September

327 Socialized Stadiums Robert A. Baade and Diane Carol Bast Subsidized stadiums may not be an economic win for sports fans. 329 A Line-Item Veto Hans F. Sennholz The line-item veto power is no cure-all for the ills of deficit spending. 333 Scenario for a New Serfdom Andrew E. Barniskis Are we plunging into a new Dark Age? 336 Constitutional Restraints on Power Edmund A. Opitz Explicit provisions that limit the federal government. 340 The Hungarian Illusion James Bovard Hungary is not the socialist utopia its proponents claim. 348 Capitalism at a Crossroads: 1875-1900 J. Brian Phillips The relentless attack on the intellectual roots of capitalism. 352 Public Choice Theory: Not the Whole Story Tibor R. Machan What we know-and do not know-about the actions of politicians and bureaucrats. 357 Lessons from Computers and Helium Jane S. Shaw Government managers have little incentive to correct their mistakes.

359 A Reviewer's Notebook John Chamberlain A review of "The Silk Road: A History" by Irene M. Franck and David M. Brownstone. CONTENTS SEPTEMBER 1987 VOL. 37 NO.9 THEFREEMAN IDEASON LIBERTY Published by The Foundation for Economic Education Irvington-on-Hudson, NY 10533 President of the Board: Robert D. Love Vice-President of Operations: Robert G. Anderson Senior Editors: Beth A. Hoffman Brian Summers Book Review Editor: Edmund A. Opitz Contributing Editors: Howard Baetjer Jr. Bettina Bien Greaves Jacob G. Hornberger Paul L. Poirot Gregory F. Rehmke The Freeman is the monthly publication of The Foundation for Economic Education, Inc., Irvington-on-Hudson, NY 10533 (914) 591-7230. FEE, founded in 1946 by Leonard E. Read, is a nonpolitical educational champion of private property, the free market, and limited govern ment. FEE is classified as a 26 USC 501 (c) (3) tax-exempt organization. Other officers of FEE's Board of Trustees are: Bruce M. Evans, chairman; Thomas C. Stevens, vice-chairman; Joseph E. Coberly, Jr., vice-president; Don L.

Foote, secretary; Lovett C. Peters, treasurer. The costs of Foundation projects and services are met through donations. Donations are invited in any amount. Subscriptions to The Freeman are available to any interested person in the United States for the asking. Single copies $1.00; 10 or more, 50 cents each. For foreign delivery, a do nation of $10.00 a year is required to cover direct mailing costs. Copyright © 1987 by The Foundation for Eco nomic Education, Inc. Printed in U.S.A. Permis sion is granted to reprint any article in this issue, except "A Line-Item Item Veto" and "The Hungarian Illusion," provided appropriate credit is given and two copies of th.e reprinted material are sent to The Foundation. Bound volumes of The Freeman are available from the Foundation for calendar years 1969 to date. Earlier volumes as well as current issues are available on microfilm from University Micro films, 300 North Zeeb Road, Ann Arbor, MI 48106.

The Freeman considers unsolicited editorial sub missions, but they must be accompanied by a stamped, self-addressed envelope. Our author's guide is available on request. PERSPECTIVE The Road to Freedom "Sure, I believe in freedom. But we have to be practical. If we let our ideals get in the way, we risk losing everything. ' , Many of our well-meaning friends often reason this way. They point out that the polit ical debates now taking place are not between statism and freedom, but over various forms of government intervention. If you want to be rel evant, these friends tell us, you will have to meet the statists half way and try to push so ciety toward a milder form of statism. For the time being, we are told, we should forget about ideals. But is this, in fact, practical? These "friends of liberty" have been compromising for several decades, and what has it gotten them? The statists began by advocating a little socialism, and these "friends of liberty" countered with proposals which, in the final analysis, amounted to just a little less socialism. The po litical wheels turned and a consensus was reached. Having beaten back the worst pro posals for socialism, the "friends of liberty"

seemed to have won. But they also had lost. They had lost some freedom and, in the process, they had lost touch with basic principles. They no longer were talking about freedom as an ideal; instead, they were making comparative analyses of statist interventions. Perhaps without realizing it, many friends of liberty had begun talking the statist language of those who would control our lives through the political process. But then, with some victories under their belt, the statists upped the ante. They wanted more socialism. Our practical friends of liberty countered, not by standing for freedom as an ideal system but, all too often, by trying to ameliorate and shift the burdens of the statist interventions. Again the political wheels turned, and today the results are in: runaway budgets, soaring deficits, and an ever-ex panding maze of regulations. Fortunately, while the political trend has been toward statism, another trend has started.

Gradually, through the efforts of a few dedi cated people, it has again become respectable to talk about certain aspects of liberty. For ex ample, the idea of denationalizing money is getting a hearing. Abolishing the Postal Ser vice's monopoly on first class mail is being se riously considered. And privatization, a catchall phrase for many proposals, is now a political buzzword. Of course, it is still not fashionable to advo cate an unhampered market economy as an ideal system. But certain parts of that system are being considered. Through consistent dis cussion of principles and continued education, we may be approaching the point where prac tical "friends of liberty" will feel that they can propose outright repeal of government inter ventions-and statists will find our friends un compromising as we make our way along the road to freedom. -BJS Cambodian Communism Sophal Song, a student at Winona State Uni versity in Minnesota, describes her experiences in communist Cambodia: "Four years of my life, from the age of ten to fourteen years, were spent under communist rule. My family consisted of my parents, my grandmother, two sisters, and two younger brothers, one who was just a baby. The com munist tactic was to divide all family members so they wouldn't try to escape from the work camps, and so they separated family members into camps many miles apart. We didn't know if our family members were alive or dead, but we had to live with the hope that they were sur viving.

"The communists separated my two sisters and me into three different camps. They put my mom with a group of women who worked on a farm in the valley and my dad worked in the field with a group of men, cutting wood, building roads, and so forth. My camp was for children seven to twelve years old. We weren't allowed to visit our families. The communists taught us to work the farms and to obey their rules. I missed my family very much so one day I escaped to see my mom, but they caught me and wouldn't give me any food for a whole day." That was not the end of Sophal Song's PERSPECTIVE struggle. Her mother died of malnutrition in 1978. Her father also perished. In 1982, she came to the United States with her grand mother, two sisters, and two brothers. Al though Sophal is thankful for her freedom, she still grieves for what she has lost. She con cludes, "The free world must know that com munism doesn't work. It is deadly. It cripples the mind and the spirit. We must always work hard to protect our freedom and to fight any force that threatens to destroy it. ' , The Minimum Wage "A minimum wage increase eliminates jobs by encouraging businesses to seek ways to lower overall labor costs. Some firms automate to avoid higher wage payments. Employers also make up for cash wage hikes by reducing fringe benefits. . . .

"Minimum wage legislation hurts most those who have the most to gain from employ ment-poor youths, especially blacks. It is ironic that American liberals are pushing a higher minimum wage, which also has been promoted by South African racists. While the Americans don't have racist intentions, they should understand, as the Afrikaners did, that the minimum wage favors better-educated and -trained white youths over their black counter parts.... "The minimum wage clearly strengthens only one group-unions, whose wage rates be come more competitive when minimum wage legislation lifts the level of nonunion compen sation-while it clearly harms many others. In .the end only improved productivity and eco nomic growth-not higher wage levels-can increase general prosperity. ' , -from an editorial in The Detroit News, March 3, 1987 What's New at FEE? The September Notes from FEE features ex citing news about our expanded program of re gional seminars. Accompanying the Notes is our annual book catalogue. This special mailing should reach you by September 20.

Extra copies are available by calling or writing to FEE.