The Pursuit of TV Happiness
With a misguided conception of patriotism in tow, the Canadian government is refusing to license American pay-TV companies in Canada on the grounds that they do not contain enough Canadian-produced material. Canadian-produced programs are not, however, what the Canadian public seems to desire.
About once weekly in the last 18 months, the members of one or another remote Canadian community have scrounged up enough money to purchase jointly a large dish antenna. With the antenna, they can receive and rebroadcast signals from the US Satcom I satellite, including most regular US TV shows and pay-TV (the most popular being Home Box Office). Some 200 isolated villages, mostly in northern Ontario and British Columbia, are thus challenging the government, as well as breaking various international treaties.
The villagers say they would be glad to subscribe to pay-TV ($8.50 a month across the border in Washington state) if it were legal. But it isn't, and so they ignore the Intelsat Treaty and a bilateral US-Canada pact, both prohibiting satellite signal interception. And they've tied the hands of the Canadian Radio-Television and Telecommunications Commission, the agency responsible for such things, by thus making almost every member of the community a "criminal."
When it comes to getting Charlie's Angels, it seems, the spirit of entrepreneurship is alive and well!
An Unfair Doctrine
At a press conference on the First Amendment, CBS chairman William S. Paley warned the print media that new technology is making them as vulnerable to the curtailment of their First Amendment rights as broadcasters now are. Paley said he now maintains a "purist viewpoint": the First Amendment either applies equally to all media or applies not at all.
The print media, he noted, have not been as actively opposed to the Fairness Doctrine and other equal-time broadcasting provisions as broadcasters are because they consider themselves in a separate category. Now, however, the increasing use of cable and satellite systems to print and deliver the news risks bringing print media under the control of the Federal Communications Commission—and such little goodies as the Fairness Doctrine. Congress has required, for instance, that candidates for federal office have equal access to the airwaves.
The purported rationale for the special control over broadcast media is the alleged scarcity of broadcast opportunities, an excuse Paley pooh-poohed. When the FCC was created in 1927, he said, there were 677 broadcast stations and 1,949 daily newspapers in the United States, whereas today there are 9,774 broadcast stations and 1,756 daily papers. It seems that print media are the ones that are scarce today. And so, proposed Paley, all government rules on the content of broadcasting should be wiped out. The role of the FCC? Simply to make sure stations keep on their assigned wave length, Paley said.
Free Press: 1, Unions: 0
When Britain's Trades Union Congress (TUC) declared a national "day of action" on May 14 to protest the economic and social policies of the Thatcher government, it expected to deprive Britishers of, among other things, their daily newspapers—written, printed, and delivered by various union members—for a painful day. What the TUC didn't count on, however, was the Freedom Association, which printed and delivered 250,000 copies of the Free Nation, made over from its usual members-only, monthly format to be as much like a daily as possible. It featured news, sports, a TV guide, a crossword, and even, alas, the de rigueur "girlie" picture.
And it was a great blow to the striking unionists. As one beleaguered news agent gleefully said, "I've been waiting for years to get my own back on the unions." The operation also attracted new members and supporters to the Association.
The Freedom Association began publishing the Free Nation in 1976 to help promote its goals. Among these are the freedom to choose whether or not to join a trade union; the right to private ownership; freedom from oppressive, confiscatory taxation; and freedom to engage in private enterprise.
Project Private Enterprise
June 24, Fremont Airport, California—After a crowd of several hundred spectators sang out the 10-second countdown, the space engineer at the control panel pushed some buttons and fired the four engines of a tied-down X-3 rocket for 30 seconds—and sighed with relief when they functioned smoothly. Sounds like the plot of any good grade-B movie, or perhaps a day in the life of a NASA engineer, doesn't it? But this particular story has a pleasant twist: the space engineer is one Robert Truax, a former government rocket expert, now working on his own; and the $1 million budgeted for the project comes entirely from the pockets of some 38 Chicago business executives and space enthusiasts.
Dubbed "Project Private Enterprise, Inc.," the venture, Truax says, is designed to: (1) prod the aerospace industry into taking a more entrepreneurial role in space exploration, instead of functioning as mere government contractors; (2) prove that straightforward technology can solve seemingly difficult problems; and, (3) demonstrate to Congress the widespread support for an expanded space program. Truax bought his engines for $115 each at a salvage shop—they had originally been built for the Air Force Intercontinental Ballistic Missiles in the 1960s for $70,000 each. Parts for the rocket come from surplus government equipment, custom-made hardware, and over-the-counter gear.
Each engine has a thrust of 1,000 pounds, which is expected to push the X-3 rocket up to 110,000 feet at a top speed of 2,400 miles per hour. At the peak point, fuel supplies will be exhausted and the rocket should continue upward until it reaches about 50 to 60 miles above earth. After it coasts downward, a series of parachutes will land it in the Pacific Ocean. Total flight time: about 15 minutes.
Truax has received pilot applications from about 200 people, and he's encouraging women to apply because of space limitations—and, he says, because the United States has not put a woman in space yet. Truax says the length from the astronaut's back of the hip to tip of the kneecap must be under 25 inches to fit comfortably into the cramped capsule. The pilot's seat is a simple, small padded stool.
The cabin will not be pressurized, and the astronaut will not wear a pressurized suit. These two facts are already causing some spoilsports to mutter about sending someone off without proper safety precautions. But, happily, the obviously voluntary nature of the job seems to mollify most aerospace officials, even if they are a bit wary. Glynn Lunney, a space shuttle manager for NASA, says that there are no laws to prevent Truax from flying his rocket. Besides, he notes, "Look what the barnstormers did for the development of aviation!"
Changes in Mozambique
After winning independence from the Portuguese as a Marxist state in 1975, Mozambique is now curtailing some government control over small and medium businesses and is looking for investments from Western multinationals. A major impetus for this critical look at internal policy was the recent takeover of neighboring Zimbabwe (Rhodesia) by ally Robert Mugabe, who waged his guerrilla offensive from Mozambique and is friendly with its president, Samora Machel. Before Mugabe's takeover, Mozambique had reportedly had to spend much of its time and resources fending off Rhodesian raiding parties.
The Portuguese left Mozambique in 1975 as a country with 12 million overwhelmingly uneducated and unskilled farmers. They also left a national debt of $640 million. Today, harvesters and tractors lie idle, because no one has the skill to maintain them. Agricultural production on the nationalized farms is down by 70 percent. Factories are running at less than half their capacity.
In a March policy speech, Machel blamed these internal problems on "inefficiency, stupidity, rudeness, and petty corruption" in the State-run enterprises that had been taken over by worker groups. He vowed to return some of the small businesses to their previous owners. Investment and "aid" in the form of loans is also being sought from western countries. Thus, despite the Soviet investment in foreign aid and military training for Mozambique, economic reality is moving this erstwhile client state towards its own version of capitalism.
Taking Stock in France
A temporary income tax deduction of up to $1,200 per person has injected some $1.8 billion into the French stock market, the Paris Bourse, over the last two years. The 1978 Monory Act allows French taxpayers to deduct up to $1,200 of any investment in the stock market, and so far over a million people have taken advantage of the rebate. In the same two-year period, French industry has benefited from fresh funds for new-equity offerings—over $1.95 million—spurring investment in plants and equipment.
The Monory Act, named after Economics Minister René Monory, is only a temporary four-year measure, but government officials are already worrying over the possibility that stock investors may pull out when the act expires in 1983. In that case, says French Treasury deputy director Bruno de Maulde, "we would have to do something" to prevent a major withdrawal from the Bourse. It remains to be seen whether the center-right d'Estaing government and the irrefutable evidence of the last two years will result in a permanent deduction, or whether that "something" will be yet another strangling loop of red tape to somehow force investors to stay in.
The States vs. the Feds
The 10th Amendment to the US Constitution reserves to the states and to individuals all the powers not specifically granted to the federal government. The Surface Mining Control and Reclamation Act of 1977, to be implemented by the Department of the Interior, orders coal mine operators to restore strip-mined land to its original condition and bans them from mining areas near public buildings, parks, and cemeteries.
The juxtaposition of these two mandates has led a second federal judge to declare portions of the 1977 act unconstitutional. Federal Judge James E. Noland in Indiana ruled that Congress had exceeded its authority in several provisions of the act, a similar ruling to the narrower one laid down by District Judge Glen Williams in Virginia earlier this year (see Trends, Apr.). A third lawsuit in Iowa went in favor of the law, however.
The National Coal Association, the states affected, and several coal companies are now pushing for a Supreme Court review and ruling on the matter. Jack Costello of the Indiana Department of Natural Resources points out that Indiana has had "real good reclamation laws since 1941," adding that the "federal law wasn't needed or necessary."
But Justice Department lawyers won a stay from an appeals court in Virginia to allow the law to remain on the books until the Supreme Court rules on it. An attorney for Amax, one of the largest coal mining companies in the United States, contends that Amax has had to spend over $35 million in equipment and operation costs to comply with the law.
Send in the Clones
Remember the dozens of monstrous little Hitler clones in the movie The Boys from Brazil? This Frankenstein scenario was propagated by some scientists and lay persons in the middle of the 1970s, some years after two scientists announced that they had perfected gene transplanting. And the stereotype of nasty little scientists doing secret wrongdoings in the bowels of their laboratories was abetted by a 1972 US Patent Office refusal to grant General Electric scientist Ananda Chakrabarty a patent for his oil-eating pseudomonas bacterium (see Trends, May 1980).
GE appealed that decision in 1976, and the case has finally been decided by the US Supreme Court. In a historic decision, the justices decided 5-to-4 in June that scientists or companies may obtain patents on living microorganisms created in laboratories. Justice Warren E. Burger, in his majority opinion, said that the federal patent law drafted by Thomas Jefferson in 1793 was intended to cover such unanticipated inventions as the telephone, transistor, and nuclear reactor. Burger drew a distinction between a law of nature (such as the law of gravity), which cannot be patented, and a laboratory-produced microorganism that "is not nature's handiwork."
The ruling clears the way for approval of over 100 patent applications currently on file. That number understates the extent of work going on, since many researchers prefer to rely on trade-secret rather than patent protection in this rapidly changing field. Among the possible applications of known research are: transplanting the human growth hormone (HGH) from human pituitaries to bacteria that will be given to livestock and, possibly, midgets; reproducing a bacterium that converts corn syrup into fructose, a natural sugar that provides the same sweetness as table sugar in similar quantities but with less calories; and, possible vaccines for hepatitis, malaria, and cancer.
A Raspberry to Liberals
The days when liberals could automatically count blacks among their ranks seems to be over. A case in point: in the last three months, prominent columnist William Raspberry has given the reading public a series of columns any libertarian could agree with. Here are some sample headlines, for example, from the Los Angeles Times: "The Fairness Doctrine Is Unfair," "Overprotection Stunts Energy Growth," and, "Are Reagan/Blacks So Far Apart on Welfare?"
This last column provoked a follow-up a week later on the same subject—"provoked" because the expected "outraged reaction from liberals and advocates of the poor" just didn't come. Instead, Raspberry received widespread support for his position—that welfare removes the incentive for people to find jobs and thus undermines the work ethic and that the best help for poor families is to require that able-bodied welfare recipients go to work. "Blacks of unmistakably liberal politics," Raspberry writes, "are telling me that they are starting to see our best-intentioned welfare programs as a snare that traps people in their poverty."
Cuts That Don't Count
In George Orwell's novel 1984, a Big Brother government twisted language to eliminate inconvenient concepts and to revise history along more favorable lines. Right on schedule, the American government, aided by some economists, most politicians, and a large portion of the media, has managed to change the popular connotations of the term "tax cut."
Ronald Reagan, for example, proposes to "cut" some $22 billion in taxes next year. Libertarian presidential candidate Ed Clark points out, however, that taxes are scheduled to increase by $87 billion in the coming year. So the "cut" Reagan is talking about actually means a downward adjustment that doesn't even begin to offset the automatic tax increases due to inflation.
A Tax Foundation, Inc., study brings the whole picture into focus: take the case of a married couple with one wage earner, two children, and an annual gross income of $10,000 in 1979. The net after-tax income received was $9,065. Say the wage earner received a 14.5 percent pay raise for 1980 ($1,450). After paying increased federal income and Social Security taxes, the after-tax income of the worker would be $10,202. But, with the dollar's decreased value due to inflation, that worker's purchasing power is calculated at $8,910. In other words, inflation further eroded the worker's after-tax income by $1,292. The losses due to higher taxes and inflation exceed the salary increase by $155 ($1,292 less the net raise of $1,137), translating our poor worker's supposed raise of 14.5 percent into a net loss in purchasing power of 1.7 percent.
According to Ernest Conine of the Los Angeles Times, for a tax "cut" to actually increase purchasing power, the reduction would have to be greater than the sum of the increases in Social Security taxes that will take effect January 1 and the increase that will occur in income-tax collections as a result of inflation. Conine therefore cannot understand all the hoopla surrounding the Kemp-Roth bill, which would reduce individual income tax rates by only 10 percent per year for three years.
A second misconception is irrefutably erased in an annual analysis by the US Chamber of Commerce based on Department of Labor statistics. While most people on the street, friendly mailings from utilities, and various TV ads often paint OPEC or the Arabs as the villains behind tighter family budgets, the analysis shows up a different culprit. Transportation costs for a family of four (including gasoline) with a 1979 budget of $20,077 have gone up by 31.9 percent since 1976. Federal income and Social Security taxes, however, have jumped up 36.8 percent. This tax increase is 50 percent more than the increase in all other items in a family budget (food, clothing, housing, transportation, medical care), which went up by an average of 24.1 percent.
With these unpleasant facts under our belts, we can look forward to seeing Libertarian Ed Clark's tax program, which he promises will be "the biggest tax cut in American history." If it actually provides for a net cut in tax collections, it may force the other parties to clean up their Orwellian rhetoric.
Love Canal Reconsidered
While the facts are not all in on the Love Canal matter, enough questions have been raised to cast considerable doubt on the media image of Hooker Chemical as an irresponsible corporate outlaw, poisoning its neighbors without concern. Among the new (and little-reported) findings are the following:
• Before Hooker bought one of its plant sites in Niagara Falls, the Army operated a plant there during World War II, producing the deadly nerve gas phosgene. And evidence indicates that the Army disposed of hazardous and toxic chemicals at the Love Canal dump during the war. The source of this information is formerly classified documents turned up by a New York State Assembly Committee. The Defense Department denies the charges. (Science News, June 7, 1980.)
• The problem pregnancy rate in the Love Canal neighborhood, cited in 1978 as a reason for permanently evacuating 200 families, was blown out of proportion. According to Dr. Nicholas Vianna of the state health department, problem pregnancies peaked in the mid-1960s and had returned to virtually normal levels by the mid-1970s. (Associated Press, June 25, 1980.)
• The much-vaunted study of chromosome damage—which led to another 2,500 near-hysterical residents being evacuated this May—has virtually no scientific value and cannot be salvaged, according to a panel of experts who reviewed it for the Department of Health and Human Services (HHS—formerly HEW). And a second review panel, convened by the Environmental Protection Agency, agreed, concluding that there is no evidence at this time that the Love Canal residents have excessive chromosome abnormalities. (Science, June 13, 1980.)
Moreover, it now turns out that Hooker Chemical had explicitly warned the Niagara Falls School Board that chemical wastes had been dumped at the Love Canal site and that no land uses should be permitted that would involve excavation—for example, "for construction in which basements, water lines, sewers, and such underground facilities would be necessary." These warnings were made orally at several 1957 school board meetings and reported faithfully in the local press. Yet the board went ahead later and allowed two city streets and a state expressway to be built across the dump site, quite possibly disturbing the fill and clay cap over the dump.
It may well be that Hooker did not do everything it should have done, given its knowledge of the facts. But the evidence that its chemical wastes have harmed people and that it is Hooker's fault looks less and less substantial as the months go by.
FAA under New Fire
June turned out to be a bad month for the Federal Aviation Administration. Its competence in both areas under its jurisdiction—setting and enforcing air safety standards, and operating the air traffic control system—came under attack, echoing charges made earlier in REASON (see "Is This Any Way to Run an Airway?" Jan. 1979).
The first blow came from the Committee on Airworthiness Certification Procedures, a body created by the National Research Council in the aftermath of last year's Chicago DC-10 crash to find out just how well the FAA does the job of ensuring safe design and operation of aircraft. The answer? Not very well. The FAA lacks the engineering know-how and dynamic leadership needed to do the job, the 13-member committee concluded. Said chairman George M. Low, "The FAA engineering staff is today considerably less competent than the engineers in the industry they regulate." But despite recommending a major change in design philosophy that, had it been in effect when the DC-10 was designed, would have prevented the crash, the committee took pains to reassure people of the basic safety of air transportation. And rather than questioning the basic soundness of making a government bureaucracy responsible for safety—instead of, say, an independent entity funded by the insurance industry—the committee recommended mostly minor changes in the status quo. Its conclusions, however, were taken as a major criticism of the FAA.
No sooner had the dust begun to settle than Rep. John Burton let fly with the second attack. Citing four failures in a single month of the air traffic control computer system for the Northern California region, Burton announced hearings into the adequacy of the system. Charging that the FAA is "downplaying the seriousness of it and misleading the public," Burton said he has received reports that some breakdowns have been covered up with doctored records and that some others have not been reported at all. The real danger occurs during the first part of a computer outage, when the transition to a manual back-up mode must be made. Controllers report having lost track of planes for as long as seven minutes after a computer failure, raising the possibility of midair collisions. The FAA denies any cover-ups and claims that computer breakdowns are becoming less frequent. At press time it was not clear whether the hearings would lead to new support for the idea (backed by the controllers' union) of privatizing the air traffic control system.
Chicago May Free Cabs
The movement to deregulate taxis has spread to Chicago. Two aldermen have introduced a measure that would remove all restrictions on both fares and the number of cabs allowed to operate. Anyone who could meet basic safety and responsibility requirements would be licensed, with the only requirement being to post the fare in the cab's window.
In recent years partial taxi deregulation has occurred in Los Angeles, Seattle, San Diego, and several smaller cities. And a few cities, such as Washington, D.C., Honolulu, and Indianapolis do not restrict the number of cabs. But the Chicago plan would be the most laissez-faire of them all.
Opposing the move in Chicago are most of the existing licensees—including Yellow Cab (which holds 2,100 of the 4,600 medallions) and Checker (which holds 1,500). Their argument is that the city has all the cabs it needs. But the fact is that most taxis in Chicago congregate at high-traffic areas like the airport and the Loop, leaving outlying areas underserved. This is the usual pattern in regulated cities (see "Alternative Transit," REASON, July 1980). With unlimited entry, however, taxi service tends to expand considerably to additional markets, including lower-income areas.
The aldermen who are backing deregulation—Clifford Kelley and Bernard Stone—understand this; both are from outlying areas. Interestingly, when Mayor Jane M. Byrne was the Chicago consumer agency head several years ago, she praised the idea of taxi deregulation. If Byrne gets behind the current move, Chicago could well become the nation's alternative transit leader.
And Now, Indoor Pollution
"Are solar homes more radioactive than uncontained nuclear meltdowns?" So asks nuclear scientist Henry Hurwitz in a recent paper intended to point out the hazards associated with drastic reductions in ventilation in order to conserve energy. One of the principal results is to trap radioactive radon gas, whose decay products can be hazardous.
Hurwitz cites measurements made in some energy-efficient homes of as much as 30 nanocuries of radon per cubic meter of air. For a concentration of just 10 nanocuries, the added lifetime lung cancer risk is computed to be one in a thousand per year of occupancy. But that is precisely the added risk level computed for the average victim of a hypothetical uncontained nuclear reactor meltdown.
Hurwitz's point is not that energy-efficient homes are bad. He is trying to alert people to the double standard being applied by government agencies—on the one hand, the Nuclear Regulatory Commission imposing extremely stringent radiation limits on the exposure of uranium miners and the general public, while much higher limits are being allowed and even encouraged for homes by the Department of Energy and the Environmental Protection Agency. Examples: the NRC standard for exposure at the boundary of a nuclear facility is 133 times less stringent than the EPA guideline for radon in Florida homes. Similarly, a home just meeting the EPA guideline could give its residents a lifetime exposure as great as that received by a uranium miner in 10 years.
And radon and its decay products are not the only hazards of tightly sealed buildings. Wallboard and foam insulation frequently give off formaldehyde. Many consumer products (hair sprays, deodorants, furniture polish) likewise give off harmful chemicals, as do gas ranges. In normal houses, the rate of air exchange is from one-half to one complete change every hour. But energy-efficient homes may allow one exchange only every 10 hours, trapping the gases within the building. By thus tightening up buildings "we may be transforming them into virtual gas chambers," says Dr. George Burch of the Tulane Medical School. David Rosenbaum of the EPA estimates that 10 percent of all US lung cancers are already caused by indoor radon.
What can be done? Install heat exchangers, which bring in fresh air without letting heat (or coolness) escape. Use an electrostatic precipitator to remove smoke and dust particles from the air. But don't simply seal up your building like the government tells you, ignoring the very real risks of indoor pollution.
Medallions Now, Coins Tomorrow?
The Treasury Department has begun taking orders for half-ounce and one-ounce gold medallions, made possible by the American Arts Gold Medallion Act. The act provides for a series of 10 different medals to be minted over the next five years.
One million half-ounce medallions, at about $300 apiece, are being offered for sale, along with 500,000 one-ounce medallions at about $600 each. The prices change daily depending on the closing price of gold on the New York Commodity Exchange, and a premium of $6 on the half-ounce and $12 on the one ounce medals is added. Call 800/368-5510, now available for daily price checks, brought to you courtesy of American taxpayers, of course; and buyers are limited to three medallions each. The Treasury Department hopes to compete with the sales of foreign gold coins, on which Americans spent some $900 million in 1979.
Another arm of government, in the meantime, is mustering unexpected support for the minting of gold coins (that is, money). Liberal Democrat Henry Reuss (D-Wisc.), chairman of the House Committee on Banking, Finance, and Urban Affairs, has asked the president to give serious consideration to issuing half- and one-ounce gold coins. His proposal was endorsed in the Senate by Sen. Jesse Helms (R-N.C.), a sound-money proponent and author of the Gold Medallion Act, who sees the proposal as an initial step toward the remonetization of gold. Reuss hopes to have the government market these gold coins to foreigners, though he would not bar Americans from buying them, as a measure to make the exchange of dubious paper money for gold at least flow in both directions.
Trucks Partially Deregulated
Things will never be the same in the trucking industry, thanks to a partial-deregulation bill that swept through both houses of Congress in May. As signed by President Carter the bill will:
• Expand entry to the trucking industry, by shifting the burden of proof from those who want to provide service to those who oppose it.
• Increase rate freedom, by allowing firms to raise or lower rates by 10 percent without approval of the Interstate Commerce Commission. After two years, the price-fixing rate bureaus would lose their antitrust exemptions and prices could rise as much as the annual increase in the producer price index.
• Repeal many restrictions on which goods can be hauled by which truckers over which routes.
Industry observers expect the measure to have far-reaching effects, including new price competition, an increase in the number of independent owner-operators, more mergers (and more bankruptcies of poorly managed firms), and a larger role for smaller firms in serving smaller cities. "There will be more changes in the trucking industry in the next five years than the previous 20," securities analyst William Legg told the Wall Street Journal.
After trucking, what comes next? Sen. Howard Cannon (D-Nev.), chairman of the Commerce, Science, and Transportation Committee, plans to take up intercity bus deregulation as a first order of business when Congress reconvenes next year. And the ICC is already planning further reductions in control of bus rates and routes on its own.
Subsidy Effects. A survey by Angeles Real Estate Co., a California developer, shows that energy use in apartments drops 45 percent when each unit has its own meter and the tenant, rather than the landlord, pays the bills.
Schiff Sentenced. Tax rebel Irwin A. Schiff, author of The Biggest Con, was sentenced to six months in prison in Connecticut and fined $10,000 for failure to file 1974 and 1975 income tax returns. An identical penalty was overturned on appeal in 1970. Schiff is also appealing his latest conviction.
Obscenity Law Overturned. Wisconsin's state Supreme Court unanimously struck down its law making it a crime to deal with "lewd, obscene, or indecent" material because the law was too broad and did not define lewd, obscene, or indecent.
The Right to Travel. A US Court of Appeals ruled that former Secretary of State Cyrus Vance acted improperly when he revoked the passport of former CIA agent Philip Agee. The court said that the State Department has no legal right to revoke an American citizen's passport unless that person is accused of a crime. This may mean that Carter will be unable to revoke the passport of former Attorney General Ramsey Clark for violating the travel ban to Iran.
Inheritance Tax Eased. California's Legislature, with only two dissenting votes, approved a bill exempting surviving spouses from state inheritance taxes and reducing taxes for other beneficiaries. Gov. Brown has been opposed to the bill because it means, he says, a $100 million loss in annual revenues, and the lone Senate and Assembly dissenters gave the same reason for their "nay." Meanwhile, Assemblyman Donald Rogers (R-Bakersfield) is heading an initiative drive to end inheritance taxes altogether.
Social Security No Guarantee. In a poll conducted for the National Commission on Social Security, 73 percent of the respondents in the 25-44 age bracket had little or no confidence that there would be enough money in the SS to pay benefits to them when they retired. At the same time, 9 out of 10 nonretired respondents are counting on Social Security as their primary or secondary source of retirement income.
Three Cheers for Delinquent Accounts. The IRS is protesting legislation that would require agents to obtain a court order before seizing the property of delinquent taxpayers, saying such leniency would be unfair to lawful taxpayers. Rep. George Hansen (R-Idaho) tartly replied: "There are ways to do it without acting like the Gestapo."
State Competition. Private cable-TV companies may be in for some subsidized competition. A national nonprofit, tax-exempt "Performing Arts, Culture and Entertainment" (PACE) pay-cable service would be set up under a proposal resulting from a Carnegie Corporation-funded study. The proposal suggests that the Corporation for Public Broadcasting come up with $30 million in start-up funds for PACE'S first three years of operation, after which it would theoretically become self-sufficient. It would charge $4.50 per month to subscribers and could rebroadcast on PBS.
Balanced Defense. Americans want more defense, but not at the expense of a balanced budget, a Sindlinger and Company survey shows. A majority (56.7 percent) of the respondents agreed that "Congress should find ways to increase defense spending by reducing nondefense spending within a balanced budget." Nondefense spending would include such items as welfare, parks and recreation, and other "human services." The survey was conducted for the Heritage Foundation.
IRS Target of Initiative. The Church of Scientology is spearheading a nationwide petition drive that would force the Internal Revenue Service to reimburse taxpayers for all the time and money spent in successful challenges to IRS assessments. It would also penalize IRS agents or employees who abuse or misapply tax laws—just as CPAs are fined by the IRS if they err in preparing tax returns. Citizens who underpay due to incorrect advice from an IRS employee are also to be exempted from paying any additional amount, and all reimbursements to taxpayers from the IRS will have to be taken from the agency's existing budget.
Seabed Mining Bill Passed. Congress finally approved a bill to allow US companies to mine mineral-rich nodules from deep seabeds after January 1988. This bill will be superseded by any treaty agreed to by the UN Law of the Sea conference in Geneva (Trends, Aug.), and imposes a tax of 0.75 percent of the value of the recovered metals.
Carter Controlled. The Senate voted in July to repeal the Credit Control Act of 1969, effective in July 1981. If approved by the House, the repeal would disallow the tough penalties imposed by Carter last March on lending by banks and credit firms. The Senate also rejected a Carter proposal to triple the budget of the Council on Wage and Price Stability (to $38.7 million) so that its staff of 233 could be expanded to 637.
Tax Cap Initiative. The National Taxpayers Union has announced its support for the Florida State Revenue Cap Constitutional Amendment Initiative circulated by the Florida Tax Cap Committee. If approved, it would cut state revenues by 17 percent and lower taxes proportionally.
GAO Admits Drug Lag Exists. The General Accounting Office has released a report criticizing the length of time it takes the Food and Drug Administration to approve new drugs (See "Whatever Happened to Human Body Glue?" May). The principal culprit is management flaws in the drug-approval process, the GAO concludes, citing such problems as a lack of precise guidelines, frequent changes of reviewers, failure to resolve scientific disagreements with industry, and uneven distribution of work among reviewers. It further chastises the FDA for refusing to accept certain foreign studies on the safety and effectiveness of new drugs.
Statist Collusion. Hospitals risk violating antitrust laws if they jointly decide to reduce services without "explicit authorization and supervision by the state," says the Justice Department—despite a 1974 law requiring an end to duplication of hospital services.