THEFREEMAN IDEAS ON LIBERTY FEATURES 124 An Optimist's View of the Entrepreneurship Explosion by Raymond J. Keating Greater economic freedom is on the horizon. 128 The Case for Economic Freedom by Benjamin A. Rogge A classic moral defense. 135 The Role of Government: Promoting Development or Getting Out of the Way by Doug Bandow How interventionism impedes economic growth and perpetuates poverty in underdeveloped countries. 141 The Source ofRights by Frank Chodorov The importance ofthe individual. 144 Confession of a Compliant Taxpayer by Dwight R. Lee To curtail fiscal folly, reduce the money pouring into federal coffers. 149 Dying for a Pizza by Ralph R. Reiland Attack crime, not commerce. 151 Cause and Effect: Crime and Poverty by Roger M Clites The real costs ofviolent and antisocial behavior. 152 We Have Yet to Learn by Gregg MacDonald The perils ofignoring history. 154 On Trial Again by Meredith Kapushion A philosophical experiment. 158 The End of the World as We Know It? by William V Bandoch, Jr., and Walter Block Is new technology rendering human labor obsolete? 160 Albert Jay Nock: A Gifted Pen for Radical Individualism by Jim Powell Portrait of"an authentic American radical." 170 Isaiah's Job byAlbert Jay Nock The demands-and rewards-ofworking for the Remnant. 173 Russell D. Shannon: In Memoriam by Donald J. Boudreaux A tribute to a gifted writer and teacher. COLUMNS Center NOTES from FEE-Balancing the Budget by Hans R Sennholz 133 IDEAS and CONSEQUENCES-A History Lesson for Free-Market Pessimists by Lawrence W Reed 146 POTOMAC PRINCIPLES-An Agenda for Limited Government by Doug Bandow 175 ECONOMICS on TRIAL-The Rich Get Richer, and the Poor Get ... by Mark Skousen DEPARTMENTS 122 Perspective--William H. Peterson 177 Book Reviews •The Bamboo Network: How Expatriate Chinese EntrepreneursAre Creating a New Economic Superpower in Asia by Murray Weidenbaum and Samuel Hughes, reviewed by William H. Peterson; Christianity and Economics in the Post-Cold War Era: The Oxford Declaration and Beyond, edited by Herbert Schlossberg, Vinay Samuel, and Ronald 1. Sider, reviewed by John W Robbins; Getting It Right: Markets and Choices in a Free Society by Robert 1. Barro, reviewed by Chris Weinkopf; Classical Economics:AnAustrian Perspective on the History ofEconomic Thought, Volume II by Murray N. Rothbard, reviewed by Douglas E. French; The Life ofAdam Smith by Ian Simpson Ross, reviewed by Raymond 1. Keating; Backfire by Bob Zelnick and TheAffirmativeAction Fraud by Clint Bolick, reviewed by Michael Levin. THEFREEMAN PERSPECTIVE IDEAS ON LIBERTY The Role of Government Published by The Foundation for Economic Education in Society Irvington-on-Hudson, NY 10533 Phone (914) 591-7230 FAX (914) 591-8910 E-mail: [email protected] Some time ago the Intercollegiate Studies FEE Home Page: http://www.fee.org Institute (lSI), now headquartered in Wil­ President: Hans F. Sennholz mington, Delaware, ran a series of student Managing Editor: Beth A. Hoffman seminars around the country on the Role Guest Editor: William H. Peterson of Business in Society (ROBIS). I know, for Editor Emeritus I ran one at Campbell University in 1978 that Paul L. Poirot Lewisburg, Pennsylvania featured free-market stalwarts like Walter Book Review Editor Williams and the late Arthur Shenfield. George C. Leef Adjunct Professor ofLaw and Economics, Surely the role of business deserves depic­ Northwood University tion and discussion. But so does, and I think Editorial Assistant more so, ROGIS-standing for Role of Gov­ Mary Ann Murphy Columnists ernment in Society, an acronym coined by Doug Bandow Edward A. Prentice of the Mount Hood Cato Institute, Washington, D. C. Lawrence W. Reed Society of Portland, Oregon, and Professor Mackinac Center for Public Policy Midland, Michigan Fred Decker of Oregon State University. Mark Skousen Rollins College, Winter Park, Florida There are at least three key questions relating Contributing Editors to that role: Charles W. Baird Precisely what role should the state play in California State University, Hayward Peter J. Boettke society, including the economy? How should New York University Clarence B. Carson that role tie into America's concern over American Textbook Committee Wadley, Alabama individual rights so magnificently framed in Thomas J. DiLorenzo 1787 and ratified in 1791 as the Bill of Rights? Loyola College, Baltimore, Maryland Joseph S. Fulda And what of the principle of federalism New York, New York Bettina Bien Greaves embodied in the Tenth Amendment as: Resident Scholar, FEE "The powers not delegated to the United John Hospers University of Southern California States by the Constitution, nor prohibited by Tibor R. Machan Auburn University it to the States, are reserved to the States Ronald Nash Reformed Theological Seminary respectively, or to the people"? Edmund A. Opitz Overarching these questions is, I think, the Chatham, Massachusetts James L. Payne nature of man and the admonishment of an Sandpoint, Idaho Jim Powell angry Lord Jehovah who, on banishing sinful Westport, Connecticut Adam and Eve, thundered down on them: William H. Peterson Adjunct Scholar, Heritage Foundation, Washington, D.C. "By the sweat of thy face shalt thou eat Jane S. Shaw PERC, Bozeman, Montana bread." For suddenly the Garden ofEden and Richard H. Timberlake University of Georgia its boundless plenty were no more. Instead, productive resources, including time, were The Freeman is the monthly publication of The Foundation for Economic Education, Inc., Irvington-on-Hudson, NY 10533. FEE, limited, sharply. The law of scarcity was in, established in 1946 by Leonard E. Read, is a non-political, educational starkly. Adam and Eve and their issue down champion ofprivate property, the free market, and limited government. FEE is classified as a 26 USC 501(c)(3) tax-exempt organization. to this hour faced-face-a life that Thomas Copyright © 1997 by The Foundation for Economic Education. Permission is granted to reprint any article in this issue, except "Albert Hobbes baldly said in his Leviathan (1651) J. Nock," provided credit is given and two copies of the reprinted was "solitary, poor, nasty, brutish, and short." material are sent to FEE. The costs of Foundation projects and services are met through dona­ So man, then and now, is in a fix, caught in tions, which are invited in any amount. Donors of $30.00 or more receive a subscription to The Freeman. For foreign delivery, a donation of $45.00 a law of trade-nffs. He can't have his bread a year is suggested to cover mailing costs. Additional copies of this issue of The Freeman are $3.00 each. and eat it too. He must weigh unlimited Bound volumes of The Freeman are available from The Foundation for ends against limited means. So Nature forces calendar years 1972 to date. The Freeman is available in microform from University Microfilms, 300 N. Zeeb Rd., Ann Arbor, MI 48106. him to make hard choices on the correct 122 PERSPECTIVE construct of the state-as society's protector This "inquiry"-Smith's much-overlooked or provider or both. title word-needs economic education, a Life is about choices. In making economic widespread understanding of ROGIS, of how decisions, individuals must choose among capitalism and the world work-an under­ scarce resources that have alternative uses. standing, by the way, sought by Leonard E. They must try to conquer or, more accurately, Read, in a stroke of brilliant entrepreneur­ lessen scarcity. But how? ship, when he began The Foundation for How, indeed, when everyone is choosing Economic Education in 1946. from among the same scarce resources? Is Ludwig von Mises, FEE's academic adviser this not a recipe for chaos if not bloodshed, for more than 25 years, warned of boomer­ the law of the jungle? Particularly in light of anging state intervention in Human Action: the condition of man, which Hobbes, for his "All varieties of [state] interference with part, saw as "a condition of war of everyone the market phenomena not only fail to against everyone"? achieve the ends aimed atby their authors and But man's lot is not war but peace-ifwith supporters, but bring about a state of affairs a proviso of a proper role for government: which-from the view of their authors' and a system of private property rights, limited advocates' valuations-is less desirable than government, a state not as a coercive provider the previous state of affairs which they were of goods and services but as a peaceful designed to alter." protector of life, liberty, and property. The idea of ROGIS then is pivotal. Gov­ From this construct, based on the original ernment is necessary, yes. But, as noted by U.S. Constitution and Bill of Rights, emerged George Washington: While government can a system of free markets: a price system, be a helpful servant when limited, it becomes capital investment, international trade, posi­ a fearsome master when unlimited. tive entrepreneurship. So the Founders un­ Overextended government that reaches be­ leashed Adam Smith's mighty Invisible yond the rule of law-fostering intervention­ Hand-personal incentives under the rule of ism and the Welfare State-is an idea whose law driving this remarkable system offreedom time never should have come. This issue of and free enterprise, of social cooperation and The Freeman explores, retrospectively and international harmony, called capitalism. more so prospectively, government's proper Despite capitalism's success, people often role. ask: Why is poverty so widespread within -WILLIAM H. PETERSON the nation and across the world? That's the wrong question. For, as noted, man is born Dr. Peterson, a Heritage Foundation adjunct into scarcity; poverty is his natural condition. scholar and Distinguished Lundy Professor of Adam Smith raised the right inquiry: Why Business Philosophy Emeritus at Campbell wealth? Thus, An Inquiry into the Nature and University in North Carolina, is this issue's Causes ofthe Wealth ofNations.