Trends
Midwife Upheld A California midwife, charged with murder in the accidental death of an infant in a home birth, has been set free, in a landmark court case. And the judge in the case defended the rights of the parents to choose their own form of medical care.
Midwife Marianne Doshi attended the home birth of the third child of Robert and Christine Gannage of San Luis Obispo. Due to complications, the infant died five days later, and though the parents did not wish to press charges, the county prosecutor filed a charge of second-degree murder (along with practicing medicine without a license) against Doshi. The case attracted much attention as a test of whether unlicensed midwifery—technically illegal, but growing in popularity—would continue to be permitted.
Judge Richard Kirkpatrick reviewed the case at the preliminary hearing and summarily dismissed all charges. The judge, known as a hard-line conservative for his frequent decisions in support of crime victims, told our reporter that "Marianne Doshi and the Gannage couple were the victims—they were victims of the American Medical Association." Citing the New Hampshire state motto "Live Free or Die," Judge Kirkpatrick's ruling emphatically upheld medical freedom of choice. People can choose "alternative" forms of care, he said, because "they have a constitutional right to do so." The prosecution did not appeal.
Exposing Safety Frauds Ever since it was created in 1966, the National Highway Transportation Safety Agency has been forcing its idea of safety onto vehicle builders and consumers—with little regard for the costs of its proposals. Recently, however, the agency has suffered important setbacks on two of its pet projects: antilock brake systems for trucks, and air bags for cars.
The trucking industry took the NHTSA to court to overturn its requirement for the costly, computer-controlled braking systems. The Ninth Federal Circuit Court of Appeals agreed with the truckers that the braking standard "was neither reasonable nor practicable" and that "many vehicles equipped with antilock systems, which were necessary to meet the standards, were potentially more dangerous in performance than pre-standard vehicles." Partly, this was due to the unreliability of the complicated new devices. Late last fall the Supreme Court agreed. Drivers: 1, NHTSA: 0.
The agency has had better luck with its air bag plan, even though the 1984 requirement has been watered down to mandate either air bags or automatic seatbelts. But here, too, the evidence is mounting that air bags are both costly and ineffective. A DOT study of 230 tow-away crashes of cars equipped with air bags turned up four fatalities—several times as many as would have occurred with conventional lap and shoulder belts instead of air bags. When challenged in Congress on this finding, DOT Secretary Brock Adams dismissed the figures as not statistically significant. In fact, however, DOT's Office of Statistics and Analysis had concluded just the opposite, stating that "the high incidence of fatalities may be suggestive that the air bag is totally ineffective in fatality reduction." This report had been suppressed by the DOT but was released under the Freedom of Information Act as part of a suit by the Pacific Legal Foundation, which is challenging the air bag order and hopes to have it overturned.
Meanwhile, the former head of the Consumer Product Safety Commission has come out against air bags. The NHTSA campaign for air bags falls short of the administration's "own minimum requirements of truthfulness and full disclosure," said John S. Byington, because the public has not been told of the costs of air bags, their ability to protect only in frontal collisions, or the dangers of accidental inflation.
In fact, when consumers are told these facts, their support for the air bag requirement plummets from 47 percent to a mere 15 percent, according to a survey by Consumer Alert. The Connecticut-based organization conducted a nationwide survey to find out how closely the NHTSA's mandate reflects public sentiment. Apparently, most consumers prefer a choice in such matters. Drivers: 2, NHTSA: 0.
Gold Gains Backers Why the soaring price of gold? It isn't just that investors worldwide are fleeing the falling dollar. More fundamentally, gold is returning to prominence as an international money—a store of value in a world of depreciating paper.
Last spring the International Monetary Fund eliminated its rule against central banks buying gold. Little-noticed at the time, the move led at least 39 countries to buy gold, among them India, Nepal, Kenya, Tanzania, and Mexico. India bought 800,000 ounces from the IMF in June, at $183 an ounce; it has been auctioning off small amounts as the price continues to rise. Major industrial countries have revalued their gold holdings from the old official rate of $35 an ounce up to market levels.
Further, the negotiations in Europe to create a new European Monetary System are increasing the official role of gold, by basing members' reserves on their gold stocks, figured at market values. "What we are seeing is gold in the process of being remonetized," says international money analyst Lou Ganz of Paine, Webber, Jackson & Curtis, Inc. Merrill Lynch gold analyst David Fitzpatrick agrees that "gold's role as a key reserve asset is once again being emphasized."
Like the man said—gold is money.
Freeing Conrail As noted earlier in REASON ("How Federal Railroad Policy Got Derailed," September 1978), Conrail is in deep trouble. The federally chartered company patched together from six bankrupt railroads has been losing money steadily since its creation by Congress two and a half years ago. But now, at least, federal officials seem to be facing the facts—not only about Conrail's true losses but also about the causes.
Three major studies critical of the railroad have been released this year, one each by the Interstate Commerce Commission, the US Railway Association, and most recently by the General Accounting Office. The latter demolished Conrail's optimistic profitability projections and forecast a system loss of up to $3 billion over the next five years.
Department of Transportation officials are worried. They don't want to get stuck with ever-increasing subsidies. Nor do Conrail's managers. At present, though, they are stuck with an ungainly 34,000-mile snarl of trackage, much of which has far too little traffic to support it. Conrail's "Final System Plan" envisions selling off or abandoning about half of this mileage, to slim the system down to profitable routes. Whether northeastern politicians will stand for such drastic cutbacks, however, remains to be seen.
Administration officials—at USRA, DOT, and the White House—seem prepared to fight for major decontrol as the key to rescuing Conrail. A recent DOT study placed the major blame for the deterioration of American railroads on decades of ICC regulation. Railroad managements have been hobbled, not only by control over their pricing policies, but also by massive subsidy of their competitors—truck lines (highways) and barge lines (waterways). As a result, says DOT Secretary Brock Adams, "the rail industry slowly cannibalized itself," eating into its capital stock and deferring badly needed maintenance. By 1985, he reported, the railroads will be $13 to $16 billion short of capital, unless something is done.
That "something" should include cutting back ICC regulation (especially rate regulation), allowing mergers that will restructure the industry for greater efficiency, and putting road, rail, and waterways on an equal competitive footing, said the DOT report. The USRA's new director, Stanton Sender, agreed with this prescription, as applied to Conrail, arguing that the company "has a fighting chance to survive if it is able to make changes" free of government regulation. Federal Railroad Administration head John Sullivan also agreed. If the railroads are to maintain safe operations, they must be free to earn enough to rebuild their decaying trackage and modernize their equipment.
Time summed it up aptly: "The best action that the Carter administration could take in support of the railroads would be to apply at least a measure of the deregulation flexibility that is already freeing the nation's soaring airlines from the fetters of federal bureaucracy."
Outspoken Poles Despite 30 years of Communist rule, opposition to the ruling orthodoxy remains strong in Poland. In September, only weeks before Polish cardinal Karol Wojtyla was named Pope, he and Cardinal Stefan Wyszynski issued a pastoral letter calling for the end of censorship in Poland. The letter was signed by all the country's Catholic bishops and was read from church pulpits throughout the country. Besides urging the end of censorship of news media, the letter called for the State to allow the broadcasting of religious programs, including church services, and urged Catholics to make use of "other, more reliable sources" of information than those of the State.
Several weeks later a Polish sociologist shocked delegates to a world congress on alcoholism by linking alcohol consumption to socialism. Dr. Zbigniew Wierzbicki of the Polish Academy of Sciences Institute of Philosophy and Sociology cited statistics from a 1972 Finnish report showing that Poland, Russia, and Hungary rank first, second, and third, respectively, in per capita consumption of alcohol. According to Wierzbicki, the State encourages drinking because central planners have for some reason (?) kept boosting production quotas for booze. As a result, the number of liquor stores far exceeds the number supposedly allowed by law. In Lubarton, for example, there are 25 stores dispensing alcohol, compared with a "legal limit" of six.
Privatizing Outer Space In an important policy development, the Carter administration has rejected proposals for costly new space ventures. Instead, it plans to scale down NASA budgets and turn over many operational roles to private industry.
These decisions were announced by President Carter at Cape Canaveral in October. Carter specifically rejected proposals that would have committed the space agency to developing solar power satellites, permanent space factories or space colonies, or a manned Mars mission. Any of these would have cost from $10 to $100 billion over the next decade. Instead, NASA will simply complete development work on the $10 billion space shuttle and then revert to a more limited role as a research and development agency. Its future budgets may shrink far below the present $4.3 billion level.
A key to holding down future budgets is to let private industry take over the operation of commercial-like programs such as Landsat (remote-sensing satellites) and the space shuttle. In recent congressional testimony, NASA's associate administrator for space transportation, John F. Yardley, broached the idea of one or more aerospace firms being hired to operate the shuttle, charging users for launch services. Yardley's deputy, Chester Lee, cited Comsat Corporation as a precedent for such a public-to-private transition.
But the Boeing Company wants to take the concept one step further. Rather than simply being hired to run the shuttle, Boeing would like to buy it and operate it as a fully private venture. Initial Boeing studies have shown some profit potential, and this winter the company is planning detailed studies on shuttle ownership and operation. The transition to fully private operations could take place within seven years, according to NASA sources. And Aviation Week states that "NASA senior management is generally in favor of concepts like Boeing's, because they free NASA personnel for what the agency wants to remain—a research and development agency."
Subway Blues We've all heard the promises—grand, new subway systems will entice people out of their gas-hogging cars and whisk them to work, saving energy and decongesting downtown streets. Every modern city should have its own version of San Francisco's BART or Washington's Metro…or should it?
It turns out that this idyllic picture is a total fabrication. Today's new fixed-rail transit systems not only don't save energy and don't reduce auto congestion, but they also cost taxpayers a small fortune. According to figures compiled by the ACU Education and Research Institute, both BART and Metro are being enormously subsidized by local taxpayers who don't ride the systems.
A typical BART commute from suburban Orinda to downtown San Francisco costs $6.77, including "social costs" to neighbors and interest on the agency's bonds. But, figured on a comparable basis, the total costs of the trip in a full-size car are only $4.49, in a subcompact $4.05, and only $3.21 on a bus. Excluding the "social costs," the average BART ride cost $4.48 in fiscal year 1975-76. Since the average fare was only 72 cents, the taxpayers had to make up $3.76 for each and every trip—more than five times the fare!
The highly touted Washington Metro is subsidized even more. During its first nine months of operation, with fares at 40 cents to 55 cents, each ride received a subsidy of $10.38—over 20 times the fare. By 1981, the taxes paid by each household in the D.C. metropolitan area to subsidize the Metro will reach $1,670—enough to buy a good used car.
Besides costing nonusers a fortune, these subway systems neither save energy nor reduce congestion. Why? Because, surveys show, they draw most of their ridership from buses, not cars. Thus, they do very little to reduce the number of cars on the road. And a study by the Congressional Budget Office concluded that "under typical conditions, new rapid rail systems actually waste energy rather than save it." This is because construction of subways is enormously energy-intensive, subway riders still drive to and from the stations in low-occupancy autos, and the subways divert riders from much more energy-efficient buses.
Despite this damning evidence, the federal government is still promoting subways as a panacea for what ails big cities. Atlanta's is already under construction, and others are on the drawing boards in Baltimore, Buffalo, Los Angeles, and Miami. The Urban Mass Transit Administration was recently voted another $13.5 billion to spend during the next few years. So it looks as if subways will continue to displace buses and absorb huge amounts of tax money in the years ahead.
FCC Eases Some Regs In anticipation of legislative moves to deregulate communications, the Federal Communications Commission has made a number of small steps in that direction.
FCC chairman Charles Ferris recently proposed a pilot test of virtually complete deregulation of radio stations. Under the plan, still being drafted, nearly all FCC radio regulations in selected test cities would be abolished and the results observed. Among the rules likely to go are the commission's guidelines on how much time broadcasters can devote to news, entertainment, and commercials; the requirements that stations cover controversial issues; and mandatory surveys of the "problems, needs, and interests of the community." Ferris expects to have the plans for the test completed by Christmas and the pilot program in operation by next fall.
In the area of long-distance telecommunications, the FCC has made a move toward increased competition in satellite communications. Reversing a long-established policy, it voted unanimously to permit Comsat to deal directly with customers for television signal transmission, instead of serving as a "carrier's carrier" dealing only with AT&T, IT&T, RCA, and Western Union. The decision is expected to lead to expanded competition between Comsat and the other four international carriers.
In cable TV the commission has moved toward deregulation in two instances but against it in another. On the negative side, it has appealed to the Supreme Court a lower-court ruling that overturned the commission's "public access" rules (see Trends, May 1978). On the other hand, it has abolished two regulations that had significantly hampered cable's growth: one that required prior FCC approval of initiating, changing, or expanding any cable service, and the other severely restricting the ability of cable systems to import distant signals from independent stations in far-off cities. Under its 1972 regulations, the FCC set ceilings on the number of independent stations a cable system could offer.
What is happening at the FCC appears to parallel the first steps the CAB took when a serious deregulation bill first appeared in Congress. If the agency follows in the CAB's footsteps, telecommunications users—and that means all of us—are in for some lively years of changes.
IRS: 2, Taxpayers: 1 In several recent cases, tax protestors have challenged the Internal Revenue Service, using arguments that have been promoted as sure things. Well, some of them turn out not to be.
Heard about the silver-coin ploy? Accept payment in old-style (pre-1964) silver coins and report only the face value for tax purposes. After all, the coins are still legal tender, right? Wrong, says the IRS. The coins must be valued at the market price. This issue has apparently not yet been litigated, though.
One that has been is the "selective prosecution" argument. Richard Ralston Catlett—a "notorious war and tax protestor" from Columbia, Missouri—argued that it was constitutionally impermissible for him to be singled out for prosecution because of his antitax views and actions. No way, ruled a federal appeals court. "The government is entitled to select those cases for prosecution which it believes will" promote compliance, said the court—free speech notwithstanding.
But taxpayers won one round. When the government sues a person to collect taxes, is the person entitled to a jury trial as a matter of right? Though the IRS said no, the 10th Circuit Court of Appeals said yes. The right to a jury trial in tax-collection cases is one that existed under English common law when the Seventh Amendment was adopted—hence, today's taxpayer is indeed entitled to such a trial.
Milestones • No-Iron Bread. The Food and Drug Administration plan to double the amount of iron required in enriched flour, bread, and bread products has been quietly shelved. Evidence from Sweden had raised questions about the safety of high levels of dietary iron intake for males, so this particular proposed dose of forced medication has now been put to rest.
• Private Nursing. Who runs the least-expensive nursing homes? If you guessed nonprofit organizations or churches, you're wrong. You're also wrong if you guessed the government. According to a nationwide survey by the National Center for Health Statistics, it is private, profitmaking nursing homes that charge the least. Their average monthly charge is only $641, compared with $722 for nonprofit homes and $669 for all types of nursing homes.
• Insanity Defense Knocked. Allowing criminal defendants to plead insanity is nothing but a charade, according to psychologist Stanton Samenow. Commenting on the Son of Sam case, Samenow referred to his 17 years of research with "criminally insane" prisoners. In 8,000 hours of interviews with 255 male criminals, including many killers, his research team never found one person who was so out of touch with reality that he did not know what he was doing when he committed the crime. Street-wise criminals know that by convincing a court and a psychiatrist that they're insane, they'll be sent to a hospital instead of a prison—and that "if you play the psychiatric game, you can get out sooner and beat the charge."
• PSROs Knocked Again. Professional Standards Review Organizations, already under fire from OMB as ineffective, have now been attacked by the General Accounting Office. GAO says claims that PSROs have saved money and improved medical care are "grossly exaggerated." GAO has studied the performance of a number of the boards and found every claim of savings to be inaccurate and overstated. Existing PSROs are costing taxpayers $150 million a year, and the Office of Management and Budget recently called for their elimination as a waste of money.
• Energy Competition. Although some politicians wish to forbid oil and nuclear fuel companies from owning coal mines, such a move would not only not enhance competition, it would actually be "fundamentally anticompetitive." So says a 133- page report by the Justice Department's Antitrust Division. The entry of oil and nuclear firms into the coal business could provide considerable new competition in that industry, rather than leaving it in the hands of a few large coal firms. Another populist fantasy bites the dust.
• Prescription Grass. Illinois has become the second state to decriminalize the use of marijuana for medical usage. Under a bill signed by Gov. James R. Thompson, as of January 1 cancer patients and victims of glaucoma will be able to use marijuana under a doctor's supervision. New Mexico enacted similar legislation last February.
• Rent Control Out. In a unanimous decision, the New Jersey Supreme Court has ruled unconstitutional the rent control ordinance of the city of Ft. Lee. The measure's 2.5 percent ceiling on rent increases was confiscatory and constituted an unfair taking of landlords' property, the court ruled. The decision is especially significant because the Ft. Lee ordinance has been the model for about 120 other New Jersey communities. Presumably, these other rent control measures are now also out the window.
• The Winner? No One. In the September primary elections, Nevada's recently enacted "None of the Above" ballot law received its first test. And proved to be a winner. In a race among three candidates for the state's sole seat in the US House, None of the Above collected the most votes. Back to the drawing board, turkeys!
• Bypassing the Mails. The latest defector from the US Postal Monopoly? None other than the US Government Printing Office. When faced with a strike threat, GPO switched to United Parcel Service to send out all orders for government documents to libraries east of the Mississippi—an area that includes 71 percent of the country's libraries. A GPO official told UPI: "The Postal Service is a little upset, but we now expect to save between a quarter and a half a million dollars in depository shipment costs…in the first year." Not only that, but "there are fewer damaged packages and we are enjoying fewer missing shipments, and when we report them they find the missing shipment immediately." As they say, the customer is always right…even if the customer is the US government.
• Further Soviet Boycott. More high-level scientists have boycotted the USSR because of its restrictions on freedom of inquiry and expression. Seven leading chemists, from universities like Cal Tech, Stanford, and Dartmouth, withdrew from the International Symposium on Macromolecular Chemistry held in Tashkent in October. Their letter to the organizing committee cited repeated "violations of the rights of scientists" and urged their Soviet colleagues to prevail on their government to change its policies.
• Laetrile Tests. The National Cancer Institute has finally agreed to conduct clinical trials of the controversial drug laetrile, long banned by the FDA. The NCI hopes to begin treating between 150 and 300 terminal cancer patients with the drug in January. FDA director Donald Kennedy promised to decide "as quickly as possible" whether to grant the NCI the necessary permit to conduct the tests.