February

80 Human Rights Around the Globe by Tibor R . Machan Some philosophical observations on rights, freedom, and cultural differences. 81 Jury Nullification: Cornerstone of Freedom by Roger Koopman Today's jury system bears little resemblance to the system established by the Founding Fathers. 83 The Unseen Costs of Family Leave by Robert A. Sirico, CSP The Family and Medical Leave Act has, in effect, increased the costs of hiring women. 85 School Violence by John Hood Can safety and security be restored? 91 The New York Asbestos Debacle by Tim Brown Environmental hysteria in the nation's largest public school system. 93 Book Reviews The Rise and Fall of Leftist Radicalism in America by Edward Walter, reviewed by David Osterfeld; A Retrospective on the Bretton Woods System-Lessons for International Monetary Reform, edited by Michael D. Bordo and Barry Eichengreen, reviewed by Robert Batemarco.

THEFREEMAN IDEASON LIBERTY Published by The Foundation for Economic Education Irvington-on-Hudson, NY 10533 Phone (914) 591-7230 FAX (914) 591-8910 President: Hans F. Sennholz, Ph.D. Senior Editor: Beth A. Hoffman Guest Editor: Doug Bandow Editor Emeritus: Paul L. Poirot, Ph.D. Associate Editors: John Chamberlain Bettina Bien Greaves Edmund A. Opitz Book Review Editor: Robert Batemarco, Ph.D. Contributing Editors: Charles W. Baird, Ph.D. Doug Bandow Clarence B. Carson, Ph.D. Thomas J. Ditorenzo, Ph.D. Joseph S. Fulda, Ph.D. Roger W. Garrison, Ph.D. Robert Higgs, Ph.D. John Hospers, Ph.D. Tibor R. Machan, Ph.D. Ronald Nash, Ph.D. William H. Peterson, Ph.D. Richard H. Timberlake, Ph.D. Lawrence H. White, Ph.D. The Freeman is the monthly publication of The Foundation for Economic Education, Inc., Irvington-on-Hudson, NY 10533. FEE, established in 1946 by Leonard E. Read, is a non-political, educational champion of pri vate property, the free market, and limited government. FEE is classified as a 26 USC 50l(c)(3) tax-exempt organization.

Copyright © 1994 by The Foundation for Economic Education. Permission is granted to reprint any article in this issue, provided appropriate credit is given and two copies of the reprinted material are sent to FEE. The costs of Foundation projects and ser vices are met through donations, which are invited in any amount. Donors of $25.00 or more receive a SUbscriptionto The Free man. Student subscriptions are $10.00for the nine-month academic year; $5.00 per semester. Additional copies of single issues of The Freeman are $2.00. For foreign deliv ery, a donation of $40.00 a year is suggested to cover mailing costs. Bound volumes of The Freeman are avail able from FEE for calendar years 1972 to date. The Freeman is available on microfilm and CD-ROM from University Microfilms, 300 N. Zeeb Rd., Ann Arbor, MI 48106. PERSPECTIVE Welfare Spending Before 1962, three out of every four dol lars in federal aid to the poor went to them directly, in cash. Today, the numbers are almost reversed. Most federal aid and local welfare spending goes to the "welfare in dustry" rather than directly to poor people.

In Milwaukee County, Wisconsin, for example, only 37 percent of total welfare spending goes directly to poor people. The rest either ends up in government programs or goes to service providers who are sup posed to design programs to help the poor. As a result, antipoverty spending in the county was $1.038 billion in 1988. That was $10,793for each poor person, or $32,379for a family of three-well above the poverty line. Yet the poverty rate in the county has not gone down. -EXECUTIVE ALERT Private Property Gain all you can by common sense, by using in your business all the understanding that God has given you. It is amazing to observe how few do this; how men run on in the same dull track with their forefathers. But whatever they do who know not God, this is no rule for you. It is a shame for a Christian not to improve upon them, in whatever he takes in hand. You should be continually learning from the experience of others, or from your own experience, read ing and reflection, to do everything you have to do better today than you did yesterday.

And see that you practice whatever you learn, that you make the best of all that is in your hand. -JOHN WESLEY The Government and Inspiration In his monograph, "Edison," published by the Newcomen Society in 1948, General David Sarnoff, then president of RCA, said: The Government is to be congratulated for the encouragement which it is givingto 50 the advance of science through the scien tific training of young men and women in colleges, universities, and research insti tutions throughout the country. If out of the thousands of young men and women who are now pursuing scientific studies, there emerges one Edison, then the mil lions of dollars being devoted to their training will be well worthwhile. It has been over 40 years since this pronouncement and still no Edison has emerged-at least not from the government funded universities. It is well known that Edison (February 11, 1847-0ctober 18, 1931) was not happy in school. He was taught at home because the publicly funded teachers found him untrainable.

Edison claimed that genius is 99 percent perspiration. His former employee and life long competitor, Nikolai Tesla, said that if Edison were tasked to find a needle in a haystack, he would examine each straw in turn until he found the needle. This can be taught. Meticulous, grinding, repetitive la bor is very much a part of most schoolwork. Yet the other one percent, the inspiration, cannot be taught. Without that spark of genius, there is no way to know what a "haystack" is, and why finding a "needle" would be exciting. Since 1985, I have worked as a commu nity college teacher and a corporate trainer. I can show proof positive that I have helped people learn to use technology. Yet, I can not imagine any way that any teacher in any school can "train" someone to be an Edi son. A million smart young people cannot be collected into a single mastermind. Edison was a once-in-a-century genius who cannot be created by government fiat.

-MICHAEL E. MAROTTA Benefits of Deregulation Deregulation of the airline, railroad, and trucking industries in the late 1970s and early 1980s has decreased costs to consum ers. And despite claims that more competi tion would encourage risk-taking, the safety PERSPECTIVE records of all three industries have signifi cantly improved. Airlines. Since the passage of the Air Cargo Deregulation Act in 1977 and the Airline Deregulation Act of 1978: • Fares are an estimated 18 percent lower than they would have been under regulation, giving consumers an annual benefit of more than $10 billion. • Air fares have fallen (in real, inflation adjusted terms) by more than 20 percent since 1978. • Accident rates have fallen by 48 percent since 1978. Railroads. The Staggers Rail Act of 1980 allowed railroads to reduce operating costs and reduce rates to consumers. As a result: • Shippers save between $3.5 billion and $5 billion a year.

• Railroad accidents have declined 70 percent since the late 1970s. • Although operating revenues have fallen, expenses have declined even further, making it more profitable for railroads to operate. Trucking. The Motor Carrier Act of 1980 eliminated the barriers to entry, price dis crimination, and price fixing that had char acterized the interstate trucking industry since 1935. As a result: • Between 1980 and 1992, the number of carriers increased from about 18,000 to more than 48,000 and the total number of jobs in the industry increased about 30 percent. • Savings to the economy are estimated to be $7.8 billion a year. • The fatal accident rate per 100 million vehicle miles shrank 40 percent between 1978 and 1989. The trucking industry still is governed by other federal regulations, the elimination of which could save about $28 billion annually on logistical costs. State de-control could bring additional savings of $12 billion per year.

-MELINDA WARREN "Government Regulation and American Business" 51 THEFREEMAN IDEASON LIBERTY THE ECONOMIC WAY OF THINKING PART 5 by Ronald Nash W e are now half-way through our eight part introduction to economics. Dur ing the course of this essay and the three to follow, we will examine four important prin ciples of the economic way of thinking. One of the more valuable things I've learned in life is the importance of viewing economics not so much as a set of doctrines or conclusions, but as a distinctive way of thinking. The principles that underlie the economic way of thinking are not difficultto grasp; they are often matters of common sense. Anyone who is unaware of these principles will not only have difficulty un derstanding why some things are true in economics, but also why people behave the way they do. I will introduce the first principle of the economic way of thinking with two accounts of human behavior that don't seem to make much sense, until analyzed in light of our first principle. I will follow my e;~amples with a brief explanation of this principle and then show how understanding that principle can help us understand human action that at first glance appears bizarre or irrational.