Trends

Latin Laissez-Faire

Despite their continued restrictions on civil liberties, the military regimes of Argentina and Chile have proved quite adept at restoring economic liberties to those countries. The results, in both cases, are Latin economic miracles.

In Argentina the legacy of the Peron years—nationalization of industry, high taxes, stifling regulations, huge government deficits—eventually led to an inflation rate of 1,000 percent and serious food shortages (in a country traditionally one of the major food exporters). At that point, in 1976, the military government took over, appointing Jose Martinez de Hoz as economics minister. Martinez de Hoz promptly set about eliminating exchange controls and the tax on food exports; slashing tariffs (from an average of 55 percent in 1976 to about 15 percent by next year); ending wage, price, and rent controls; and selling off nationalized firms. Some 250,000 government workers have been let go, and only 2 of the 15 major public corporations (the post office and the railroads) are still receiving partial subsidies.

The results? Inflation, though still very high, has been cut from 1,000 percent in 1976 to 400 percent in 1977, 160 percent in 1978, and 150 percent in 1979. Because the economy is booming (the GNP grew by 11.1 percent in the first half of 1979), unemployment is down to 1.5 percent. Argentines have returned millions of dollars from overseas into local banks, enabling the banks to resume making loans. And foreign investment has doubled in each of the past two years.

A similar resurgence has taken place in Chile, whose economy had been decimated by the socialist Allende regime. Under the guidance of Chilean economists trained at the University of Chicago, the government has moved unilaterally to free trade, slashing import tariffs to a low 10 percent. That move has led to major changes in industry, as inefficient producers—no longer sheltered by high tariff walls-either went bankrupt or shifted to other fields or methods. The government has slashed its own expenditures, reducing them from 40 percent of GNP to 25 percent. The budget deficit has been eliminated and a host of controls and regulations repealed.

Chilean inflation, accordingly, has been slashed from 350 percent in 1975 to about 35 percent in 1979. The GNP has increased by an average of seven percent a year for the past three years, productivity has been increasing at over 10 percent a year, and foreign exchange reserves are at their highest point ever. The only economic dark spot in this picture is that unemployment still exceeds 13 percent. Nonetheless, economist Milton Friedman, for one, predicts that the reconstruction of the Chilean economy "will be regarded as one of the economic miracles of the 20th century."

Jitney Comeback?

The jitney, a private car operating on regular routes for a flat fare, is on the verge of making a comeback in America—and all because of the energy crisis. That's the view of two analysts at Resources for the Future, Milton Russell and Joel Darmstadter, as expressed in a recent RFF report, Energy in America's Future: The Choices before Us.

Until they were outlawed in the 1920s at the behest of trolley interests, hundreds of jitneys plied the streets of every major city, offering low-cost, flexible transportation. Even today illegal jitneys thrive in cities where enforcement of anti-jitney laws is lax, especially in low-income areas. By offering service less costly than taxis and more flexible than trains or buses, jitneys reduce the need for auto ownership, especially second-car ownership. And because they allow multiple ridership, jitneys transport more people on a gallon of gas than private cars do.

These points are all very logical, but jitneys remain outlawed nearly everywhere. The task, says Darmstadter, is to change the political climate that condones such special-interest legislation: "What you have to do is to convince the people of that United States that taxicab companies don't have a God-given right to make more money." At least, not at the expense of entrepreneurs who wish to hire out their cars.

Contracting Supported

In earlier Trends columns we have reported on the privatization of fire protection services in Hall County, Georgia. The commissioners of that county abolished their government fire department last March and hired Rural/Metro Fire Department, Inc., of Scottsdale, Arizona, to take its place. The private firm has been doing the job for 10 percent less than the county was spending, with second-year savings expected to be 15-16 percent.

But that second-year contract—indeed, the completion of the first-year contract—had to overcome a number of obstacles. First, the discharged county firefighters filed suit, charging that the commission's action had been unconstitutional. When that suit was dismissed, they organized a successful campaign to recall all five commissioners, meanwhile appealing the court decision. But neither move accomplished their purpose. The new commissioners refused to cancel the contract, and the Georgia supreme court last September unanimously upheld the commissioners' authority to contract for fire service.

The latest chapter took place in December. In order to justify their actions, the commissioners placed a straw vote on the ballot asking if the voters approved of fire-service contracting. By a substantial 59-41 margin, the voters declared their support, whereupon the local newspaper chided the commissioners for having been so cautious. Rural/Metro president Louis A. Witzeman called the vote the firm's biggest victory in its 30-year history, proving that private-enterprise public services can win the support of the people served.

Senate Backs Private Mining

Defying so-called world opinion and the interminable Law of the Sea conferences, the US Senate has passed a bill to allow private mining of seabed mineral resources. (A similar bill passed the House in 1978 but died in the Senate.) The Senate bill would allow US firms to be licensed by the Commerce Department to prospect for manganese nodules on the seabed and would set up a mechanism for staking out claims and complying with environmental rules.

The Law of the Sea conferences, held annually over the past decade, have been attempting to set up a socialist regime for seabed mining, under the dubious proposition that the manganese nodules belong to "all mankind" rather than to the discoverer of each particular field. The conference would therefore make seabed exploitation the province of a United Nations monopoly that (in some versions) would allow limited mining by private firms, so long as the profits went largely to Third World governments. But political squabbling has thus far prevented any final agreement from being reached on a treaty.

The Senate bill anticipates an eventual treaty in two respects. On the one hand, it requires mining companies to deposit 0.75 percent of gross nodule-mining income in a Treasury trust fund, for possible distribution as UN royalties. On the other hand, however, it instructs US Law of the Sea negotiators not to agree to any treaty provision that would force licensed US mining firms to cease operations. Thus, the Senate is on record that it is not likely to approve any treaty that would surrender seabed control to the United Nations.

Electronic Mail Monopoly Setbacks

December was a bad month for the US Postal Service's hopes to extend its monopoly into electronic mail service. In quick succession, its chosen contractor quit in disgust and its overseer, the Postal Rate Commission, recommended an alternative plan that would break the monopoly.

The first shoe to fall was that of Western Union Telegraph Company. That firm had been picked by USPS as the private contractor to provide the communications links between 25 specially equipped post offices. (Business mailers would send certain types of computer-generated messages over local telecommunications links to the nearest of these post offices; from there, postal service computers would transmit them over Western Union lines to the receiving post office, where they would be printed out, stuffed into envelopes, and delivered by the local USPS employees.) But Western Union grew tired of bureaucratic and regulatory delays and decided, in December, to bow out.

But a more serious blow was soon to follow. Two weeks later the Postal Rate Commission gave its okay to USPS entry into electronic mail—but not as a monopoly. The commission instead proposed that any number of communications firms be free to provide connections between post offices. This, said the commission, would enhance competition, promote better and cheaper service, and maybe even resolve USPS's dispute with the Federal Communications Commission. (The FCC has asserted jurisdiction over electronic mail and has been taken to court by the postal service.) Since with freely competing carriers USPS wouldn't be "providing" the telecommunications, it would no longer be in conflict with the FCC.

Needless to say, USPS is not taking the recommendation lying down. Postmaster General William Bolger has complained that under the competitive regime proposed by the rate commission, it wouldn't be able to control the service. Some people would reply that that's precisely the point.

International Airline Deregulation

The rollback of government controls on entry, service, and pricing in the airline business has begun to extend beyond US borders. To begin with, pressure from the Civil Aeronautics Board has led every US airline but one to quit the government-sanctioned rate-setting machinery of the International Air Transport Association (IATA). About a year and a half ago the CAB issued a show-cause order arguing that participation of US airlines in cartelized pricesetting via IATA is contrary to antitrust laws. Although the CAB backed off in December under intense pressure from foreign governments, it had already accomplished its aims. All US airlines but National had quit IATA's price-fixing conference, and IATA had changed its rules to make participation in pricefixing an optional activity.

In addition, Congress this winter enacted the International Air Transportation Act, a counterpart of its 1978 deregulation act for domestic air service. It provides new freedom for US airlines in international service to raise and lower fares and provides for the government to suspend or revoke the permits and rates of foreign airlines whose governments place unreasonable regulations on US carriers.

And pressure for deregulation of European air service continues. Leading the attack are Britain's private airlines: Laker, British Caledonian, and Britannia, each of which has proposed new discount fares as much as 50 percent below present levels. They point out that per-mile fares in Europe are as much as double those within the United States—largely because of shared-monopoly service by mostly government-run airlines. The few independent airlines that have slashed fares are profiting handsomely. Sweden's Linjeflyg, for instance, has increased its traffic by 50 percent and made its first profit in three years by introducing off-peak and youth discount fares. Internationally, on routes where service has been deregulated by liberal new bilateral agreements, traffic has soared. (Examples: US-Belgium service up 85 percent in 1979, US-Australia service up 50 percent, US-Netherlands service up 40 percent.)

Laker and other independents are using figures of this sort to try to persuade European governments to deregulate. And failing that, Laker plans to appeal to the Common Market's executive commission, arguing that present air service is a monopoly—which is forbidden by the Treaty of Rome. It may take a few more years, but deregulation is clearly on the way in Europe, and around the world.

Second Amendment Assailed

Libertarians have always argued that the Founding Fathers meant it when they included in the Bill of Rights what became the Second Amendment: the right of people to keep and bear arms. While attempts have been made to undercut this amendment, they have been thwarted by the existence of vocal and organized defenders of the amendment.

One such group, the Second Amendment Foundation, is currently agitating against what it believes is the first law of its kind in the United States. The New Haven Board of Aldermen passed 18-to-4 an ordinance banning the sale of handguns between private individuals. Handguns can now only be bought (or sold) from federally licensed dealers (none of whom, the SAF alleges, sell handguns in New Haven).

The SAF is filing suit against the city, resting its case on the Connecticut state constitution, which specifies that "every citizen has a right to bear arms in defense of himself and the state."

Left Criticizes State Monopoly

When socialists argue that certain services should be State-run monopolies "in the public interest," there is always the problem of who determines what that public interest is. France is currently providing an edifying twist to that question with leftist criticism against the radio-TV broadcast monopoly run by the center-right government.

Leftists now complain that the government is using the news for political purposes—specifically, the aggrandizement of President Valery Giscard d'Estaing—and are demanding equal time. Socialist Party leader Francois Mitterand, arrested last summer during a raid on an illegal Socialist radio station, reiterates that socialists support the principle of State broadcast monopolies, as long as they are run in the public interest. The difficulties of Mitterand and d'Estaing ever coming to an agreement about what is in the public interest did not seem to occur to the party leader.

The Communists are also challenging the state monopoly with a pirate radio station that broadcasts pop records and doctrine. The police succeed in jamming the broadcasts fairly frequently.

Another problem worrying French politicians is the changing technology that is making possible direct satellite television broadcasts into homes. As Sen. Jean Cluzel said in a debate in the upper house of parliament, "When a French viewer is given the choice of 20 commercial channels, will he make the effort to look for a national quality channel?"

Industrial Innovation

In 1977, a Commerce Department Report concluded that "reduction of unnecessary regulatory barriers to innovation is required" and suggested that antitrust laws be modified to permit cooperative R&D, that tax policies on capital and investment be liberalized, and that a uniform patent policy regarding patent rights to inventions from federally sponsored research be implemented. President Ford, who had commissioned the study, then ignored the results.

That was bad enough. To add insult to injury, President Carter in April 1978 ordered a massive (and costly) "Domestic Policy Review of Industrial Innovation" to be coordinated by Assistant Secretary of Commerce Jordan Baruch. It took 18 long months—and involved 28 government agencies and 500 industrial, labor, and academic leaders—to come to the conclusion that excessive and contradictory federal regulatory policy is the single greatest barrier to innovation.The policy review further seconded various conclusions from the 1977 Commerce Report and was presented to Carter with specific proposals stressing the disincentives built into federal regulations, tax policies, patent laws, and antitrust laws.

On October 31, 1979, Carter announced his industrial innovation plan based on the results of the study. The Carter plan ignores all the recommendations on tax incentives and concentrates instead, perhaps inevitably, on federal handouts. Our eminent president proposes setting up four "Generic Technology Centers" in 1981—to the tune of $6-$8 million—to be jointly funded by government and industry, with government's share progressively dropping. Not only that, we can look forward to two regional "Corporations for Innovative Development" that will each hand out loans of up to $4 million from federal largesse, with matching funds from each region. To help foster small innovative firms, the National Science Foundation is due to receive an increase in funds from $2.5 million to $12.5 million. The NSF program for joint university-industry cooperation in R&D will itself be granted an extra $20 million to distribute in 1981.

As an example of a problem created by government being where it shouldn't be in the first place, policymakers have had to wrestle with the question how to get some 30,000 patents off the ground and into the marketplace—patents that were developed with research money from the federal government. Federal policy has been that companies shouldn't get exclusive rights to market these developments because that would be unfair. Carter is now in favor of giving companies exclusive marketing rights through a uniform government patent policy that gives contractors exclusive licenses with the government maintaining march-in rights if the contractor fails to commercialize the invention. Steps will also be taken to make patents less vulnerable to court challenges.

Technological innovation, as measured by new patents, has been slipping steadily from 45,633 patents granted to Americans in 1966 (with 9,567 to non-Americans) to a mere 33,181 in 1976 (with the number of foreign patents rocketing to 18,744). This is attributable partly to the fact that, unlike in foreign countries, almost 50 percent of American R&D is dedicated to defense-related projects, as well as to increasing red tape (one vice-president for R&D confesses to spending 90 percent of his time on present or anticipated regulations) and to general inflation, which has brought the US citizens' saving rate down from 7.5 percent in 1967 to 5.1 percent in 1977.

Recognizing that confusing and contradictory regulations further inhibit innovation, Carter's plan provides for federal agencies to write up a five-year forecast of what rules they think will be made. The cost of complying with federal regulations is now estimated to be as high as $100 billion a year and increasing.

Carter further aims to revise federal procurement policies. Present policies require that certain specific designs be bought for government use, whether or not there are cheaper, more efficient products on the market that would do the same thing. Carter proposes setting up performance standards instead of mandating specific designs.

He unfortunately ignored other recommendations, such as the proposed reduction of capital gains taxes on small businesses, which would have left innovators' money in their own pockets in the first place, rather than being funnelled into bureaucrats' salaries and expensive policy reviews.

Round Two for Jarvis

Spurred on by the overwhelming victory of Proposition 13 in 1978, Howard Jarvis has successfully managed to place on the June 1980 ballot his new initiative to cut the California income tax in half. It may sound disastrous to a bureaucracy that typically reacts in horror, but the measure would only cut $4.9 billion from a projected $23 billion 1980 tax take in California.

As to reacting in horror, the opposition has learned a little from its Prop. 13 fiasco and is proceeding more cautiously. But bureaucracy's bitterness over the public's gall in approving Prop. 13 surfaces in a comment made by a fiscal official to a Los Angeles Times reporter: "We talked about the dire effects of Proposition 13 and then we bailed it all out with the surplus. Now they'll vote for this and the roof will fall in," he predicted balefully.

The Jarvis initiative would also abolish property taxes on business inventories, a tax cut that was passed by the legislature late last year but that Jarvis wants to place in the less-capricious constitution. And the initiative would do the same with the new legislative indexing law, which indexes state income taxes but is up for expiration in two years.

Portugal Rights Itself

When Portugal ended half a century of dictatorship five years ago, it saw a succession of 11 elected governments of a military or socialist cast. Those governments paved the way for the country's present inflation and unemployment problems—both up to about 25 percent—and the electorate showed its discontent in the elections last December, where a record 87.5 percent of the voters went to the polls.

The antisocialist center-right Democratic Alliance won 42.2 percent of the vote, giving it a three-seat majority in the 250-seat parliament. The Socialists went down from 35 percent of the vote in 1976 to only 27 percent in 1979. (The Communists, however, picked up 5.4 percent more this time, adding to the 14.6 percent attained in 1976.) The Democratic Alliance, led by lawyer-politician, Francisco Sa Carneiro, repeated its victory in the rural parish assembly elections two weeks later.

The new government intends to open the market to private banks in competition with its nationalized ones, to compensate businesses and individuals whose properties were seized by the State, and to repeal labor laws that prohibit employers from firing workers.

Democratic Alliance leader Sa Carneiro seems to be quite an individualist. He has openly scorned the Socialists for their willingness to compromise and formed his party in opposition to the nationalization of banks and industries. He quit his party last year when it voted to support the Socialists and returned only recently. In a country that is 90 percent Catholic, Sa Carneiro openly lives with a Swedish publishing executive and not with his Portuguese wife.

Imbalance of Payments For Defense

Because most of its leaders have adhered to the domino theory of communist takeover, America has not been shy about providing for the defense of its ever-shifting allies. Being among the richest countries in the world has contributed to its magnanimous beneficence, although now that the gas and grocery bills have become more painful, and the balance-of-payments deficit more outrageous, some people have begun questioning whether the United States should, in fact, be policing the world.

The Washington Monthly, for example, carried an article entitled "Make Our 'Allies' Pay" in its November 1979 issue. The thrust of the article is that there is an imbalance of economic loyalties rather than megatons; that the very countries we defend with our nuclear largesse are the countries that are competing most vigorously with our economy, such as Japan, the OPEC nations, and West Germany. The author, Vincent Wilson, notes that "West Germany, a country that borders on the Warsaw bloc, a country with a strong economy and an inflation rate last year of only 2.8 percent, recently declined to meet its commitment for increased NATO expenditures because, according to the West German defense minister, its security is not threatened." Wilson suggests furnishing our allies with a timetable within which they can begin sharing defense costs.

California Governor Jerry Brown seconded Wilson's sentiments when, in his own inimitable style, he asked, "If the Germans don't want to spend any more on their defense than they do, why should we be the suckers while they spend that money to export products to this country?" Brown said our defense money would be better spent coping with domestic energy problems and domestic investment and that a stronger economy rather than more nuclear weapons is the key to a stronger defense.

Have they been reading Libertarian presidential candidate Ed Clark's literature lately?

Taxes Spur Underground Economy

From 1964 to 1979, according to a report in the Wall Street Journal, the Consumer Price Index has risen about 137 percent and personal income has trotted along at its heels at 131 percent. While it may then seem that things aren't so bad, figures show that the 1964 median income for a family of four ($8,132) put that family in a tax bracket of 18 percent compared to the 21 percent now taken from the equivalent $18,815 median income of a 1979 family. The deceptive tax brackets, plus the much higher Social Security "contributions," give the 1979 family a purchasing power adjusted to inflation of $1,056 less than the 1964 family.

Economist Lacy Hunt estimates that a 10 percent increase in income will raise a family's federal income taxes by 16 percent and predicts that federal taxes will average past 20 percent of income after 1980. State and local taxes, meanwhile, may be less painful but are predicted to rise due to the burgeoning costs of employee pension programs for bureaucrats.

The WSJ article further raises questions about employee retirement programs: A 35-year-old employee who earns $10,000 a year now, is given eight percent annual raises, and retires with a retirement figure of half his projected income will end up in a much higher tax bracket then than in his working years. His retirement income will also be ravaged by inflation.

Resentment against these extortionist policies is beginning to surface. A recent survey showed that people consider 52 cents of every tax dollar that goes to the federal government a waste, an opinion that cuts across lines of party affiliation, region, age, sex, and income level. (A year ago, a comparable poll showed the perceived waste to be 48 cents.) The people surveyed indicated that they feel 29 cents of state tax dollars are a total loss, while 23 cents of local tax dollars are written off.

Almost certainly as a reaction to such evaluations, the United States possesses an increasingly healthy underground economy. Economist Peter Gutmann made waves two years ago when he placed this underground economy at 10 percent (about $176 billion) of the reported gross national product, but now his startling figures have been assailed as being too conservative.

Economist Edgar Feige claims that the underground economy is at least twice that calculated by Gutmann, accounting for 19 percent of the GNP in 1976 and for 26 percent by 1978. Feige claims that official statistics therefore understate the true growth of the economy, which he puts at 11 percent in both 1977 and 1978, and of course overstate unemployment and inflation (because prices rise more slowly underground).

If Feige is right—and we suspect he is close to the truth—then there is more reason for optimism than official figures on our economy may show.

Government Immunity Under Fire

In a Spotlight column on highway hazard fighter Joseph Linko last April, REASON attributed the preponderance of road hazards to "the lack of a single, responsible party operating a highway and assuming responsibility for its safety." Because governments have not had to pay for their mistakes, they have been less careful than private contractors open to suit might have been.

Well, not anymore, it seems. The California Supreme Court ruled late last year in a 4-to-3 decision that the state may be held liable for damages in accidents caused by its negligence with respect to conditions on public highways. The majority decision rejected state pleas that it could not be held responsible by noting that, in this particular case, there was sufficient evidence to conclude that dangerous conditions existed even when the driver was careful. (The case involved a 1972 suit by Dennis and Patricia Ducey after they were hit on Highway 17 near Fremont, California, by a car whose driver had lost control, crossed the median, and crashed into their car. They cited the excessive number of accidents on that particular stretch due to the lack of median barriers.)

In another court decision that may make city governments more respectful of property rights, the California Supreme Court upheld the rights of Westchester area residents in Los Angeles against that city. The surprisingly unanimous decision pointed out that when the city decided to expand the Los Angeles International Airport near an established residential area, it meant increased noise for and thus an intrusion upon those citizens. The court did not obscure the issue with arguments about property rights versus social welfare, and granted the residents an award of $86,800 in damages. The court observed that citizens should be able to assert personal rights as property owners or occupants and said, "We discern no basis for any reasoned distinction between claims for property damage and personal injury arising from the same activity and cause."

Los Angeles City Attorney Burt Pines swore to seek a review from the US Supreme Court, naturally.

Milestones

No Federal Bail-Outs. The Business Roundtable recently issued a press release on the Chrysler crisis affirming the principle of "no federal bail-outs." The Roundtable did make a case for "targeted federal assistance" but went on to deplore "the costs and inefficiencies of government intervention in the economy." Well, they're getting there. Postscript: Roundtable member Chrysler pulled out in a huff.

Korean Dissent Allowed. In the tradition of dictators everywhere, South Korea's former president Park Chunghee issued an emergency decree back in 1975 that barred all political dissent, demonstrations, and criticism. In his first major act as president following Park's assassination, Choi Kyu-hah lifted that emergency decree last December and was expected to release political prisoners guilty of violating the decree.

Union Curbs in Britain. The Conservative government's plan to restrict some union practices in England was supported in a poll of trade unionists. Proposed legislation to stop secondary picketing (picketing of firms not directly concerned in a dispute) was backed by 74 percent of those polled, while 71 percent favored State-funded secret ballots on strikes and elections. Most significant was the fact that 66 percent were in favor of limiting a union's power to coerce workers to join.

OSHA Exemptions. Businesses in 49 industries with 10 or fewer employees have been granted an exemption by Congress from OSHA safety inspections retroactive to October 12, 1979, and extending to September 30, 1980. The 49 industries were selected on the basis of their safety records, while a bill now in Congress would extend the exemptions to individual companies with good safety records rather than just qualifying industries.

School Initiatives Flunk. Two separate California initiatives failed to qualify for the June 1980 ballot for lack of signatures. The National Taxpayers Union's Educational Tax Credit initiative would have offset state income taxes by up to $1,200 per year for money spent on a person's education by individuals or corporations. The NTU gathered 200,000 signatures, about 300,000 short, and is currently deciding whether to try to qualify it for the next ballot (leaning toward the yes side). The Coons-Sugarman School Voucher Aid initiative, which would have given school vouchers to parents against state income taxes of up to $1,200 per student, would not disclose how many signatures they had attained and were pessimistic about trying again.

Kentucky Okays Diversity. The Supreme Court of Kentucky held that the Kentucky Board of Education cannot compel a religious school to abide by its decrees. Similar to a recent North Carolina case (see Trends, Jan.), the Kentucky court stated that schools must comply only with health and safety requirements and that pupils may be required to take standardized achievement tests; otherwise, religious schools may do what they will.

Swiss Interest Rates. In a puzzling series of moves, Swiss banking authorities first lowered the negative interest penalties on nonresident Swiss franc accounts of over 100,000 SwF from 40 percent to 10 percent and then a month later removed the penalties entirely. The amount of interest nonresident accounts can earn, while up from SwF 20,000, remains limited to the first 100,000 francs of any individual account.

Policing the Police. The Supreme Court ruled 6-to-3 last November that law enforcement officers cannot search a person for merely being in a place they are authorized to search. The police can do so only by obtaining a warrant that specifically authorizes them to search all persons on the premises—which will be issued only if they can convince a judge or magistrate that there is reason to believe all such persons are violating the law.

White Flight Explained. Two separate studies on "white flight" and mandatory busing, one in Los Angeles and the other in Boston, indicate strongly that court-ordered busing is opposed for "ideological" reasons. Court-ordered busing leaves people feeling they have no avenue for dissent, and therefore increases opposition significantly compared to busing ordered by a school board. The Los Angeles study further noted that, contrary to conventional thinking, families who believe school desegregation increases racial tension are less likely to flee than those who do not.

No Limits to Press Freedom. Allen H. Neuharth—president of the Gannett group, which owns 80 daily newspapers, 7 television stations, and 12 radio stations—calls "the abuse and misuse of government power" the greatest danger in the world today. In his speech to the Cincinnati Chamber of Commerce, Neuharth reminded his audience of Thomas Jefferson's warning 200 years ago that freedom of the press cannot be limited without being lost.

Condominiums Can Choose. The Florida Supreme Court ruled late last year that condominium associations can set age restrictions for residents and can prohibit children in condominiums intended for the elderly. The only restriction set by the court was that such rules must be administered uniformly.