December

THEFREEMAN IDEAS ON LIBERTY FEATURES 780 787 792 794 798 803 810 813 817 819 823 825 827 Center 790 808 836 778 838 841 847 Consumer Information and the Calculation Debate by E. C. Pasour, Jr. Challenging the claim that government can improve on the information provided by markets. The Market Didn't Do It by Dwight R. Lee Don't blame the messenger for bad news. Free-Market Economics in a Phone Booth by Russell Shannon What the AT&T breakup has taught us about competition. Perspectives on Capitalism and Freedom by Edward W Younkins Similarities in libertarian, Judeo-Christian, and Objectivist views. Frank Chodorov: Champion of Liberty by Aaron Steelman Remembering one of the giants of libertarianism. Global Warming: Not an Immediate Problem by J. David Bethel Apocalypse not. Arab Terrorism: Causes and Cure by Robert W McGee Property rights and Palestinian anger. Putting the Framers' Intent Back Into the Commerce Clause by Eric W Hagen The impact of the 1995 Lopez decision.

Liberty and Privacy: Connections by Joseph S. Fulda Safeguarding the right to privacy is essential for preserving freedom. The Southern Tradition: Implications for Modern Decentralism by Thomas Woods Jr. Thinking locally, acting locally. The Sexual Harassment Lemon Law by Sarah J. McCarthy A cure that's worse than the disease. A Property Rights Parable for City Dwellers by Richard Pombo and Joseph Farah A cautionary tale. William Ewart Gladstone's Great Campaigns for Peace and Freedom by Jim Powell Nineteenth-century England's preeminent liberal politician. COLUMNS NOTES from FEE-Two Yardsticks of Morality by Hans F Sennholz IDEAS and CONSEQUENCES-Making the Case for Liberty Stick by Lawrence W Reed POTOMAC PRINCIPLES-Foreign Aid and International Crises by Doug Bandow E,CONOMICS on TRIAL-Austrians vs. The Chicago School, Part III by Mark Skousen DEPARTMENTS Perspective-Tibor R. Machan, Robert Higgs Letters to the Editor: The Flat Tax Book Reviews -The Central Banks by Marjorie Deane and Robert Pringle, reviewed by Douglas E. French; Hands Off: Why Government Is a Menace to Economic Health by Susan Lee, reviewed by Raymond 1. Keating; Free Enterprise Moves East: Doing Business from Prague to Vladivostok by Carter Henderson, reviewed by Murray Sabrin; Austrian Economics for Investors and Economics ofa Pure Gold Standard, revised 3rd edition by Mark Skousen, reviewed by Robert Batemarco; The Privatization Process edited by Terry L. Anderson and Peter 1. Hill, reviewed by E. S. Savas; Emancipating Slaves, Enslaving Free Men: A History ofthe American Civil War by Jeffrey Rogers Hummel, reviewed by Doug Bandow.

Index 1996 THEFREEMAN IDEAS ON LIBERTY Published by The Foundation for Economic Education Irvington-on-Hudson, NY 10533 Phone (914) 591-7230 FAX (914) 591-8910 E-mail: freeman@westnet.com President: Hans F. Sennholz Managing Editor: Beth A. Hoffman Guest Editor: Robert Higgs Editor Emeritus Paul L. Poirot Lewisburg, Pennsylvania Book Review Editor Robert Batemarco Marymount College, Tarrytown, New York Editorial Assistant Mary Ann Murphy Columnists Doug Bandow Cato Institute, Washington, D.C. Lawrence W. Reed Mackinac Center for Public Policy Midland, Michigan Mark Skousen Rollins College, Winter Park, Florida Contributing Editors Charles W. Baird California State University, Hayward Peter J. Boettke New York University Clarence B. Carson American Textbook Committee Wadley, Alabama Thomas J. DiLorenzo Loyola College, Baltimore, Maryland Joseph S. Fulda New York, New York Bettina Bien Greaves Resident Scholar, FEE Robert Higgs The Independent Institute, Oakland, California John Hospers University of Southern California Tibor R. Machan Auburn University Ronald Nash Reformed Theological Seminary Edmund A. Opitz Chatham, Massachusetts James L. Payne Sandpoint, Idaho Jim Powell Westport, Connecticut William H. Peterson Adjunct Scholar, HeritageFoundation, Washington, D.C.

Jane S. Shaw PERC, Bozeman, Montana Richard H. Timberlake University of Georgia Lawrence H. White University of Georgia The Freeman is the monthly publication of The Foundation for Economic Education, Inc., Irvington-on-Hudson, NY 10S33. FEE, established in 1946 by Leonard E. Read, is a nonpolitical, educational champion of private property, the free market, and limited government. FEE is classified as a 26 USC SOl(c)(3) tax-exempt organization. Copyright © 1996 by The Foundation for Economic Education. Permission is granted to reprint any article in this issue, except "William Ewart Gladstone,"· provided credit is given and two copies of the reprinted material are sent to FEE. The costs of Foundation projects and services are met through dona tions, which are invited in any amount. Donors of $30.00 or more receive a subscription to The Freeman. Student subscriptions are $10.00 for the nine-month academic year; $S.oo per semester. Additional copies of this issue of The Freeman are $3.00 each. For foreign delivery, a donation of $4S.00 a year is suggested to cover mailing costs.

Bound volumes of The Freeman are available from The Foundation for calendar years 1972 to date. The Freeman is available in microform from University Microfilms, 300 N. Zeeb Rd., Ann Arbor, MI 48106. Cover: Frank Chodorov PERSPECTIVE The Welfare State and the News In the welfare state, news reporting has been taken over by lobbying that masquer ades as news. Nearly every news item in magazines and the papers, or on radio and television, except for something truly earth shaking and unique (a peace agreement be tween England and Northern Ireland or winners of the Nobel Prize), amounts to featuring some event or situation in which people want something and are asking gov ernment to provide it. Editors and broadcast producers appear clearly to be focusing on stories that generate some kind of govern ment action. Indeed, it is a feather in the cap of a news organization if its story provokes some politician to introduce a bill, call a hearing, or promise some kind of reform. If this is related to the demands of some sizable group in our society, success is nearly assured. Pulitzer Prizes tend to be delivered to those who make the "news" do public service work.

Clearly, in a welfare state the prospects for such "news" casting are fabulous. Why should reporters, commentators, or producers ever consider that it could be in the public interest to shut the doors of government to all such demands? Doing so would bar a large per centage of their stories from making a differ ence. The media might even have to explore going after genuine news, maybe some good news. But so long as the welfare state is the status quo, we can pretty much count on floods of stories about demands for additional govern ment action from day to day, week to week, month to month, depending on the broadcast schedule of the next program, or the issue date of the next publication. Except for the editors of the few papers and magazines that champion liberty, none of those in charge will encourage truly crit ical scrutiny of mainstream political affairs. None willraise such questions as "Why should government deprive the successful of the fruits of their success, or even the fortunate of their good fortune, just because others do not enjoy the same? What justifies such Robin 778 Hoodism?" Or who among those who feed off the welfare state so successfully would ever raise the question: "Mr. President, ifwe spend borrowed money our children will have to be taxed to repay, does this not violate the princip~e 'No taxation without representa tion'? "

Would any such journalist raise the ques tion to some politician or bureaucrat: "If in the criminal law it is wrong to punish people unless they have been proven guiltyof a crime, why is it right that government regulations may impose enormous economic burdens on people who have done nothing wrong? Isn't this a kind of prior restraint that has no place in a free society?" What about the question: "If the 14th Amendment prohibits the un equal application of the law, why are produc ers prohibited from discriminating, while con sumers can do so with total impunity? And why can government regulate every profes sion but the press, arts, and clergy-is this not a built-in inequality, a state-sponsored dis crimination ?" When news organizations feed off the wel fare state so successfully, why would they ever express even the most natural doubts about it as they deal with the leaders of state on Meet the Press, This Week with David Brinkley, Face the Nation, and the rest?

Doing so would take some genuine journal istic integrity, the kind many people seem to praise only when observed in foreign re porters who risk life and limb as they challenge their dictators. When nothing but one's cushy existence as a reporter is at stake and no firing squad threatens, the courage to challenge the status quo can be readily surrendered. - TIBOR R. MACHAN (Dr. Machan is professor of philosophy at Auburn University.) PERSPECTIVE Why the Anxiety? For some time, pundits and columnists have busied themselvespondering a puzzle:although Americans are better off than ever before by various measures, they seem discontented; they worry excessivelyabout what the future will bring. Populists blame multinational corporations for shifting jobs abroad. Ross Perot hears a "giant sucking sound" that, he claims, arises from jobs being relocated to Mexico, thanks to NAFTA. Left-liberals blame big companies for downsizing themselves and setting adrift thousands of employees who had anticipated a lifetime of secure employment. Once laid off, these workers are said to be fit for little but flipping hamburgers. Hence the ballyhoo about the disappearance of the middle class.

The facts provide little support for these popular notions. Mexico is not snatching away American jobs wholesale. The gains from trade are mutual, and labor markets are alwaysin flux. As for the demise of the middle class, the claim is sheer hyperbole. But I too hear a giant sucking sound, which may have to do with the anxieties so many Americans are feeling. It is the sound of governments at every level sucking away our liberties. Day after day, unchecked by so called "contracts" with America or bogus "revolutions," government grows relentlessly. The Code of Federal Regulations swells, and state and local governments follow suit with new controls of all kinds. Americans have sound reasons for appre hension. While nearly every country on the planet is turning away from invasive govern ment controls, Americans continue doggedly down the road to serfdom. -ROBERT HIGGS Guest Editor 779 THEFREEMAN IDEAS ON LIBERTY ConsumerInformationand the CalculationDebate by E. C. Pasour, Jr.