VOLUME XVI, NUMBER 3

Forums: Civil Rights Great Depression Caused and Eminent Domain by Government?

he Independent Policy Forum recently held he Great Depression, World War II, and Tprograms on the timely issues of civil rights Tthe Cold War dramatically changed the and eminent domain. American political economy. In his new book, • The American civil rights movement of Depression, War, and Cold War (Oxford Uni- the 1960s was crucial to delegitimize white versity Press, cloth, $35.00), Robert Higgs, supremacy worldwide, but it also instilled in the Independent Institute’s Senior Fellow in white society a sense of guilt that led to the Political Economy and editor of The Indepen- adoption of policies that have unintentionally dent Review, provides a path-breaking reas- hindered the progress of blacks and other mi- sessment of how those seminal events shaped norities, Hoover Institution Research Fellow 20th-century America.

Shelby Steele, author of White Guilt, addresses the Independent Policy Forum.

Shelby Steele argued at the May 9 Independent Policy Forum, “Is White Guilt Destroying the Promise of Civil Rights?” The passage of the Civil Rights Act of 1964 and the Voting Rights Act of 1965—and the implicit admission by most of white society that (continued on page 3) IN THIS ISSUE: Independent Policy Forums ...... 1, 6 Great Depression Caused by Government? ... 1 For example, Higgs explains how New President’s Letter ...... 2 Deal measures destroyed capital markets and Independent Institute in the News ...... 4 prolonged and deepened the Great Depres- The Independent Review ...... 5 sion; how a weapons procurement policy in 1940–41 negatively transformed the role of Making Housing Affordable ...... 6 defense contractors; how and why the U.S. ci- Fellows Honored With Awards ...... 8 (continued on page 3) 2 The INDEPENDENT

EXECUTIVE STAFF DAVID J. TH EROUX, Founder and President MARY L. G. TH EROUX, Vice President MARTIN BUERGER, COO & Vice President ALEXANDER TABARROK, Ph.D., Research Director BRUCE L. BENSON, Ph.D., Senior Fellow IVAN ELAND, Ph.D., Senior Fellow ROBERT HIGGS, Ph.D., Senior Fellow ALVARO VARGAS LLOSA, Senior Fellow RICHARD K. VEDDER, Ph.D., Senior Fellow K. A. BARNES, Controller JOHN CAMPBELL, Development Director CARL P. CLOSE, Academic Affairs Director President’s Letter: PAT ROSE, Public Affairs Director FRED HAMDEN, Sales and Marketing Director

Ideas Have Consequences BOARD OF DIRECTORS GILBERT I. COLLINS, Private Equity Manager ROBERT L. ERWIN, Chairman, Large Scale Biology Corporation JAMES D. FAIR, III, Chairman, Algonquin Petroleum Corp. PETER A. HOWLEY, Chairman, Western Ventures his fall during our 20th Anniversary, we W. DIETER TEDE, Owner, Hopper Creek Winery DAVID J. THEROUX, Founder and President, The Independent Institute Tare very pleased to release the seminal new MARY L. G. THEROUX, former Chairman, Garvey International PETER A. THIEL, Managing Member, Clarium Capital Management book, Depression, War, and Cold War, by our SALLY VON BEHREN, Businesswoman Senior Fellow Robert Higgs. The sequel to Dr. BOARD OF ADVISORS HERMAN BELZ Professor of History, University of Maryland Higgs’s pioneering 1987 book, Crisis and Le- THOMAS BORCHERDING Professor of Economics, Claremont Graduate School viathan, which triggered an entire new assess- BOUDEWIJN BOUCKAERT Professor of Law, University of Ghent, Belgium ment of the nature and effects of government JAMES M. BUCHANAN Nobel Laureate in Economic Science, George Mason University ALLAN C. CARLSON power, Depression, War, and Cold War now President, Howard Center for Family, Religion, and Society ROBERT D. COOTER provides an authoritative analysis of harmful Herman F. Selvin Professor of Law, University of California, Berkeley ROBERT W. CRANDALL U.S. government policies since 1930, refuting Senior Fellow, Brookings Institution RICHARD A. EPSTEIN the myths of conventional thinking and rede- James Parker Hall Distinguished Service Professor of Law, University of Chicago A. ERNEST FITZGERALD Author, The High Priests of Waste and The Pentagonists fining and redirecting public debate. B. DELWORTH GARDNER Professor of Economics, Brigham Young University Producing Crisis and Leviathan was no GEORGE GILDER Senior Fellow, Discovery Institute NATHAN GLAZER easy task, because virtually nobody then cared Professor of Education and Sociology, Harvard University WILLIAM M. H. HAMMETT about the book’s thesis. No foundation or Former President, Manhattan Institute RONALD HAMOWY major donors were interested in funding the Emeritus Professor of History, University of Alberta, Canada STEVE H. HANKE book because it did not fit anyone’s political Professor of Applied Economics, Johns Hopkins University RONALD MAX HARTWELL Emeritus Professor of History, Oxford University agenda. At the height of the “Reagan Revolu- JAMES J. HECKMAN Nobel Laureate in Economic Science, University of Chicago tion,” with a perceived, yet fictional, roll-back H. ROBERT HELLER President, International Payments Institute of government spending, I was told repeatedly WENDY KAMINER Contributing Editor, The Atlantic Monthly LAWRENCE A. KUDLOW that no one would care about the book. But Chief Executive Officer, Kudlow & Company JOHN R. MacARTHUR once the book was published, a real revolution Publisher, Harper’s Magazine DEIRDRE N. McCLOSKEY of ideas began. Distinguished Professor of Liberal Arts and Sciences, University of Illinois at Chicago J. HUSTON McCULLOCH The prescient insights of Dr. Higgs have Professor of Economics, Ohio State University FORREST McDONALD Distinguished University Research Professor of History, University of Alabama become all too vivid in the aftermath of 9/11 THOMAS GALE MOORE Senior Fellow, Hoover Institution with the largest expansion of federal power and CHARLES MURRAY Senior Fellow, American Enterprise Institute MICHAEL NOVAK spending since FDR, virtually none of which Jewett Chair in Religion and Public Policy, American Enterprise Institute JUNE E. O’NEILL has anything to do with protecting Americans. Director, Center for the Study of Business and Government, Baruch College CHARLES E. PHELPS So long as the citizenry remains in the dark Provost and Professor of Political Science and Economics, University of Rochester PAUL CRAIG ROBERTS regarding the true nature and effects of this pro- Chairman, Institute of Political Economy NATHAN ROSENBERG Fairleigh S. Dickinson, Jr. Professor of Economics, Stanford University cess, special-interest power-grabbers have the SIMON ROTTENBERG Professor of Economics, University of Massachusetts cover needed to expand government for their PAUL H. RUBIN Professor of Economics and Law, Emory University benefit at the expense of the citizenry. While BRUCE M. RUSSETT Dean Acheson Professor of International Relations, Yale University PASCAL SALIN politics as usual has failed, the illuminating Professor of Economics, University of Paris, France WILLIAM F. SHUGHART II analysis of Dr. Higgs and other Institute fellows Robert M. Hearin Chair and Professor of Economics, University of Mississippi VERNON L. SMITH is providing the necessary insights today toward Nobel Laureate in Economic Science, George Mason University JOEL H. SPRING overturning this abuse of power. Professor of Education, State University of New York, Old Westbury RICHARD L. STROUP Professor of Economics, Montana State University Institute books such as Depression, War, and THOMAS S. SZASZ Emeritus Professor of Psychiatry, State University of New York, Syracuse Cold War (see p. 1), our journal The Indepen- ROBERT D. TOLLISON Robert M. Hearin Chair and Professor of Economics, University of Mississippi ARNOLD S. TREBACH dent Review (see p. 5), events (pp. 1, 6), media Professor of Criminal Justice, American University GORDON TULLOCK projects (p. 4), and other programs are provid- University Professor of Law and Economics, George Mason University GORE VIDAL ing the crucial difference. Your tax-deductible Author, Burr, Lincoln, 1876, The Golden Age, and other books RICHARD E. WAGNER support as an Independent Associate Member Hobart R. Harris Professor of Economics, George Mason University SIR ALAN WALTERS Vice Chairman, AIG Trading Corporation makes this far-reaching work possible, while PAUL H. WEAVER Author, News and the Culture of Lying and The Suicidal Corporation providing you with our new studies plus other WALTER E. WILLIAMS Distinguished Professor of Economics, George Mason University benefits (please see enclosed envelope). We CHARLES WOLFE, Jr. Senior Economist and Fellow, International Economics, RAND Corporation welcome your involvement. THE INDEPENDENT (ISSN 1047-7969): newsletter of The Independent Institute. Copyright ©2006, The In de pend ent In sti tute, 100 Swan Way, Oakland, CA 94621-1428 • 510-632-1366 • Fax: 510-568-6040 • Email: info@independent. org www.independent.org. The INDEPENDENT 3

Independent Policy Forums: Civil Rights and White Guilt • Eminent Domain (continued from page 1) racially discriminatory laws were immoral and to remove every last vestige of racism from unacceptable—was “America’s greatest mo- white society, the bulk of which sees racism as ment” and “one of the greatest moral evolutions disgraceful, said Steele. Rather, the challenge in all of human history,” said Steele, author of is to acquire the education, job skills, values, White Guilt: How Blacks and Whites Together and attitudes most conducive to thriving under Destroyed the Promise of the Civil Rights Era. the conditions of a newly acquired freedom, ac- Unfortunately, the sea change in attitudes cording to Steele. “Instead of constantly saying that made this advancement possible was ac- there’s racism around every corner, and racism companied by desires of the country’s institu- is a big barrier in my life, say instead there may tions to avoid the new stigma of racism by pro- be racism, but I am free. I have opportunities. moting policies that assuaged collective “white I can do whatever I want in life. I can go as far guilt” more effectively than they helped black as I want to go.” Americans advance economically or socially, A transcript is available at: www.independent according to Steele. .org/events/transcript.asp?eventID=116.• “The purpose of the Great Society was not • When last year the U.S. Supreme Court, in actually to end poverty or achieve racial equal- (continued on page 7) ity, it was to restore some legitimacy to the American government, to American Society,” Steele said. At their worst, “white guilt” poli- cies have helped to eviscerate the black family, devastate America’s inner cities, and shackle rather than liberate the black underclass. In addition, many black Americans have failed to appreciate how the legacy of slavery, discrimi- natory Jim Crow regulations, and segregation have prevented black society from developing the cultural capital that other groups have used to lift themselves up when given freedom, Timothy Sandefur, a property rights attorney for the Steele said. Pacific Legal Foundation, addresses the Independent The challenge for blacks today isn’t to try Policy Forum.

New Book: Depression, War, and Cold War (continued from page 1) vilian economy foundered during the command the economy. economy of World War II; and how economic • World War II did not create prosperity. recovery from the Great Depression occurred Although defense-related industries did well only after the war ended. (continued on page 7) Higgs then discusses the political economy of the Cold War, including the role of various Praise for “crises” in sustaining the U.S.-Soviet arms Depression, War, and Cold War race; how members of Congress have used the defense budget to get re-elected, at the expense “An important book! Those interested in the interaction between the domestic economy, of programs the armed services deemed more war and heavily armed peace, will find it es- important; and how defense contractors have sential.” made out like bandits, their stocks significantly —Paul Johnson, Author, Modern Times outperforming the Standard & Poor’s 500— and A History of the American People. while taxpayers shouldered their risk. Here are just a few of the book’s findings: “This book marks Higgs as one of the most important and original political analysts of our Contrary to popular legend, President Frank- • time. An intellectual tour de force!” lin Roosevelt’s policies didn’t end America’s — Jonathan Bean, Professor of History, Great Depression—they prolonged it: con- Southern Illinois University temporaneous evidence from corporate bond markets and opinion polls indicates that by “Higgs’s superb book is a real eye-opener.” shaking investors’ confidence in the security of — Richard E. Sylla, Professor of the History of Financial Institutions and property rights, the New Deal discouraged the Markets, New York University long-term private investment needed to revive 4 The INDEPENDENT

The Independent Institute in the News • Opinion: In May, the Washington Post Senior Fellow Ivan Eland wrote op-eds Writers Group began syndicating Senior on foreign policy and national security Fellow Alvaro Vargas Llosa’s weekly published in the San Diego Union- columns internationally in both Spanish Tribune, Gardner News, MotherJones. and English. Domestic newspapers such com, and Providence Journal. The as Riverside Press-Enterprise, Dallas Center on Peace and Liberty also Morning News, La Opinion, Tiempos released a piece by Robert Higgs on del Mundo, El Diario la Prensa, Mundo Haditha, published in the Calgary Hispanico, Diario Las Americas, Rocky Herald, and commissioned Edward Peck Mountain News, Arizona Daily Star, to write on the Israel lobby published in San Diego Union-Tribune, Sun-Sentinel, the Pittsburgh Post-Gazette. and Des Moines Register have picked • Books: Restoring Free Speech and up the column, as well as international Liberty on Campus was reviewed outlets including Toronto Star, Diario in Futurist, Re-Thinking Green was del Exterior, ABC, Vistazo, El Diario de reviewed in Journal of College Science Hoy, Listin Diario, ABC, and La Primera. Teaching, and Resurgence of the Warfare Vargas Llosa also wrote a cover article State was reviewed in Future Survey. in The New Republic on Simón Bolívar. • Broadcast: Senior Fellow Ivan Eland Other op-eds commissioned by the was interviewed on WUSB, Wisconsin Center on Global Prosperity included Public Radio, KGNW, KCTC, Al-Jazeera, Carlos Sabino’s pieces on the politics and Voice of America. Senior Fellow of Venezuelan oil, published in the Alvaro Vargas Llosa was interviewed Providence Journal. Benjamin Powell’s on CNN En Espanol, CNN International, op-eds on issues like the economics GLOBO, Radio 10 in Argentina, BBC, of immigration and eminent domain and Peru 21. Shelby Steele promoted his were published in Atlanta Journal- talk at the Institute with interviews on KQED “Forum” and KGO’s “Pete Wilson Show” in San Francisco. Senior Fellow Benjamin Powell discussed immigration policy on WBAL, Westwood One, KNX, KDX, was quoted on CNN “Live From,” and appeared on NBC11 in San Jose, CA. • Additional Highlights: The Institute’s Open Letter on Immigration was initially published in the Philadelphia Inquirer and continued to spark controversy in the editorial pages of the Independent Institute Senior Fellow Ivan Eland Wall Street Journal, New York Times, is interviewed on CBS TV in San Francisco. Pittsburgh Tribune-Review, National Constitution, Investor’s Business Daily, Post, New York Daily News, and Daily News of Los Angeles, Cincinnati elsewhere. Additionally, Ivan Eland’s Enquirer, Eagle Tribune (MA), Salem work on defense spending, security, News (MA), East Bay Business Times and the war on terror was quoted in the (CA), Mountain Mail (CO), Providence Wall Street Journal, Associated Press, Journal, Columbus Business Journal, Desert Sun, Charleston Gazette, Pampa San Francisco Business Times, Silicon News, Pittsburgh Post-Gazette, and Valley/San Jose Business Journal, and “Marketwatch.” S. Fred Singer’s Hot Sacramento Business Journal. The Talk, Cold Science and other research Center on Entrepreneurial Innovation were discussed in syndicated columns also commissioned a piece on the by Joel Achenbach and William Rusher anniversary of the Kelo decision by and San Francisco Chronicle columnist Adjunct Fellow Edward Lopez, which Debra Saunders interviewed Benjamin was carried in the North County Times Powell for a piece on eminent domain and several business papers. Additionally, and Wal-Mart.• The INDEPENDENT 5

The Independent Review Privatizing Marriage • Sociology and Freedom he Independent Review continues to public-policy topics. The 347 responses they T publish insightful scholarship on a wide received suggest that the sociology profession range of timely topics. in the United States tilts heavily to the left and has few, if any, members who are classical lib- Privatizing and Protecting Marriage erals (i.e., those whose primary political value • The institution of marriage could better meet is individual liberty). needs if couples had more options than taking “Overall, sociologists overwhelmingly sup- or leaving the terms of marriage offered in the port (most of them strongly) economic inter- one-size-fits-all version provided currently by ventions, gun control, redistribution, govern- government, according to Doshisha University ment schooling, and discrimination controls. Law professor Colin Jones (“A Marriage Pro- That is, they are predominantly left-wing,” posal: Privatize It”). write Klein and Stern. “It appears that the “Couples entering into marriage should number of classical liberals who belong to the be able to use a partnership agreement that is ASA is approximately zero.” tailored to their own circumstances and aspira- Although most of the poll’s findings are tions, one that reflects the values and expecta- not surprising, the absence of classical liberals tions that they themselves attach to marriage,” among sociologists polled is harder to explain, Jones writes. (An op-ed based on his article ran Klein and Stern argue. Classical liberals such in the San Francisco Chronicle, January 22.) as Adam Smith, Alexis de Tocqueville, Her- Ending the government’s monopoly on bert Spencer, William Graham Sumner, and marriage, Jones argues, would foster innova- tion in the design of marriage contracts, result- ing in better legal and relationship counseling, better protection for children and spouses, and better marriages. Couples could select from a variety of marriage-document kits. They would also be free to form or join marital cor- porations—organizations, including churches, whose members share the same values about marriage—which might arise to cater to the needs of different kinds of couples. This privatization of marriage, Jones fur- ther suggests, might also help defuse the con- troversy over same-sex marriage because op- ponents and proponents of same-sex marriage would join separate marital corporations and thus would see their version of marriage pro- tected. See “A Marriage Proposal: Privatize It” at: www.independent.org/publications/tir/article. asp?issueID=46&articleID=588.

Sociology and Freedom • Sociologists study a diverse range of social F. A. Hayek discussed topics potentially of issues and groups—but how diverse a group interest to contemporary sociologists. In addi- are sociologists themselves? At least when it tion, other topics of interest to classical liberals comes to political diversity, the answer is: “not also seem ripe for sociological study, such as very.” A new study of American sociologists the differences between cooperation and coer- found far more support for economic regula- cion; the interrelations between commerce and tions, the regulation of personal choices, and a community; the role of privilege, prestige, sta- broad role for government than opposition to tus, and power in “rent seeking”; and the social them (“Sociology and Classical Liberalism”). mechanisms that foster and reinforce statism. The study’s authors, Daniel Klein and “Sociology and Classical Liberalism,” by Charlotta Stern, sent letters to 1,000 mem- Daniel B. Klein and Charlotta Stern, is avail- bers of the American Sociological Associa- able at: www.independent.org/publications/tir/ tion (ASA) asking their preferences about 18 article.asp?issueID=46&articleID=584.• 6 The INDEPENDENT

Independent Policy Report Making Housing Affordable ousing shortages caused by restrictive O’Toole. “Governments are abusing their power Hland-use planning have added hundreds and misplacing their priorities when they create of thousands of dollars to the cost of buying housing shortages by focusing on saving open homes in California, says a new report from the space that is already abundant.” Independent Institute, The Planning Penalty: O’Toole recommends that cities leave open How Smart Growth Makes Housing Unafford- space protection to private conservation orga- able. Research Fellow Randal O’Toole, the nizations and that they reduce planning rules study’s author, estimates that land-use restric- so that homebuilders can meet the demand for tions added from $69,000 to the cost of median new housing. He also recommends that city homes in Bakersfield, Calif., to $850,000 to governments set user fees and taxes to make the cost of median homes in San Francisco and surrounding counties. “How smart is ‘smart growth’ if it makes every home in a city cost $70,000 to $850,000 more so the city can save $11,000 on a few new homes?” asks O’Toole. The report finds that planning-induced hous- ing shortages statewide added $136 billion to homebuyer costs in 2005. This does not count the cost to renters or purchasers of retail, com- Randal O’Toole mercial, or industrial property. The planning penalties in California are almost as great as sure new development covers its costs, and let those in all other states combined. people make their own choices about where The report also criticizes government- they want to live. funded open-space programs that reduce the See “The Planning Penalty: How Smart Growth supply of land available for housing. “The 2000 Makes Housing Unaffordable,” by Randal census found that 94 percent of California’s O’Toole at www.independent.org/publications/ residents live on just 5 percent of the land,” says policy_reports/detail.asp?type=full&id=20.• Independent Policy Forum, Washington, D.C. What Should the U.S. Do about China? n May 17, the Independent Institute held The panel addressed numerous crucial issues Oa forum at its conference center in Wash- surrounding U.S. diplomacy with China. If the ington, D.C., on China’s emergence as a world Chinese add political liberalization to their power, and how U.S. policies should change to economic reforms, will China necessarily be reflect this reality. friendly to the United States? Conversely, if Independent Institute Research Director Al- China remains an autocracy, will it necessarily exander Tabarrok launched the event with re- be a threat to the U.S? As the United States did marks on the move toward capitalism in China, with Iran, what if the U.S. government builds describing it as an amazing phenomenon, albeit up India only to see it become the greater adver- very much a work in progress. sary? Should the U.S. conduct a policy of con- The evening continued with Ivan Eland tainment before knowing China’s future foreign (Senior Fellow and Director of the Independent policy course? How large a sphere of influence Institute’s Center on Peace and Liberty), James is a rising China going to be allowed to have? Lilley (former ambassador to China and South How far does the U.S. security perimeter need Korea), and Rear Admiral Eric McVadon (In- to extend in Asia, especially east Asia? stitute for Foreign Policy Analysis). Based on his new Policy Report, Is Future Conflict with China Avoidable?, Dr. Eland stressed the importance of trade and honest, peaceful friendship with all nations, arguing that China does not present the threat that many Americans fear it does. Instead, its emergence as an economic power has been a blessing for (L to R) Ivan Eland, James Lilley, and Eric McVadon hundreds of millions of people. The United address the Independent Policy Forum. (continued on page 8) The INDEPENDENT 7

Independent Policy Forums: Civil Rights and White Guilt • Eminent Domain (continued from page 3)

Kelo vs. City of New London, broadened the power of local governments to take private property for the purpose of economic devel- opment or other “public” benefits, it undercut a key feature of the American legal system: the protection of private-property rights. In response, many states have considered legisla- tion intended to assuage public concerns about the government assault on the rights of property owners. What precedents led to the Kelo decision, and what are the prospects for making property Steven Greenhut, Orange Country Register editorial rights more secure? Orange County Register writer, addresses the Independent Policy Forum. editorial writer Steven Greenhut and property- rights attorney Timothy Sandefur (Pacific to implement the strict property-rights views of Legal Foundation) discussed these issues at the 17th-century philosopher John Locke but were January 31 forum “Eminent Domain: Abuse of undermined by influential 18th-century legal Government Power?” thinker William Blackstone, whose writings In recent years, redevelopment officials have horrified Thomas Jefferson. The two opposing acted as though other people’s property was at views of property rights and sovereignty came their disposal, said Greenhut, author of Abuse increasingly into conflict in eminent domain of Power: How the Government Misuses Emi- court cases in the 1850s. nent Domain. In Southern California, several Sandefur concluded by discussing details of municipalities have aggressively condemned several post-Kelo bills to restrict government property for the purpose of redevelopment. At a takings. Unfortunately, on closer inspection conference of city planning officials, one advo- many of those bills offer weak protections for cate of eminent domain gave four (conflicting) property owners. The problem of perverse in- rationales that could be offered to the public to centives for lawmakers and a weak philosophi- defend the taking of private property. cal understanding of the importance of property Only properties in neighborhoods deemed rights are the root problems. “blighted” are vulnerable to eminent domain, “We have a government whose primary but there is a huge loophole to this restriction, mission…is to steal things from people who Greenhut said. For redevelopment purposes, a earn them and give them to people who don’t,” formerly run-down property that has been refur- he said. bished is legally still considered blighted. Sandefur himself has consulted in the draft- Timothy Sandefur, who submitted a friend- ing of a proposed constitutional amendment to of-the-court brief on behalf of property owners limit eminent domain in California, so perhaps in the Kelo case, discussed eminent domain in there is reason for optimism. relation to the concept of sovereignty. A transcript is available at: www.independent America’s founders, Sandefur said, struggled .org/events/transcript.asp?eventID=114.

New Book: Depression, War, and Cold War (continued from page 3) during the war years, few consumer durables gin. An investor who held a portfolio of top (e.g., cars and houses) and non-defense capital defense stocks during those four decades would goods were produced. The virtual elimination of have earned 2.4 times more than investing an unemployment then was due to the draft, which equal amount in a diversified portfolio. forced 22% of the prewar labor force into the Like his classic Crisis and Leviathan, military at below-market wages. Higgs’s new work merits much acclaim. • From 1949 to 1989, the top defense firms To purchase Depression, War, and Cold War, outperformed the stock market by a huge mar- see www.independent.org/store.• New Publications & Events: To Order Anytime: www.independent.org 1-800-927-8733 8 The INDEPENDENT

Institute Fellows Honored with Awards hree Independent Institute fellows were T recently honored with special awards. • The Institute received the 2006 Sir Antony Fisher International Memorial Award for its book by Center on Global Prosperity Direc- tor Alvaro Vargas Llosa, Liberty for Latin America: How to Undo Five Hundred Years (L to R) Award recipients Alvaro Vargas Llosa, Bruce of State Oppression. The award, sponsored by Benson, and Robert Higgs the Atlas Economic Research Foundation, is es facing classical liberals in the coming given to institutes that have effectively pro- years—raising the less developed world out moted economic liberty with new books. of poverty, educating people on the hazards “The battle of ideas, as you well know, is of the drug war, fighting terrorism, protecting never won,” Vargas Llosa told the attendees private property from environmental funda- of the awards ceremony, held in Colorado mentalism, and exposing the true nature of Springs, Colo. “There have been periods in so-called “market socialism.” history when it looked as if freedom was See “The State of Freedom: 2006,” by Alvaro irreversible. We talk of globalization today Vargas Llosa (4/21/06) at www.independent as if we had invented a new creature, but for .org/issues/article.asp?id=1709 millions of people globalization was already • The Association of Private Enterprise the assumed environment in the 19th century. Education presented Senior Fellow Bruce L. And then the 20th century saw the emergence Benson with its Adam Smith Award to recog- of collectivism in its atrocious and genocidal nize an individual who has made a sustained form. So we cannot guarantee that the trend and lasting contribution to the perpetuation of toward individual liberty and the free flow of the ideals of a free market economy. ideas, goods, services, and perhaps, one day, • Senior Fellow in Political Economy Robert even people, will not be reversed. And that Higgs was awarded the Wieser Prize for Ex- only means there is a lot of work ahead.” cellence in Economic Education by the Lib- Vargas Llosa also noted five challeng- eral Institute of Prague, Czech Republic.•

Independent Policy Forum: China (continued from page 6) States should not so quickly view China as

PAID an adversary, but rather as a healthy trading partner. Furthermore, the U.S. government’s US POSTAGE PERMIT #2443 PERMIT COLUMBUS, OH

NON-PROFIT ORG NON-PROFIT enormous military programs need not be ex- tended or increased to deter a commercially flourishing China. A transcript is available at: www.independent .org/events/transcript.asp?eventID=117.• Subscribe Free! The Light house Stay abreast of the latest social and econom ic issues in the weekly email news let ter of The In de pen dent Institute. • Insightful analysis and commentary • New publications • Upcoming events • Current media programs • Special announcements Subscribe today by sending an email to [email protected] 100 Swan Way 100 Swan California 94621-1428 Oakland,