Trends

Will Life in the Fast Lane Soon Be Legal?

There's nothing like enforcing a stupid law to speed up its repeal.

That champion of statism Elizabeth Dole may have done more to kill the 55-mile-per-hour speed limit than any of its opponents. She said she'd enforce the law and told Vermont and Arizona to wave their share of federal highway funds good-bye. These rural states, it seems, let more than half their drivers break the double-nickel limit.

Now politicians are racing to support repeal. Dole's boss, Ronald Reagan, recently told Sen. Steven D. Symms (R–Idaho) that he wants to scrap the law and once again let state and local governments set their own speed limits. A bill that would do just that is pending in Congress; another would modify the law to allow higher speeds on rural interstates.

Nearly a dozen states, mostly in the West, have reduced driving at 65 or 70 to a minor infraction punishable by a mere $5 or $10 fine, with no records kept. Out West, where a driver is more likely to crash out of boredom than from speeding, the legislatures keep trying to convince Washington to let them do it their way.

Meanwhile, a group of Colorado investors has a plan to circumvent the speed limit—and Denver traffic—by building a private toll road from Ft. Collins to Pueblo, a distance of about 200 miles. The highway would compete with Interstate 25, which runs smack through Denver and Colorado Springs, forcing travelers to fight city traffic. Since the road wouldn't use any federal highway funds, developers can set the speed where they want to with impunity—and their target is 80 miles per hour.

The higher speed limit would require a special exemption from the state law, but the legislature is likely to cooperate, the group's attorney, Tom Grimshaw, told REASON. After all, Colorado lawmakers have been among those trying to persuade the feds to lift the double-nickel limit.

Construction of the toll road would begin in about two years, says Grimshaw, and the project would cost about $800 million to complete. To foot the bill, the group plans to float bonds and to raise seed money from railroads, power companies, and water-transmission companies that would use rights of way along the highway.

Colorado hasn't had any private roads since pioneer days. Although a century-old state law does grant private road developers eminent-domain powers to condemn property they need, these road entrepreneurs hope not to resort to it.

Legal questions remain, however. "What do you do about police power? Who patrols?" asks Grimshaw. "If somebody's driving too slow, who gives them a ticket?" With the anti-55 rebellion picking up speed, public highway cops may soon be asking that question too.

Voters Say No to Preaching Politicians

The nascent presidential candidacy of television evangelist Pat Robertson has triggered fears that a new wave of moral regulation is approaching, primed to swamp our civil liberties in a deluge of sanctimony and Meese Commission reports. But it seems that the American people are in fact less than enthusiastic about a new moral crusade.

According to a recent Los Angeles Times poll, most Americans retain their traditional distrust of government meddling in personal affairs, even while 9 out of 10 consider religion "important" in their lives. Among the findings:

• A minority—38 percent—support laws against the distribution of pornography to adults.

• A smaller number—35 percent—support laws forbidding homosexual acts between consenting adults.

• By a 5-to-3 margin, Americans see moral regulation as an "annoying…intru[sion] into the private lives of citizens" rather than a noble effort to "protect activities that flout traditional family values."

The poll contained particularly bad news for Robertson, whose campaign has a strong religious flavor. Political candidates "who bring in their own religious beliefs when they discuss issues facing the nation" were disapproved of by 2½ to 1. By the same margin, they said they would be "less likely" and not "more likely" to vote for "a political candidate who described himself as an evangelical Christian."

Robertson's political ambitions have also discomforted some party leaders, who fear that a candidate urging the government to step up regulation of our personal lives might drive away younger voters (See "Making Republicanism Cool," June). Republican National Committee chairman Frank Fahrenkopf admitted to the Wall Street Journal: "We face the problem right now that the great strength of our party is among young voters, and on some of the social issues they are less conservative" than Robertson.

Robertson, it should be noted, sometimes makes a lot of sense when he turns his attention to economic issues, where his favorite theme is the need "to get the federal government off the backs of the people and out of our pocketbooks." Well, how about keeping the beast out of our bedrooms, as well?

Freedom of Flight No Longer for the Birds

As the evidence rolls in, more and more mainstream thinkers are acknowledging the enormous benefits of airline deregulation. One of the latest reports on freedom of flight's up-side comes from a once-unlikely source—the Brookings Institution in Washington, headquarters of the liberal policy establishment in exile.

In The Economic Effects of Airline Deregulation, economists Steven Morrison and Clifford Winston estimate that since 1978, deregulation has saved travelers $6 billion a year (in 1977 dollars) and earned airlines an extra $2.5 billion a year. The book also argues that many of the nasty effects that skeptics predicted just haven't come to pass.

Critics charged, for example, that deregulation would deprive small cities of service. But, found Morrison and Winston, deregulation has actually preserved or improved air service at many small airports by making it easier for airlines to tie them into hub-and-spoke routing systems. Without deregulation, they estimate, about 40 more airports would have lost all commercial service. And travelers going from one small city to another now have many more flights to choose from, thanks to routes that take them into a large airport, the hub, and out again to their destinations.

"In the years to come," Morrison and Winston conclude, "deregulation will almost certainly be regarded as a spur to the airline industry's continued development and a substantial contribution to the American economy." In other words, it's the only way to fly.

Shall I Compare Thee to an Iowa Social Worker?

The librarians of Minnesota should be happy bookers. After all, they're worth 30 percent more than their professional colleagues in Vermont, who in turn are 20 percent more valuable than the poor folks who shush talkative book lovers in Iowa. Minnesota secretaries, on the other hand, ought to sneak south of the border—in neighboring Iowa, they'd be worth 40 percent more.

No, typing hasn't suddenly gone out of style in Fritz Mondale country, nor have the state's librarians joined the Teamsters. These anomalies, and many more, are courtesy of "comparable worth"—the tidy system that was supposed to end sexist wage differences by rationally determining how much each job is "really" worth.

Now that several states have actually set up comparable-worth systems for public employees, comparative data are flowing in. And the results are showing what economic theory predicted all along. Wages set by bureaucrats and consultants, rather than supply and demand, turn out to be arbitrary and inconsistent.

Sure, the market produces differences that bother feminists—paying chemists, who are in short supply, more than librarians, who are not, for example. But these "new and improved" systems create differences of their own, even for the exact same job. The market says a librarian and a chemist aren't doing the same job; comparable worth, a new study reveals, would seem to be saying that a librarian and a librarian aren't doing the same job!

The study, done by the Center for the Study of American Business at Washington University (St. Louis), demonstrates gross inconsistencies in comparable-worth schemes. After putting states' different job-rating systems on the same numerical scale, using 100 to represent the lowest-paid job in each state, research analyst Richard E. Burr finds wide discrepancies in the "worth" of the same jobs. Photographers, for example, snap up 283 points in Vermont, 167 in Minnesota, and a paltry 133 in Iowa.

Behind these discrepancies, Burr reveals the problem with all comparable-worth systems: Somebody has to come up with a "politically correct" way of defining and weighting job characteristics. And not everyone agrees on how important each characteristic should be.

In true feminist fashion, for example, Iowa gives its highest weighting to the knowledge a job requires (25 percent) and counts physical demands the least (5 percent). Michigan, on the other hand, downplays knowledge to a mere 11 percent and gives physical activities a respectable 8 percent weighting. But the state also redefines physical dexterity—a component of "physical activities"—to suggest, says Burr, "that lifting a 75-pound box every two hours requires the same effort as typing and lifting many smaller objects such as files and pencils during the same time period."

That must be why so many bodybuilders work out with pencils.

Liberty Grows on the Green Side of the Fence

The beauty of a free society is that, rather than force one centrally designed utopia on its hapless citizens, it creates a "framework for utopias," as philosopher Robert Nozick has put it. This principle itself seems to foster pro-liberty, antigovernment sentiments, as can be seen in elements of this country's communal, ecologically oriented Green, or New Age, movement.

Take, for example, the Cooperative Resources and Services Project (CRSP), a Los Angeles-based New Age-ish organization. The CRSP serves as a training center and information clearinghouse for all sorts of communal ventures, from the worker-owned Ocean Beach Peoples Food Cooperative to a new Ecological Revolving Loan Fund, which will make loans to "ecological cooperatively owned" businesses. Since its founding in 1980, the CRSP has advised several hundred businesses, groups, and individuals on the nuts and bolts of cooperative living and enterprise.

The group's undertakings may have a nonmarket, antiprofits aura about them, but they are emphatically not dependent on government help. For instance, a current project, the Los Angeles Mutual Housing Association, seeks to develop small, cooperatively owned "cohousing" communities. (Its first project will be a 25-unit community.)

But no government assistance is required, thank you. "We like to stay as far away [from government] as possible," CRSP executive director Lois Arkin told REASON. The group believes that the best way to make housing affordable for low- and middle-income folks is to "privatize government-owned land," preferably by selling it to voluntary housing coops.

The CRSP's faith in voluntary solutions to social problems is also evident in its eight-page fact sheet on homelessness. The organization shuns welfarist liberal bromides—Arkin writes that housing shortages are an example of "overdependence on government to solve problems it created and is now ill-equipped to solve." The pamphlet denounces public housing as a "discredited solution."

What is CRSP's answer to the well-publicized plight of the homeless? Private charity and the donation of time and energy, of course. But in addition, the group recommends a more enlightened attitude toward "squatters rights." It urges that homeless individuals who live as squatters, usually on land owned by governments, be provided assurance that they will not be tossed out of their makeshift shacks. With that assurance, "spontaneous investment of squatters' sweat equity in upgrading their communities usually follows." (Compare the Global Trend on Bogota, page 16.) Simply put, the proper response to homelessness is private charity plus giving the homeless the chance to do things, such as build a home, for themselves.

To encourage this urban homesteading, the CRSP urges state authorities to "turn a blind eye to building and occupancy code violations" that, if penalized, prevent individuals from living in housing deemed unsuitable by government bureaucrats. The CRSP ends this remarkable little pamphlet with a description of the numerous jobs—taxi driver, street vendor, prostitute, newsstand operator, even street-corner pencil salesman—that are closed to the poor by Los Angeles laws and regulations.

Some people may find groups like the CRSP a bit too starry-eyed or communally minded. We all have our own visions of utopia. But that, after all, is what freedom is all about.

Save the Whales—Support Property Rights

Thousands of Oregon sea lions owe their lives to an obscure businessman out to make a buck.

While the state was paying bounty hunters to kill the animals, R.E. Clanton preserved the only mainland breeding grounds for Steller sea lions. In 1927, he bought Sea Lion Caves, the largest sea cave in the United States, and opened it to tourists a few years later. To protect the animals their customers came to see, Clanton and subsequent owners spent much of their time fending off the bounty hunters who elsewhere almost wiped out Oregon's sea lion population.

Nowadays, federal law tries to protect the animals Oregon once paid to have slaughtered. But most people still look to the government to set and enforce environmental policy, and environmentalists usually see free markets and profits as the enemy.

These attitudes may be changing, however. More and more people are recognizing that the surest way to protect wildlife and wilderness areas is through private property, not government decree.

One sign of the new environmental philosophy is the rapid growth of the Nature Conservancy. Founded in 1951, the Arlington, Virginia-based group has saved 2.4 million "ecologically significant" areas the old-fashioned way—by buying them. From 1977 to 1985 the Conservancy's membership increased almost ten-fold, to 230,000 individuals from 25,000. The nonprofit group also draws so much support from business—about $35 million and thousands of acres of land a year—that Industry Week magazine has dubbed it "Industry's Favorite Environmental Group."

Clifford E. Messenger, a Nature Conservancy board member and former Wilderness Society activist, told Industry Week he switched groups several years ago when "I began to realize that you can win a victory today in Congress but lose it eight years later. But if you own the land, it will stay protected." Ah, property rights!

Even the federal government, or at least one small part of it, seems to be coming around to the recognition that private property encourages conservation. In its annual report early this year, the Council on Environmental Quality (a branch of the Office of Management and Budget) included a special section on private conservation efforts. "Unowned resources are more likely to be over-exploited than resources privately owned and managed, since a private owner directly benefits from the preservation and maintenance of such resources and thus is more likely to act as a responsible steward," the report observed in its prologue.

Along with Sea Lion Caves, the CEQ showcased 11 private conservation efforts. North Maine Woods Inc., for example, is a nonprofit group that owns 2.8 million acres of undeveloped, primitive forestland and charges visitors lower fees than a nearby state park. At the other end of the size spectrum is Sassapaw Research Refuge, an 18-acre farm run by a retired biologist as a habitat for butterflies, moths, and wasps.

Even the oft-maligned business of hunting has gained recognition as a tool in preserving wildlife. The reason is simple incentive: If you're running a for-profit hunting range, the last thing you want is a scarcity of game. The Deseret Ranch in Utah, which offers hunting on a quarter million acres, employs innovative grazing techniques that have increased both the ranch's domestic livestock herds and its wildlife population. In fact, the ranch has been so successful that the state of Utah is transplanting Deseret elk to public lands to improve hunting there.

A group of scientists has even suggested a market approach to that favorite environmental cause—saving the whales. As things stand now, whales are literally priceless and therefore undervalued; whalers have every incentive to kill as many animals as possible, since that's how they make the most money. And they have found ingenious ways to cheat on environmentalist-inspired treaties that restrict commercial killing.

So, suggests the proposal, why not give the world's whales to the now-ineffectual International Whaling Commission? The IWC could then make whales private property by auctioning off whaling rights; proceeds would pay for the boats and crews needed to monitor whale stocks and enforce the new arrangement. Since whalers who owned the rights wouldn't want to destroy their own crop, they wouldn't kill off the animals faster than they could reproduce.

Free-market conservation. It's a whale of an idea.

Milestones

? Cornhuskers 1. Nebraska has a new law making it the first state to allow local phone competition, effective January 1. The law, which still faces legal challenges, would also remove most price controls. One reason for the move: with no competition forcing relief from monopolistic phone rates, many companies had started to bypass the local phone network, the state telecommunications director told REASON.

? Debtor late than never. Debt-for-equity swaps—an exchange in which Western lenders trade outstanding loans for a stake in various Third World businesses, instead of hitting up their own governments to bail them out—is proving a partial answer to the onerous debt problems faced by many impoverished nations. Chile, Mexico, and the Philippines are among the countries encouraging such swaps, which will total close to $2 billion in 1986.

Global Trends

Tomorrow, the Promised Land

JERUSALEM—It was almost 60 years ago that socialism was institutionalized in Israel. Israel's has never been a straightforward form of socialism, as practiced in Eastern Europe and the Soviet Union, but the similarities, especially in the economic sphere, are striking.

Politically, Israel never adopted U.S.-style democratic reforms such as direct representation, a constitution, and the separation of powers. Nonetheless, it is a democracy—not perfect, but it does work.

Yet after decades of economic failures, as well as wars, some people are flirting with quite uncommon ideas—at least for this part of the world. These Israelis, despite years of indoctrination in the benefits of their "unique" semi-socialist collectivist system, have come to realize that constant warfare, economic and political instability, and corrupt ruling political organizations must finally be dealt with.

"Independence" (Atzma'ut) was the first party to call for a reform of the whole political and economic system. Since 1978, it has advocated total free enterprise in economic matters, direct elections, a constitution, and a separation of powers, including a presidential system. Independence's bold positions received much acclaim in the press but did not lead to any significant show at the polls in either the 1981 or 1984 elections.

One of the party's major themes is the rejection of all foreign aid, in the belief that the country can be run with its own resources, contrary to what most Israelis seem to think. Another controversial Independence proposal—to abolish the income tax—was not credible to most people, nor were other innovative ideas pushed by the party. Independence is still around, though, and it publishes the only free-market economic journal in the country, Free Man. The party's leader and chief ideologue, Prof. Ezra Sohar, is now the don of free-market thinkers in Israel.

Recently, a middle-of-the-road party called the New Liberal Center, led by the mayor of Tel Aviv and former Liberal members of the Likud, has adopted some of Independence's ideas. Polls show that the party will probably elect a few representatives its first time around. A presidential system. a constitution, and a freer economy are its principal planks.

For the time being, it seems that the greatest legal advance for freedom is the recently approved free-trade zone in Israel's southern port and sea resort, Eilat. Abolishing the value-added tax for all goods sold there increased business by almost 20 percent, and tourism is thriving.

There is also good news from the black market: 430 illegal cable TV stations cover the country, making huge profits and taking small fees while police and the state are totally helpless. The state-owned TV system here really is that bad!

—Oded Yinon

So They Loaded Up the Truck and Moved to Bogota

Doing something about the rapid migration of rural dwellers into Third World urban areas has become a prime concern of planners and academics who specialize in less-developed countries. But a new study of the process of urbanization in Bogota, Colombia—undertaken by the planners extraordinaire at the World Bank, no less—suggests that sometimes, the best planning may be no planning at all.

For five years the bank studied 4-million-people-strong Bogota, chosen as your typical developing Latin American city. In one respect, though, Bogota turned out not to be typical: instead of regulating new-housing development, the city government encourages a system of unregulated private housing known as "pirate development." And the result, as the World Bank study found, is that Bogota has managed to avoid the illegal land invasion and impoverished squatter areas that typically plague growing Third World.

Policy analyst Ann Bernstein, writing in South Africa's Finance Week, explains the scene in Bogota. Pirate developers "buy rural land on the fringes of the city, subdivide it into housing plots (ignoring local planning rules), and then sell the plots with few or no services" such as water hookups. Urban migrants then build basic housing on these plots.

Fears that pirate development would turn Bogota into a giant shantytown, says Bernstein, have proved unfounded. The study found that it takes an average of just five years for migrants to turn their shacks into conventional houses. Over the last 20 years, pirate development has accounted for 50–60 percent of all residential housing construction in Bogota. "There is no doubt," writes Bernstein, "that this supply system helped Bogota to cope with its rapid growth—from 607,000 people in 1950 to over 4 million in 1983."

Which goes to show you: Folks will generally make out all right if government just leaves them alone. Let Bogota be a lesson for all Third World governments. And First and Second World ones, too.

Global Roundup

? Good News Good News from Pago Pago. The U.S. territory of American Samoa is going on a privatization rampage. Governor A.P. Lutali has sold off the island's marine railway and is negotiating to get the state out of businesses from electricity to hospitals. Says Lutali: "Nearly everything except the schools and roads are on the drawing board…—but even those have not been ruled out."