned formed moral and legal con- was born. But while government flexed its
straints believed necessary to limit the heavy new regulatory muscles, the industry regula-
hand of government. They wrote in the Con- tion that emerged did not systematically
stitution: “Nor shall private property be taken destroy bedrock private-property rights. That
for public use without just compensation.” was to come later, delivered by the environ-

Property rights. Why are they so important? mental revolution in the late 1960s and early
Deep in the genetic material that forms 1970s, the advent of Leviathan Two.


===== PAGE 22 =====

726 THE FREEMAN ¢ DECEMBER 1998

The environmental revolution cut through ty rights of ordinary people. If government
and across the property-rights fabric that was going to regulate, then let's get the right
formed the market economy. The new social regulation, the one that favors us.
regulation that emerged regulated industries What do we have? Rules that limit the
and functions within each and every plant, emissions of sulfur dioxide to fight acid rain,
factory, field, and mine. Command-and- even though the scientists who studied the
control, technology-based regulation emerged issue said there was no acid-rain problem.
in the fine print of the Federal Register. The Rules that give a black eye to industries that
rule book grew thick with regulations affect- must publicize emissions of more than 600
ing water and air, waste disposal, reconstruc- chemicals, in pounds, even though all indus-
tion of closed mines and wells, landfills, tree- try taken together produces just 17 percent of
cutting, waste disposal, homebuilding, and the total emissions. Rules that set stricter con-
chemicals from birth to grave. The creative trols on new and expanding plants while
energies of America’s brightest and best entre-  grandfathering older ones. Regulations that
preneurs were diverted. Energy previously favor one fuel over others. Endangered-
devoted to finding new and better products species protection that limits timber-cutting
and services, making markets, and reducing on government land, raising the price of tim-
costs became focused on regulators, regula- ber and the profits of firms that cut on their
tion, and ways to avoid costs and gain politi- own land. The list could go on.
cal favors. Quite understandably, firms and industries

And who supported this massive effort? that live in this age of regulated capitalism
Dedicated environmentalists with true con- have invested in the rules and stand to lose
cerns about the biological envelope that sup- when the rules are revised. They quite logical-
ports all life; quasi-environmentalists who ly support the Leviathan, hoping always to
saw an opportunity to stop economic develop- bring down costs once the favors have been
ment in its tracks; bureaucrats who found won. And just as understandably, there are the
enriched careers in regulating; politicians politicians who seek to harvest a political
who found new markets for their services; and commission each time they pass favors for
some industrialists who found it easier to special-interest groups.
compete in Washington for political favors Any effort to deregulate raises the wrath of
than to slug it out in competitive markets. The the favored groups. Is it any wonder that Con-
famous iron triangle emerged full-blown. gress is unable to take meaningful action to

eliminate Superfund, the program that pro-
. duces lots of litigation and hardly any
Bap tists and Bootleggers cleanup? Is it any wonder that Congress is

And what was the glue that held it together? unable to pass a property-rights protection
An alliance of “Baptists” and “bootleggers.” bill? Should we be surprised that Congress
(These labels hark back to the tacit alliance in cannot completely modify the Endangered
the old battles for alcohol prohibition; the Species Act in ways that reverse incentives,
Baptists wanted liquor outlawed because it making exploration, production, and conser-
was sinful, while the bootleggers silently sup- vation of species attractive endeavors instead
ported them because legal liquor threatened of deadly activities to be avoided at all costs?
their business.) Those who take the moral high

ground in appealing for rules they believe will Houses Built on the Sand of
protect the earth are the “Baptists” in the story. ge .
The “bootleggers” are the businessmen who Politics Will Fall

let the Baptists fight their battles for them Societies that fail to protect fundamental
knowing the result will be regulations that property rights are destined to fail. We are no
raise competitors’ costs, limit the entry of new exception. But why?

competition, and shield them from common- Rapidly expanding global markets, ad-
law suits that previously protected the proper- vances in technology, the unavoidable need


===== PAGE 23 =====

THE GOLDEN AGE AT RISK 727

to reduce costs, the failure of old smokestack property rights to land. Opposition to com-
regulation, rising incomes, and a veritable pensated takings comes understandably from
property rights rebellion are combining to the urban areas—the organized interests that
force change. In the absence of meaningful support zoning, planning, and government
international competition, U.S. firms can gain ownership of environmental resources.
from costly regulations that cartelize indus- There is friction in the workings of the
tries. When technological change is slow and property rights movement, but its force can-
obsolescence rates even slower, firms can gain not be denied. Recognizing this, regulators
with command-and-control, technology- have changed their behavior. They have
based regulation. Eventually, the true environ- backed away from the more blatant and arbi-
mentalist begins to wonder what it’s all about. trary enforcement of rules. And gridlocked
If air and water quality is no longer improv- Washington is getting the message.
ing, if Superfund sites are caught in a deadly Following in the wake of the property
gridlock that accomplishes nothing, if firms movement, we see a devolution of environ-
are required to spend huge amounts on trivial mental protection to the states, where politi-
problems and little on more serious ones, cians recognize that they cannot keep
eventually, environmentalists say “enough.” investors from building and expanding facili-
Rapidly rising incomes generate demand for ties elsewhere. When it’s cheap to vote with
real environmental improvements that cannot your feet, politicians sometimes see the light.
be and are not being delivered by central But if the house of regulation falls, will
authorities. And when countless ordinary peo- another, even stouter one take its place? Will
ple find that rights to use their land in cus- property rights be more secure?
tomary ways are challenged and taken with-
out compensation by regulatory authorities,
they rebel. The house built on sand comes
crashing down. I leave these important questions on the
table momentarily to tell you about the
. . prospects for America’s coming Golden Age.
The Property Rights Rebellion Think with me for a few minutes about this
Led by westerners fed up with increased country 100 years ago, and then let us com-
interference with traditional land rights, hun- pare that time with the one we now face.
dreds of grassroots organizations nationwide Three major forces played through the
reminded politicians of the Fifth Amendment economy a century ago. The first was massive
prohibition against taking private property for waves of immigration—the largest seen in our
public purpose without just compensation. history. People came to these shores looking
Failing to get satisfaction in Washington, the for a better life, seeking opportunity to work
movement turned to the states. Today, 24 and build. Wages fell. Prices fell. Incomes
states have passed some form of property- rose. Second was the technological revolu-
rights legislation, and legislation is pending in tion: electricity, petroleum, moving assembly
seven others. The geographic pattern that lines, interchangeable parts, transportation,
results is interesting. The Pacific northwest and communication. Finally, there was a
and Rocky Mountain states have all passed massive restructuring of firms and indus-
property-rights laws. Just four western states tries: efficiency-enhancing mergers, consoli-
have failed to respond. By contrast, the north- dations, alliances, spin-offs. The decades that
eastern states have done practically nothing. followed delivered America’s first Golden
In urban America, it seems, property rights Age: rapid increases in income and wealth.
are not an issue. City folks commuting on Improvements in basic living conditions. The
morning trains to New York, Hartford, and emergence of the Great American Bread
Boston know little about wetlands, Super- Machine.
fund, and endangered species. Indeed, they What do we observe today? Massive waves
know little about the importance of basic of immigration; a technological revolution;

America’s Golden Age


===== PAGE 24 =====

728 THE FREEMAN « DECEMBER 1998

cost-minimizing restructuring, mergers, con- an international cartel manager, if you will,
solidations, and alliances; and the computer- that seeks to coordinate nations worldwide in
driven virtual corporation. production and consumption activities that

Is there another Golden Age in the offing? relate to carbon emissions. This parallels the
I think so, but that is because I am extreme- earlier formation of the U.N. Commission on
ly optimistic. We Americans face a daunting Global Governance, important elements writ-
challenge. Along with the positive features ten into the North American Free Trade
mentioned, we also have higher taxes, a Agreement, and the new powers of the World
mountain of regulation, and a threatened Trade Organization. These fledgling bureau-
system of property rights. There is a Golden cracies will naturally seek to build a global
Age in the offing, but its realization is threat- regulatory regime, a potential threat to prop-

ened. erty rights, free markets, and the coming
Golden Age.
Where Do We Stand? Will the Golden Age emerge? Will enforce-

ment of constitutional constraints be strength-

Let me return to the question: will a stouter ened? Will this time of environmental feudal-
regulatory regime replace the one that is ism come to an end?

falling? This, perhaps, is the most trouble- These are the questions that seize us. And

some question, one addressed by the Kyoto the answers? The answers depend on what you

Agreement on global warming. Out of that and I do to strengthen the case for liberty and

agreement comes an international authority, individual responsibility. OJ

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===== PAGE 25 =====

Peripatetics by Sheldon Richman

No Credit Due

he pundits are bewildered over the pub- History and social studies classes comprise a
lic’s contradictory response to President series of tales in which noble political leaders
Clinton during his recent troubles. Most saved the country from the rapaciousness of
Americans have a low opinion of his charac- greedy businessmen.
ter. Yet at least 60 percent of those polled Although the federal government has been
think he’s doing a terrific job and should not meddling in our private economic activities
resign. How can this be? for well over a century, the explicit idea that it
Assuming the polling results are accurate, is the steward of the economy goes back to the
it may be possible to make sense of this Great Depression of the 1930s. That calamity
strange combination of opinions. First, we can supposedly proved that government is the
dismiss the theory that most Americans are indispensable glue that holds the economy
cynics who care about nothing but the econo- together. As a result, since the days of
my or money. Of course, they place a priority Franklin Roosevelt, Washington has openly
on the material well-being of themselves and assumed responsibility for nearly all econom-
their families. No one should object to that. ic matters. Planners and administrators came
Nevertheless, Americans do think the char- to the capital in droves beginning in 1933 and
acter of officeholders is important. That’s why found an abundance of work. When World
they frown on the President’s admitted moral War II began, they found even more to do
lapse. If character were unimportant we through such agencies as the War Industries
would not find Clinton’s “unfavorables” Board.
exceeding his “favorables” in the polls. The restoration of peace did not send the
Clearly, people have judged the President a planners packing. Government agencies were
scoundrel who nevertheless can do his job expected to maintain full employment, man-
well. What needs explaining is the connection age the money supply, finely calibrate the lev-
between the (so far) good economy and the els of taxation, spending, and inflation, and do
President’s positive job-performance rating. all the other specialized tasks that a great
People assume that if inflation and unemploy- economy can’t do for itself. Postwar legisla-
ment are low and incomes are rising, the Pres- tion set up the President’s Council of Eco-

ident deserves credit. Why? nomic Advisers, sending out the unsubtle
One obvious reason is that most people message that the President was at the helm.
went through government-run schools. Those So no one should be surprised that today’s

schools self-servingly teach children that the generations believe government keeps the
government is responsible for the well-being economy going or that the President deserves
of the nation, economic well-being included. credit in good times. That’s what they’ve

heard since they were old enough to under-
Sheldon Richman is editor of The Freeman. stand the language.

729


===== PAGE 26 =====

730 THE FREEMAN ee DECEMBER 1998

The problem is that it’s not true. Presidents, take credit anyway: “My economic program
and governments in general, don’t make the was passed by the Congress and millions of
economy perform well. The economy is indi- new jobs were created. We’ve grown the econ-
viduals engaging in production and exchange omy. My program worked!” Since most peo-
for mutual gain. If government abstains from ple don’t know how to do economic analysis,
interfering with those activities—to be pre- they have no way to challenge that claim. It
cise, with property rights and contractual might never occur to them that the progress
freedom—people will prosper and we will say they see would have occurred anyway or
that the economy works well. There is no would have been more impressive had the
active role for government. What we call the President’s program not been passed. As
market process is self-motivating and self- Israel Kirzner wrote in these pages in Octo-
regulating. It exhibits something that for ber, the conclusions of economic science are
many people is hard to fathom: undesigned counterintuitive. That is politically convenient
order. Government may maintain the legal for incumbents during prosperous times.

framework that facilitates the process, but it Note the asymmetrical conclusion. In good
cannot successfully run or guide that process. times, political leaders don’t deserve credit.
Nor is it required to do so. But in bad times, they are likely to deserve

We'd be saved a lot of trouble if every child blame. It works out that way because, absent
encountered the idea of undesigned order at government interference and major natural
the earliest moment he was capable of under- calamity, people will create prosperity. Reces-
standing it. But don’t wait for it to become a sion, depression, inflation, stagnation, and
prominent part of the public-school curricu- mass unemployment invariably have political
lum, because the very idea subverts the case origins.
for public schooling. If central planning (or When we get right down to it, the govern-
guidance) is unnecessary for creating a com- ment really has only two basic choices: impede
plex computer industry, why would it be nec- producers and consumers in their efforts to cre-
essary to create an education industry? ate prosperity or leave them alone—laissez
There’s no more subversive idea than unde- faire! Goodness knows that President Clinton
signed order. has pushed through policies—taxes and regu-

The existence of undesigned order can’t be lations—that would have created major hard-
doubted. Without it there'd be no economics. ship had we (“the economy”) been less
Pioneering economists created the discipline resilient. Perhaps he deserves credit for not
out of their attempts to explain a regularity interfering more. But that would be like prais-
that couldn’t be denied but for which no plan- ing someone for not stealing from us.
ner was responsible. As one of them summed Although economic indicators have been
up his observations, “Paris gets fed.” favorable the last several years, good times

The market order is resilient enough to are not guaranteed. Some government policy
overcome a good deal of government harass- could bring things crashing down any time. If
ment, regulation, and confiscation. Tenacious, Clinton’s problems have inhibited him from
goal-oriented people usually can find ways interfering even more with our productive
around the obstacles to prosperity that the activities, then we should be grateful for the
political system puts in their way. That scandal.
admirable feature of the economy unfortu- Everyone needs to understand that Presi-
nately also creates a problem: it enables Pres- dents cannot “grow the economy” or create
idents to claim, and win, undeserved credit prosperity. Free people do that simply by
for economic progress. Presidents are always going about their business in a legal environ-
doing things to the economy: announcing reg- ment that protects property rights. The most
ulatory initiatives, signing bills, pushing new government can do is stay out of the way. If
taxes, calling for new spending. If people the American people had the economic edu-
manage to neutralize the harmful effects of cation they lack, they would see President
those actions, the President is in a position to Clinton in a far different light. OJ



===== PAGE 27 =====

FREEMAN

Ideas On Libert

The “Human Rights” Deception

by Richard W. Stevens

O: December 10, 1998, world and nation- tically obliterates Americans’ constitutional
al leaders commemorate the birthday of rights.
an impostor. The United Nations Universal Of the roughly 34 individual rights guaran-
Declaration of Human Rights turns 50 years teed in the U.S. Constitution and Bill of
old on that date. Because Americans know so Rights, the U.N.’s Declaration nominally pro-
little about their own Constitution and Bill of tects only eight. (See Table I.) Five more
Rights, most do not know that the Universal rights find only partial support in the UN.
Declaration destroys both the letter and spirit Declaration, including the prohibition of bills
of the Bill of Rights. So when President Clin- of attainder, the protection of citizens’ privi-
ton declares that the documents are equally leges and immunities while traveling or living
great statements of human rights, as he did in other states, and the protection against
last year, few people will protest. “arbitrary interference” with privacy, home,
The Bill of Rights, the true statement of and family. Fully 21 other American individ-
individual rights and limited government, ual rights disappear entirely. (See Table II on
turns 207 on December 15, 1998. Unless the next page.)
Americans actively celebrate Bill of Rights
Day that day, the proximity of the two Table I: American Rights Nominally
anniversaries permits the Universal Declara- | Protected by the Universal Declaration
tion to shine as an international protector of

rights while the Bill of Rights is largely er
ignored.! To borrow from Gresham’ Law, Right Provision
“bad rights drive out good.” No ex post facto laws Article 11
Habeas corpus (no A
. . . arbitrary imprisonment icle9

Erasing the Bill of Rights Free exercise of religion Article 18

The Universal Declaration does not require Freedom of speech and press Article 19
any government to respect any particular indi- Freedom of assembly Article 20(1)

vidual rights. Instead, it provides, according | Rignt to life, liberty and
to the preamble, only a “common standard of | property (“due process”) Articles 3, 7, 11(1)

achievement for all peoples and all nations.” 17(1), 17(2)
Its “standard of achievement,” however, prac- Right to public trial in
criminal case Article 10
No cruel and unusual
Richard Stevens, a lawyer in Washington, D.C., spe- punishments Article 5

cializes in legal research and writing.

731


===== PAGE 28 =====

732 THE FREEMAN e¢ DECEMBER 1998

“everyone” can have such a right is for gov-

Table II: American Rights Lost ernment to force workers to pay for non-
Under the Universal Declaration workers’ welfare and retirement funds.4 So
Two witnesses required to convict person of the declared “right” of “everyone” to social
treason security requires that national governments
No punishment of families of person convicted institute schemes of plunder.
of treason (corruption of blood) Using the device of granting “rights” to
No established govemment refigion “everyone,” the Universal Declaration man-
People’s right to form citizen militias dates many such schemes. The Declaration
Individual right to keep and bear arms grants:
Prohibition on peacetime quartering of troops
in private residences the “right to work”
Probable cause, oath, and particularity the right to “just and favourable conditions
requirements for arrest warrants of work”
Probable cause, oath, and particularity : . .
requirements for search warrants the right to “protection against unemploy-
Grand jury requirement ment” i
No “double jeopardy” the “right to just and favourable remunera-
Govemment compensation for taking of tion . . . supplemented, if necessary, by
private property for public use other means of social protection”

Right to a speedy trial in a criminal case

A the “right to rest and leisure”
Right to a trial by impartial jury in a criminal 8

case the “right to a standard of living adequate
Right to a trial in the location where the crime for the health and well-being of [the indi-

occurred vidual and his family], including food,
Right to confront witnesses at trial clothing, housing and medical care and nec-
Right to require witnesses to appear in court essary social services,” as well as health,
Right to a lawyer for defense in a criminal case employment, and disability insurance
Right to a trial by jury in a common law civil the “right to education”

case
Right to have a single jury decide a case To bestow each of these “rights” on every-
No excessive bail in criminal cases one the governments must decide what each
No excessive fines citizen is entitled to, how much to spend, what

private or business conduct is permitted and
prohibited, and then compel the citizens to
Universal Power to Plunder pay. Massive government intrusion into all
facets of human life becomes necessary to
implement these “rights” to plunder. After all
the systems of compelling and plundering are
installed, little can remain of the Universal
Declaration’s Article 3 right to liberty and its
Article 17 right to own property.

None of these plunder “rights” appears in
the U.S. Constitution or Bill of Rights.

The UN.’s Declaration not only fails to pro-
tect core American individual rights; it also
enshrines the power to plunder. Frederic Bas-
tiat, the French economics writer, observed
that human beings can satisfy their wants
either by “ceaseless labor” or by “seizing the
product of others.”2 Government’s proper job,
Bastiat said, is “to stop this fatal tendency to
plunder instead of work.”3 The Universal Dec-
laration runs directly contrary to any notion of Declaration of
a plunder-free society. :

By couching itself in the language of indi- Government Rights
vidual rights, the Universal Declaration legit- Beyond granting rights to plunder, the Uni-
imizes the power to plunder. For example, versal Declaration gives governments nearly
Article 22 declares that “Everyone . . . has the total power to dictate all aspects of human
right to social security” The only way that life. Article 28 states that “everyone is entitled



===== PAGE 29 =====

THE “HUMAN RIGHTS” DECEPTION 733

to a social and international order in which The Universal Declaration defaults in favor
the rights and freedoms set forth in this of government power. Article 29, section 2,
Declaration can be fully realized.” In other states that individual rights and freedoms are
words, the people must have a large, intrusive limited by “due recognition and respect for
government. the rights and freedoms of others and meeting

In addition, under Article 26, governments the just requirements of morality, public order
must require each citizen to accept the Uni- and the general welfare in a democratic soci-
versal Declaration’s big-government gospel: ety.” Government, under the UN. Declaration,
“Elementary education shall be compulsory defines morality, public order, and general
[and] shall be directed to the full development welfare. The limitations on rights are to be
of the human personality and to the strength- “determined by law”—which in the Declara-
ening of respect for human rights and funda- tion means determined by the government.

mental freedoms . . . and shall further the But Article 29, section 3, appears to say that
activities of the United Nations for the main- the U.N. may override governments to assure
tenance of peace.” that rights are properly interpreted: “These

Article 29 then imposes on all people the rights and freedoms may in no case be exer-
duty to serve the “community” within the cised contrary to the purposes and principles
“social order” envisioned by the Universal of the United Nations.”

Declaration: “Everyone has duties to the com- Article 30 is ominous: “Nothing in this
munity in which alone the free and full devel- Declaration may be interpreted as implying
opment of his personality is possible” As for any State, group or person any right to
government defines nearly all of the functions engage in any activity or to perform any act
of the community within the social order, aimed at the destruction of any of the rights
including work, leisure, education, and eco- and freedoms set forth herein.” This Article
nomic decisions, these “duties” are defined destroys the right to actively oppose big-gov-

by, and owed to, the government. ernment programs. It abrogates the Bill of
Rights’ guarantees of free speech, press,

oy assembly, and petition for redress of griev-
Devil in the Default ances. Article 30 guarantees governments the

Both the U.N.’s Declaration and the Bill of ight to stop people from opposing compulso-
Rights contain “catchall” provisions. These Ty €ducation, taxation, social security, the
provisions explain how governments are suyp- MIMUM Wage, compulsory “public service,

posed to analyze questions about rights and and any other government plunder program.
powers that cannot be answered directly from The U.N.’s Universal Declaration of Human

Rights bears no similarity to the Bill of

difference between the two documents better Rights. Americans should reject the attempts
than comparing those provisions. to lump the two documents together in one

Amendments 9 and 10 of the Bill of Rights annual “human rights week.” On December
instruct the government to operate within its 15 Of each year Americans should celebrate
limited powers and to leave other powers to Bill of Rights Day by learning more about
the people. The Ninth Amendment states: their rights and teaching others. When Amer-
“The enumeration in the Constitution of cer- cans understand their precious Bill of Rights,

tain rights shall not be construed to deny or they won't be impressed by the United
disparage others retained by the people.” The Nations’ dangerous substitute. []

Tenth Amendment states: “The powers not 1. Since August 1997, 27 state and local governments have pro-

: ._ claimed Bill of Rights Day. Information about the national Bill of
delegated to the United States by the Consti Rights Day program is available at www .jpfo.org or (414) 769-0760.

the documents themselves. Nothing shows the

tution, nor prohibited by it to the States, are 2. Frederic Bastiat, The Law (lrvington-on-Hudson, N.Y.: Foun-
reserved to the States respectively, or to the on for Economic Education, 1950), p- 10.
people.” These provisions limit federal power 4. See Henry Hazlitt, Economics in One Lesson (New York:

: Arlington House, 1978), pp. 209-210, and Murray N. Rothbard,
and leave any unexpressed powers and rights Man, Economy, and State (Los Angeles: Nash Publishing, 1970),

to the local governments and the people. pp. 817-18, 829.


===== PAGE 30 =====

Economic Notions by Dwight R. Lee

¥ Economics

Price Floors, Surpluses,
and the Minimum Wage

| Phe month 1 discussed the distorting With Pg being the lowest price that can be
effects of government-imposed price legally charged, suppliers are anxious to sell
ceilings. Not content to limit the disruptive Qg units of the product. But at Pr, consumers
impact on economic decisions to price ceil- are willing to buy only Qp units. The result is
ings, governments are also quite willing to a surplus given by the difference between Qq
impose floors under which prices cannot and Q,. The appropriate response to a surplus
legally fall. Like price ceilings, price floors is some combination of reduced supply and
disrupt market cooperation and have conse- increased consumption. In a free market, sup-
quences quite different from those advertised pliers communicate their frustration at not
by their advocates. Before considering an being able to sell all they would like by low-

example of price floors—minimum wages— ering the price they charge. As the price
let’s examine the problem in general terms. declines below Pg, consumers increase their

consumption and suppliers reduce their pro-
Creating Surpluses duction. This mutual adjustment continues

until the price reaches P*, where producer and
consumer decisions are perfectly coordinated.
But the price floor, Pg, blocks that communi-
cation between suppliers and consumers, pre-
venting them from responding to the surplus
in a mutually appropriate way.

The standard downward-sloping demand
curve, D, and upward-sloping supply curve, S,
are shown in the nearby figure. As discussed
in my column on demand and supply two
months ago, these two curves determine an
equilibrium price, P*, that coordinates the
decisions of all consumers and suppliers. At
P* consumers want to purchase exactly the Suppliers Can Be Worse Off
amount that suppliers want to sell.

Despite the amazing coordination that
results from the equilibrium price, politicians
are often convinced by organized interests
that some suppliers should receive higher
prices. Interestingly, as we shall see, those
who lobby for higher prices are not always the
ones who will receive them. But regardless of
the source of the pressure, the political
response is often to impose a price floor, such
as Pg in the figure.

Consumers are clearly made worse off by
price floors. They are forced to pay higher
prices and consume smaller quantities than
they would with free-market prices. But price
floors can also make suppliers worse off.
Some suppliers can benefit from a price floor
if they can sell all, or most, of the quantity
they would like at that price, but then other
suppliers will be even less able to sell as much
as they desire.

Only if all suppliers of a product can sell as

Dwight Lee is Ramsey Professor of Economics and much as they want at the price floor is it pos-
Private Enterprise at the University of Georgia. sible for them to be better off as a group, and

734


===== PAGE 31 =====

735

then only temporarily. Farmers favored price Price
Surplus

supports for crops because the federal gov- aN IN s
ernment stood ready to purchase the supply Pe —

that farmers couldn’t sell at the above-market
price. But even in this case, the benefit to sup-
pliers was only temporary since competition
among farmers increased the cost of doing
business. For example, the lure of above-
market prices prompted farmers to bid up the NN

price of land. That 1s, the price of land incor- J b

porated the benefits of the price supports.

Those who owned good farmland before the

programs started won windfall benefits, but

those who entered farming afterward and paid Qp a Qg Quantity
inflated land prices did not.

to hire, and with no legal way of paying a
lower wage, it costs nothing to exclude some
A good example of how price floors can applicants from consideration. If an employer
harm the very people who are supposed to be has a choice between hiring the mayor’s son
helped by undermining economic cooperation or a poor kid from the other side of the tracks
is the minimum wage. Legislating a minimum who would be willing to work for less, the
wage is commonly seen as an effective way of mayor’s son is almost sure to get the job.
giving raises to low-wage workers. Unfortu- The young person from an affluent family
nately, it, like any price floor, creates a sur- can expect to have connections that make it
plus. In this case, it is a surplus of workers possible for him to get a minimum-wage job
(suppliers of labor), more of whom are will- before heading off to college, or a part-time
ing to work in minimum-wage jobs than there minimum-wage job while in college. The
are employers (demanders) willing to hire at poor kid whose education in an inner-city
that wage. We call a surplus caused by the public school makes going to college unlike-
minimum wage “unemployment.” ly, and whose best hope for gaining skills is
A wage floor hits workers with limited job experience, is less likely to get a job
skills, primarily young people. According to because of the minimum wage. This kid
The Economist, in 1997 the average unem- would have a far better chance if he could
ployment rate among workers under 25 was communicate his willingness to work by
three times greater than the average unem- accepting the lower wage that is now out-
ployment rate among those 25 or older (June lawed. It should surprise no one that the
27, 1998). Young people are best able to unemployment rate for nonwhite teenagers is
improve their economic prospects by develop- several times the rate for white teenagers.
ing skills that increase their productivity. For The political demand for the minimum
those with the fewest advantages, the best wage does not come from low-wage workers.
hope is work experience and on-the-job train- Today labor unions are the most active sup-
ing. The minimum wage reduces the number porters of increasing the minimum wage.
of people employers will hire for what is Unskilled nonunion workers can compete
essentially training. with skilled union workers only by offering
Consider also that the minimum wage their services for less. Increasing the mini-
reduces the cost of discriminating on non- mum wage limits this competition, allowing
economic grounds in hiring. With more young union workers to demand higher wages than
people applying for jobs than employers want would otherwise be possible. OJ

The Minimum Wage


===== PAGE 32 =====

FREEMAN

deas On Libert

The Culture of
Classical Liberalism

by Tadd Wilson

espite what is taught in most universities, to purely economic or political understand-
the essentially classical liberal ideas of ings of man. The existentialist Jean-Paul
free-market economics and limited govern- Sartre, British socialist literary and political
ment have won the basic test of any doctrine: critic Raymond Williams, and even the politi-
does it beat the best alternative? The evidence cal philosopher Hannah Arendt come to mind.
1s clear, whether in the collapse of the former It was Arendt who, in Men in Dark Times
Soviet Union’s planned economy or in the (1968), referred to “many periods of dark
public-sector downsizing in countries as var- times in which . . . people have ceased to ask
ied as Estonia, New Zealand, and Poland. any more of politics than it show due consid-
However, classical liberalism—once a eration for their vital interests and personal
dominant philosophical paradigm—now liberty.”
allegedly fails the more subtle test of com- From the right, Allan Bloom argued in
pleteness. Many on the left and right criticize “Commerce and ‘Culture’” that “the very
classical liberals for focusing purely on eco- notion of ‘culture’ was formed in response to
nomics and politics to the neglect of a vital the rise of commercial society.” In The Clos-
issue: culture. The criticism could have impli- ing of the American Mind (1987), Bloom
cations for the future of classical liberalism. spoke disparagingly of merely economic or
As F.A. Hayek pointed out in “The Intellectu- political conceptions of a free society, chiding
als and Socialism,” the perception of a philos- friends of the market that in accepting “value-

ophy affects its longevity. free” economics “they are admitting that their
‘rational’ system needs a moral supplement in
Right and Left Versus the order to work, and that this morality is not
itself rational—or at least the choice of it is
Last Man not rational, as they understand reason.”

From the left, classical liberals have faced Bloom's observations continue to be recycled
(or, some would suggest, have not faced) seri- by more overtly political conservatives such
ous questions about the limits and very nature as former federal judge Robert Bork and
of politics and economics. Indirectly inherit- Weekly Standard publisher William Kristol.
ing both Friedrich Nietzsche's apparent deifi- ~~ Quite reasonably, many classical liberals
cation of culture and his fear of an atomistic, retort that political and economic theory nat-
utility-maximizing Last Man, most twentieth-  urally focuses on politics and economics, and

century intellectuals have been openly hostile that they are more interested in defining the
political sphere rather than accounting for

what falls outside it. Others mention that
Tadd Wilson is a freelance writer in Fairfax, Virginia. many artists (those most involved in “cul-

736


===== PAGE 33 =====

The Foundation for Economic Education
Irvington-on-Hudson, New York 10533
Tel. (914) 591-7230

Fax (914) 591-8910

E-mail: freeman @fee.org

December 1998

The Constitution’s New Defenders

11 the talk of cigars, blue dresses, the Constitution says. If we're just going
A and other paraphernalia of mod- | to do whatever we think, then we're not
ern presidential amours has drawn going to have a constitutional form of

national attention away from how the government.”
prospect of impeaching Bill Clinton is Hear, hear! Ms. Lofgren is a member of a
inspiring a sea-change in constitutional political class that for sixty years has waxed
theory. Many big-government advocates eloquent over “a living constitution” whose
now champion strict constitutional con- plain language should never curb
struction. The President’s defenders are Washington's zeal to regulate the economy,
probably at this very moment poring over redistribute wealth, and take private prop-
Robert Bork'’s scholarly articles in search of | erty. This the-Constitution-says-what-we-
intellectual ammunition for Clinton's fancy-it-to-say conviction was most notably
defense against impeachment. championed by the late Justice William

For example, when interviewed recently Brennan, who justified his rejection of strict
on National Public Radio, Rep. Zoe constructionism by arguing that “[i]t is
Lofgren (D-CA), a member of the House arrogant to pretend that from our vantage
Judiciary Committee, sounded downright we can gauge accurately the intent of the
Borkian. She solemnly intoned that we Framers on application of principle to spe-
moderns are not free to read into the cific, contemporary questions.”
Constitution’s phrase “high crimes and This is an expedient view of the
misdemeanors” (which governs impeach- Constitution for those who disapprove of
ment) anything that we wish. Instead, she that document's clear restrictions on gov-
advised that the proper meaning of these ernment power. The framers feared gov-
words “comes from Alexander Hamilton, ernment, and the Constitution they ratified
from George Mason, from Madison.” Rep. is crystal clear that government power in
Lofgren added that she has “spent a lot of America was to be severely limited. But
time researching, going back and reading since 1937 or thereabouts, Congress, the
again The Federalist Papers [and] the notes various Presidents (yes, even Reagan), and
from the Constitutional Convention.” the judiciary have refused to be con-

She concludes that members of Congress | strained by the constitutional text. The con-
“are constrained by what the law is, what sequence inundates us: a behemoth,



===== PAGE 34 =====

obnoxious, deceitful, and ravenous framers thought were necessary to forge

government. the states into a nation without stripping
Fortunately, judging from her remarks them of their plenary powers or the people
made soon after Independent Counsel Ken of their rights under the common law.
Starr released his report, Rep. Lofgren On any plausible reading of the
would now rightly scold those who cling Constitution—and of the accompanying
to Justice Brennan's politically convenient commentary by the framers, such as The
view that the Constitution means whatever | Federalist Papers—the vast bulk of what
we moderns want it to mean. Perhaps Rep. Washington does today is unconstitution-
Lofgren now has courage to direct her col- al. Nowhere does the Constitution give to
leagues’ attention to Federalist #10 in which Washington the power to specify the size
James Madison says that the protection of of our toilet tanks, the fuel-efficiency of our
people’s abilities to own property “is the automobiles, or what constitutes sexual
first object of government” and that gov- harassment in the workplace (another
ernment efforts to redistribute property are | issue, incidentally, on which Clinton's sup-
“improper or wicked.” porters insist on strict construction).
Hey, maybe the era of big government Nowhere does the Constitution give to
really is over! Washington the authority to use taxpayer
Of course, cynics might accuse Rep. funds to subsidize farmers or to help cor-
Lofgren and her fellow converts to origi- porations advertise their products in for-
nal-intent constitutionalism (such as Rep. eign markets. And nowhere does the
Barney Frank of Massachusetts) of insin- Constitution authorize Washington to dic-
cerity—of advocating original intent only tate minimum wages, to prevent private
on the question of impeachment, and then landowners from developing their proper-
. merely to save this-particular president's ties, or to distribute welfare. The framers
political skin. In light of the dubious ethics left most regulatory powers with the
of today’s politicians, this possibility can’t states—and even these powers were
be dismissed. Thankfully, it’s easy to test understood to be constrained by common-
the sincerity of Rep. Lofgren & Co. If they law protections that citizens enjoyed
are willing to repeal the vast bulk of regu- against intrusion by any government.
latory legislation enacted by Congress So let Rep. Lofgren and her fellow
since the New Deal, then their belief in Constitutional scholars in Congress prove
Constitutional government is genuine. But that they respect the framers as much as
if Rep. Lofgren and her colleagues resist they now claim: repeal federal minimum-
repealing these statutes, we can conclude wage legislation, the Americans with
only that she and her friends are hypocriti- Disabilities Act, the Endangered Species
cal, insincere, bamboozling politicians— Act, and the countless other statutes and
much like Clinton, according to his critics. regulations that today plague ordinary
Why is repeal of this legislation a sound Americans.
test of Rep. Lofgren’s sincerity? If the Constitution again becomes the
The Constitution delegates to Congress law of the land, America can look forward
only a handful of powers. All powers not to a great flourishing of freedom and pros-
explicitly delegated to Washington are, as perity. Bill Clinton and his paramours will
the Tenth Amendment says, “reserved to be forgotten. And future generations might
the States respectively, or to the people.” even erect a statue of Zoe Lofgren and her
Article I, Section 8 is where the friends, Defenders of the Constitution.

Constitution spells out most of the powers

delegated to Congress. These powers

include regulating only interstate and for- / ) 75)

eign commerce, coining money, establish- MA 2 {
ing post offices, creating a federal court

system, supporting an army and a navy, Donald J. Boudreaux
and a handful of other powers that the President



===== PAGE 35 =====

FEE Holiday Sale — Staff Favorites

appy Holidays to all of our many thousands of readers! This
month the staff suggests titles for your consideration. You

may already be familiar with our selections; on the other
hand, we may introduce you to some books you've heard about but
haven't yet read. Either way, we hope you'll think about adding some ||
of these wonderful works to your library or to a friend's library. After |i
all, sharing the great gift of knowledge is a superb way to spread the
holiday spirit.

Don Boudreaux, President of FEE: Beth Hoffman, The Freeman's Managing Editor:
The Choice by Russell Roberts Economic Policy: Thoughts for Today and

The Choice offers the most accessible and spirited Tomorrow by Ludwig von Mises

case for free trade written during the 20th Want to introduce your brother-in-law to the
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unsurpassed. More importantly, Russell Roberts ~~ know where to begin? Give him a copy of one of
brings to life the humanity of unhampered trade.  FEE’s perennial best sellers: Economic Policy. In
113 pages, paper $1195 Sale: $8.00 just over 100 pages, Mises deftly covers six
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Sheldon Richman, Editor of The Freeman: investment, and policies and ideas. Mises argues
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This book was one of the first things I read on
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Perfect for students!

Karol Boudreaux, Director of Seminars:
The Foundations of Morality by Henry Hazlitt
NEW EDITION!

$9.95 Sale: $6.00 | first encountered this insightful book in 1994
at our Clemson, S.C., reading group. What a
pleasure to work through Hazlitt’s arguments

Sam Mitchell, FEE's Director of External Operations: for the basis of a moral, free society. The prose

Capitalism and Freedom by Milton Friedman is pure, the arguments lucid, the conclusion
compelling. I was so impressed with the book

that I planned on using it as the text for an
MBA Business Ethics class I used to teach. Don
and I came to FEE so I never carried that plan

109 pages, paper

This readable and compelling masterpiece by
Nobel laureate Milton Friedman is
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Cap italism and Freedom P rovides an excellent out, but I CAN say this book is superb.
introduction to the principles of classical
liberalism and explains how these principles 398 pages, paper $3895 Sale: $15.00

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===== PAGE 36 =====

1999 FEE Undergraduate Seminar
Where Liberty and Learning Meet

“Thank you for having me as a guest at the fabulous
FEE institution. It is truly a bastion of freedom and lib-
erty that helps mold individuals’ minds to become
stronger with economic understanding. I thoroughly
enjoyed the lectures that were given at the seminar;
they met my highest expectations!!”

— NOEL SAWATZKY, The Citadel, Attendee at March,

1998 Seminar

FEE’s annual Undergraduate Seminar will take place March 18 to March 20,
1999. This two-and-one-half day seminar is designed to introduce college
undergraduates to the ideas and principles of free-market economics and
classical-liberal philosophy. %

Students from across the country and from around the world join us to dis-
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vate-property rights, and limited government. Speakers will challenge stu-
dents to consider why freedom is important in their lives.

The seminar begins with the Second Annual John Anthony Krogdahl
Memorial Lecture, by Bruce Yandle of Clemson University, on Thursday
evening. On Friday and Saturday students will participate in four one-hour
lectures. Discussion sections will follow.

“Our selection process is competitive. Students must complete an applica-
tion form and a short essay. FEE hosts those students selected to participate
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Students are responsible for their travel expenses only.

If you would like to apply for this seminar, or if you would like to receive a
nomination form for a student you know, please contact Karol Boudreaux,
FEE, 30 South Broadway, Irvington-on-Hudson, NY 10533, (914) 591-7230
(office), (914) 591-8910 (fax), or kboudreaux@fee.org.

¥¢ You can help promote liberty by sponsoring a student at this seminar.
For $400.00 you can cover the costs of one student’s participation. Please
note on your check that you are sponsoring a student or call or fax a cred-
it card contribution. Thank you for your help!



===== PAGE 37 =====

737

ture”) were political liberals in their time, interpretation. Moreover, these definitions
notably Friedrich von Schiller, Ludwig van point to two areas of potential activity con-
Beethoven, Percy Shelley, John Milton, and cerning any given culture: explaining individ-
Johann von Goethe. However, the critics’ ual behavior and changing individual behav-
point should not be lost: as a broad area of ior. While these two areas may ultimately be
thought, classical liberalism is generally per- inseparable, we will treat them as discrete for
ceived as caring little for the non-political or the purposes of drawing out two criticisms of
non-economic; and the standard retort “sells classical liberalism since, essentially, the cri-
short” a rich tradition of scholarship and tiques from Bloom, Arendt, and others, though
thought that, on examination, provides varying in particulars, boil down to the asser-
grounds for serious discussion of culture, tion that classical liberalism is sufficient nei-
even if it offers no dogmatic account. ther for explaining culture nor for creating cul-
This essay will make two simple points: ture—that is, for sustaining values.
that many classical liberals do indeed
acknowledge the importance of “culture,” Hayek: Beyond
though they present no unified front on the eqs
matter; and that this cultural awareness is an Political Economy
important part of their respective overall Rather than attacking their critics on
classical-liberal philosophies. We will discuss abstract grounds, students of the classical-
three great exponents of classical liberalism: liberal tradition can refute the claim that all
FA. Hayek, Ayn Rand, and Albert Jay Nock. classical liberals neglect culture with three
words: the fatal conceit. Appreciated mostly
9 for enlarging and deepening his critique of cen-
What Is Culture? tral planning, Hayek’s book The Fatal Conceit
Before going any farther, let’s look at what touches on nearly every important field related
exactly “culture” is, or rather, at how little to culture: anthropology, biology, philosophy,
clarity there is on the issue. The 1995 Oxford linguistics, and psychology—in addition to
Companion to Philosophy notes that the word economics and politics. While the thrust of the
“may be used in a wide sense to describe all book is a proof that socialism is based on
aspects characteristic of a particular form of demonstrably false premises, in setting up his
human life, or in a narrow sense to denote case Hayek offers a grounding for an account
only the system of values implicit in it.” The of how societies evolve that is not merely eco-
entry concludes that understanding culture is nomic, not purely political, and not purely
helpful for evaluating systems of values with rational—it is between instinct and reason.
an eye to the ideals they reflect about what Though the laws of economics (what Lud-
human life ought to be. A less academic wig von Mises called praxeology) remain sta-
source, Webster's Seventh New Collegiate ble across time, for Hayek, an account of the
Dictionary, defines culture in such terms as “rational” reaction to these laws does not pro-
“enlightenment and excellence of taste vide the best explanation of social change and
acquired by intellectual and aesthetic train- individual values. In a section entitled “Bio-
ing”; “a particular stage of advancement in logical and Cultural Evolution,” Hayek notes
civilization”; “the characteristic features of that, with respect to separating instinct from
such an age or state”; and “behavior typical of habitual learning, “we cannot precisely distin-
a group or class.” guish between these two determinants of con-
While neither definition offers a precise duct because they interact in complicated
understanding of culture, both focus on two ways.” Hayek also suggests that tension
essential elements of “culture”: that general between instinct and reason, “a conflict fired
trends and individuals’ actions are related to by the discipline of ‘repressive or inhibitory
and can be explained as motivated by values, moral traditions’ . . . is perhaps the major
and that these values are not ultimately stable; theme of the history of civilization.” He then
that is, they must be taught and are subject to postulates that this tension between instinct


===== PAGE 38 =====

738 THE FREEMAN « DECEMBER 1998

and reason drives cultural evolution, a process defines a nation’s culture as “the sum of the
of “continued trial and error, constant ‘exper- intellectual achievements of individual men,
imentation’ in arenas wherein different orders which their fellow-citizens have accepted in
contended.” Only after setting the evolution- whole or in part, and which have influenced
ary/cultural stage does Hayek move on to dis- the nation’s way of life.” Far from being stat-
cuss the origins of liberty, property, and jus- ic, “a culture is a complex battleground of dif-
tice, and beyond to the development of large- ferent ideas and influences” so that “to speak
scale markets and extended orders. of a ‘culture’ is to speak only of the dominant
After offering his account of culture, Hayek ideas, always allowing for the existence of
explicitly recognizes the behavior-changing dissenters and exceptions.”
function of culture: “Recognising that rules Like Hayek, Rand also tackles the issue of
generally tend to be selected, via competition, the necessary conditions for civilization.
on the basis of their human survival-value, While Hayek highlights civilization’s depen-
certainly does not protect those rules from dence on rules of just conduct that allow an
critical scrutiny.” In other words, although the extended order to evolve, Rand states her case
evolutionary mechanism Hayek has outlined more simply: “the precondition of a civilized
works, rationally critiquing specific rules and society is the barring of physical force from
norms is important. And though Hayek social relationships.” Rand shares with Hayek
spends most of the remainder of The Fatal an adherence to methodological individual-
Conceit challenging socialist and collectivist ism, stating unequivocally “[a] great deal may
economics (obviously with the hope of chang- be learned about society by studying man.”
ing behavior), he does devote an entire chap- However, Rand’s strong stance leads her to
ter to what can clearly be labeled “cultural conclude that “nothing can be learned about
criticism” —*“Our Poisoned Language.” In man by studying society” and the only funda-
that chapter, Hayek notes the enormous mental factor determining the nature of any
importance of language in cultural evolution, social system is the presence or absence of
particularly language’s ability to subtly trans- individual rights, statements with which
mit error from generation to generation. (He Hayek would find some uneasiness. But,
points to the proliferation of the modifier whatever the similarities or differences
“social,” as in “social justice,” to indicate how between Hayek and Rand, both develop
language can perpetuate erroneous thinking.) explanatory theories of individual behavior
These examples show two things: Hayek that encompass and transcend economics and
takes a holistic view of human affairs that politics and yet are integral to their political
encompasses far more than economics or pol- philosophies.
itics, and this view allows Hayek to interpret Rand does address culture from a critic’s
and criticize particular cultures with an eye to point of view. Like Hayek, she abhors the lin-
changing individual behavior and general guistic and ethical dominance of the word
trends. In short, Hayek was no “mere econo- “social”: “there is no such entity as ‘society,’

mist.” Nor was he alone. since society is only a number of individual
men.” She devoted an entire essay in The
Rand: No Stone Unturned Objectivist (April 1966) to “Our Cultural

Value-Deprivation.” And in Philosophy: Who

Of the three authors discussed in this arti- Needs It, she argues that one of the United
cle, Ayn Rand is the one who most conscious- States’ great weaknesses comes from its fail-
ly advanced a particular philosophy, Objec- ure to generate a culture of its own. America
tivism. As such, Rand’s notion of culture is failed to discover “the words to name their
carefully defined and integrated into her sys- [the founders’] achievements . . . i.e., the
tem of beliefs built on her irreducible pri- appropriate philosophy and its consequence:
maries: existence, identity, and conscious- an American culture.” This cultural deficiency
ness. In her 1982 collection, Philosophy: Who left American intellectuals dependent on
Needs It, her last published book, Rand European (particularly German) “hand-



===== PAGE 39 =====

THE CULTURE OF CLASSICAL LIBERALISM 739

me-downs” and caused an unfortunate “recy- such notable figures as Robert Nisbet, Russell
cling of Kantian-Hegelian premises,” that is, Kirk, William F. Buckley Jr, and Murray
collectivism. Rand’s account clearly echoes Rothbard, as well as Chodorov.

Hayek’s fear about our “poisoned language” Though he voiced very strong opinions on
and, ironically enough, anticipates some of economic and political affairs (most notably
what Bloom would argue a few years later. in Qur Enemy, the State), Nock’s analysis was

Like her predecessor Albert Jay Nock, certainly not limited to economic or political
Rand spoke appreciatively of ancient Greece criticism. Rather, like Hayek and Rand, Nock
for giving birth to philosophy by idealizing drew from a wide range of disciplines for his
reason. She praised Greek art and religion for inspiration, including literature, history,
personifying “proper human values” such as mythology, classical and modern political the-
beauty, wisdom, justice, and victory. In The ory, and religion. Also like Hayek, Nock was
Romantic Manifesto, Rand stresses the impor- an astute observer of culture as it affected
tance of art in general for selectively recreat- individual behavior and general trends—and
ing reality, isolating “those aspects of reality though he developed no rigorous theoretical
which represent man’s fundamental view of account of cultural evolution as did Hayek, he
himself and of existence.” Clearly, Rand’s still ultimately took the long view of culture,
view of art is an example of the reinterpretive, often referring to his centuries-old inspira-
exploratory, and evaluative function attributed tions: Shakespeare, Dante, Socrates, Virgil,
to culture in the definitions above. Moreover, and his beloved Rabelais.
culturally functioning art is not mere enter- Primarily, however, Nock chose to observe
tainment but a crucial part of individual man’s and criticize the early twentieth-century
existence, insofar as man’s self-interest can- American culture he saw around him (though
not be decided on whimsically but must be he eventually despaired of changing anyone’s
discovered. behavior). Nock’ cutting wit turned from

As with Hayek, our discussion of Rand is music and literature in “A Cultural Forecast”
not intended to decide the merits of her argu- to the role of criticism itself in “Criticism’s
ments but rather to make two points: she Proper Field” In “American Education,” he
offers a fundamental view of human affairs took on the academy: “The root-idea, or ideal,
that encompasses more than economics or of our system is the very fine one that educa-
politics; and this view allows her to evaluate tional opportunity should be open to all. The
and criticize particular cultures with an eye to practical approach to this ideal, however, was
challenging individuals’ assumptions, their not planned intelligently, but, on the contrary,

behavior, and general trends. very stupidly; it was planned on the official
assumption that everybody is educable, and
Nock: Cultured Critic this assumption still remains official.” Though

Nock wrote to the audiences of his day, his
Unlike Hayek (an economist turned politi- substantive account of culture remains a rele-
cal philosopher) or Rand (a novelist turned vant and fruitful source of criticism. As Nock
philosopher), Albert Jay Nock wrote quite observed in the April 5, 1930, issue of the new
obviously as a cultural critic. Generally favor- Freeman, “Criticism’s first job in this country
ing the essay above the journal article, trea- is... taking its eyes and mind resolutely off
tise, or novel, Nock brought his marvelous lit- the contemporaneous.”
erary talents to a wide variety of forums, Finally, Nock had an abiding concern for
including the Atlantic Monthly, Harper's, The the individual mind in an age of collectivism
Nation, The Freeman of the 1920s and ’30s, and conformity. A passage from “A Cultural
several quarterly reviews, and Frank Chodor- Forecast” that anticipates Hayek’s connection
ov’s broadsheet, analysis. Though not well of self-preserving instinct, reason, and cultur-
known among young libertarians, Nock exert- al evolution warns against the confusion of
ed a major influence on the budding anti- state and culture. In addition, Nock urges his
collectivist movement of the 1940s, including readers to better themselves before faulting


===== PAGE 40 =====

740 THE FREEMAN e DECEMBER 1998

American culture for not giving all the citi- that even “Adam Smith knew that a capitalist
zens of the United States an appreciation of society . . . could not flourish without the
the humane life. Commenting on the lives of virtues of trustworthiness or bourgeois pride,”
Virgil, Marcus Aurelius, and Socrates, Nock for “Smith’s other book, The Theory of Moral
says that “they approached their own age with Sentiments, was about love, not greed.” Hap-
the understanding, equanimity, humour, and pily, McCloskey observes that the current sit-
tolerance that culture indicates; and instead of uation may not be as bleak as the one Bloom
expecting their civilization to give them more had portrayed in 1987: “Yet even many econ-
than it possibly could give them, instead of omists have learned by now that moral senti-
continually fretting at their fellow citizens, ment must ground a market.”
blaming, brow-beating or expostulating with In fact, McCloskey’s article (which antici-
them for their derogations from the humane pates her 1996 book on the same subject) is
life, they bent their energies, as far as circum- an excellent example of one classical liberal
stances allowed, towards making some kind economist’s appreciation for culture, touching
of progress in the humane life themselves.” intelligently on classical and modern philoso-
Ultimately, Nock demonstrates that classi- phy, the language of virtue, medieval history,
cal liberalism and an appreciation for “high” and Freudian psychology. And McCloskey is
culture are not just reconcilable but comple- not alone. Several groups (albeit small) and
mentary. Nock also provides a stylistic model writers have been expanding classical liberal-
and substantive source of insight, wit, and ism’s horizons beyond politics and econom-
humanity for classical liberal critics. ics. Most recently, economist Tyler Cowen
argues in In Praise of Commercial Culture
that an economic look at “cultural produc-
tion” shows a strong correlation between
Clearly, there is no dearth of classical liberal prosperity and mass consumption of both low
writing that ventures beyond economics and and high cultural artifacts.
politics. But it still leaves us with the question This brief look at Hayek, Rand, and Nock
of why classical liberalism takes such a beat- does not end the debate over culture—rather,
.ing from those concerned with culture. Per- it should initiate discussion among classical
haps, as Bloom suggests, the problem is not liberals in an area where they have, and have
so much that classical liberal interest in cul- had, much to contribute. To the critics, we can
ture does not exist but that it is overlooked. respond that, far from crippling classical lib-
And perhaps those who call themselves clas- eralism or rendering it “merely” practical, the
sical liberals are the most negligent in this absence of a unified party line on the question
respect. As University of Iowa economist and of culture enables us both to appreciate the
historian D.N. McCloskey notes in a 1994 latest insights of a diversity of disciplines and
American Scholar article, “Bourgeois Virtue,” to continue exploring our own rich tradition
classical liberals (and indeed, everyone) of historians, moral and ethical philosophers,
should “stop defining a participant in an econ-  essayists, novelists, theologians—and, yes,
omy as an amoral brute.” McCloskey writes political philosophers and economists. Cl

Classical Liberal Culture



===== PAGE 41 =====

FREEMAN

deas On Libert

Spanish-American War: Death,
Taxes, and Incompetence

by Burton Folsom

R rember the Maine!” was the battle United States also recorded its largest deficit
cry that led America into the Spanish- since the Civil War years.
American War in 1898. The mysterious explo-
sion of the US.S. Maine in Havana harbor
killed 260 Americans and triggered hostility
toward Spain, the suspected culprit. Spain The man in charge of organizing an army to
was no threat to U.S. interests, but some fight Spain was the secretary of war, Russell
Americans wanted to help the Cubans, who Alger—a Detroit lumber baron and former
were struggling under Spanish rule, and oth- governor of Michigan. Most historians of the
ers had visions of creating an American Spanish-American War say that Alger did a
empire. dismal job. At one level, he was weak and
Exactly one hundred years ago, on Decem- unprepared. On March 9, 1898, six weeks
ber 10, 1898, the United States signed the before the U.S. declared war on Spain, Con-
peace treaty ending its short and victorious gress allocated $50 million “for national
war with Spain. What is not widely known is, defense and for each and every purpose con-
first, how inept the U.S. government was in nected therewith.” But Alger never insisted that
organizing the war, and second, how the tax any of it be used to prepare an army to fight.

Government Ineptitude

code changed as a result of the war. Those In April, when the war began, Alger des-
changes—higher taxes—became part of perately struggled to equip the Army for bat-
American life ever after. tles in Cuba. Disaster followed disaster. For

The war was expensive, and taxpayers were example, the soldiers were issued wool uni-
squeezed. Congress hiked taxes on tobacco forms for a summer war in a tropical climate.
and alcohol, and also passed the first inheri- The mess pans were leftovers from the Civil
tance tax in American history. Those higher War. Few soldiers received modern rifles;
taxes remained in place after the war (except most ended up with outdated Springfields,
for a brief repeal of the inheritance tax). Inter- and some, like Michigan’s 32nd regiment, had
nal revenue collections never exceeded $162 no rifles at all and never made it overseas.
million in any year from the Civil War era to Those who did make it to Cuba ate food so
1897. After the Spanish-American War, annu- sickening that soldiers called it “embalmed
al internal revenue collections never fell beef,” and a special war commission later
below $230 million. During the conflict, the investigated what was in it.

Alger, of course, blamed the slow-moving

Burton Folsom is senior fellow at the Mackinac Cen- bureaucracy, including the legions of political

ter for Public Policy and author of The Myth of the appointees in the War Department, for his
Robber Barons, which is now in its third edition. problems. Alger himself, however, had to take

741


===== PAGE 42 =====

742 THE FREEMAN DECEMBER 1998

support from President McKinley. In temporary
retirement, Alger wrote a book, The Spanish-
American War, to try to explain why so much
went so wrong.

Those who are too critical of Alger miss a
larger point. Incompetent generals, lazy
bureaucrats, and a confused secretary of war
are the stuff of most wars. That’s one reason
why wars should be avoided, if possible. What
offsets the ineptitude is that America has had
a free people eager to preserve their way of
life and willing to overcome military hard-
ships to do so.

Within four months and one week after
Congress declared war, over 274,000 men had
volunteered to put on wool uniforms, endure
a disease-ridden tropical climate, eat bad
food, and risk their lives shooting antique

full responsibility for appointing William R. guns at menacing Spanish soldiers. Not all of
Shafter as chief general for the Cuban cam- these men made it to Cuba, but M.B. Stewart,
- paign. Shafter, from Galesburg, Michigan, one who did, said it best this way: “We were
was 62 years old when the war broke out. He doing the best we knew and our lack of
moved slowly because he weighed almost 300 knowledge was more than outweighed by the
pounds. He was ill during most of the fight- magnificent spirit and discipline of both offi-
ing, and many questioned his abilities. Teddy cers and men.”
Roosevelt, who led the charge up San Juan We have two groups, then: the American
Hill, said that “not since the campaign of soldiers, raised in a culture of freedom and
Crassus against the Parthians [over 2,000 willing to preserve it if called upon; and the
years ago] has there been so criminally politicians, who seemed to care more about
incompetent a general as Shafter.” protecting their careers or building an over-
Yet in spite of the snafus and bungling, the seas empire than they did about the lives of
United States won the war. The Navy, which soldiers or the taxes on civilians. Even after
was well prepared, joined the Army to force a the Spanish-American War, politicians missed
Spanish surrender at Santiago, Cuba. When the their chance to balance the scales of justice. In
war ended, many Americans demanded a 1902, the Michigan legislators selected Rus-
formal investigation of why the war department sell Alger to be a U.S. senator, and shortly
was so inefficient. Secretary Alger resigned in thereafter they built a bronze bust of General
1899 under heavy criticism and without clear Shafter in his hometown of Galesburg. [1

Russell A. Alger (1836-1907)


===== PAGE 43 =====

FREEMAN

deas On Libert

The Conquest of the
United States by Spain

by William Graham Sumner

(Editors Note: One hundred years ago the ments of the Spanish symbol. We have beaten
United States went to war against Spain in its Spain in a military conflict, but we are sub-
first full-blown imperialist adventure. As a mitting to be conquered by her on the field of
result of the war, the United States gained con- ideas and policies. Expansionism and imperi-
trol of the Philippines, Puerto Rico, Guam, alism are nothing but the old philosophies of
and Cuba. The following year William Graham national prosperity which have brought Spain
Sumner [1840-1910], the classical liberal to where she now is. Those philosophies
sociologist at Yale University, published a appeal to national vanity and national cupidi-
prophetic essay in the Yale Law Journal in ty. They are seductive, especially upon the
which he argued that although the United first view and the most superficial judgment,
States defeated Spain in battle, there was a and therefore it cannot be denied that they are
sense in which Spain had defeated the United very strong for popular effect. They are delu-
States. We couldn't end the year without repro- sions, and they will lead us to ruin unless we
ducing excerpts from Sumner’s classic essay.) are hard-headed enough to resist them.

uring the last year the public has been LER

familiarized with descriptions of Spain The original and prime cause of the war
and of Spanish methods of doing things until was that it was a move of partisan tactics in
the name of Spain has become a symbol for a the strife of parties at Washington. As soon as
certain well-defined set of notions and poli- it seemed resolved upon, a number of inter-
cies. On the other hand, the name of the Unit- ests began to see their advantage in it and has-
ed States has always been, for all of us, a sym- tened to further it. It was necessary to make
bol for a state of things, a set of ideas and tra- appeals to the public which would bring quite
ditions, a group of views about social and other motives to the support of the enterprise
political affairs. Spain was the first, for a long and win the consent of classes who would
time the greatest, of the modern imperialistic never consent to either financial or political
states. The United States, by its historical ori- jobbery. Such appeals were found in sensa-
gin, its traditions, and its principles, is the tional assertions which we had no means to
chief representative of the revolt and reaction verify, in phrases of alleged patriotism, in
against that kind of a state. I intend to show statements about Cuba and the Cubans which
that, by the line of action now proposed to us, we now know to have been entirely untrue.

which we call expansion and imperialism, we LEE,
are throwing away some of the most impor-
tant elements of the American symbol and are There is another observation, however,

adopting some of the most important ele- about the war which is of far greater impor-
743


===== PAGE 44 =====

744 THE FREEMAN e DECEMBER 1998

tance: that is, that it was a gross violation of the people, and sound political sense is a
self-government. We boast that we are a self- matter of habit and practice. We can give it up
governing people, and in this respect, particu- and we can take instead pomp and glory. That
larly, we compare ourselves with pride with is what Spain did. She had as much self-
older nations. . . . The war with Spain was pre- government as any country in Europe at the
cipitated upon us headlong, without reflection beginning of the sixteenth century. The union
or deliberation, and without any due formula- of the smaller states into one big one gave an
tion of public opinion. Whenever a voice was impulse to her national feeling and national
raised in behalf of deliberation and the recog- development. The discovery of America put
nized maxims of statesmanship, it was into her hands the control of immense territo-
howled down in a storm of vituperation and ries. National pride and ambition were stimu-
cant. Everything was done to make us throw lated. Then came the struggle with France for
away sobriety of thought and calmness of world-dominion, which resulted in absolute
judgment and to inflate all expressions with monarchy and bankruptcy for Spain. She lost
sensational epithets and turgid phrases. It can- self-government and saw her resources spent
not be denied that everything in regard to the on interests which were foreign to her, but she
war has been treated in an exalted strain of could talk about an empire on which the sun
sentiment and rhetoric very unfavorable to the never set and boast of her colonies, her gold
truth. . . . Patriotism is being prostituted intoa mines, her fleets and armies and debts. She
nervous intoxication which is fatal to an had glory and pride, mixed, of course, with
apprehension of truth. It builds around us a defeat and disaster, such as must be experi-
fool’s paradise, and it will lead us into errors enced by any nation on that course of policy;
about our position and relations just like those and she grew weaker in her industry and com-
which we have been ridiculing in the case of merce and poorer in the status of the popula-
Spain. tion all the time. She has never been able to
ERE recover real self-government yet. If we Amer-
icans believe in self-government, why do we
It has become almost a doctrine with us that let it slip away from us? Why do we barter it
patriotism requires that we should hold our away for military glory as Spain did?

tongues while our interests, our institutions,
our most sacred traditions, and our best estab- 2 SEL
lished maxims have been trampled underfoot. We assume that what we like and practice,

There is no doubt that moral courage is the and what we think better, must come as a wel-
virtue which is more needed than any other in come blessing to Spanish-Americans and Fil-
the modern democratic state, and that truck- ipinos. This is grossly and obviously untrue.
ling to popularity is the worst political vice. They hate our ways. They are hostile to our
The press, the platform, and the pulpit have ideas. Our religion, language, institutions, and
all fallen under this vice, and there is evidence manners offend them. They like their own
that the university also, which ought to be the ways, and if we appear amongst them as
last citadel of truth, is succumbing to it like- rulers, there will be social discord in all the
wise. I have no doubt that the conservative great departments of social interest. The most
classes of this country will yet look back with important thing which we shall inherit from
great regret to their acquiescence in the events the Spaniards will be the task of suppressing
of 1898 and the doctrines and precedents rebellions. If the United States takes out of the
which have been silently established. Let us hands of Spain her mission, on the ground
be well assured that self-government is not a that Spain is not executing it well, and if this
matter of flags and Fourth of July orations, nation in its turn attempts to be school-
nor yet of strife to get offices. Eternal vigi- mistress to others, it will shrivel up into the
lance is the price of that as of every other same vanity and self-conceit of which Spain
political good. The perpetuity of self-govern- now presents an example. To read our current
ment depends on the sound political sense of literature one would think that we were


===== PAGE 45 =====

THE CONQUEST OF THE UNITED STATES BY SPAIN 745

already well on the way to it. Now, the great Here is another point in regard to which the
reason why all these enterprises which begin conservative elements in the country are mak-
by saying to somebody else, We know what is ing a great mistake to allow all this militarism
good for you better than you know yourself and imperialism to go on without protest. It
and we are going to make you do it, are false will be established as a rule that, whenever
and wrong is that they violate liberty; or, to political ascendency is threatened, it can be
turn the same statement into other words, the established again by a little war, filling the
reason why liberty, of which we Americans minds of the people with glory and diverting
talk so much, is a good thing is that it means their attention from their own interests. Hard-
leaving people to live out their own lives in headed old Benjamin Franklin hit the point
their own way, while we do the same. If we when, referring back to the days of Marlbor-
believe in liberty, as an American principle, ough, he talked about the “pest of glory.” The
why do we not stand by it? Why are we going thirst for glory is an epidemic which robs a
to throw it away to enter upon a Spanish poli- people of their judgment, seduces their vanity,

cy of dominion and regulation? cheats them of their interests, and corrupts
GEE, their consciences.
We are told by all the imperialists that these SARE
people [of the former Spanish possessions] Of the interpretation of clauses in the Con-

are not fit for liberty and self-government; stitution I am not competent to speak, but the
that it is rebellion for them to resist our benef- Constitution is the organic law of this confed-
icence; that we must send fleets and armies to erated state in which we live, and therefore it
kill them if they do it; that we must devise a is the description of it as it was planned and as
government for them and administer it our- it is. The question at stake is nothing less than
selves; that we may buy them or sell them as the integrity of this state in its most essential
we please, and dispose of their “trade” for our elements. The expansionists have recognized
own advantage. What is that but the policy of this fact by already casting the Constitution
Spain to her dependencies? What can we aside. The military men, of course, have been
expect as a consequence of it? Nothing but the first to do this. It is of the essence of mil-
that it will bring us where Spain is now. itarism that under it military men learn to
GEFE, despise constitutions, to sneer at parliaments,

and to look with contempt on civilians. Some

The doctrine that we are to take away from of the imperialists are not ready to go quite so
other nations any possessions of theirs which fast as yet. They have remonstrated against
we think that we could manage better than the military doctrine, but that only proves that
they are managing them, or that we are to take the military men see the point at issue better
in hand any countries which we do not think than the others do. Others say that if the legs
capable of self-government, is one which will of the Constitution are too short to straddle
lead us very far. With that doctrine in the the gulf between the old policy and the new,
background, our politicians will have no trou- they can be stretched a little, a view of the
ble to find a war ready for us the next time that matter which is as flippant as it is in bad taste.

they come around to the point where they
think that it is time for us to have another. We fle
are told that we must have a big army here- The question of imperialism, then, is the

after. What for; unless we propose to do again question whether we are going to give the lie
by and by what we have just done? In that to the origin of our own national existence by
case our neighbors have reason to ask them- establishing a colonial system of the old
selves whom we will attack next. They must Spanish type, even if we have to sacrifice our
begin to arm, too, and by our act the whole existing civil and political system to do it. I
western world is plunged into the distress submit that it is a strange incongruity to utter
under which the eastern world is groaning. grand platitudes about the blessings of liberty,


===== PAGE 46 =====

746 THE FREEMAN ee DECEMBER 1998

etc., which we are going to impart to these efforts of science and art to ameliorate the
people, and to begin by refusing to extend the struggle for existence.

Constitution over them, and still more, by

throwing the Constitution into the gutter here LER

at home. If you take away the Constitution, Now what will hasten the day when our

what is American liberty and all the rest? present advantages will wear out and when we

Nothing but a lot of phrases. shall come down to the conditions of the older
EE and densely populated nations? The answer is:

war, debt, taxation, diplomacy, a grand gov-

It seems as if this new policy was destined ernmental system, pomp, glory, a big army

to thrust a sword into every joint in our his- and navy, lavish expenditures, political job-
torical and philosophical system. Our ances- bery—in a word, imperialism.

tors revolted against the colonial and naviga-
tion system, but as soon as they got their inde- ARS
pendence, they fastened a navigation system The point which I have tried to make in this

on themselves. The consequence is that our lecture is that expansion and imperialism are
industry and commerce are today organized at war with the best traditions, principles, and
under a restrictive system which is the direct interests of the American people, and that
offspring of the old Spanish restrictive sys- they will plunge us into a network of difficult
tem, and is based on the same ideas of eco- problems and political perils, which we might
nomic policy; viz., that statesmen can devise a have avoided, while they offer us no corre-
prosperity policy for a country which will do sponding advantage in return.

more for it than a spontaneous development Of course “principles,” phrases, and catch-
of the energy of the people and the resources words are always invented to bolster up any
of the territory would do. policy which anybody wants to recommend.
GEE So in this case. The people who have led us on

to shut ourselves in, and who now want us to

Everywhere you go on the continent of break out, warn us against the terrors of “iso-
Europe at this hour you see the conflict lation.” Our ancestors all came here to isolate
between militarism and industrialism. You see themselves from the social burdens and inher-
the expansion of industrial power pushed for- ited errors of the old world. When the others
ward by the energy, hope, and thrift of men, are all over ears in trouble, who would not be
and you see the development arrested, divert- isolated in freedom from care? When the oth-
ed, crippled, and defeated by measures which ers are crushed under the burden of mili-
are dictated by military considerations. At the tarism, who would not be isolated in peace
same time the press is loaded down with dis- and industry? When the others are all strug-
cussions about political economy, political gling under debt and taxes, who would not be
philosophy, and social policy. They are dis- isolated in the enjoyment of his own earnings
cussing poverty, labor, socialism, charity, for the benefit of his own family? When the
reform, and social ideals, and are boasting of rest are all in a quiver of anxiety, lest at a day’s
enlightenment and progress, at the same time notice they may be involved in a social cata-
that the things which are done are dictated by clysm, who would not be isolated out of reach
none of these considerations, but only by mil- of the disaster? What we are doing is that we
itary interests. It is militarism which is eating are abandoning this blessed isolation to run
up all the products of science and art, defeat- after a share in the trouble.

ing the energy of the population and wasting
its savings. It is militarism which forbids the ty
people to give their attention to the problems There is a consistency of character for a

of their own welfare and to give their strength nation as well as for a man. A man who
to the education and comfort of their children. changes his principles from week to week is
It is militarism which is combating the grand destitute of character and deserves no confi-


===== PAGE 47 =====

THE CONQUEST OF THE UNITED STATES BY SPAIN 747

dence. The great men of this nation were such !
because they embodied and expressed the
opinion and sentiments of the nation in their
time. Their names are something more than
clubs with which to knock an opponent down
when it suits one’s purpose, but to be thrown
away with contempt when they happen to be
on the other side. So of the great principles;
whether some of us are skeptical about their
entire validity and want to define and limit
them somewhat is of little importance. If the
nation has accepted them, sworn by them,
founded its legislation on them, imbedded
them in the decisions of its courts, and then if
it throws them away at six months’ warning,
you may depend upon it that that nation will
suffer in its moral and political rectitude a
shock of the severest kind.
LEE, our fathers formed was a glorious dream
which demands more than a word of respect
Upon a little serious examination the off- and affection before it passes away. Indeed, it
hand disposal of an important question of pol- is not fair to call it a dream or even an ideal;
icy by the declaration that Americans can do it was a possibility which was within our
anything proves to be only a silly piece of reach if we had been wise enough to grasp
bombast, and upon a little reflection we find and hold it. It was favored by our comparative
that our hands are quite full at home of prob- isolation, or, at least, by our distance from
lems by the solution of which the peace and other strong states. The men who came here
happiness of the American people could be were able to throw off all the trammels of tra-
greatly increased. The laws of nature and of dition and established doctrine. They went out
human nature are just as valid for Americans into a wilderness, it is true, but they took with
as for anybody else, and if we commit acts we them all the art, science, and literature which,
shall have to take consequences, just like up to that time, civilization had produced.
other people. Therefore prudence demands They could not, it is true, strip their minds of
that we look ahead to see what we are about to the ideas which they had inherited, but in
do, and that we gauge the means at our dis- time, as they lived on in the new world, they
posal, if we do not want to bring calamity on sifted and selected these ideas, retaining what
ourselves and our children. We see that the they chose. Of the old-world institutions also
peculiarities of our system of government set they selected and adopted what they chose
limitations on us. We cannot do things which and threw aside the rest. It was a grand oppor-
a great centralized monarchy could do. The tunity to be thus able to strip off all the follies
very blessings and special advantages which and errors which they had inherited, so far as
we enjoy, as compared with others, bring dis- they chose to do so. They had unlimited land
abilities with them. That is the great funda- with no feudal restrictions to hinder them in
mental cause of what I have tried to show the use of it. Their idea was that they would
throughout this lecture, that we cannot govern never allow any of the social and political
dependencies consistently with our political abuses of the old world to grow up here. There
system, and that, if we try it, the State which should be no manors, no barons, no ranks, no
our fathers founded will suffer a reaction prelates, no idle classes, no paupers, no disin-
which will transform it into another empire herited ones except the vicious. There were to
just after the fashion of all the old ones. ... be no armies except a militia, which would
And yet this scheme of a republic which have no functions but those of police. They

i
William Graham Sumner (1840-1910)



===== PAGE 48 =====

748 THE FREEMAN e DECEMBER 1998

would have no court and no pomp; no orders, never be forced to leave his family or to give
or ribbons, or decorations, or titles. They his sons to shed blood for glory and to leave
would have no public debt. They repudiated widows and orphans in misery for nothing.
with scorn the notion that a public debt is a Justice and law were to reign in the midst
public blessing; if debt was incurred in war it of simplicity, and a government which had
was to be paid in peace and not entailed on little to do was to offer little field for ambi-
posterity. There was to be no grand diploma- tion. In a society where industry, frugality,
cy, because they intended to mind their own and prudence were honored, it was believed
business and not be involved in any of the that the vices of wealth would never flourish.

intrigues to which European statesmen were

accustomed. There was to be no balance of Le aRES

power and no “reason of state” to cost the life .. . It 1s by virtue of these ideals that we
and happiness of citizens. . . . Our fathers have been “isolated,” isolated in a position

would have an economical government, even which the other nations of the earth have
if grand people called it a parsimonious one, observed in silent envy; and yet there are peo-
and taxes should be no greater than were ple who are boasting of their patriotism,
absolutely necessary to pay for such a govern- because they say that we have taken our place
ment. The citizen was to keep all the rest of now amongst the nations of the earth by virtue
his earnings and use them as he thought best of this war. My patriotism is of the kind which
for the happiness of himself and his family; is outraged by the notion that the United
he was, above all, to be insured peace and States never was a great nation until in a petty
quiet while he pursued his honest industry three months’ campaign it knocked to pieces a
and obeyed the laws. No adventurous policies poor, decrepit, bankrupt old state like Spain.
of conquest or ambition, such as, in the belief To hold such an opinion as that is to abandon
of our fathers, kings and nobles had forced, all American standards, to put shame and
for their own advantage, on European states, scorn on all that our ancestors tried to build
would ever be undertaken by a free democra- up here, and to go over to the standards of
tic republic. Therefore the citizen here would which Spain is a representative. J

Skousen and Other Top Economists on Samuelson at
the American Economic Association

The annual meetings of the American Economic Association (AEA) will con-
vene in New York City, January 3-5, 1999.

Freeman columnist Mark Skousen will be chairing and participating in an AEA
session titled “Fifty Years of Paul Samuelson’s Economics” on Monday, January 4,
at 8:00 a.m. in the Trianon Ballroom at the New York Hilton. Other participants
will include Greg Mankiw of Harvard, David Colander of Middlebury College,
Roy Ruffin and Paul Gregory of the University of Houston, Alan Blinder of
Princeton University, and Freeman Contributing Editor Peter Boettke of George
Mason University.

For complete information on registration, check AEA’s Web site,
www.vanderbilt.edu/ AEA.

FEE will host a get-together for participants and friends Monday evening at
the Hilton. For further information, contact Janette Brown at FEE—(914) 591-7230.



===== PAGE 49 =====

Economics on Trial by Mark Skousen

FREEMAN

Ideas On Libert
DeceMBER 1998

Everything Is Cheap—
and Getting Cheaper

“Capitalism is about turning luxuries into necessities.”
—ANDREW CARNEGIE!

We all labor under the notion that the cost lifestyle would be profoundly barbaric. The
of living is high and rising every year. opportunity cost of doing many tasks our-
Yet, believe it or not, economic life is rela- selves is so high that we must be grateful for
tively inexpensive, and getting cheaper all the the interactive market system we enjoy.
time. Economists often talk about negative exter-
This truth was reinforced recently when my nalities, such as air and water pollution
friend and colleague Roger Clites told me caused by businesses that don’t pay the full
about a little exercise he does regularly with costs of production. Yet the number of posi-
his economics students. He first asks them tive externalities—benefits that we enjoy and
whether college life is expensive or not. Most that others create or pay for—are far more
raise their hands. Then he asks the students to abundant.
think of a good or service they regard as Thus, compared to a situation in which
expensive. Last year one student responded, each individual makes everything for himself,
“Beer costs too much.” Professor Clites things are cheap. And that’s not all.
assigned this student the task of making his
own beer and bringing it to the next class. At The Real Standard of Living
the next meeting, the student confessed that it . o
had cost him a great deal more to try to make Is Rising tee
a beer than to buy it in the store, and he still Recently several studies have been pub-
wasn’t able to make it. lished concluding that the real cost of living
The point is simple but profound. Every day has been falling and the standard of living ris-
each of us profits handsomely from the spe- ing dramatically throughout the twentieth
cialization, knowledge, and abilities of mil- century in the United States. Even the poorer
lions of other individuals. Adam Smith called income classes have improved materially their
it the division of labor, which he regarded as economic condition under free enterprise.
the fundamental basis of capitalism. Without I highlighted the work of Stanley Leber-
the work, expertise, and capital of others, our  gott, professor emeritus of economics at Wes-
- leyan University, in my column in March
Dr. Skousen (http.//www.mskousen.com; mskousen@ 1997. His fascinating work, Pursuing Happi-
aol.com) is an economist at Rollins College, Depart- poco. American Consumers in the Twentieth
ment of Economics, Winter Park, FL 32789, a Forbes Century (Princeton University Press, 1993)
columnist, and editor of Forecasts & Strategies. He is . >? ’
currently working on his own textbook, Economic demonstrates that virtually all American con-
Logic. sumers have been able to make an uncertain

749


===== PAGE 50 =====

750 THE FREEMAN ee DECEMBER 1998

and often cruel world into a pleasanter and of Dallas, complete with numerous color pic-
more convenient place to live and work. A tures and graphs. It’s an ideal teaching tool.
typical homestead in 1900 had no central Write the Federal Reserve Bank of Dallas,
heating, electricity, refrigeration, flush toilets, 2200 North Pearl St., Dallas, TX 75201, call
or even running water. Today even a large 214-922-6000, or visit its Website, www.
majority of poor families benefit from these dallasfed.org.)
goods and services.? More and more Americans have benefited
from an increase in the quantity, quality, and
...And the Real Cost of Living variety of goods and services because of the
Is Declinin g nature of the free-enterprise system: competi-
tion reduces costs, encourages new products

Now along come W. Michael Cox, an econo- and improved processes, and promotes quali-
mist at the Federal Reserve Bank of Dallas, and ty improvements. In the labor market,
Richard Alm, a business writer for the Dallas increased productivity leads to higher wages,
Morning News, who did an exhaustive study of which allows workers to buy better, cheaper
the cost of basic goods and services in this cen- products.
tury. They conclude that the real prices of hous-
ing, food, gasoline, electricity, telephone ser- .
vice, home appliances, clothing, nd other Today the Poor Are Rich
everyday necessities have fallen significantly.

Examples: In 1919, it took two hours, 37
minutes of work to buy a three-pound chick-
en. Today, it’s down to 14 minutes. In 1915, a
three-minute long-distance telephone call
from New York to San Francisco cost $20.70.
Today, it’s less than 50 cents, equal to two
minutes of work at the average wage. In 1908,
a Model T cost $850, equivalent to more than
two years’ wages for an average factory work-
er. Today, the average worker toils only about
eight months to buy a Ford Taurus.

Many products have fallen dramatically in
price (real, if not nominal) over the past 20
years, including computers, radios, stereos
and color televisions, telephones, microwave
ovens, gasoline, soft drinks, and most airline
tickets. Cox and Alm do point to two excep-
tions: medical care and higher education. But
even in these two cases, they argue that the
medical care is better than it used to be, and
that the higher costs of an education result in
higher lifetime income.

Cox and Alm summarize, “As we enter the
21st century, Americans take for granted our
ability to afford the trappings of the world’s
most envied middle-class lifestyle. It’s the 1. Quoted in Paul Johnson, A History of the American People
result of the decline of real prices in a dynam- (New York: HarperCollins, 1997), p. 551. I highly recommend this
ic economy, p layed out over and over.” a RAP Rector, “America Has the World’s Richest
urge you to obtain a copy of Cox and Alm’s Poor People,” Wall Street Journal (September 24, 1998).
full research report, published in the 1997 3. Michael Cox and Richard G. Alm, “Buying Time,” Reason

magazine, August/September 1998, p. 42. The full study is “Time
Annual Report of the Federal Reserve Bank well Spent: The Declining Cost of Living in America.”

Cox and Alm have also written a new book
with an intriguing title, The Myth of Rich and
Poor, to be published next month by Basic
Books. Their research confirms the unortho-
dox view that the poor in America are catch-
ing up rapidly to the lifestyle of the rich. This
perspective on the real cost of living goes
counter to the conventional wisdom of most
economists, who assert that the gap between
rich and poor has been growing in the 1980s
and 1990s. Perhaps it’s time for economists to
consider this new approach to measuring eco-
nomic lifestyles.

With cheap financing, more and more poor
people can afford a fully equipped home and
automobile. They can have the best seat in the
house for a ball game or concert through
cable television. They can travel to exotic
lands or top vacation spots through discount-
ed package fares. They can communicate with
friends all over the world through cheap long-
distance telephone service or e-mail. And
they can find a wealth of information at their
fingertips through the Internet.

The rich aren’t so different after all. OJ



===== PAGE 51 =====

751

Libertarian Party presidential candidate,
BOOKS holds that people should strive to live their
lives happily. They need not and should not
sacrifice themselves for the supposed good of
How I Found Freedom in an Unfree World abstractions like "S00 lety” or “the nation.”
Nor should they sacrifice themselves in obe-
by Harry Browne dience to clichés like, “You must not be self-
LiamWorks 1997 © 387 pages ® $24.95 ish.” Everyone is selfish, the author notes, and
the anti-selfishness injunction is merely a
means some people use to pressure others to
subordinate their desires to those of the
here always have been and probably “unselfish.”
always will be a great many human Returning to the fight versus flight debate,
beings who just won’t leave others alone. His- Browne suggests that most people will find
tory is full of them—famous tyrants and con- more happiness if they adopt the latter strate-
querors—and no doubt you know people who, gy. The government’s functionaries are not as
on a lesser scale, insist on bossing others knowledgeable or motivated as they are gen-
around. The ones who do the most damage in erally assumed to be, he maintains, and there-
the United States (and other “free” countries) fore individuals who want to be left alone can
are the people Adam Smith described as “men find freedom by steering clear of the state.
of system,” always brimming over with As an example, he tells about a business he
schemes for making the world more just, safe, once ran, where payroll taxes were becoming
moral, orderly, or whatever. They are certain unbearable. Browne was contacted by an
that their schemes will “work” provided that organization that wanted his financial assis-
everyone can be compelled to go along. Their tance so it could wage a political fight against
visions ensnare us all. such taxes. Instead, Browne dissolved the
Given the lamentable fact that those people business and reformulated it as a group of
abound, what is the person who just wants to independent contractors cooperating for
live according to his own desires to do? Some mutual gain. The effort against the payroll tax
give themselves ulcers by complaining about went nowhere, but Browne and associates
the way the world is. Others take action, try- were better off than ever.
ing to obtain greater freedom than the “men Do you get hot under the collar because
of system” deign to give them. They work to government does things that violate your
get freedom-restricting laws repealed, taxes rights? Browne advises you to forget about
reduced, bad officials replaced, and even gov- the concept of rights: “You're in the Rights
ernments overthrown. Occasionally, these Trap whenever you count on anything other
efforts succeed. Often, they fail. In either than an individual’s self-interest to cause him
case, fighting the battle for freedom has costs: to give you what you want.” People who are
time and property are given up; lives may be violating your rights aren’t going to stop just
lost. because you claim to have rights against their
But there is a third option: action to seek actions. You're probably better off taking eva-
freedom without confronting the oppressors. sive action rather than unleashing a torrent of
That is the message-in-chief of Harry righteous rhetoric, Browne says.
Browne’s How I Found Freedom in an Unfree But what if everyone adopted the
World. First published in 1973, now reissued Browneian philosophy and huddled in the
with a new foreword and afterword, this book shrinking domains of freedom, which might
is an argument in favor of finding freedom by just alert the statists to them and lead to fur-
avoiding and outwitting the authoritarians. ther crackdowns? Don’t worry about that, our
Browne makes an interesting case. author replies. What you do won’t affect oth-
In the tradition of Ayn Rand, Harry ers. Try to squeeze as much happiness as you
Browne, financial writer and, ironically, 1996 can out of life, and if you conclude that doing

Reviewed by George C. Leef



===== PAGE 52 =====

752 THE FREEMAN « DECEMBER 1998

so requires ducking the mailed fist of the issue” law. Under these laws, an ordinary cit-
state, go ahead. izen who passes a background check—and in

Fair enough, but suppose that instead of some states, safety training—is issued a per-
armed revolt against the King, the colonists in mit to carry a handgun for lawful protection.
1775 had increased their disobedience of Lott’s meticulous research far surpassed all
British laws? Browne would answer that if the previous work on the effects of those laws. He
people had maximized their opportunities for collected data from 3,054 counties in the
freedom instead of taking up arms, in time the United States over a 15-year period and exam-
spread between what it cost to control the ined changes in the rates for nine different
colonies and what they yielded in taxes would crimes, not just homicide. He also accounted
have caused the King to abandon them in dis- for the effects of dozens of other variables,
gust. Maybe so. Or maybe the havens of free- including changes in arrest rates, changes in
dom would have been exterminated one by the age and racial composition of a county’s
one and today we would be saddled with a ter- population, changes in national crime rates,
ribly invasive megastate. Which is where we and other changes in gun-control laws,
are anyway. including the adoption of waiting periods.

A useful, thought-provoking book. Od The results? Concealed-handgun license
George Leef, president of Patrick Henry Associates: laws significantly reduce violent crime. The

Liberty Consultants in East Lansing, Michigan, is Tates of homicide, rape, robbery, and aggravat-
book review editor of The Freeman. ed assault fall between 5 and 8 percent. Crimes

begin dropping immediately, but the full bene-
fits of concealed-handgun laws take about
three years to make themselves fully felt. The
larger the percentage of the population with
permits, the greater the drop in crime.

More Guns, Less Crime: Understanding
Crime and Gun Control Laws

by John R. Lott, Jr. Lott also found a small but statistically sig-
University of Chicago Press ® 1998 © 232 pages nificant increase in non-confrontational prop-
* $23.00 erty crimes such as larceny. Apparently, con-

- cealed-handgun laws do not erase criminals’
Reviewed by Dave Kopel appetite for other people’s property, but the

laws do encourage the more rational criminals
un prohibition kills people. Guns in the to acquire the property in ways that do not
hands of responsible citizens save lives risk their lives.
and make everyone safer—even the employ- More Guns, Less Crime includes additional
ees of gun-control organizations. University research that Lott has conducted since 1996.
of Chicago economist and law professor John For example, he found that after one state
R. Lott, Jr., proves those claims beyond a rea- enacts a concealed-weapons law, crime rates
sonable doubt in his new book, More Guns, in neighboring states without concealed-
Less Crime: Understanding Crime and Gun weapons laws tend to increase; criminals who
Control Laws. Single-handedly, Lott has rede- live near state borders make sure to choose
fined the gun-control debate in the United victims who can’t protect themselves.
States. The best antidote to guns in the wrong
Lott first appeared on the national firearms- hands is guns in the right hands. Lott’s data
policy scene in 1996 with the release of his show that states with concealed-handgun laws
research about concealed-carry laws. As of enjoy a 69 percent lower rate of mass murders
1985, only a handful of states allowed citizens in public places than states without such laws,
to legally carry firearms in the streets and all other things being equal.
other public places for protection. But now, 31 Despite the high level of statistical sophis-
states do so; except for Vermont and Idaho tication in More Guns, Less Crime, the book
(outside Boise), which require no permit at is pleasant to read. Lott lays out the data in an
all, all of the states have some type of “shall accessible manner, building from simpler sta-


===== PAGE 53 =====

BOOKS 753

tistical models to more complex ones. The Faria, a neurosurgeon who left Cuba as a
book serves not only as a guide to firearms child, sees events with the clarity that so
policy, but as a readable introduction to mul- often comes from having lived under tyranny.
tivariate statistical analysis. He writes that the proposals for health-care

The most interesting part of the book, how- “reform” are “as much a threat to the preser-
ever, is the chapter in which Lott addresses vation of the sanctity of the doctor-patient
the criticism of his research. In marked con- relationship, Hippocratic medicine, and
trast to the anti-gun researchers funded by patient and physician autonomy, as socialized
federal Centers for Disease Control and Pre- medicine in the form of a single-payer sys-
vention, Lott has made his data readily avail- tem. . . . In fact, the failures and shortcom-
able to any and all researchers. ings of the managed care/managed competi-

To the anti-gun movement, the statistics tion scheme may lead in the end directly to
on crime deterrence are irrelevant. But any- the single-payer system, when the ‘free-
one with an interest in rational firearms pol- market’ is erroneously blamed for the failure
icy ought to thank John Lott for writing this and collapse of corporatism in American
excellent book. More Guns, Less Crime medicine.”

would be a fine gift for your state represen- The last of Faria’s essays in the book is
tative, local newspaper editor, or public dated July 1995, but events have validated his
library. [0 concerns. Beginning in 1996, with the forma-

Dave Kopel is research director at the Independence tion of the National Health Policy Board, gov-
Institute, a free-market think tank in Colorado €rnment intervention in medical care has pro-
(http://i2i.org). His most recent book, with Paul ceeded apace. We have seen enactment of
Blackman, is No More Wacos: What's Wrong with guaranteed issue of health insurance, price
Federal Law Enforcement and How to Fix It. controls in the form of community rating, new
unfunded health-care mandates, patient-
access laws, Medicare changes that compro-
} } mise seniors’ freedom to buy health insurance
by Miguel A. Faria, Jr., M.D. that they desire, Medicaid changes that force
Hacienda Publishing © 1997 207 pages © $23.95 (itizens out of fee-for-service and into restric-
tive managed care, and a $40 billion federal
program for children’s health care. Faria (and
others) warned against taking this path, but
VWemne If you have high blood pres- the political urge to devise highly publicized
sure, consult your physician before “solutions” to health-care problems that are
reading Medical Warrior. Dr. Miguel Faria the result of previous interventions is just too
writes with such fervor and conviction about powerful. More are waiting in the wings.
the looming dangers of a health-care system Faria has not only stood against the trend
dominated by big government, big business, toward socialized medicine but also against the
and big labor that people with medical prob- medical profession’s moves into peripheral
lems may wish to read something far less social issues—for example, gun control. The
provocative. American Medical Association has advocated
In this collection of his published essays, restrictive legislation as part of its campaign
Faria offers us a depressing look at the con- against domestic violence. In the Journal of the
tinuing statist re-invention of our health-care Medical Association of Georgia, which he used
system. Readers are introduced to an impend- to edit, Faria wrote that gun control was an
ing health-care dictatorship the author attack on individual liberty that would do noth-
describes as “corporate socialism,” dominated ing to reduce violence. That temerity got him
by federal regulations and financed by billions fired from the journal. His chapter “Editorial
of taxpayer dollars, but indifferent to the Lynching in the Deep South” recounts his bat-
desires and welfare of individual patients. Itis tles with the Medical Association of Georgia
a frightful prospect. and the Atlanta Journal-Constitution.

Medical Warrior

Reviewed by Conrad F. Meier



===== PAGE 54 =====

754 THE FREEMAN ¢ DECEMBER 1998

Perhaps the greatest virtue of this book is just as motor trucks were regulated at the
that it reminds us of the past failings of social- behest of the railroads in an earlier period of
istic meddling with the medical marketplace rent-seeking. Regarded initially (and possibly
and the futility of trying more of the same. If erroneously) as a “natural monopoly,” pre-
bleeding a patient of an ounce of blood just 1984 cable provision was regulated by local
made him weaker, it was folly to believe that governments through franchise-bidding
bleeding him of a pint would make him better. arrangements. These arrangements were sup-
But that is similar to what the advocates of posed to bring the price of cable services
government intervention in health care have close to cost-based levels. Debate continues
been doing: prescribing more of the same over whether this form of “regulation” had the
harmful treatment. As Faria forcefully argues, desired impact on price. There is no debate,
freedom for patients and practitioners is the however, on the municipally regulated
cure for the manifold illnesses of our system. monopoly’s adverse effects on quality and on

For. me, the biggest problem with Medical investments in new programming.

Warrior is its obscurity. My research of the The Cable Communications Policy Act of
worldwide library database revealed only 17 1984 “deregulated” parts of the cable indus-
copies in more than 25,000 public libraries, try, largely freeing cable operators from rate
and the book has had little or no exposure at regulations. The predictable result was that
the major retailers. Nevertheless, it makes an between 1987 (the effective date of deregula-
important contribution to the literature docu- tion) and 1991, there was massive and rapid
menting the demise of what was once the growth in cable investments and in new tech-
world’s greatest health-care system. [J nologies. Prices rose, but so did quantity
Conrad F. Meier is health policy adviser for The demanded, and Service quality also forged
Heartland Institute and assistant in research at the ahead. Hazlett and Spitzer demonstrate this
Center for Advanced Social Research at the Univer- with the best available data from the Govern-
sity of Missouri-Columbia. ment Accounting Office, Federal Communi-
cations Commission, and private sources. As
they point out, a GAO survey showed that the

Public Policy Toward Cable Television: cable companies responded to price incen-
The Economics of Rate Controls tives by “consolidating packages, adding

basic channels, upgrading basic program
by Thomas W. Hazlett and quality (spending more per channel), market-

Matthew L. Spitzer ing basic service more aggressively, and drop-
MIT Press and the AEI Press ® 1997 ® 253 pages ping premium rates.” All this, of course,
* $32.00 enhanced consumer welfare—a principle that

is oft-forgotten in the whole cable regulatory

Reviewed by Robert B. Ekelund, Jr.

mess.

Predictably, the re-regulation of prices

n modern times no industry has been regu- enshrined in the (misnamed) Cable Television

lated, “deregulated,” “re-regulated,” and Consumer Protection and Competition Act
“re-deregulated” more than cable television. harmed consumers. The authors meticulously
Much has been written about cable regulation, examine the economic effects of re-regulation
but there is no better chronicle of the most and conclude that the 1992 regulations were
recent (post-1984) high tragicomedy of cable ineffective “in suppressing cable rates in
doings than this clear review by economists quality-adjusted terms.” And they go further
Thomas Hazlett and Matthew Spitzer. Their to suggest that, while impossible to quantify,
account is a case study in what government “the hidden costs that result from regulation-
should not do. inspired disorder are almost certainly domi-

Cable television was initially brought under nant; the real expense to society involves lost
the regulatory communications umbrella to surplus from the services not sold, the pro-
benefit over-the-air broadcasters in the 1970s, gram services not begun, and the infrastruc-



===== PAGE 55 =====

BOOKS 1755

ture not built” Cable regulation, in other The Ethics of Liberty
words, has been the typical case of govern-
ment’s imposing huge costs in an attempt to by Murray N. Rothbard, with a new
solve a minimal or non-existent problem. introduction by Hans-Hermann Hoppe
Hazlett and Spitzer follow the “economic New York University Press ® 1998 ® xliii + 308
effects” with the most entertaining discussion pages, including bibliography and index ® $25.00
of the book—the political economy surround- - -
ing the passage and conduct of the 1992 Act. Reviewed by Sheldon Richman
A prediction of who gains and who loses from
the imposition of nominal price controls in he late Murray Rothbard was a libertari-
1992 would not have been hard to make, and an scholar and advocate with an incredi-
the authors clearly explain the outcomes. Nat- bly wide range of interests. His books covered
urally, cable operators and programmers technical economics in the Austrian tradition
opposed passage, while TV broadcasters and (Man, Economy, and State; Power and Mar-
telephone companies supported it. Politicians, ket), economic history (America’s Great
eager to seize a consumer-oriented election Depression, The Panic of 1819), the history of
issue, complied with the latter’s desires. As economic thought (Economic Thought Before
usual, the interests of consumers counted for Adam Smith, Classical Economics), history
very little in the political calculus. (the multivolume Conceived in Liberty), and
After a discussion of new forms of compe- political philosophy, or what he called politi-
tition on the horizon, Hazlett and Spitzer end cal ethics.
with this strong conclusion: “unregulated What underlay all his work was a passion
cable monopoly works better for consumers for liberty and a fervor for building a unified
than regulated monopoly even in the face of science dedicated to its study. Rothbard took
anticompetitive barriers (yielding substantial obvious delight in exploring the foundations
market power) and during relatively brief and ramifications of liberty across disciplines.
adjustment periods.” For him, individual liberty was a single gem
This excellent study is strongly recom- with many facets: economic, historical, socio-
mended as a superior analysis of regulatory logical, political-ethical. A scholar can set his
effects in the cable market. When rent- sights on one or another facet, but for Roth-
seeking coalitions become strong enough to bard, something is lost if one neglects the
effectively demand new forms of regulation, whole gem.
in cable or any other market, politicians will The Ethics of Liberty, first published in
be ever eager to supply them. Greed is alive 1982, is the summation of Rothbard’s political
and well in D.C., Gotham, and the philosophy. We are fortunate it has been res-
provinces, and there is no end in sight for cued from the limbo of out-of-print books by
the political wrangling over cable TV. But if New York University Press. The book is
economists view their role as devising poli- unchanged, except for the addition of a new
cies to achieve normative goals—such as introduction by Hans-Hermann Hoppe, a pro-
eliminating dead-weight regulatory losses—  tégé of Rothbard’s.
perhaps they should become better “journal- In his search for the purest political philos-
ists” for the intelligent layman. The tale of ophy based on “self-ownership,” Rothbard
the effects of cable regulation by Hazlett was nothing if not provocative. His ideas
and Spitzer could and should serve as a about liberty, property, and the state, ground-
model. [0 ed in reason and Thomistic natural law, led
Robert Ekelund is Lowder Eminent Scholar in the him to advocate “anarcho-cap italism,” for he
department of economics at Auburn University, could not square a coercive, monopoly gov-
Alabama. ernment with the individual’s natural right to
liberty and legitimately acquired property.
Even readers who are left unpersuaded by
Rothbard’s position on this or other matters



===== PAGE 56 =====

756 THE FREEMAN e DECEMBER 1998

will find the journey challenging. away’ from home. Regardless of his age, we
Rothbard’s scope is breathtaking. He exam- must grant to every child the absolute right to
ines the nature of exchange and aggression, run away, and to find new foster parents who
the state, war, children’s rights, free speech, will voluntarily adopt him, or to try to exist on
lifeboat situations, animal rights, contracts, his own.” (Emphasis in the original.)
utilitarian free-market economics, and the
political philosophies of Isaiah Berlin, FA. On defamation and the property right in
Hayek, and Robert Nozick. In each chapter, one’s reputation: “Jones’s ‘reputation’ is pure-
something will make you stop and think hard ly a function of the subjective values and

before moving on. beliefs about him contained in the minds of
Here 184 sampling of some of the more other people. But since these are beliefs in the
provocative fare: minds of others, Jones can in no way legiti-

mately own or control them. Jones can have
On punishment for criminals: “Retribution po property right in the beliefs and minds of
is in bad repute among philosophers, who other people.” (Emphasis in the original.)
generally dismiss the concept quickly as
‘primitive’ or ‘barbaric’. . . . But simply to On war: “War, then, even a just defensive
dismiss a concept as ‘barbaric’ can hardly suf- yr ig only proper when the exercise of vio-
fice; after all, it is possible that in this case, ence is rigorously limited to the individual
the ‘barbarians’ hit on a concept that was criminals themselves. We may judge for our-
superior to the more modern creeds.” selves how many wars or conflicts in history

have met this criterion.”
On children’s rights: “But when can we say

that this parental trustee jurisdiction over chil-
dren shall come to an end? . . . The clue to the
solution of this thorny question lies in the
parental property rights in their home. For the
child has his full rights of self-ownership
when he demonstrates that he has them in
nature—in short, when he leaves or ‘runs Sheldon Richman is editor of The Freeman

A brief review cannot do justice to a work
so brimming with insights about the funda-
mentals of a free society. Now that The Ethics
of Liberty is again available, students of free-
dom will want to get their teeth into it. []

Kephart Wins Szasz Award

Robert D. Kephart, a pioneering libertarian philanthropist and publisher, has
won the eighth annual Thomas S. Szasz Award for Outstanding Contributions
to the Cause of Civil Liberties. Kephart was the founder of Books for Libertarians
and Libertarian Review, two important publications that influenced thousands of
young people who went on to become advocates for individual liberty. He has
also been a source of support and advice for countless organizations dedicated
to freedom. Kephart has taken particular interest in people serving prison sen-
tences for victimless crimes.

The award was created to honor the work of Thomas Szasz, who has relent-
lessly defended individual rights, especially against the threat from “the thera-
peutic state”—the alliance of medicine and state.



===== PAGE 57 =====

The Pursuit of Happiness by Jon Sanders

¥ current Issues

The Tyranny of un
the Proper Y,

O: strain of the vampire legend holds right to smoke. What it leaves is not, however,
that the bloodsucking fiends can enter the right not to smoke—that would imply a
people’s homes only with their victims’ con- choice. When a government makes the
sent. Similarly, government can enter an area choice, then what it grants those who would,
only if its citizens allow it. Charity, for in a free society, choose not to smoke is not a
instance, was once no province of govern- right but a convenience.
ment. Neither was medical care. Nor were Many people, of course, would prefer that
health and manners. But today people are fewer of their fellow citizens smoked, drank,
carelessly welcoming the fiend, seeking leg- wore perfume, played music loud, ran air con-
islative prohibition of activities they consider ditioners, or read Huckleberry Finn. And they
unhealthy and unmannerly. would use government to end those activities
The most far-reaching example is Califor- and enforce what they deem proper. If we
nia’s ban on smoking in bars, which com- wish to be free, however, we should work to
pletes its total ban on smoking in public areas. keep the government out of trivial matters. We
Most of the activities under legislative fire are would do better to remember the words of
things—smoking, drinking, eating fatty George Santayana: “A man may not always
foods—that bring many people pleasure but eat and drink what is good for him; but it is
that many other people consider rude or better for him and less ignominious to die of
unhealthy. At one time people ignored activi- the gout freely than to have a censor officially
ties they disliked and avoided places (like appointed over his diet, who after all could
bars) where they took place. Nowadays the not render him immortal.”

easily offended insist that the government Santayana has pinpointed one problem with
ensure that no building or gathering contains the health despots’ mantra that “If you do x
whatever social ill offends them. [whether x is smoke, drink, or partake of

Citizens in a free society, however, should Chicken McNuggets], you will die.” Even if
never confuse their right to disdain rudeness you abstain, you will still die.
with the government’s ability to outlaw it. Our
rights protect the boorish along with unboor-
ish, the healthy with the unhealthy. Those
rights exist for everyone or not at all. If soci- Another problem with this tyranny of the
ety outlaws smoking, then it takes away the proper is the transience of what society con-
siders proper. Think of how much and how
Jon Sanders is a research associate for the Pope often the proper fashion and dress have
Center for Higher Education Reform in Research Tri- changed in this century. Even the proper body

angle Park, North Carolina, a program of the John Shape has changed, in just a matter of
Locke Foundation. decades. Compare Jayne Mansfield and Mari-

757

Changing Fashions


===== PAGE 58 =====

758 THE FREEMAN e DECEMBER 1998

lyn Monroe to Kate Moss and Uma Thurman. gers of alcohol, recent studies have found that
Men’s fashion has not been immune either: for many people, moderate consumption of
for example, no longer are hats worn as busi- alcohol can be more healthy than abstinence.
ness attire. Another recent study suggests that a high-fat
Society’s tastes in food, music, sports, and diet reduces the risks of stroke for men
other things are equally transient. So, too, is (“Study Suggests Eating Saturated Fat Might
what society deems proper and improper. For Ward Off Strokes in Men,” Detroit Free
this reason alone, it is foolish for any genera- Press, Dec. 24, 1997). And smoking may
tion to seek legislation to codify what it con- lower the cancer risk for some women (AP
siders proper. Doing so imposes on future wire story, May 20, 1998).
generations the tastes of their predecessors. Thus, uncertainty over what is healthy or
For instance, society today considers a low- proper is another important reason to keep
fat diet to be proper because fat is seen as government out of these arenas. Let people
related to heart disease and early death. The decide for themselves what they want, and let
marketplace quickly responded to society’s science help them choose. If enough people
wishes with a glut of low-fat or no-fat food decide a certain activity is undesirable, let
products. Despite that market response, some them discourage it not by legislation but by
people consider personal health something peer pressure.
the government should be involved with any- Peer pressure is a powerful enough societal
way. That’s not a new idea; we already have impetus to enforce the “proper.” Nevertheless,
“sin taxes” on such “unhealthy” items as beer, a free society allows those who prefer to resist
wine, and cigarettes. These people would that pressure to do so. In issues of public taste,
have sin taxes applied to other unhealthy con- coercion is the wrong tool for enforcing pro-

sumables—“Twinkies,” for example. priety. It is like using a baseball bat to play
Others either want unhealthy items banned tennis.
altogether or seek to punish their producers There is, however, an even greater reason

for providing them to the public. Their targets government should stay out of the realm of
are not limited to tobacco and beer, however. health and manners: the erosion of freedom.
As Doug Bandow reported last August in Just because some people make what most
Investor s Business Daily, the health despots people consider to be the wrong choices does
are also going after fast-food restaurants, not mean government should do the choosing.
chemical manufacturers, gun makers, caf- Allowing foolish choices is far wiser than sac-
feine, meat, and even milk. rificing the freedom to choose. As Gandhi
said, “Freedom is not worth having if it does
gt not connote freedom to err.”

Unhealthy Restrictions To revise John Donne, no freedom is an
Aside from being priggishly autocratic, island, entire of itself. Every freedom is a part
dictating notions of health to all following of the main. If a freedom is taken away, soci-
generations may actually be unhealthy. ety is the less. Every freedom’s death dimin-
Against centuries of warnings about the dan- ishes us all. OC

r
by


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760

INDEX AUSTRIAN economics BLEVINS, Sue A.
Nature and significance of economic Guess who paved the road to socialized
THE FREEMAN education (Kirzner) 10:582-586 medicine. 7:407-409
VOLUME 48 Vienna and Chicago: a tale of two BLUMENFELD, Samuel. See Book
JANUARY-DECEMBER schools (Skousen) 2:117-119 reviews (McGuiness)
Why are Austrians unusually bearish? BOAZ, David
1998 (Skousen) 1:54-55 Whose kids are they? 10:607-609
AX business welfare and privatize Social BOHANAN, Cecil and Van Cott, T. Norman
Security (Bandow) 3:159-161 Roberto and Fidel: two versions of
Prepared by Beth A. Hoffman ve “share the wealth.” 4:200-201
and the editorial staff of . BOLCH, Ben. See Book reviews (Singer)
The Freeman BOUDREAUX, Donald J.
B Notes from FEE:
Arrogant antitrusters (August)
Note: In page references, the number The Constitution’s new defenders
preceding the colon designates the month, BAIRD, Charles W. (December)
the numbers following refer to the pages. Elections, extortion, and unions. 1:46-47 Cursed by economic knowledge and
Articles have at least three entries—author, The myth of compulsory unionism. ignorance (May)
title, and subject—except in a few cases 3:155-156 The danger of deifying the state
when the title and the appropriate subject Pursuit of happiness column: (November)
coincide. Books reviewed are listed Paycheck protection in California: what Foolish inconsistencies (June)
alphabetically by author on pages 767-768. went wrong? 11:703-704 Bill Gates, philanthropist (January)
Salt without savor. 5:319-320 Judges versus majorities versus peaceful
Who wins in strikes? 8:511-512 people (March)
See also Book reviews (Phelps) Lessons from homeschooling
BALDWIN, Jason (September)
Property and the moral life. 2:84-87 Much more than meets the eye
A BANDOW, Doug (February)
Potomac principles column: Julian Simon, lifesaver (April)
America’s permanent criminal class. What is the American Constitution?
ADA: Terms of impairment (Leef) 7:412-413 (July)
10:597-599 Ax business welfare and privatize Social Why honorable people avoid politics
ADLER, Jonathan H. Security. 3:159-161 (October)
Global warming—hot problem or hot Deficits are good. 5:283-284 See also It just ain’t so; Book reviews
air? 4:231-236 The folly of economic warfare. (Landsburg)
ALL the world’s a classroom (Richman) 10:602-603 BOVARD, James
8:450451 Global politics, political warming. The IRS, now and forever? 11:672-675
ALLEN, Candace and Dwight R. Lee 1:34-36 BROZEN, Yale
In defense of markets and misers. Institutional immortality, Washington The attack on concentration. 6:325-331
4:213-216 style. 6:342-343 BROZEN, Yale (Richman) 6:322-323
AMERICA’s permanent criminal class Is anyone still for limited government? BROZEN, Yale: in memoriam (Henderson)
(Bandow) 7:412-413 9:551-552 6:324-325
ANDERSON, Terry and Leal, Donald R. - Murderous nostalgia. 11:668-669 BURN your house—boost the economy
Nature’s entrepreneurs. 11:646—650 Native American success stories. (Parks) 3:178-179
ANOTHER minimum-wage clash 4:220-222 BUSINESS
(McKenzie) 11:676-677 Qutmoded paternalism. 8:467—468 AX business welfare and privatize Social
ANTITRUST Service muddles in Washington. Security (Bandow) 3:159-161
Arrogant antitrusters (Boudreaux) 12:722-723 Do corporations have social
August Notes from FEE Taxpayers at risk. 2:97-99 responsibilities? (Hood) 11:680—684
Attack on concentration (Brozen) BEISNER, E. Calvin NFL oilers: a case study in corporate
6:325-331 How environmentalism disdains the welfare (Keating) 4:209-212
Ghost of John D. Rockefeller poor. 8:461-463 On giving back (Leef) 3:157-158
(DiLorenzo) 6:334-337 BENNETT, James T. and DiLorenzo,
APPLE icons. See articles listed under Thomas J.
Lesson plans Regulatory poison. 2:68-70 C
ARE women being victimized by the BILLIONS for a misconception (Reed)
market? (Reed) 4:207-208 7:398-399
ASIAN financial crisis BIOGRAPHY CABRERA, Sigfredo
Asia’s crises: toward a new growth Herbert Dow and predatory pricing Plenty of room at the inn. 9:575-576
paradigm? (Lingle) 12:710-712 (Folsom) 5:307-311 CAMPAIGN finance: the sympton, not the
How real is the Asian economic miracle? Billy Durant: from carriages to cars problem (Wenders) 2:38-89
a reprise (Skousen) 4:246-247 (Folsom) 3:172-177 CAPITAL letters 6:381; 10:629
Taxpayers at risk (Bandow) 2:97-98 Henry Ford and the triumph of the auto CAPITALISM: discrimination’s implacable
ASSET forfeiture run amok (Reed) industry (Folsom) 1:37-42 enemy (Hood) 8:485-489
11:655-656 Will Kellogg: king of corn flakes CARDIFF, Chris
ATTACK on concentration (Brozen) (Folsom) 4:239-244 The seduction of homeschooling
6:325-331 Dr. Gertrude B. Kelly: a forgotten families. 3:139-144
ATTARIAN, John feminist (McElroy) 10:623-627 CASTRO, Fidel. See Cuba
Smuggled cigarettes, unteachable Should government build the railroads? CHARACTER and government policy
politicians. 9:560-563 (Folsom) 6:362-367 (Walsh) 7:394-397
See also Book reviews (Gelernter; Klein; Dr. Andrew Ure: pioneer free trader CHILDREN

Robertson) (Chodes) 10:604-606 For the children (Madden) 7:388-390


===== PAGE 61 =====

INDEX 761

Children, continued Discrimination, continued ELECTIONS, extortion, and unions (Baird)
Heritage we owe our children (Read) Discrimination by the numbers: lies, 1:46-47
7:391-393 damned lies, and statistics (Levy) ELLIG, Jerry. See Book reviews
See also Education; Homeschooling 10:591-594 (Ballonoff)
CHODES, John Fairness: results versus process EMPLOYERS swamped by good
Dr. Andrew Ure: pioneer free trader. (Williams) 10:639-640) intentions (Payne) 10:589-590
10:604-606 DO corporations have social EMPLOYMENT
CINEMA and the capitalist hero responsibilities? (Hood) 11:680-684 “49” and holding (Keating) 11:685-686
(Younkins) 6:383-384 DOES the Internet prove the need for Sizing up downsizing (C. Lee)
CIVILIAN service: Service muddles in government investment? (Morriss) 10:615-618
Washington (Bandow) 12:722-723 11:660-664 ENTREPRENEURS, entrepreneurship
CLASSICAL liberalism, culture of DORN, James A. Herbert Dow and predatory pricing
(Wilson) 12:736-740 A new monetary universe. 11:657-659 (Folsom) 5:307-311
CLIMATE-change worries in the eighteenth ~~ DOW, Herbert, and predatory pricing Billy Durant: from carriages to cars
century (Drewry) 7:414-417 (Folsom) 5:307-311 (Folsom) 3:172-177
COHEN, Andrew I. DRAWING the line (Richman) 5:296-297 Henry Ford and the triumph of the auto
Let property settle smoking disputes. DREWRY, Aubrey industry (Folsom) 1:37-42
2:100-103 Climate-change worries in the eighteenth Will Kellogg: king of corn flakes
See also Book reviews (Kelley; Machan) century. 7:414-417 (Folsom) 4:239-244
COMMUNITARIANISM Individualism DURANT, Billy: from carriages to cars Nature’s entrepreneurs (Anderson and
and freedom: vital pillars of true (Folsom) 3:172-177 Leal) 11:646-650
communities (Younkins) 1:51-53 Should government build the railroads?
CONQUEST of the United States by Spain (Folsom) 6:362-367
(Sumner) 12:743-748 E ENVIRONMENT of freedom (Kwong)
CORDATO, Roy E. 9:535-539
Should there be a carbon subsidy? ENVIRONMENT, environmentalism
7:418-419 EARLIER response to environmental Climate-change worries in the eighteenth
See also Book reviews (Shughart) tyranny (Walker) 4:228-230 century (Drewry) 7:414-417
CORPORATIONS. See Business EAST Asia’s crises: toward a new growth Earlier response to environmental
CREATIVE apathy (Richman) paradigm? (Lingle) 12:710-712 tyranny (Walker) 4:228-230
8:476-477 ECONOMIC freedom and economic Fine art of conservation (Jackson)
CUBA growth (Holcombe) 2:90-93 10:612-614
Idiocy of autocracy (Richman) ECONOMIC notions column. See D. Lee Global politics, political warming
6:356-357 ECONOMICS: a branch of moral (Bandow) 1:34-36
Inventing life in Cuba (Olshan) philosophy (Read) 6:338-341 Global warming—hot problem or hot
4:196-199 ECONOMICS on trial column. See Skousen air? (Adler) 4:231-236
Roberto and Fidel: two versions of ECONOMICS Golden age at risk (Yandle) 12:724-728
“share the wealth” (Bohanon and Van Cursed by economic knowledge and Government versus the environment
Cott) 4:200-201 ignorance (Boudreaux) May Notes (Madden) 2:103-105
CULTURE of classical liberalism (Wilson) from FEE How environmentalism disdains the poor
12:736-740 Economics, law, and personal (Beisner) 8:461-463
relationships (Laband and Sophocleus) Nature's entrepreneurs (Anderson and
1:13-15 Leal) 11:646-650
It’s an economy, not a machine Nightmare in green (Wollstein)
(Richman) 9:558-559 9:540-544
D Nature and significance of economic Should there be a carbon subsidy?
education (Kirzner) 10:582-586 (Cordato) 7:418-419
See also D. Lee; Skousen Sustainable development: common sense
DEFINING state and society (McElroy) All the world’s a classroom (Richman) 9:545-550
4:223-227 8:450-451 ESSENCE of Americanism (Read)
DEMAND and supply (D. Lee) Character and government policy 9:527-532
10:619-620 (Walsh) 7:394-397 EVERYTHING is cheap—and getting
DEMOCRACY would doom Hong Kong Educational decarceration (Hager) cheaper (Skousen) 12:749-750
(Wenders) 1:43-45 7:400402
DEMPSEY, Gary Lessons from homeschooling (Boudreaux)
The myth of an emerging information September Notes from FEE
underclass. 4:217-219 Nature and significance of economic F
DEMPSEY, Gary and Lukas, Aaron education (Kirzner) 10:582-586
Mafia capitalism or Red legacy? One freedom (Madden) 1:48-50 FAIRNESS: results versus process
8:469472 Origins of the public school (Murphy) (Williams) 10:639-640
DiLORENZO, Thomas 7:403-406 FDA regulations: Regulatory poison
The ghost of John D. Rockefeller. Seduction of homeschooling families (Bennett and DiLorenzo) 2:68-70
6:334-337 (Cardiff) 3:139-144 FEDERAL ID: Number, not a name: big
It just ain’t so! 12:708-709 Service without a smile (Richman) government by stealth (Wolfe)
DIiLORENZO, Thomas J. (co-author) 11:678-679 5:298-303
See Bennett Terms of impairment (Leef) 10:597-599 FEE/Foundation for Economic Education,
DISCRIMINATION Whose kids are they? (Boaz) 10:607-609 history of
Capitalism: discrimination’s implacable EDUCATIONAL decarceration (Hager) Leonard E. Read: crusader (Greaves)
enemy (Hood) 8:485-489 7:400-402 9:522-526
Discrimination and liberty (Williams) EKELUND, Jr., Robert B. See Book Leonard E. Read: a portrait (Opitz)

4:255-256 reviews (Hazlett and Spitzer) 9:518-521


===== PAGE 62 =====

762 THE FREEMAN « DECEMBER 1998

FINE art of conservation (Jackson) Gates, continued
10:612-614 Bill Gates, philanthropist (Boudreaux) H
FOLLY of economic warfare (Bandow) January Notes from FEE
10:602-603 See also Antitrust HAGER, Daniel
FOLSOM, Burton GESHELIN, Rebecca (co-author). See Educational decarceration. 7:400-402
Herbert Dow and predatory pricing. Levatter “Wrecking”: the ominous rationale for
5:307-311 GHOST of John D. Rockefeller attacks on the tobacco industry.
Billy Durant: from carriages to cars. (DiLorenzo) 6:334-337 11:689-690
3:172-177 GLOBAL politics, political warming See also Book reviews (Contoski)
Henry Ford and the triumph of the auto (Bandow) 1:34-36 HAYEK, F.A., ideas of .
industry. 1:37-42 GLOBAL warming—hot problem or hot Today’s most influential economist?
Will Kellogg: king of corn flakes. air? (Adler) 4:231-236 (Skousen) 5:313-314
4:239-244 GLORY be! (Read) 12:713-715 Hayek was right: the worst do get to the
Should government build the railroads? GOLDEN age at risk (Yandle) top (Reed) 2:77-78
6:362-367 12:724-728 HEALTH care. See Medicine
Spanish-American War: death, taxes, and =~ GOLDEN comeback, part I (Skousen) HENDERSON, David
incompetence. 12:741-742 9:567-568 In memoriam: Yale Brozen. 6:324-325
See also Book reviews (Roche; Shaffer); GOLDEN comeback, part 11 (Skousen) HERITAGE we owe our children (Read)
It just ain’t so! 9:516-517 10:630-631 7:391-393
FOOD for thought (Reed) 1:22-23 GOLDEN comeback, part III (Skousen) HEYNE, Paul. See Book reviews (McKenzie)
FOOD safety 11:692-693 HIGGS, Robert
Mother of all food fights (Kazman) GOVERNMENT and the market: chicken The mythology of Roosevelt and the
11:670-671 or egg? (Hood) 3:169-171 New Deal 9:553-557
Regulatory poison (Bennett and GOVERNMENT versus the environment HIGH plains drifters: politicians’ lucrative
DiLorenzo) 2:68-70 (Madden) 2:103-105 protection racket (McChesney) 1:4-9
We can do better than government GOVERNMENT, abusive power of HILL, PJ. See Book reviews (Yandle)
inspection of meat (Pasour) 5:290-295 Asset forfeiture run amok (Reed) HOLCOMBE, Randall G.
FOR the children (Madden) 7:388-390 11:655-656 Economic freedom and economic
FORD, Henry, and the triumph of the auto Campaign finance: the sympton, not the growth. 2:90-93
industry (Folsom) 1:37-42 problem (Wenders) 2:88-89 See also Book reviews (Goodwin)
FOREIGN policy Drawing the line (Richman) 5:296-297 HOMESCHOOLING
Creative apathy (Richman) 8:476-477 Foolish inconsistencies (Boudreaux) Lessons from homeschooling (Boudreaux)
“FORTY -nine and holding” (Keating) June Notes from FEE September Notes from FEE
11:685-686 Hayek was right: the worst do get to the Seduction of homeschooling families
FREE market and scientific research top (Reed) 2:77-78 (Cardiff) 3:139-144
(Steelman) 5:260-262 Institutional immortality, Washington HONG KONG
FREE markets style (Bandow) 6:342-343 Democracy would doom Hong Kong
Are women being victimized by the Lying government ads (Machan) (Wenders) 1:43-45
market? (Reed) 4:207-208 3:167-168 HOOD, John
In defense of markets and misers (Allen No credit due (Richman) 12:729-730 Capitalism: discrimination’s implacable
and Lee) 4:213-216 Number, not a name: big government by enemy. 8:485-489
Much more than meets the eye stealth (Wolfe) 5:298-303 Do corporations have social
(Boudreaux) February Notes from FEE Statistics: a vehicle for collectivist responsibilities? 11:680-684
Roads without the state (Samuel) mischief (Wenders) 6:358-369 Government and the market: chicken or
1:24-30 Taxation by other means (Schulz) egg? 3:169-171
White magic (Read) 1:10-12 2:106-107 See also Book reviews (Novak)
FREE trade: Dr. Andrew Ure: pioneer free Trust not in what your government can HOSPERS, John. See Book reviews (Ross)
trader (Chodes)10:604—606 do for you (Reed) 6:332-333 HOW big government usurped personal
FREEDOM Whose rules? whose law? (Walker) responsibility (Leeson) 10:621-622
Democracy would doom Hong Kong 7:434-435 HOW cities put the brakes on taxicabs
(Wenders) 1:43-45 GREAT Depression (Staley) 3:147-150
How to get action (Read) 8:458-560 Great myths of the Great Depression HOW environmentalism disdains the poor
Individualism and freedom: vital pillars (Reed) 8:478-482 (Beisner) 8:461-463
of true communities (Younkins) Mythology of Roosevelt and the New HOW real is the Asian economic miracle?
1:51-53 Deal (Higgs) 9:553-557 (Skousen) 4:246-247
Neither left nor right (Read) 2:71-73 GREAT myths of the Great Depression HOW to get action (Read) 8:458-560
One freedom (Madden) 1:48-50 (Reed) 8:478-482 HOW to reduce taxes (Read) 4:202-206
FREEDOM not to pay for other people’s GREAT pretenders (Richman) HUMAN ignorance and social engineering
politics (Reed) 5:272-273 11:642-643 (McElroy) 5:278-282
FREEDOM 101 (Richman) 2:66-67 GREAT tumabouts in economics, Part I] “HUMAN rights” deception (Stevens)
FRIEDMAN, Milton, ex-Keynesian (Skousen) 6:369-370 12:731-733
(Skousen) 7:437-438 GREAVES, Bettina Bien
FYLSTRA, Dan Leonard E. Read: crusader 9:522-526
Opening pandora’s box. 11:665-667 GRISWOLD, Daniel T. See Book reviews | |
(Krauss)
GUESS who paved the road to socialized
medicine (Blevins) 7:407-409 IDEAS
G GUN control Culture of classical liberalism (Wilson)
Reading the Second Amendment 12:736-740
GATES, Bill (Richman) 2:112-115 Essence of Americanism (Read)
Barbarians at the Gates (Richman) Seen and unseen in gun control 9:527-532

7:386-387 (Richman) 10:610-611 Glory be! (Read) 12:713-715


===== PAGE 63 =====

INDEX 763

Ideas, continued KAZMAN, Sam Leef, continued
On behalf of an ideal (Read) 10:587-588 The mother of all food fights 11:670-671 Pounds of prevention—ounces of cure.
Tyranny of the proper (Sanders) KEATING, Raymond 8:490-493
12:757-758 “49 and holding.” 11:685-686 Terms of impairment 10:597-599
See also Freedom The NFL oilers: a case study in See also Book reviews (Browne; DeVos;
IDEAS and consequences column. See Reed corporate welfare. 4:209-212 Folsom; Goldsmith; Hayek; Hazlitt;
IDIOCY of autocracy (Richman) See also Book reviews (Danielson; Hornberger and Ebeling; Ahmad/Lane;
6:356-357 Rosentraub; Stine) Lieberman; Rorty; Siegan; Sowell)
IF rates of return matter, Social Security is KELLOGG, Will: king of corn flakes LEESON, Peter T.
a goner (Reed) 9:533-534 (Folsom) 4:239-244 How big government usurped personal
IKEDA, Sanford. See Book reviews (Siegel) =~ KELLY, Dr. Gertrude B.: a forgotten responsibility. 10:621-622
IMF'S dubious purpose (Vasquez) feminist (McElroy) 10:623-627 LESSON plans (marked with apple icons)
10:600-601 KENDRICK, David. See Book reviews Asia’s crises: toward a new growth
IN defense of markets and misers (Allen (Lukas) paradigm? (Lingle) 12:710-712
and Lee) 4:213-216 KIRZNER, Israel Character and government policy
IN memoriam: Yale Brozen (Henderson) The nature and significance of economic (Walsh) 7:394-397
6:324-325 education 10:582-586 Herbert Dow and predatory pricing
INDIA KLEIT, Andrew N. (Folsom) 5:307-311
How environmentalism disdains the poor It just ain’t so! 10:580-581 Demand and supply (D. Lee) 10:619-620
(Beisner) 8:461-463 KOBER, Stanley. See Book reviews Environment of freedom (Kwong)
Persistence of poverty in India: culture (Greider) 9:535-539
or system? (Shah) 3:151-154 KOPEL, David. See Book reviews (Lott) Fairness: results versus process
INDIVIDUAL rights KWONG, Jo (Williams) 10:639-640
“Human rights” deception (Stevens) An environment of freedom. 9:535-539 Free market and scientific research
12:731-733 (Steelman) 5:260-262
Whose choice? whose responsibility? Ghost of John D. Rockefeller
(Richman) 10:578-579 L (DiLorenzo) 6:334-337
INDIVIDUALISM and freedom: vital Great myths of the Great Depression
pillars of true communities (Younkins) (Reed) 8:478-482
1:51-53 LABAND, David N. and Sophocleus, John It’s a jungle out there! what we can learn
INDIVIDUALIST feminism: the lost P. from the privatization of zoos (Wade)
tradition (McElroy) 8:494-498 Economics, law, and personal 8:464-466
INSTITUTIONAL immortality, Washington relationships. 1:13-15 “Let em skate!”: defeating local
style (Bandow) 6:342-343 LABOR socialism (Leef) 5:274-277
INTERNET. See Technology Another minimum-wage clash Markets and freedom (D. Lee) 9:564-565
INVENTING life in Cuba (Olshan) (McKenzie) 11:676-677 Mother of all food fights (Kazman)
IRS, now and forever? (Bovard) Elections, extortion, and unions (Baird) 11:670-671
11:672-675 1:4647 Number, not a name: big government by
IS anyone still for limited government? Freedom not to pay for other people’s stealth (Wolfe) 5:298-303
(Bandow) 9:551-552 politics (Reed) 5:272-273 Plenty of room at the inn (Cabrera)
IT just ain’t so! Myth of compulsory unionism (Baird) 9:575-576
August (Boudreaux) 8:440-441 3:155-156 Power of incentives (D. Lee) 6:360-361
September (Boudreaux and Folsom) Paycheck protection in California: what Pound scum (Morriss) 12:718-719
9:516-517 went wrong? (Baird) 11:703-704 Price ceilings . . . (D. Lee) 11:687-688
October (Kleit) 10:580-581 Salt without savor (Baird) 5:319-320 Price floors . . . (D. Lee) 12:734-735
November (Richman) 11:644-645 Who wins in strikes? (Baird) 8:511-512 Service without a smile (Richman)
December (DiLorenzo) 12:708-709 LAPP, Nathan 11:678-679
IT’S a jungle out there! what we can learn Liberating the jury. 3:162-166 Should government build the railroads?
from the privatization of zoos (Wade) LEAL, Donald R. (co-author). See Anderson (Folsom) 6:362-367
8:464—466 LEE, Christopher Social cooperation and the marketplace
IT’S an economy, not a machine Sizing up downsizing. 10:615-618 (D. Lee) 7:432-433
(Richman) 9:558-559 LEE, Dwight R. Social cooperation, good intentions, and
Social Security can be good for your incentives (D. Lee) 5:304-305
health. 3:132-134 Social justice (Williams) 7.447448
Economic notions column: Specialization and wealth (D. Lee)
J Demand and supply. 10:619-620 8:483484
Markets and freedom. 9:564-565 Terms of impairment (Leef) 10:597-599
JACKSON, Bemie The power of incentives. 6:360-361 Tyranny of the proper (Sanders)
The fine art of conservation Price ceilings cause shortages and higher 12:757-758
10:612-614 costs. 11:687—688 Wild West meets cyberspace (Morriss)
JUDGES versus majorities versus peaceful Price floors, surpluses, and the minimum 7:427-431
people (Boudreaux) March Notes from wage. 12:734-735 LET property settle smoking disputes
FEE Social cooperation and the marketplace. (Cohen) 2:100-103
JURY, power of 7:432-433 “LET ‘em skate!”: defeating local
Liberating the jury (Lapp) 3:162-166 Social cooperation, good intentions, and socialism (Leef) 5:274-277
incentives. 5:304-305 LET'S not throw American medicine into
Specialization and wealth. 8:483-484 Boston Harbor (Orient) 7:410-411
K See also co-author (Allen) LETTER from Russia (Shishatsky)
LEEF, George C. 8:473-475
“Let "em skate!”: defeating local LEVATTER, Ross and Geshelin, Rebecca.
KAZA, Greg. See Book reviews (Davidson socialism. 5:274-277 Who pays the price for motherhood?

and Rees-Mogg) On giving back. 3:157-158 1:31-33


===== PAGE 64 =====

764 THE FREEMAN ee DECEMBER 1998

LEVITE, Allan MEIER, Conrad F. See Book reviews NFL oilers: a case study in corporate
Technology and happiness. 8:454-457 (Faria) welfare (Keating) 4:209-212
LEVY, Robert A. MEINERS, Roger. See Book reviews NO credit due (Richman) 12:729-730
Discrimination by the numbers: lies, (McChesney) NON-ABSURDITY of natural law
damned lies, and statistics 10:591-594 MICHIGAN: where privatization is (McElroy) 2:108-111
The tobacco deal: myths and working (Reed) 3:145-146 NOTES from FEE. See Boudreaux
misconceptions. 1:16-21 MICROSOFT. See Gates NUMBER, not a name: big government by
LIBERATING the jury (Lapp) 3:162-166 MISES, Ludwig von, ideas of stealth (Wolfe) 5:298-303
LINGLE, Christopher Nature and significance of economic
East Asia’s crises: toward a new growth education (Kirzner) 10:582-586
paradigm? 12:710-712 MOLECULAR individualism (Richman) O
LOCKE, John, ideas of 3:130-131
Government and the market: chicken or MONEY OLSHAN, Marc A.
egg? (Hood) 3:169-171 Golden comeback, part I (Skousen) Inventing life in Cuba. 4:196-199
LUKAS, Aaron (co-author). See Demspey 9:567-568 ON beh g . a.
alf of an ideal (Read) 10:587-588
LYING government ads (Machan) Golden comeback, part II (Skousen) ON giving back (Leef) 3:157-158
3:167-168 10:630-631 ON rt ty boar, les (Road) 5.263271
Golden comeback, part III (Skousen) that day began lies (Read) 5:263-
p ONE freedom (Madden) 1:48-50
11:692-693 OPENING pandora’s box (Fylstra)
Great pretenders (Richman) 11:642-643 11:665-667
IMF's dubious purpose (Vasquez) ’
M 10:600-601 OPITZ, Edmund A.
, . Leonard E. Read: a portrait. 9:518-521
It’s an economy, not a machine ORIENT. Jane M
MACAULAY, Hugh (Richman) 9:558-559 Let's not throw Ameri icine ink
The Taiwan model. 7:422-426 New monetary universe (Dom) Sno ow mencan medicine into
MacCALLUM, Spencer Heath 11:657—659 Boston Harbor. 7:410-411
A peaceful ferment in Somalia. MONOPOLY. See Antitrust ORIGIN of religious tolerance (McElroy)
6:351-355 MORALITY 6:347-350 )
MACHAN, Tibor R. Economics: a branch of moral OR oan public school (Murphy)
Lying government ads. 3:167-168 philosophy (Read) 338-341 OUR ti N Richm
MADDEN, Russell Penalty of surrender (Read) 3:135-138 lon 10s BORE (Richman)
For the children. 7:388-390 On that day began lies (Read) 5:263-271 : .
Government versus the environment. MORRISS, ES P. Read) OUTMODED Foternaliam (Bandow)
2:103-105 Does the Internet prove the need for )
One freedom. 1:48-50 government investment? 11:660—664
MAFIA capitalism or Red legacy? Pound scum. 12:718-719 P
(Dempsey and Lukas) 8:469-472 The Wild West meets cyberspace.
MARKET reforms score big in soccer 7-427-431
(Rodriguez) 12:720-721 MOTHER of all food fights (Kazman) PALMER, Tom G.
MARKET. See Free market 11:670—671 The U.S. (Dis)information Agency.
MARKETS and freedom (D. Lee) MURDEROUS nostalgia (Bandow) 2:74-76
9:564-565 11:668-669 PARKS, Lawrence
MASON, Stevens T.: Should government MURPHY, Robert P. Bum your house—boost the economy.
6:362-367 7:403-406 PASOUR, E.C,, Jr.
McCHESNEY, Fred S. MURRAY, Philip R. See Book reviews We can do better than government
High plains drifters: politicians’ lucrative (Bray) inspection of meat. 5:290-295
protection racket. 1:4-9 MYTH of an emerging information See also Book reviews (Simon)
Defining state and society. 4:223-227 MYTH of compulsory unionism (Baird) went wrong? (Baird) 11:703-704
Human ignorance and social 3:155-156 PAYNE, James M.
engineering. 5:278-282 MYTHOLOGY of Roosevelt and the New Employers swamped by good intentions.
Individualist feminism: the lost tradition. Deal (Higgs) 9:553-557 10:589-590
8:494-498 PEACEFUL ferment in Somalia
Gertrude B. Kelly: a forgotten feminist. (MacCallum) 6:351-355
10:623-627 PENALTY of surrender (Read)
The non-absurdity of natural law. N 3:135-138
2:108-111 PERIPATETICS column. See Richman
The origin of religious tolerance. NATIVE American success stories PERSISTENCE of poverty in India: culture
6:347-350 (Bandow) 4:220-222 or system? (Shah) 3:151-154
McKENZIE, Richard B. NATURAL law PERSPECTIVE. See Richman
Another minimum-wage clash. Natural society revisited (Pilon) PETERSON, W.H. See Book reviews
11:676-677 6:344-346 (Johnson, Holmes, and Kirkpatrick;
MEDICINE Non-absurdity of natural law (McElroy) Keating; Templeton Honor Rolls;
Free market and scientific research 2:108-111 Weaver)
(Steelman) 5:260-262 NATURE and significance of economic PHILANTHROPY
Guess who paved the road to socialized education (Kirzner) 10:582-586 Bill Gates, philanthropist (Boudreaux)
medicine (Blevins) 7:407-409 NATURE'S entrepreneurs (Anderson and January Notes from FEE
Let’s not throw American medicine into Leal) 11:646-650 In defense of markets and misers (Allen
Boston Harbor (Orient) 7:410-411 NEITHER left nor right (Read) 2:71-73 and Lee) 4:213-216
Who pays the price for motherhood? NEW monetary universe (Dorn) PILON, Juliana Geran

(Levatter and Geshelin) 1:31-33 11:657-659 Natural society revisited. 6:344-346


===== PAGE 65 =====

INDEX 765

PLENTY of room at the inn (Cabrera) READ, Leonard E. (100th anniversary of Richman, continued
9:575-576 birth) Such a deal! 7:420-421
POLITICS Crusader (Greaves) 9:522-526 Perspective:
America’s permanent criminal class Light giver (Richman) 9:514-515 All the world’s a classroom. 8:450-451
(Bandow) 7:412-413 A portrait (Opitz) 9:518-521 Barbarians at the Gates. 7:386-387
Freedom not to pay for other people’s READING the Second Amendment Yale Brozen. 6:322-323
politics (Reed) 5:272-273 (Richman) 2:112-115 Freedom 101. 2:66-67
High plains drifters: politicians’ lucrative ~~ REED, Lawrence W. The great pretenders. 11:642-643
protection racket (McChesney) 1:4-9 Great myths of the Great Depression. Molecular individualism. 3:130-131
Why honorable people avoid politics 8:478-482 Our ultimate resource gone. 4:194-195
(Boudreaux) October Notes from FEE Ideas and consequences column: Leonard Read: light giver. 9:514-515
See also Government Are women being victimized by the Reports of the end of history are grossly
POTOMAC principles column. market? 4:207-208 exaggerated. 12:706-07
See Bandow Asset forfeiture run amok. 11:655-656 Ring in the new! 1:2-3
POUND scum (Morriss) 12:718-719 Billions for a misconception. 7:398-399 Mr. Spencer versus the state. 5:258-259
POUNDS of prevention—ounces of cure Food for thought. 1:22-23 Whose choice? whose responsibility?
(Leef) 8:490-493 The freedom not to pay for other 10:578-579
POWER of incentives (D. Lee) 6:360-361 people’s politics. 5:272-273 See also It just ain’t so! 11:644-645;
PRICE ceilings cause shortages and higher Hayek was right: the worst do get to the Book reviews (Rothbard)
costs (D. Lee) 11:687-688 top. 2:77-78 RING in the new (Richman) 1:2-3
PRICE floors, surpluses, and the minimum If rates of return matter, Social Security ROADS without the state (Samuel) 1:24-30
wage (D. Lee) 12:734-735 is a goner. 9:533-534 ROBERTO and Fidel: two versions of
PRICES, pricing Michigan: where privatization is “share the wealth” (Bohanon and Van
There’s some good in gouging (Selick) working. 3:145-146 Cott) 4:200-201
4:237-238 The trade deficit: much ado about RODRIGUEZ, L. Jacobo
Fine art of conservation (Jackson) nothing. 12:716-717 Market reforms score big in soccer
10:612-614 Trust not in what your government can (Rodriguez) 12:720-721
PRIMACY of property rights and the do for you. 6:332-333 RUSSIA
American founding (Upham) What is this thing called “sprawl”? Letter from Russia (Shishatsky)
2:79-83 10:595-596 8:473-475
PRIVATIZATION, private vs. public REGARDLESS of choice, vote! (Read) Mafia capitalism or Red legacy?
enterprises 11:651-654 {Dempsey and Lukas) 8:469—472
Food for thought (Reed) 1:22-23 REGULATION
1t’s a jungle out there! what we can learn Employers swamped by good intentions
from the privatization of zoos (Wade) (Payne) 10:589-590 S
8:464-466 Environment of freedom (Kwong)
Michigan: where privatization is working 9:535-539
(Reed) 3:145-146 How cities put the brakes on taxicabs SAMUEL, Peter
Pound scum (Morriss) 12:718-719 (Staley) 3:147-150 Roads without the state. 1:24-30
PROPAGANDA Mother of all food fights (Kazman) SAMUELSON?’S last hurrah (Skousen)
U.S. (Dis)Information Agency (Palmer) 11:670-671 3:180-181
2:74-76 Plenty of room at the inn (Cabrera) SANDERS, Jon
PROPERTY rights 9:575-576 Tyranny of the proper. 12:757-758
Let property settle smoking disputes Pounds of prevention—ounces of cure SCHULZ, Max
(Cohen) 2:100-103 (Leef) 8:490-493 Taxation by other means. 2:106-107
Primacy of property rights and the What is this thing called “sprawl”? SCIENCE
American founding (Upham) 2:79-83 (Reed) 10:595-596 Climate-change worries in the eighteenth
PROPERTY and the moral life (Baldwin) REGULATORS: the new socialists century (Drewry) 7:414-417
2:84-87 (Reiland) 2:94-95 Free market and scientific research
PURSUIT of happiness column. See Baird; REGULATORY poison (Bennett and (Steelman) 5:260-262
Cabrera; Sanders; Williams; Younkins DiLorenzo) 2:68-70 See also Medicine; Technology
REILAND, Ralph R. SEDUCTION of homeschooling families
Regulators: the new socialists. 2:94-95 (Cardiff) 3:139-144
RELIGIOUS tolerance, origin of SEEN and unseen in gun control
(McElroy) 6:347-350 (Richman) 10:610-611
R REPORTS of the end of history are grossly SELICK, Karen
exaggerated (Richman) 12:706-07 There's some good in gouging. 4:237-238
READ, Leonard E. REYNOLDS, Morgan. See Book reviews SEMMENS, John. See Book reviews
Economics: a branch of moral (Kopel and Blackman) (Johnston)
philosophy. 6:338-341 RICHMAN, Sheldon SERVICE muddles in Washington
The essence of Americanism. 9:527-532 Reading the Second Amendment. (Bandow) 12:722-723
Glory be! 12:713-715 2:112-115 SERVICE without a smile (Richman)
The heritage we owe our children. Periptatetics column: 11:678-679
7:391-393 Creative apathy. 8:476-477 SHAH, Parth J.
How to get action. 8:458-560 Drawing the line. 5:296-297 The persistence of poverty in India:
How to reduce taxes. 4:202-206 It’s an economy, not a machine. culture or system? 3:151-154
Neither left nor right. 2:71-73 9:558-559 SHISHATSKY, Grigory
On behalf of an ideal. 10:587-588 No credit due. 12:729-730 A letter from Russia. 8:473-475
On that day began lies. 5:263-271 The idiocy of autocracy. 6:356-357 SHOULD government build the railroads?
Penalty of surrender. 3:135-138 The seen and unseen in gun control. (Folsom) 6:362-367
Regardless of choice, vote! 11:651-654 10:610-611 SHOULD there be a carbon subsidy?

White magic. 1:10-12 Service without a smile. 11:678-679 (Cordato) 7:418-419


===== PAGE 66 =====

766 THE FREEMAN e DECEMBER 1998

SIMON, JULIAN Socialism, continued TAYLOR, Jerry
Julian Simon, lifesaver (Boudreaux) What's left of Marxism? (Skousen) Sustainable development: common sense
April Notes from FEE 8:500-501 or nonsense on stilts? 9:545-550
Our ultimate resource gone (Richman) SOMALIA, peaceful ferment in TECHNOLOGY
4:194-195 (MacCallum) 6:351-355 Does the Internet prove the need for
SIMON, Rita. See Book reviews (Salins) SOPHOCLEUS, John P. (co-author). government investment? (Morriss)
SINGLETON, Solveig. See Book reviews See Laband 11:660-664
(Huber) SPANISH-American War Myth of an emerging information
SIRICO, Robert. See Book reviews (Shils) Conquest of the United States by Spain underclass (Dempsey) 4:217-219
SIZING up downsizing (C. Lee) (Sumner) 12:743-748 Opening pandora’s box
10:615-618 Spanish-American War: death, taxes, and (Fylstra)11:665-667
SKOPPEK, Jiirgen. See Book reviews incompetence (Folsom) 12:741-42 Wild West meets cyberspace (Morriss)
(Scalia) SPECIALIZATION and wealth (D. Lee) 7:427-431
SKOUSEN, Mark 8:483-484 TECHNOLOGY and happiness (Levite)
Economics on trial column: SPENCER, Herbert, versus the state 8:454-457
A golden comeback, part I. 9:567-568 (Richman) 5:258-259 TERMS of impairment (Leef) 10:597-599
A golden comeback, part 11. 10:630-631 SPORTS THERE'S some good in gouging (Selick)
A golden comeback, part III. 11:692-693 Market reforms score big in soccer 4:237-238
Everything is cheap—and getting (Rodriguez) 12:720-721 TIMBERLAKE, Richard. See Book
cheaper. 12:749-750 NFL oilers: a case study in corporate reviews (Gordon)
Milton Friedman, ex-Keynesian. welfare (Keating) 4:209-212 TOBACCO deal: myths and
7.437438 STALEY, Sam misconceptions (Levy) 1:16-23
Great turnabouts in economics, Part II. How cities put the brakes on taxicabs. TOBACCO, smoking
6:369-370 3:147-150 Let property settle smoking disputes
How real is the Asian economic miracle? ~~ STATE, statism (Cohen) 2:100-103
a reprise 4:246-247 The danger of deifying the state Smuggled cigarettes, unteachable
Samuelson’s last hurrah. 3:180-181 (Boudreaux) November Notes from politicians (Attarian) 9:560-563
Today’s most influential economist? FEE “Wrecking”: the ominous rationale for
5:313-314 Defining state and society (McElroy) attacks on the tobacco industry
Vienna and Chicago: a tale of two 4:223-227 (Hager) 11:689-690
schools. 2:117-119 Is anyone still for limited government? TODAY'S most influential economist?
What's left of Marxism? 8:500-501 (Bandow) 9:551-552 (Skousen) 5:313-314
Why are Austrians unusually bearish? See also Government TRADE deficit: much ado about nothing
1:54-55 STATISTICS (Reed) 12:716-717
SMUGGLED cigarettes, unteachable Burn your house—boost the economy TRANSPORTATION
politicians (Attarian) 9: 560-563 (Parks) 3:178-179 Roads without the state (Samuel) 1:24-30
SNYDER, Jeffrey R. Discrimination by the numbers: lies, TRUST not in what your government can
Unrestrained appetites, unlimited damned lies, and statistics (Levy) do for you (Reed) 6:332-333
government. 5:285-289 10:591-594
SOCIAL cooperation, good intentions Statistics: a vehicle for collectivist
(Lee) 5:304-305 mischief (Wenders) 6:358-359 | -— V
SOCIAL justice (Williams) 7:447-448 STEELMAN, Aaron
SOCIAL Security The free market and scientific research. . .
Ax business welfare and privatize Social 5:260-262 US Diolnformation Agency (Palmer)
Security (Bandow) 3:159-161 See also Book peviews (Palmer) UNDERAGE drinking: Outmoded
How big government usurped personal STETSON, Brad. See Book reviews . }
rs . paternalism (Bandow) 8:467-468
responsibility (Leeson) 10:621-622 (Sleeper) . ,.
: . . UNRESTRAINED appetites, unlimited
If rates of return matter, Social Security STEVENS, Richard W.
. } ? Cr. . government (Snyder) 5:285-289
is a goner (Reed) 9:533-534 The “human rights” deception. .
. . UPHAM, David
Social Security can be good for your 12:731-733 . :
. The primacy of property rights and the
health (Lee) 3:132-134 STOCK market . ;
: . . American founding. 2:79-83
SOCIAL theory, society Why are Austrians unusually bearish? ; .
- . See also Book reviews (Lind)
Defining state and society (McElroy) (Skousen) 1:54-55 .
. JO URE, Dr. Andrew: pioneer free trader
4:223-221 SUMNER, Willem Gham (Chodes) 10:604-606
Economics, law, and personal The conquest of the United States by ,
: : . VANCE, Laurence M. See Book reviews
relationships (Laband and Sophocleus) Spain. 12:743-748 . .
. . (Kincaid; Lefkowitz; Richburg)
1:13-15 SUPREME Court. See Wickard VASQUEZ, Ian
Government and the market: chicken or SUSTAINABLE development: common , . .
2 (Hood) 3:169-171 Sn The IMF's dubious purpose 10:600-601
egg? (Hood) 3: sense or nonsense on stilts? (Taylor) I.
) . . . VIENNA and Chicago: a tale of two
Human ignorance and social engineering 9:545-550
. schools (Skousen) 2:117-119
(McElroy) 5:278-282 VOTING
Natural society revisited (Pilon) 6:344-346 Regard] f choi te! (Read
Who pays the price for motherhood? estes " oice, vote! (Read)
(Levatter and Geshelin) 1:31-33 T )
SOCIALISM
Idiocy of autocracy (Richman) 6:356-357 W
“Let ‘em skate!”: defeating local TAIWAN model (Macaulay) 7:422-426
socialism (Leef) 5:274-277 TAXATION
Murderous nostalgia (Bandow) How to reduce taxes (Read) 4:202-206 WADE, Keith
11:668-669 Taxation by other means (Schulz) It’s a jungle out there! what we can learn
Regulators: the new socialists (Reiland) 2:106-107 from the privatization of zoos.

2:94-95 TAXPAYERS at risk (Bandow) 2:97-98 8:464-466


===== PAGE 67 =====

INDEX 767

WALKER, Daniel F. WHOSE rules? whose law? (Walker) Women rights, continued
An earlier response to environmental 7:434-435 Individualist feminism: the lost tradition
tyranny. 4:228-230 WHY are Austrians unusually bearish? (McElroy) 8:494-498
WALKER, Jesse (Skousen) 1:54-55 “WRECKING”: the ominous rationale for
Whose rules? whose law? 7:434-435 WICKARD v. Filburn attacks on the tobacco industry
WALSH, Dale E. Unrestrained appetites, unlimited (Hager) 11:689-691
Character and government policy. government (Snyder) 5:285-289
7:394-397 WILD West meets cyberspace (Morriss)
WE can do better than government 7:427-431
inspection of meat (Pasour) 5:290-295 WILLIAMS, Walter E.
WENDERS, John T. Pursuit of happiness column:
Campaign finance: the sympton, not the Discrimination and liberty. 4:255-256 Y
problem. 2:88-89 Fairness: results versus process
Democracy would doom Hong Kong. 10:639-640 YANDLE, Bruce
1:43-45 Social justice. 7:447-448 The golden age at risk. 12:724-728
Statistics: a vehicle for collectivist WILSON, Tadd See also Book reviews (Brubaker;
mischief. 6:358-359 The culture of classical liberalism. Delong; Marzulla and Marzulla)
WHAT is this thing called “sprawl”? 12:736-740 YATES, Steven. See Book reviews
(Reed) 10:595-596 WOLFE, Claire (Schmidt)
WHAT'S left of Marxism? (Skousen) A number, not a name: big government YEAGER, Leland B. See Book reviews
8:500-501 by stealth. 5:298-303 (Cowen)
WHITE magic (Read) 1:10-12 WOLLSTEIN, Jarret B. YOUNKINS, Edward W.
WHO pays the price for motherhood? Nightmare in green 9:540-544 Cinema and the capitalist hero.
(Levatter and Geshelin) 1:31-33 WOMEN, women’s rights 6:383-384
WHO wins in strikes? (Baird) 8:511-512 Are women being victimized by the Individualism and freedom: vital pillars
WHOSE choice? whose responsibility? market? 4:207-208 of true communities. 1:51-53
(Richman) 10:578-579 Gertrude B. Kelly: a forgotten feminist YUGOSLAVIA: Folly of economic
WHOSE kids are they? (Boaz) 10:607-609 (McElroy) 10:623-627 warfare (Bandow) 10:602-603

BOOKS

(Reviewer’s name in parentheses)

AHMAD, Imad-ad-Dean. Islam and the FARIA, Miguel A, Jr., M.D. Medical JOHNSTON, James D. Driving America:
discovery of freedom (Lecf) warrior (Meier) 12:753-754 your car, your goverment, your
9:570-571 FOLSOM, Burton W., Jr. Empire builders choice (Semmens) 11:699-700

BALLONOFF, Paul. Energy: ending the (Leef) 3:184-185 KEATING, Raymond J. New York by the
never-ending crisis (Ellig) 10:636-637  GELERNTER, David. Drawing life: numbers: state & city in perpetual

BLACKMAN, Paul H. (co-author). surviving the Unabomber (Attarian) crisis (Peterson) 1:58-59
See Kopel 7:444-445 KELLEY, David. Unrugged individualism:

BRAY, Thomas J. Unconventional GOLDSMITH, Stephen. The twenty-first the selfish basis of benevolence
wisdoms: the best of Warren Brookes century city (Leef) 7:443-444 (Cohen) 11:698-699
(Murray) 3:186-188 GOODWIN, Charles Stewart. The arc of KINCAID, Cliff. Global taxes for world

BROWNE, Harry. How I found freedom in the pendulum: a philosophy for government (Vance) 9:573
an unfree world (Leef) 12:751-752 government in the 21st century KIRKPATRICK, Melanie (co-author).

BRUBAKER, Elizabeth. Property rights in (Holcombe) 10:635-636 See Johnson
the defence of nature (Yandle) GORDON, John Steele. Hamilton's KLEIN, Daniel B., ed. Reputation: studies
6:373-374 blessing (Timberlake) 2:123-124 in the voluntary elicitation of good

CONTOSKI, Edmund. Makers and takers: GREIDER, William. One world, ready or conduct (Attarian) 3:190-191.
how wealth and progress are made not: the manic logic of global KOPEL, David B. and Blackman, Paul H.
and how they are taken away or capitalism (Kober) 2:127-128 No more Wacos: what’s wrong with
prevented (Hager) 6:375-376 HAYEK, F.A. (ed. Bruce Caldwell) The federal law enforcement and how to

COWEN, Tyler. Risk and business cycles: collected works of F. A. Hayek Volume fix it (Reynolds) 2:121-122
new and old Austrian perspectives 10—socialism and war (Leef) 2:124-125 KRAUSS, Melvyn. How nations grow
(Yeager) 9:571-572 HAZLETT, Thomas W. and Spitzer, rich: the case for free trade (Griswold)

DANIELSON, Michael N. Home team: Matthew L. Public policy toward 6:378-380
professional sports and the American cable television: the economics of rate LANDSBURG, Steven E. Fair play:
metropolis (Keating) 11:696-698 control (Ekelund) 12:754-755 what your child can teach you

DAVIDSON, James Dale and Rees-Mogg, HAZLITT, Henry. Is politics insoluble? about economics, values, and the
Lord William. The sovereign (Leef) 1:57 meaning of life (Boudreaux)
individual (how to survive and thrive HOLMES, Kim R. (co-author). See Johnson 5:315-316
during the collapse of the welfare HORNBERGER, Jacob G. and Ebeling, LEFKOWITZ, Mary. Not out of Africa
state) (Kaza) 2:126-127 Richard M., eds. The tyranny of gun (Vance) 3:185-186

DELONG, James V. Property matters control (Leef) 6:376-377 LIEBERMAN, Myron. The teacher unions
(Yandle) 6:373-374 HUBER, Peter W. Law and disorder in (Leef) 4:249-250

DeVOS, Dick. Rediscovering American cyberspace (Singleton) 10:634-635 LIND, Michael, ed. Hamilton's republic:
values (Leef) 5:316-317 JOHNSON, Bryan T.; Holmes, Kim R.; and readings in the American democratic

EBELING, Richard M. (co-editor). Kirkpatrick, Melanie. 1998 index of nationalist tradition (Upham)

See Hornberger economic freedom (Peterson) 7:441-442 11:701-702


===== PAGE 68 =====

A)

768 THE FREEMAN ee DECEMBER 1998

LOTT, John R., Jr. More guns, less crime: RICHBURG, Keith B. Out of America SIEGAN, Bernard H. Property and freedom
understanding crime and gun control (Vance) 3:185-186 (Leef) 8:507-508
laws (Kopel) 12:752-753 ROBERTSON, A. Haeworth. The big lie: SIEGEL, Fred. The future once happened
LUKAS, J. Anthony. Big trouble what every baby boomer should know here: New York, D.C., L.A, and the
(Kendrick) 10:637-638 about social security and medicare fate of America’s big cities (Ikeda)
MACHAN, Tibor R. Generosity: virtue in (Attarian) 1:60-61 11:695-696
civil society (Cohen) 11:698-699 ROCHE, George. The book of heroes: SIMON, William E. (author of foreword).
MARZULLA, Nancie G. and Roger J. great men and women in American The Templeton honor rolls for
Property rights: understanding history (Folsom) 10:633-634 education in a free society, 1997-1998
government takings and environmental ~~ RORTY, Richard. Achieving our country (Peterson) 3:188
regulation (Yandle) 6:373-374 (Leef) 11:694-695 SIMON, Julian. The ultimate resource 2
McCHESNEY, Fred. Money for nothing: ROSENTRAUB, Mark S. Major league (Pasour) 4:250-251
politicians, rent extraction and losers: the real cost of sports and SINGER, Fred S. Hot talk, cold science:
political extortion (Meiners) who’s paying for it (Keating) global warming’s unfinished debate
4:251-252 11:696-698 (Bolch) 7:442-443
McGUINNESS, Diane. Why our children ROSS, John. Unintended consequences SLEEPER, Jim. Liberal racism (Stetson)
can’t read and what we can do about it (Hospers) 1:59—60 8:503-504
(Blumenfeld) 8:502-503 ROTHBARD, Murray N. The ethics of SOWELL, Thomas. Conquests and cultures
McKENZIE, Richard B. The paradox of liberty (Richman) 12:755-756 (Leef) 10:632-633
progress: can Americans regain their SALINS, Peter D. Assimilation, American SPITZER, Matthew L. (co-author).
confidence in a prosperous future? style (R. Simon) 3:189-190 See Hazlett
(Heyne) 4:252-254 SCALIA, Antonin. A matter of STINE, G. Harry. Halfway to anywhere:
NAIMAN, Arthur (co-author). interpretation: federal courts and the achieving America’s destiny in space
See Zepezauer law (Skoppek) 1:62-64 (Keating) 3:183-184
NOVAK, Michael. The fire of invention: SCHMIDT, Alvin J. The menace of TEMPLETON honor rolls for education in
civil society and the future of the multiculturalism (Yates) 1:61-62 a free society, 1997-1998 (Peterson)
corporation (Hood) 7:440-441 SHAFFER, Butler. In restraint of trade: the 3:188
PALMER, R. R,, ed. J.-B. Say: an business campaign against competition, ~~ WEAVER, Henry Grady. The mainspring of
economist in troubled times 1918-1938 (Folsom) 5:317-318 human progress (Peterson) 6:372-373
(Steelman) 8: 508-509 SHILS, Edward. The virtue of civility: YANDLE, Bruce. Common sense and
PHELPS, Edmund S. Rewarding work: selected essays on liberalism, common law for the environment:
how to restore participation and self- tradition, and civil society (Sirico) creating wealth in hummingbird
support to free enterprise (Baird) 8:506-507 economies (Hill) 8:504-505
6:337-338 SHUGHART, William F. II, ed. Taxing ZEPEZAUER, Mark and Naiman, Arthur.
REES-MOGG, Lord William (co-author). choice: the predatory politics of fiscal Take the rich off welfare (Steelman)

See Davidson discrimination (Cordato) 11:700-701 2:122-123