Book Reviews

In a condensation of his own book, Mr. Libecap remarks that private parties, leasing sections of the 174 million acres of public land from the Bureau of Land Management in the Department of the Interior, have not had the economic incentive to make necessary improvements on the range property that supports their cattle. The result is that the lands remain below their production po tential. The environmentalists, faced with the evidence that there has in deed been overgrazing and a conse quent depletion of range fertility, have reacted by calling for more regulation and "multiple use." But who can be trusted to regulate the regulators and to decide on alterna tive employment for acres which re sist the growth of anything but grass or lowlying brush? Private Ownership Secretary Watt's answer is to offer some of the western public lands for sale to private ranchers. He has, naturally, been excoriated for the very suggestion. Nevertheless, in his attitude, Watt is the true Jefferso nian. As Jonathan R. T. Hughes of Northwestern University points out in a foreword to Mr. Libecap's book, what the architects of our original national land policy wished to avoid was a "suboptimal use based on un certain tenure." In planning the Northwest Ordinance of 1785, Thomas Jefferson wrote that the federal governm~nt should sell all its vast domain ito private owners, guaranteeing in'the purchase con tract that it should "never after, in any case, reve'irt to the United States." What J:efferson wished to avoid, says Jon~than Hughes, was government ownership of the means of production.

What Jefferson could not guess, despi te the reports of the Lewis and Clark expedition, was that land laws designed for the well-watered East needed a special adaptation to the vast territories of what was then known as the :Great American Desert. In the Ohio Valley, which was "west" to Jefferson, a small family could do very well on a quar ter section or more of land. The quarter section dominated the thinking of the architects of the Homestead Act. !Homesteading did handsomely by tne generations that took up land on the so-called Middle Border reaching 'from Wisconsin to 'where the water began to run out along the hundredth parallel of lat itude that bisects the Dakotas and Nebraska. But, as Jonathan Hughes puts it in graphic language, "the American wave of settlers and homesteaders exhausted itself on the edges and in the :seams of the west ern deserts." Dry-land farming had to depend on irrigation water that was problematical. The semi-arid 446 THE FREEMAN July grasslands west of the hundredth parallel could only support stock on vast reaches of terri tory. A General Land Office accustomed to doling out the continent in 160-acre patches could not cope with the necessities of cattle and sheep ranchers.

Overstocking and Overgrazing Unclaimed Public Lands The first cattlemen lived by "pre scriptive right," using the open range on a first-come, first-served basis. The barbed wire enclosure of the small holding was naturally anathema to the first cowpunchers. Compromises reached by the late Eighteen Eighties combined deeded home steads with renewable grazing rights on still unclaimed public lands. But as long as the grazing rights were subject to political manipulation, the temporary possessors were inclined to get the most out of the land while the going was good. Where a profit minded rancher would, under pri vate ownership, refrain from de stroying his own estate by overgraz ing it, the temporary renter of public domain would have no qualms. Without secure tenure, says Mr. Libecap, "ranchers ... were reluc tant to invest in range improve ments ... expected returns were apt to be low since any benefits would be spread among all herders."

Overstocking paid off in good years-but large herds were vulner able to sudden drought. When the rains did not replenish the range, ranchers were forced to dump their animals, with consequent disrup tion of the market. Insecure tenure, says Mr. Libe cap, encourages overstocking and discourages investing in wells and fences. Ranchers have to contend with a situation in which the Bu reau of Land Management adminis ters 23 per cent of the acreage in the eleven far-western states. The BLM controls nearly 70 per cent of Ne vada, more than 40 per cent of Utah, and some 20 per cent of Wyoming, Oregon, Idaho, Arizona, California, New Mexico and Colorado. According to Mr. Libecap, 75 per cent of the world's grazing lands which are facing depletion do not have secure tenure arrangements. He calls on Secretary ofthe Interior Watt to transfer the 174 million acres of rangeland under BLM control to private owners who would have per sonal stakes in judicious manage ment. Since the purpose should not be to generate real estate profits, but to improve the land, the sale price should be nominal.

There would, of course, be a great hullabaloo if Secretary Watt were to offer the whole 174 million acres for sale at once. But sales in selected spots would provide good laboratory tests. The times are propitious-and Secretary Watt is just the man to stand the gaff of temporary criti cism. ® 1982 OTHER BOOKS 447 THE MIDNIGHT ECONOMIST: CHOICES, PRICES AND PUBLIC POLICY by William R. Allen (Playboy Press, 747 Third Ave., New York, N.V. 10017), 1981 295 pages - $13.50 cloth Reviewed by Edmund A. Opitz By DAY he is an academicaUy cre dentialed professor of economics at a prestigious university, and he also heads the International Institute for Economic Research. But when night falls he gets on syndicated radio for a three minute commentary as The Midnight Economist. He is William R. Allen, an exceedingly well-inte grated dual personality. For the past several years I have been reading his scripts regularly.

Each one has but a single point to make, and makes it brilliantly. Al len has such mastery of his eco nomic philosophy that he brings precisely the relevant considera tions to the topic at issue, and no others. His treatment is witty, down to-earth, and devastating. Who says economics can't be fun? There's basic stuff here; topics like private property, the free market, money, the corporation. And, there are critiques of communism, con sumerism, government tinkering, pollution, energy, unionism, infla tion, tariffs, environmentalism, and the like . We discover that economics is not so much ,a new subject matter as a new way of looking at all sub jects. Ecology?: We all want to pre serve our natu~al resources; we want to save the whale. Listen to the economist and we'll realize that ecology is a subdivision of econom ics-and this will keep a lot of en vironmentalist,s off the streets. You dislike smog? Allen clears the air.

And much more. Read separately and at intervals, Allen's brief talks were vastly en tertaining. In' book form they are addictive. ® ANTITRUST AND MONOPOLY: ANATOMY OF A POLICY FAILURE by Dominick T. Armentano (John Wiley & So~s, 605 Third Ave., New York, N.V. 10158), 1982 292 pages - $22.95 cloth, $12.95 paperback Reviewed by Brian Summers THIS is an extehsive revision of Pro fessor Armentano's classic 1972 study, The Myths of Antitrust. The cases have been updated and the ar guments reinfotced. A good book has been made even better. All the major antitrust cases are carefully analyzed and thoroughly critiqued. The' economic history of each case is given, along with the important court decisions. Most of 448 THE FREEMAN these decisions, the author shows, penalized companies whose only crime was that they reduced costs, improved products, and thus served many willing customers. But such competitive processes are ignored by the practitioners of anti trust. They view competition, not as a market process aimed at winning customer approval, but in terms of the size and number of firms in a given industry. On these grounds, it has been easy to convict firms which grew because consumers preferred their products.

If a company grows by efficiently serving the buying public, who is to complain? Frequently, complaints are led by the company's rivals. Sometimes they attack the success ful firm by filing antitrust suits. Other rivals seek government fran chises, certificates of public conve nience, licenses, tariffs, price-sup port programs, and similar barriers to entry. The companies that hide behind these legal barriers are the true monopolists, but they receive scant attention from those who claim to protect the consumer's interests. Since the publication of The Myths of Antitrust, several prominent au thors have joined Professor Armen tano in criticizing the efficacy of an titrust. But his books remain the only major studies which consistently view competition as a dynamic pro cess, and oppose all antitrust on principle. Only through such prin cipled, carefully reasoned opposi tion will the antitrust laws be re pealed. @ HANDSOME BLUE LEATHERLEX FREEMAN BINDERS $4.00 Order from: THE FOUNDATION FOR ECONOMIC EDUCATION, INC.

IRVINGTON-ON-HUDSON, NEW YORK 10533 the Freeman VOL. 32, NO.8 • AUGUST 1982 The Relics of Intervention: 5. New Deal Welfarism Clarence B. Carson 451 The growing welfare burdens largely began in the New Deal of the mid-Thirties. The Illusion of a Riskless Society Elgin iGroseclose 464 The risks increase as the government intervenes. Rothbard's liberty Reviewed A critical review of "The Ethics of Liberty." John Hospers 468 Mixed Economies a No-Man's land Glenn l. Pearson 485 In the war between freedom and slavery, political intervention tends to enslave. Public Policy and the Free Economy Thomas J. Dilorenzo 492 Only the free economy is capable of achieving equity and prosperity. Book Reviews: 510 "The Subterranean Economy" by Dan Bawly Anyone wishing to communicate with authors may send first-class mail in care of THE FREEMAN for forwarding.