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THE r WILSON QUARTERLY AUTUMN 1980 A NATIONAL REVIEW OF IDEAS AND INFORMATION WOODROW WILSON INTERN.--IONAL CENTER FOR SCHOLARS Smithso~ionInstitution Buffdiq Washington D.C. WOODROW WILSON INTERNATIONAL CENTER FOR SCHOLARS Director, James H. Billington Deputy Director, Prosser Gifford THE WILSON QUARTERLY Editor: Peter Braestrup Managin Editor: Anna Marie Torres Senior ~iitor:Cullen Murphy Associate Editor (Books): Robert R. Harris Associate Editor (Periodicals): Alan Tonelson Assistant Editor: Bradley Rymph Editorial Assistant: T. E. Ricks Editorial Secretary: Patricia R. Sheridan Administrative Assistant: Melanie Davis Production Coordinator: Renee L. Gemand Research Assistants: Mark J. Auslander, Alison C. Jones, Tim Kalich, Jennifer Widner Librarian: Zden6k V. David Design Consultant: Elizabeth Dixon Design Assistant: Mary McNeil Business Manager: William M. Dunn Circulation Coordinator: Karl Ackerman Editorial Advisers: Abbott Gleason, A. E. Dick Howard, Abraham Lowenthal, Lois Decker O'Neill, Richard Seamon, S. Frederick Starr, Allen Weinstein, Samuel F. Wells, Jr. Published in January, April, July, and October by the Woodrow Wilson Interna- tional Center for Scholars, Smithsonian Institution Building, Washington, D.C. 20560. Indexed biennially. Copyright @ 1980 by the Woodrow Wilson Inter- national Center for Scholars. THE WILSON QUARTERLY is a registered trade- mark. Subscriptions: one year, $14; two years, $24; three years, $35. Foreign subscriptions: one year, $16; two years, $28; three years, $41. Foreign subscrip- tions air mail: one year, $26; two years, $48; three ears, S71. Lifetime subscrip- tion (domestic only): $150. Sin le copies and backissues mailed upon request: $4.50, including postage and handling; outside U.S. and possessions, $6.50. Second-class postage paid at Washington, D.C., and additional mailing offices. Editorial0 ices Smzthsonian Institution Building, Washin ton, D.C. 20560. All nsolicitemanuscripts should be accompanied by a self-addressedstamped en- velope. Send changes of address and all subscription correspondence with Wilson Quarterly mailing label to Subscriber Service, The Wilson Quarterly, P.O. Box 2956, Boulder, Co. 80322. (Subscriber hot line: 212-687-0770.) Advertising Representative: National Mediarep Corp., Ill John Street, Room 2406, New York, N.Y. 10038. Contact: Harvey Oshinsky. U.S.A. newsstanddistribution by Eastern News Distributors, Inc., 111 Eighth Av- enue, New York, N.Y. 10011. LISPS 346-670 VOL. IV NO. 4 BOARD OF TRUSTEES Max M. Kampelman, Chairman Paul W. McCracken, Vice Chairman James A. Baker, 111 Theodore C. Barreaux Daniel J. Boorstin Joseph D. Duffey Stuart E. Eizenstat Patricia Roberts Harris Edmund S. Muskie Jesse H. Oppenheimer John E. Reinhardt S. Dillon Ripley Anne Firor Scott Robert M. Warner To market, to market. .. To a freer market, that is. is even more remarkable. Butane, besides That's where the United States has its use in cigarette lighters, has a far more been slowly heading since the government important application in improving the began lifting price controls on the oil busi- cold-weather starting capacity of motor ness. As long as OPEC sets the price of so fuel. Since butane is derived from crude oil much of the crude oil America uses-al- and natural gas, its price was affected not most half, currently-we can't expect that only by oil industry costs but also by the decontrol will lower energy prices. But with controls program. The price of butane was the straitjacket beginning to come off, decontrolled last winter, the very season we can expect the market to work back when demand for butane is at its strongest. toward what it does so well: allocating re- Many refiners and others thought there'd sources efficiently and thus making more be a shortage, or a leap in the price. In- supplies available-at the lowest possible stead, the industry started scrambling, and cost. in a matter of months, the price of butane With the burden of price control eas- dropped by 25 cents a gallon. ing, business is encouraged to scramble We saw a similar result in the case of for the best deal again. When the scram- natural gasoline-a substance derived blers include the 10,000 firms, large and from natural gas that can be used to make small, that risk their funds in exploration motor fuel. Under controls, refiners had to and production of petroleum in this coun- wrestle with a complicated system for shar- try, their very competition assures that cus- ing and allocating the supply of natural tomers can often gain ground in their own gasoline. With decontrol, refiners started battle for economic survival and prosperity. scrambling for the best deal. And the price Signs that decontrol has already soon fell by about 25 cents per gallon. begun to work for consumers are not hard Satisfying the bureaucrats, as America to find. Natural gas production in the U.S. did for so long with price controls on the oil turned upward in 1979, reversing a decline business, can be an expensive indulgence. that had persisted since 1973-and the A recent study by two university econo- president of the American Gas Association mists concluded that price controls on oil says the incentives provided by decontrol have been costing the United States $3 bil- were important in achieving this turn- lion each year by generating red tape, dis- around. According to an energy official in couraging domestic production, and en- Texas, the same thing happened there in couraging excessive demand. 1979 when the gradual decontrol process That's a rather high price to pay for began. He estimates that the Texas up- happy bureaucrats. We think most Ameri- swing in natural gas production has saved cans, given the choice, would prefer the American consumers more than $1 billion scramble of free markets-and the cost in outlays for imported oil. efficiencies that only competition can What happened to the price of butane produce. Mobil ^ISSO Mobil Corporation 1 Now in Paperback 1 Political Control of the Economy Edward R. Tufte "Lucid, comprehensive, brilliant." -James Q. Wilson, Commentary Winner of the 1979 Gladys Kammerer Award of the American Political Science Association for the best book on U.S. national policy. 'A remarkable study, one that is provocative and concise, sometimes brazen in its theoretical assumptions and assertions, laced throughout with elegance and wit. Amid the vast outpouring of contemporary social science, [this] truly is a book for all seasons, important to every scholar interested in the relationship of elections, government, and public policy." - The American Political Science Review $4.95 (Cloth, $10.00) 1 NPWfrom Princeton 1 Reasoning About Discrimination The Analysis of Professional and Executive Work in Federal Antibias Programs Richard A. Lester Lester examines federal antibias programs applied in the 1970s by developing an analytical basis for judging sex, race, and age discrimination in professional and executive employment. Drawing heavily on the results of systematic research, enforcement actions by the agencies, and court cases, he criticizes the analytical underpinning of the programs and suggests means for improving their suitability for professional and executive workers. $1 7.50 Write for our Political Science Catalogue. Princeton University Press Princeton, New jersey 08540 / Speak German like a diplomat! What sort of people need to learn a The FSI's Programmed German Course foreign language as quickly and effective- comes in two volumes: You may order one ly as possible? Foreign service personnel, or both courses: that's who. 0 Volume I. Programmed introduction to Now you can make a start on learning German, 9 cassettes, 12 hours and to speak German with the same mate- 647-page text, $115. rials used by the U.S. Department of 0 Volume II. Basic Course, Continued State- the Foreign Service Institute's (More Advanced) 8 cassettes, 8% Programmed Introduction to German and hours and a 333-page text, $98. Basic Course, Continued. (New York State residents add ap- The FSI spent thousands of dollars and propriate sales tax.) many years developing these materials Your cassettes are shipped to you in hand- for use by members of America's some library binders. diplomatic corps. Today people in all TO ORDER, JUST CLIP THIS AD and mail walks of life who need to learn to speak a with your name and address, and a check foreign language are turning to this or money order. Or charge to your credit outstanding audio cassette program. card (American Express, VISA, Master The Foreign Service Institute's German Charge, Diners Club) by enclosing card Course is by far the most effective way to number, expiration date, and your learn German at your convenience and at signature. your own pace. It consists of a series of The Foreign Service Institute's German tape cassettes and accompanying text- course Is unconditionally guaranteed. Try book. You simply follow the spoken and it for three weeks. If you're not convinced written instructions, listening and learn- it's the most convenient and most painless ing. By the end of the course you'll find way to learn German, return it and we'll re- yourself learning and speaking entirely in fund every penny you paid! Order today! German! A native German speaker, clearly Many other FSI language courses recorded on the cassettes, provides an ex- also available. Write us. cellent model to help you develop your skills. This course turns your cassette player into a "teaching machine." With its unique 145 E. 49th St., Dept. 'w, New York, N.Y. 10017 learning method, you set (212) 753-1783 your own pace testing yourself, correcting 1 I errors, reinforcing accurate responses. Ja! I want to speakGerman like adiplomat. Rush me 1the course volumes I've checked below. Volume I, Basic. $115 I Volume 11, Advanced. $98 I I understand that if I'm not completely satisfied, I may return the course materials within three weeks Iand receive a full refund.
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