Book Reviews

High tech comes out of the labora tories and off the blackboards of chemists and physicists-it is pre eminently of the mind. The money that is to be made from the proper application of such aca demic sources so far outruns what Massachusetts can derive from cod fish and cranberry juice that it is ri diculous to think about it. Even so, the application of mind to the pack aging of cranberry juice in water and airproof paper! containers and the wrapping of fish in plastic bears out Mr. Brookes's thinking. Indeed, as 755 756 THE FREEMAN December George Gilder points out in a fore word, Mr. Brookes's career as a businessman consisted largely of re educating the entire meat industry in its marketing practices. Believ ing in Cryovac, a saran-type plastic package used mostly for frozen poul try, Mr. Brookes showed his col leagues that saran could be used to wrap and box all the appropriate cuts of fresh red meat at the slaughter house, thus doing away with much of the work done expensively by re tail butchers.

Erhard Advises Kennedy The trouble with the politicians who represent Mr. Brookes's state in Washington is that they still think in terms of a retail butcher constit uency. This was not always true of the Massachusetts politico. Mr. Brookes has a great fondness for the memory of President John F. Ken nedy, who believed in the Laffer Curve before Laffer. .Brookes re minds us that it was Chancellor Ludwig Erhard of West Germany who first impressed it upon young John Kennedy that ciItting high marginal tax rates would payoff even more for the masses than the classes. When Kennedy visited Germany in 1961, Erhard, a Mont Pelerin disci ple of Mises, Roepke and Hayek, told him to avoid the British high tax model, to stop punishing wealth cre ation and to cut America's "egre giously high wartime tax rates." Kennedy took Erhard's advice, overriding his own "liberal" advis ers. He made his tax-cut case in words that would "have delighted both Andrew Mellon and Ronald Reagan." When his tax bill passed in the early days of Lyndon John son, before the high spending of the Great Society and the Vietnam War was inflicted upon us, America, in Kennedy's words, "began moving again." Personal savings jumped from an average annual growth rate of 2 per cent to 9 per cent. Business investment went from 2 per cent to more than 8 per cent. Within two years the Gross National Product had increased 20 per cent, and unem ployment had declined by 33 per cent.

Even Walter Heller, the Keynesian economist who had tried to stay Kennedy's hand, had to admit that the tax cuts, anticipating Laffer, had paid for themselves "in increased revenues." Thus "trickle down" trickled out to help government it self as well as the little man strug gling to make it to a higher income tax bracket. A Democratic governor, Edward J. King, got the idea and proceeded to put Massachusetts on the Laffer Curve by reducing local taxes. Un fortunately, Senator Edward Ken nedy and his House of Representa tives colleague Tip O'Neill have failed to appreciate the wisdom,that Ludwig Erhard conveyed to John F. Kennedy a full generation ago.

1982 THE ECONOMY IN MIND 757 The Case For Deregulation A lesson for OPEC What Warren Brookes tries to bring home to his readers in Boston and elsewhere is as old as Adam Smith and J. B. Say, who believed that ideas could payoff in unham pered production if they were al lowed to flow without the attention of the politico in· search of special privilege for a limited constituency. We have seen what could happen to please the almost universal constit uency of automobile owners when Jimmy Carter and Ronald Reagan deregulated oil prices. OPEC has never been the same since. Brookes, not satisfied with the trouble we have already made for the OPEC energy cartel, wants to ex tend deregulation to natural gas sooner rather than later. He notes that three separate studies, one of them by the Colorado School of Mines, show that there is plenty of gas in the continental United States to make oil imports from the Middle East unnecessary once factories and utilities have been converted to nat ural gas or easily accessible coal.

According to Dr. Paul Hastings Jones, "geo-pressured methane" gas in deep Gulf Coast brines could con,. tain 50,000 trillion cubic feet of gas. This is for the far future when we really need to drill deep. There are much more available reserves that would be tapped quickly if the price were permitted to swing free. Mr. Brookes goes to Canada to prove his point. When Canada dere gulated new gas:it completely trans formed western Canada's "lei surely" petroleum industry within two years. The new gas discoveries piled up a surplus that Canada was happy to sell to the United States at enhanced prices, meanwhile freeing oil for gasoline use in cars both in the U.S. and in Canada itself. Reagan know~ all this, but he has not yet mustered the political cour age to do for gqS what has already been done for oil. So we continue to have a natural gas shortage. As William Tucker of Harper's maga zine, quoted by Brookes, puts it, "without the fqreign oil needed to make up for th~ natural gas short age, OPEC would be about as impor tant to the American economy as a Turkish bazaar.'"

Brookes is marvelous when it comes to using. statistics, but he is just as good when he deals in moral categories. No ipdividual or nation, he says at one point, "ever became rich through envy. Nothing useful or constructive was ever created through envy. No business ever suc ceeded through! envy. No jobs were ever created through envy. Envy in reality is the single most impover ishing attitude of thought." This is only one of Brookes's small sermons. A preacher could live off the grist provided by this book for·a year. , 758 THE FREEMAN December THE PATH OF DUTY by Leonard E. Read (The Foundation for Economic Education, Inc., Irvington-on-Hudson, N.Y. 10533), 1982 128 pages - $7.50 Reviewed by Perry E. Gresham Leonard Read has done it again. His new book is called The Path ofDuty. Most tables of contents are dull de scriptive material, but this one is as exciting as the fetching illustrations that appear in a seed catalog. Each one suggests a bright and winning idea which is well-nigh irresistible.

Here they are-all 26 ofthem-fol lowed with a very useful index. 1. The Path of Duty 2. The Purpose of Wealth 3. How To Become a Millionaire 4. Vanity and Virtue 5. The Limits of Knowledge 6. Poverty Has Its Advantages 7. The Enjoyment of Truth 8. Several Facets of Freedom 9. Education For Virtue 10. My Rights Are Your Rights 11. Fearless and Free 12. Self-Improvement 13. Exalting The Common Good 14. Choose Statesmen, Not Politicians 15. The Source of Progress 16. Say "Yes" To Life 17. Kindness and Intelligence 18. Sublime Example 19. Earnest Resolution 20. Attraction 21. A Benefactor To Mankind 22. Govern Thyself 23. There Is Time Enough 24. Sweet Land of Liberty 25. To Aspire After Virtue 26. Greatness Walter Scott inspired the titIe es say with his shrewd remark, If you have no friends to share or re joice in your success in life-if you can not look back to those to whom you owe gratitude, or forward to those to whom you ought to afford protection, still it is no less incumbent on you to move stead ily in the path of duty; for your active exertions are due not only to society; but in humble gratitude to the Being who made you a member of it, with powers to serve yourself and others.

His chapter "The Purpose of Wealth" contains an autobiographi cal insert which suggests the reason for Leonard Read's success in found ing and maintaining the Founda tion for Economic Education. Said Read, My annual salary when General Man ager of the Los Angeles Chamber of Commerce in the early forties was $18,000. One day the head of the coun try's largest insurance company offered me the job of heading their affairs in the seven western states. Said he, "Leonard, I do not know how much you will earn but I guarantee it will not be less than $100,000." I replied, "No, thank you." Read turned down this offer because his life was devoted to the under standing and the promulgation of freedom as a way of life.

1982 OTHER BOOKS 759 Leonard Read's contention is that a person can become a millionaire by thinking a million great thoughts. This is not only a sublimated mil lionaire but an actual one, for these million great thoughts payoff in the marketplace. This little volume continues to range over such interesting thoughts as the advantages of poverty. One of our very great Americans was called to Harvard University where his son was in school. The son was in trou ble. The father, whose name is a household word in America, was outraged by his son's behavior and said to the student, "Why on earth would you do this? Such action would have been unthinkable in my stu dent days." The student answered, "Dad, I did not have the advantage of being poor." For Read one of the great values of the philosophy of liberty is the en joyment it brings to the people who attempt to practice it. There is noth ing grim and dour about Read's eco nomic philosophy. No one would have ever called ·economics "the dismal science" had Read been the princi pal writer at that time. Liberty and truth are to be enjoyed-not en dured.

In chapter 8 Read reaches back to John Stuart Mill who says, "T}:1eonly freedom which deserves the name, is that of pursuing our own good in our own way, so long as we do .not at tempt to deprive others oftheirs, or impede their efforts to obtain it." That genius who wrote so clearly about liberty was so schooled that he studied himself into a contradic tory socialist viewpoint. Fortu nately, his great book on liberty makes amends for his other mis takes. One particularly helpful passage in The Path of puty' has to do with the penchant of 4mericans to choose second-rate people for high public office. Leonard Read uses Burke for his opening statement in chapter 10 and proceeds to. show how we can stay free in spite of the politicians. There is a destiny above and beyond us which brings, us back to liberty time and time again. One of my best friends in his later years said, "When I was young, I judged people o~ the basis of what they could do. Now that I am old, I judge them on the basis of how kind they are." Leonard Read's little book is a shining example of his kindly personality. He has no time to put people down, but only to identify the best in those around him in order that they might: be inspired to nob ler things.

The book concludes with a series of 15 quotatiolls pertinent to the qualities that. mark a pilgrim through this life with greatness. In this Read has performed the func tion that Plato ~entioned for every great teacher, which is to "hold be fore the young, a vision of great760 THE FREEMAN ness." This little book, The Path of Duty, does just that and each reader will be inspired. THE OMINOUS PARALLELS: THE END OF FREEDOM IN AMERICA by Leonard Peikoff (St~in &Day, Scarborough House, Briarcliff Manor, N.Y. 10510), 1982 383 pages - $16.95 Reviewed by Robert James Bidinotto GERMANY was the "land of poets and philosophers" -an educated, indus trialized, civilized nation that took pride in its artists, thinkers, and culture. Yet it first appeased, then elected, then obediently followed a man who led it into a global, sys tematic campaign of aggression, racism, horror, and mass extermi nation that defied all reason, values, and precedent.

Dr. Peikoffs thesis is that the seemingly incomprehensible mad ness of National Socialism seized Germany not in spite of, but pre cisely because of, her "poets and phi losophers." The "ominous parallels" are that similar ideas-and the cul tural consequences-are sprouting in America today. , It is a sobering thesis, and controversial: few readers, even those sup porting the free market, will fail to be challenged by at least some of Dr. Peikoffs indictments. As the chief spokesman for the late Ayn Rand's Ojectivist philosophy, he attacks some popularly accepted philosoph ical and moral ideas. But therein lies much of the book's value. Nobody can come away from this work without a better grasp of how ideas rule the practical lives of men, and without a deep re-examination of his own basic convictions. Perhaps the most impressive as pect of Dr. Peikoffs analysis is its scope. It is a wide-scale synthesis of the history of certain philosophical ideas, and their cultural manifesta tions, in both the Old World and the New. Among the fields traversed are the arts (from music to architec ture), science, religion, political and economic theory and history, educa tion, psychology, even cult fads, in both Germany and America. The writing is clear, colorful, and well organized; and the many subjects are always linked by reference to a few basic principles.

Dr. Peikoff concludes his book with a short, systematic summary of the Objectivist philosophy, a neo-Aris totelian theory offered as an anti dote to the doctrines he has indicted. Even those who might disagree will find within these pages the best brief condensation of Ayn Rand's system in print. @ Index THE FREEMAN-Volume 32, January-December 1982 Prepared by BETTINA BIEN GREAVES of the Foundation staff NOTE: In page references, the number preceding the colon designates the month, those following refer to pages. All articles have at least three entries-author, subject, and title-except in a few cases when title clearly indicates subject matter. Books reviewed are listed on page 768. A ABSTRACTconcept of human liberty (LeFevre) 12:742 747 ADAM SMITH'S economics of freedom (Montgomery) 1:47-54 AFRICA Cut-throat opportunities (North) 6:347-364 First-world wealth and third-world poverty (Davis) 11:678-684 AMERICAN idea (Bradford) 10:627-631 ANARCHY Elements of a fair system of taxation (Foley) 9:528 541 Rothbard's liberty reviewed (Hospers) 8:468-484 Source of sovereignty (Foley)3:167-175 AND now for some good economicnews! (Shannon) 1:12 14 ANDERSON, Bill Deficits are not the only problem. 10:587-591 Economic democracy. 11:651-659 ANTIBUSINESS/capitalistic bias Capitalism-hero or culprit? (Bradford) 12:750-754 Corporate mergers: (Richman) 5:282-285 First-world wealth and third-world poverty (Davis) 11:678-684 Intellectuals, moralists, and the free market (Wil liams) 2:111-121 Relics of intervention, #2 (Carson) 5:305-317 Social role of business (Foley)10:611-626 ARGENTINA on the brink (Sennholz) 12:716-727 ASIA Economic growth in Taiwan: invisible factors con tributing to economic development in the Republic of China (Liu) 3:131-138 First-world wealth and third-world poverty (Davis) 11:678-684 ATHLETICS, college Fine art of cheating (Foley) 11:643-649 B BECHARA, Dennis Cutting the budget. 4:225-228 Development of Puerto Rico, The. 10:592-604 Freedom for less developed countries. 2:104-110 BEYOND the Christmas story (Carson) 12:707-713 BlDINOTTO, Robert James Guide to principled seW·defense,A. 12:728-734 See also Book reviews (PeikoID BIG BUSINESS Corporate mergers (Richman) 5:282-285 Rebirth of economic freedom (Douglas) 11:662-672 BIG little governments (McGath) 6:344-346 BRADFORD, Ralph American idea, The. 10:627-631 Capitalism-hero or culprit? 12:750-754 BRIGANDS and the bargainers (Ross) 9:515-519 BUREAUCRACY, productivity and inflation (Isaacs) 2:88-93 BURNHAM, Raymond M., II Key to success, The: do.unto others. 12:714-715 c CAMPAIGN for EconoJn1.cDemocracy (Fonda & Hay den) Economic democracy (Anderson) 11:651-659 CANADA damaged by. faulty theories (McDonald) 10:605-610 CAPITALISM and greed (Doti) 11:673-677 CAPITALISM, defender ,of-Ludwig von Mises (Reis man) 7:432-439 CAPITALISM-hero or qulprit? (Bradford) 12:750-754 761 762 THE FREEMAN December CARSON,-Clarence B.