October

383 When Voting Makes No Sense Tibor R. Machan How does one vote responsibly in an era of omnipresent government? 385 Capitalism and the Jews Milton Friedman Why is it that despite the historical record of the benefits of competitive capitalism, the Jews have been disproportionately anti-capitalist? 395 Public Policy Debate: The Rigged Game John Semmens Government bureaucrats and professional politicians have certain advantages in slanting public policy debate in favor of their own interests. 397 The Line-Item Veto Won't Work Cecil E. Bohanon and T. Norman Van Cott Fact and theory tell us that the line-item veto power will not accomplish what its proponents intend. 400 William H. Hutt, 1899-1988 Richard M. Ebeling In memory of an unflinching proponent of the competitive market order. 402 ·John D. Rockefeller and the Oil Industry Burt Folsom The story of an astonishing entrepreneur and philanthropist.

413 A Reviewer's Notebook John Chamberlain A review of Charles Leslie Glenn, Jr. 's The Myth of the Common School. 415 Other Books: The Supreme Court's Constitution: An Inquiry into Judicial Review and Its Impact on Society by Bernard H. Siegan. CONTENTS OCTOBER 1988 VOL. 38 NO. 10 THEFREEMAN IDEAS ON LIBERTY Published by The Foundation for Economic Education Irvington-on-Hudson, NY 10533 President of the Board: Bruce M. Evans Vice-President: Robert G. Anderson Senior Editors: Beth A. Hoffman Brian Summers Contributing Editors: Bettina Bien Greaves CarlO. Helstrom, III Jacob G. Hornberger Edmund A. Opitz Paul L. Poirot 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: Thomas C. Stevens, chairman; Ridgway K. Foley, Jr., vice-chairman; Paul L. Poirot, secretary; H.F. Langenberg, trea surer.

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. Additional single copies $1.00; 10 or more, 50 cents each. For foreign delivery, a donation of $15.00 a year is required to cover direct mailing costs. Copyright © 1988 by the Foundation for Economic Education, Inc. Printed in U.S.A. Permission is granted to reprint any article in this issue, except "Capitalism and the Jews" and "John D. Rockefeller and the Oil Industry," provided appropriate credit is given and two copies of the reprinted material are sent to The Foundation. Bound volumes of The Freeman are available from The Foundationofor 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, WI 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 Reprise Twenty years ago, at the time of another presidential election, I wrote my first little essay that appeared in The Freeman. It was called, "Each on His Own White Charger." (October 1968) The theme was simple: The challenges of the time were to be solved by each of us acting morally and responsibly, not by some "polit ical savior" on a white horse magically ap pearing in our midst with cure-aIls. Though two decades have passed, the chal lenge for believers in the market economy and limited government remains the same. There are those who will argue that the cause of individual freedom has made progress. I would politely disagree. Our affairs private and public remain too much at the whim of con gressmen, judges, bureaucrats, and a host of others. And, for every deregulation of business that has occurred, new burdens can easily be cited.

If anything, with the continued inflation of the money supply, and the passage of more and more laws, the task before us is as difficult as ever. Each person living the most exemplary life he or she can continues as the best means for pursuing the ideals and the benefits of the free market and limited government. We know we are surrounded by statists, so cialists, and technocrats of varying tones. We know, too, we are forever being urged to com promise the virtues of individuality and free en terprise in the name of societal goodness, an alleged fairer distribution of goods and ser vices, and one-worldness. The pity of these pleas is that those who make them disregard the uncoerced market as the place where the fulfillment of what they seek is most likely to occur. They prefer the use of the police power, the State, in the achieve ment of their ends. Mankind must have a code by which to live.

The code existed before the creation of any current government. But the dos and don'ts of the Commandments and the Golden Rule do PERSPECTIVE not satisfy those who would create an improved (?) society by forcing everyone into their own molds at gunpoint. What would happen to society and to the world if people truly respected one another, if people recognized that despite all efforts to ed ucate and to civilize there always will be the unfit and the antisocial? The harmony, the caring society and world we seek, are not to be found through the use of force in the peaceful activities of people whether it be in the arts, education, or the man ufacture of patty cakes. Salvation begins and ends with each of us as individuals. No one can instill it except our selves. We can and do have teachers to help us understand and see, but the adoption of the final product depends upon ourselves. That has not changed in twenty years, nor will it in twenty times twenty more.

- EARL ZARBIN Tokyo's Farmers About 120 million people now live in Japan, 25.5 million of them in the huge Tokyo-Yoko hama megalopolis. Because of soaring land prices, most Tokyo residents live in tiny homes or apartments, developers are resorting to con structing shopping malls underground, and one Japanese company is even planning floating of fice buildings to moor in Tokyo Bay. Yet Yukio Noguchi, professor of public fi nance at Hitotsubashi University, argues that Tokyo does not suffer from an insufficient amount of land in absolute terms. (Look Japan, February 1988) Japan's population density, in fact, is similar to that of southern New Eng land. Then why the soaring land prices? As Japan's population has grown, its cities have expanded and swallowed up surrounding territory. But the farmers' rice paddies have often been encircled and left intact. According to Robert Chapman Wood, writing in the No vember 16, 1987, issue of Forbes, "Tokyo farms can be worth $230 and more per square foot (commercial land on Park Avenue in New York can command $65 per square foot), and their value has been rising at up to 50 percent per year." But few suburban farmers sell. Why should they? They are taxed only on the value of their land for agricultural purposes, while they face enormous capital gains taxes if they sell. And if they can't make a profit in the suburbs, local governments often give them a special subsidy.

Some rice paddies have been converted to housing in recent years, but nowhere nearly enough to dent the housing shortage. Only 47 per cent of the land within metropolitan Tokyo has been developed. And 30 per cent of metro politan Tokyo is still used for farmland. As Wood points out, Japan "maintains a maze of regulations and tax benefits that at tempt to protect farms, tenants, rickety old urban houses, and small stores from the modem world." Because of these regulations and taxes, "Tokyo's residents live in minus cule apartments and houses." Japanese rice farmers enjoy a privileged status because urban Japanese "want to live the life of a farmer vicariously." But they must pay the price-as taxpayers, in the form of subsidies; and as consumers, in the form of crowded living space. -BBG The Value of the Market The central value of the free market is that it is inextricably intertwined with human freedom, both spiritually and materially. What the past 50 years of the world socialist experi ment have demonstrated beyond reasonable doubt is that if human beings are to be free in spirit and of mind, they must first be free to make their individual market choices. Deprived of the latter, they are automatically deprived of the former. Granted freedom of spirit, they de mand freedom of the marketplace.

-CHARLES D. SNELLING 380 THEFREEMAN IDEAS ON UBERTY Fairness and Justice: Process vs. Results by Walter E. Williams I n pursuit of what Friedrich A. Hayek calls • "the mirage of social justice," Americans have turned their faces against liberal values and are rapidly embracing the immo rality of socialism. In an effort to achieve social justice, decent, well-meaning people who hold little brief for despotism are unwittingly laying its infrastructure. Throughout American history we have been recognized as the beacon and hope of the world's freedom-cherishing people. This repu tation was not earned because somehow Amer icans are congenitally morally superior people. To the contrary, our cultural-ethnic-religious mosaic consists of descendants of French, Eng lish, German, Irish, Jews, Greeks, Italians, Japanese,Chinese, Africans, Protestants, Cath olics, and a host of other divisions of people who have been slaughtering one another in their homelands for centuries.