Reason Magazine - Staff

Balance Sheet

info@reason.com (Rick Henderson) — Mon, 01 Feb 1999 00:00:00 EST

Assets

Busted! The Supreme Court gives the Fourth Amendment a much-needed boost in, of all things, a drug case. An Iowa law lets cops search the cars of drivers cited for routine traffic offenses. Surprisingly, the justices say cops overreached when they searched a speeder's car, even though they found pot in the vehicle.

Boomer Time? Bill Clinton may make his mark on history for something other than impeachment. He rules out Social Security tax increases and says some of the Social Security funds should be invested in the private market. Republicans won't let the government do the investing, making some form of individual Social Security accounts likely.

Duplicate Efforts. Blanket opposition to cloning fades, as Japanese scientists report cloning eight calves from the cells of one adult cow. And in early December, a government-appointed panel of British scientists urges the Blair administration to overturn its ban on human embryo research. The panel says human fetal tissue should be used to create replacement body parts.

Net Debt. U.S. District Judge Lowell Reed puts the Child Online Protection Act on hold. Reed issues a temporary restraining order, saying the act, which prohibits commercial Internet sites from publishing material that might be "harmful to minors," a much broader standard than "obscene," could violate the First Amendment. A challenge to the law should go to trial on January 20.

Liability

Private Ayes. The Clinton administration further hamstrings Internet privacy and electronic commerce with new export controls on data-scrambling encryption programs. Under the guise of arms control, the United States and 32 other countries agree to ban the export of state-of-the-art encryption, including software you can buy off the shelf from many retailers.

Bank Dicks. In other privacy news, the feds try to turn bankers into spies. Regulations proposed by the Federal Reserve would force bankers to track customers' "normal" transactions and report "suspicious" activities. Everything from selling your car to switching your 401(k) could make you a criminal suspect.

Be Nice, Eh? Canada considers a hate speech law that would make U.S. campus censors proud. (See "Codes of Silence," November.) A federal advisory group pushes a law that would make it a crime to possess materials "for the purpose of distribution to promote hate." British Columbia has already enacted the code. One obnoxious newspaper writer has been dragged in front of the province's Human Rights Tribunal for his cranky columns.

Post Awful. Happy 1999: A first-class letter now sets you back 33 cents. The Hudson Institute's Thomas Duestenberg says that's four times what it cost in real terms 30 years ago. By contrast, over the same period the cost of long-distance calls has fallen by 88 percent.

Draft Dodgers

info@reason.com (Rick Henderson) — Fri, 01 Jan 1999 00:00:00 EST

The Cold War may be over, but it looks as if the peace dividend has vanished. Congress sent the Pentagon $271 billion in the budget it passed in October, $8.4 billion more than the budget resolution ratified a few months earlier. And with all the armed forces complaining about outdated weapons systems and shortages of spare parts, a "readiness" problem just about guarantees a new boom in military spending.

The services are also griping about a shortage of recruits: The Navy says it will fall 1,700 recruits short this year; the Air Force expects a deficit of 900. And a small but influential group of legislators is pushing a bad idea that refuses to die: reinstating the draft.

At a September House National Security Committee hearing, Rep. Norman Sisisky (D-Va.), the ranking Democrat on the military readiness subcommittee and a longtime advocate of the draft, raised the possibility of resuming conscription. Rep. Steve Buyer (R-Ind.), chairman of the military personnel subcommittee, said the shortage of recruits indicates that "a lot of young people
are escaping their civic responsibilities. There are benefits to a draft."

Fortunately, the armed services steadfastly oppose it, and they made their sentiments clear at the hearing. Representatives from the Navy and the Air Force said they could fill their ranks with recruits if Congress would raise service members' pay.

Chris Hellman, a policy analyst at the Center for Defense Information, says the all-volunteer forces are merely facing the same labor shortages that affect the economy as a whole. The shortfalls are "cyclical, linked to the health of the economy" and can easily be addressed through "appropriate incentives and bonuses" for recruits, he says.

Despite what Hellman calls "zero support" for reinstituting the draft, debating conscription does serve a political purpose: It allows Congress, the White House, and the Pentagon to avoid discussing the appropriate role of the American military in a post-Cold War world. Meanwhile, U.S. forces continue to engage in open-ended missions in Europe, the Persian Gulf, the Balkans, and Korea.

Balance Sheet

info@reason.com (Rick Henderson) — Tue, 01 Dec 1998 00:00:00 EST

Assets

Duty Freed. California lightens the burden of jury duty. Gov. Pete Wilson signs a bill to require all courts to adopt "one day, one trial," excusing prospective jurors from service for the next year if they aren't put on a trial their first day.

Floating Boats. Say hello to the "mass upper class." The proportion of the U.S. population earning at least $100,000 a year in constant dollars has soared from 3.2 percent in 1967 to 11.8 percent in 1997, says the Census Bureau. It's no zero-sum boom: The share of people below the poverty line continues to fall.

Universal Access. More than 100 would-be refugees are locked up in a New Jersey prison, pending their asylum hearings. They claim prison guards have deprived them of sleep, fed them spoiled food, and forced them to help build the prison without compensation. Now a federal district court agrees to let their case against the INS proceed. It could establish the precedent that immigrants seeking asylum have the same basic rights as U.S. citizens.

Return to Sender. Private space exploration could be closer. Congress passes a bill allowing private companies to launch reusable vehicles similar to the space shuttle. Until now, the private sector could send only satellites and other nonreturnable objects into space.

Liabilities

Beltway Turkeys. Just in time for Thanksgiving, the U.S. Department of Agriculture tells Perdue Farms to remove the "never frozen" label from turkeys that have, well, never been frozen. The feds fear Perdue is tricking consumers by selling turkeys that are processed and shipped at near-freezing temperatures.

Buck Passing. With the blessing of Bill Clinton and the Democratic Party, the Federal Election Commission proposes to unilaterally ban unregulated "soft money" from campaigns. The contributions, which underwrite political parties, issue-oriented advertising, and voter registration rather than individual candidates, have long been considered political speech protected by the First Amendment.

Communication Breakdown. L.A. school officials who oppose Proposition 227, the June initiative which effectively ended bilingual education, are refusing any formal language instruction to as many as 100,000 non-English-speaking children in the public schools, reports the Los Angeles Times. Instead of helping kids learn the alphabet or grammar, administrators say they're teaching oral literacy, or "oracy."

Green Eyeshades. Al Gore, Carol Browner, and the administration's green gurus say the Kyoto greenhouse gas treaty will barely nick the average American's pocketbook. Think again. The Energy Information Administration (part of the same executive branch that employs Gore and Browner) predicts that, by 2010, complying with Kyoto will hike gas prices by 53 percent and push down GDP by 4.1 percent.

Cyberspace March

info@reason.com (Rick Henderson) — Tue, 01 Dec 1998 00:00:00 EST

Just a few months ago, it seemed as if genuine Social Security reform--including at least a partial privatization of the retirement system--was inevitable. Then came Monicagate.

In an attempt to keep Social Security on legislators' radar screens, and to demonstrate how cyberspace can be used in political advocacy, reformers have launched "The Billion Byte March," a Web site that allows those who log on to e-mail the White House and members of Congress and demand changes in the Social Security system.

The brainchild of two groups, Economic Security 2000 Action and Third Millennium, the Billion Byte March has also received bipartisan backing in Congress: Its honorary co-chairs are Sens. Bob Kerrey (D-Neb.), Chuck Robb (D-Va.), and Rick Santorum (R-Pa.), and Reps. Jim Kolbe (R-Ariz.), Mark Sanford (R-S.C.), and Charlie Stenholm (D-Texas), each of whom planned to appear at a rally on Capitol Hill in mid-October. The elected officials and the advocacy groups agree on a set of basic principles, which are listed on the Web site, including an insistence that any reforms of Social Security must allow individuals to invest at least a portion of their payroll taxes in private savings accounts.

National Co-Chair Hillary Beard, who is also executive director of Economic Security 2000 Action, says the leaders of the "march" hope to send between 250,000 and 1 million e-mail messages to Congress and the White House on a single day around the time the president delivers the State of the Union address in late January.

Balance Sheet

info@reason.com (Rick Henderson) — Sun, 01 Nov 1998 00:00:00 EST

Assets

Special Delivery. Telling a conference of business customers the Postal Service "needs to be deregulated, commercialized," new Postmaster General William
L. Henderson concedes the first-class mail monopoly will eventually end. This public reversal may also signal less hostility from the Postal Service toward its customers and competitors.

Local Authority. The Salt Lake City Council refuses to convert its local police force into federal immigration cops. A plan drafted by the chief of police, the Immigration and Naturalization Service, Attorney General Janet Reno, and Sen. Orrin Hatch (R-Utah) to "cross-deputize" 20 Salt Lake City cops is voted down 4 to 3.

Trumping Trump. Donald Trump and the Atlantic City Casino Reinvestment Development Authority end their attempt to seize boardinghouse owner Vera Coking's property. (See "Trump Change," Citings, May 1997.) The CRDA tried to take Coking's home so that Trump Plaza could build a parking lot for its limos. But after a local court rules this use of eminent domain unconstitutional, the agency abandons its effort.

Blue Moon. Pandering to the "family values" crowd, Norway's ruling Christian People's Party implements Sunday blue laws. Large retailers must shut their doors. But gas stations are exempt, letting crafty merchants fight back. RIMI and REMA, the nation's two largest supermarket chains, say they'll install gas pumps at several hundred outlets.

Liabilities

Stun Gun. Mr. Smith, Mr. Wesson, meet Mr. Nader. The latest gun control scheme would apply federal health and safety regulations to firearms. Writes Violence Policy Center analyst Susan Glick in the Los Angeles Times, "If handguns were held to the same standards as every other consumer product in America, they would likely be banned."

Cattle Prod. The General Accounting Office says more than one-quarter of the federal government's $1 billion food inspection budget is wasted on a single antiquated process. While safety measures to check for infectious bacteria go unfunded, notes the GAO, federal inspectors squander $271 million a year eyeballing cow and chicken carcasses for visible signs of disease.

Kangaroo Court. Did ads for Bill Clinton's 1996 re-election violate campaign laws against "express advocacy"? Certainly not, despite the bleatings of campaign reformers and the Federal Election Commission. Clinton may deserve to lose the White House, but not over this.

Old News? Greedy geezers and the redistributionist crowd get an unexpected reprieve: Stock market gyrations and the Clinton scandals all but guarantee that Social Security reforms won't take place before the 2000 election.

Balance Sheet

info@reason.com (Rick Henderson) — Thu, 01 Oct 1998 00:00:00 EDT

Assets

Healthy Trade. Biotech research may doom the U.S.-Cuba trade embargo. SmithKline Beecham plans to test a breakthrough vaccine for group B meningitis developed in Cuba--if the U.S. government will grant a waiver of the embargo. If the waiver goes through, other American companies may try to test AIDS and cholera treatments developed on the island.

Private Possibilities. The distinction between public and private gets a boost in the courtroom, as the "Yale Five" lose. (See "For Heaven's Sake," December.) The Orthodox Jewish students sued the university rather than face the prospect of living in coed dorms. U.S. District Judge Alfred Covello is not amused. "The plaintiffs could have opted to attend a different college or university if they were not satisfied with Yale's housing policy," Covello rules.

Cartel, Schmartel. Keep those Whip Inflation Now buttons in storage. Reports that OPEC nations plan to cut oil production and raise prices look like hooey. The International Energy Agency predicts crude prices will fall for at least another year, fueled by the Asian recession and the eagerness of exporting countries to undercut their rivals.

Continental Air. The German government begins to privatize all its airports. Berlin accepts bids for the operation of its three existing airports; the new Berlin-Brandenburg International Airport will be privately financed and run. The federal government also plans to divest its holdings of airports in Frankfurt, Cologne-Bonn, and Munich.

Liabilities

Pacific Palace. As Seattle Mariner Ken Griffey Jr. chases Roger Maris's home run record, the Mariners' new ballpark reaches an unsavory mark: The yet-to-be-completed, 45,000-seat, retractable-roof stadium will cost at least $498 million, making it the most expensive sports facility in the nation's history.

Shanghaied. Promoting freedom online remains dangerous in China. Shanghai officials arrest Lin Hai, a 30-year-old computer engineer who sent 30,000 e-mail addresses to an Internet-based human rights mailing list in the United States. If convicted, Lin, who is charged with "inciting the overthrow of state power," faces a five-year prison term.

Minor Attraction. The Federal Trade Commission accelerates its thought-police-like campaign to protect "kids" from booze. The agency forces TV ads for Beck's Beer and Kahlua White Russians off the air: The beer ad shows people enjoying themselves on a boat, and the Kahlua ad claims (correctly) that its premixed cocktail is low in alcohol. The FTC threatens action against eight other alcohol makers for using actors who look "too young."

Mission Scrubbed. The prospects for floating industrial parks dim temporarily as the Department of State halts the Sea Launch offshore commercial satellite program. (See "New Waterworld Order," November.) The government put the brakes on Sea Launch because of concerns that Boeing, the project's main U.S. backer, may have shared sensitive satellite information with China.

Discovery Channels

info@reason.com (Rick Henderson) — Thu, 01 Oct 1998 00:00:00 EDT

The New Republic fires Associate Editor Stephen Glass after discovering he invented sources and subjects for more than two dozen stories he wrote for the magazine. The Boston Globe dismisses columnist Patricia Smith after finding out she also created fictional characters to deliver polemical messages in her "reporting" about life on the streets. CNN and Time make a dramatic public apology and retraction–and fire two producers–after jointly airing and publishing stories alleging that the U.S. military used nerve gas on American deserters in Vietnam.

Prestige press outlets have taken some serious body blows over the past few months. And media critics have quickly fingered the cause of these missteps: capitalism–or more precisely, the lust to capture readers and viewers in a hypercompetitive marketplace.

In the Los Angeles Times, former CBS and NBC reporter Marvin Kalb, now a professor at Harvard’s Kennedy School of Government, blames "profit-centered, business-oriented news" and the "24-hour-a-day news cycle with nonstop demands for ‘profitable news.’ " In Intellectualcapital.com, media critic Eric Alterman faults the "culture of celebrity worship" and "the notion that the actual information in any given story is less important than the entertainment package it helps create." Wired’s Jon Katz complains that "the business of journalism has become dominated by large conglomerates whose only interest is profits, who have no ideology other than mass marketing."

Joseph Pulitzer and William Randolph Hearst must be cackling from their graves. A century ago, the two icons of contemporary prestige journalism drove the nation into a frenzy–and a war with Spain –with their sensationally exaggerated accounts of Spanish oppression in Cuba. Their goal was to sell newspapers with what became known as yellow journalism. From the colonial pamphleteers who fomented revolution against the British to the frontier editors who would publish any slander to sell papers (as recounted in Mark Twain’s hilarious early story "Journalism in Tennessee"), "newspapermen" and broadcasters have always sought bigger audiences and fatter profits by offering information and entertainment.

The current controversies are different in one important way: The competitive processes of today’s marketplace led to the rapid exposure and resolution of these journalistic shenanigans. Rather than denigrate capitalism and the search for profits, media critics should praise market processes for providing a public service. The desire to discover the truth, and to place reputation ahead of short-term notoriety, exposed all three frauds.

Glass’s follies were made public by an editor for the online publication Forbes Digital Tool. Adam Penenberg covers technology companies, and when he read a story Glass wrote about young computer hackers working for high-tech firms, something seemed fishy. Penenberg discovered that a company described in the article didn’t exist–and neither did the hackers. Penenberg then approached TNR Editor Charles Lane with this information, and after conducting his own investigation, Lane gave Glass the heave-ho.

Patricia Smith’s fabrications were discovered internally, but the Globe wasted little time getting rid of her in a very public way before she could further damage the paper’s credibility–and its bottom line. And when outraged veteran groups and skeptical military analysts flooded CNN and Time with questions about their story on nerve gas attacks in Vietnam, CNN–a relative newcomer in the media business–feared that its reputation as a source of news might be irreparably damaged. It hired respected First Amendment lawyer Floyd Abrams to check out the criticisms. Abrams found the story shabbily reported and concluded it should never have been aired.

CNN’s Ted Turner announced the creation of an ombusdman-like office that will vet future investigative stories before the network airs them. But the controversy continues, primarily because CNN didn’t fire correspondent Peter Arnett, and media watchdogs are still hounding CNN.

Not so long ago, most people got pretty much all their news from the big three networks and their local daily newspaper. It was a great system for those fortunate enough to land the few available jobs. And many who work in today’s prestige media prefer the old regime. Now, laments Kalb, NBC and its cable outlets MSNBC and CNBC offer 27 hours of national news every day; most network affiliates add two to three additional hours of local news.

And that’s just one media group: C-Span, CNN, Fox, PBS, NPR, all-news radio channels, radio talk shows, and Web pages that link to wire services offer plenty more viewing and listening options. These additional outlets serve as feedback mechanisms, constantly vying to offer more information, a different take on a story, a new angle that can clarify a complicated issue. There are more opportunities for enterprising journalists to build reputations for themselves and their publishers.

A 24-hour market now serves news junkies, and it offers a new set of challenges for those who provide information to the public. There’s more time to fill, which places a premium on providing material worth watching. Channel- (and Web-) surfing audiences are fickle; they can easily go elsewhere if they feel they’re not being informed or entertained.

But these peripatetic viewers are also less likely to accept what they see without question, especially when hundreds of alternatives bid for their time and attention. And there’s actually more pressure on reporters and editors to be careful in verifying stories before airing or publishing them: If a media outlet gets something wrong, there are countless competitors eager to point out mistakes before their news-hungry audiences.

If Kalb, Alterman, and Katz were truly public-spirited, they would celebrate the current competitive atmosphere: The "nonstop demand for profitable news" encourages correction of error and dissemination of truth. The quest to maintain credibility leads media outlets to investigate their own work. In the marketplace, reputation is one major factor that separates prestigious institutions from fly-by-night operators and other fast-buck artists. Competitive forces have broken up the near-monopoly powers the big media providers once enjoyed. As with the end of any monopoly, consumers–in this case, news lovers–are the ultimate victors.

All the News That's Fit to Fake

info@reason.com (Rick Henderson) — Thu, 20 Aug 1998 00:00:00 EDT

Prestigious U.S. media have taken some serious body blows over the past few months, and critics have quickly fingered the cause of these missteps: capitalism, or more precisely, the lust to capture readers and viewers in a hypercompetitive marketplace.

But the critics have their thinking caps on backward. The competitive processes of today's marketplace were what led to the rapid exposure and resolution of these journalistic shenanigans.

Rather than denigrate capitalism and the search for profits, media critics should praise market processes for providing a public service. The desire to discover the truth, and to place reputation first, exposed all the frauds.

LET'S RECAP the notorious goings-on. The New Republic fired an associate editor, Stephen Glass, after discovering he invented sources and subjects for more than two dozen stories written for the magazine.

The Boston Globe dismissed columnist Patricia Smith after finding out she created fictional characters to deliver polemical messages in her "reporting" about life on the streets.

Then the newspaper forced the resignation of veteran columnist Mike Barnicle, citing reportorial lapses in a 1995 column about children with cancer and "the duplicitous way in which the story was written." Indeed, the children may have been fictional.

Cable News Network and Time magazine made a dramatic public apology and retractionóand fired two producersóafter jointly airing and publishing stories alleging that the U.S. military used deadly nerve gas on American deserters in Vietnam.

THE CRITICS have been having a field day. In the Los Angeles Times, Marvin Kalb, a former CBS and NBC reporter who is now a professor at Harvard's Kennedy School, blames "profit-centered, business-oriented news" and the "24-hour-a-day news cycle with nonstop demands for 'profitable news.'"

In Intellectualcapital.com, media critic Eric Alterman faults the "culture of celebrity worship" and "the notion that the actual information in any given story is less important than the entertainment package it helps create."

"The business of journalism," complains Wired’s Jon Katz, "has become dominated by large conglomerates whose only interest is profits, who have no ideology other than mass marketing."

JOSEPH PULITZER and William Randolph Hearst must be cackling from their graves.

A century ago, the two icons of that era's prestige journalism drove the nation into a frenzy–and a war with Spain–over their sensationally exaggerated accounts of Spanish oppression in Cuba. Their goal was to sell newspapers with what became known as yellow journalism.

From the Colonial pamphleteers who fomented revolution against the British to the frontier editors who would publish any slander to sell papers, "newspapermen" and broadcasters have always sought bigger audiences and fatter profits by offering information and entertainment.

THE CURRENT controversies are different in one important way: How they were exposed.

Glass' follies were made public by an editor for the on-line publication Forbes Digital Tool.

Adam Penenberg discovered that a "high tech" company mentioned in a Glass article didn't exist. Penenberg approached New Republic Editor Charles Lane with this information. After conducting a thorough investigation, Lane gave Glass the heave-ho.

In Boston, Patricia Smith's fabrications were discovered internally, but the Globe wasted little time getting rid of her in a very public way before she could further damage the paper's credibility–and its bottom line.

BARNICLE FIRST got into trouble when the Globe’s competitor, the Boston Herald, discovered that one of his columns lifted 10 one-liners without attribution from a book by comedian George Carlin.

The paper initially suspended Barnicle for two months. But when management found out that Barnicle may also have fabricated a rather maudlin column about sick children, Globe Editor Matthew Storin said Barnicle's departure was "the best thing for the paper."

WHEN OUTRAGED veteran groups and skeptical military analysts flooded CNN and Time with questions about their story on nerve gas attacks in Vietnam, CNN–a relative newcomer in the media business–feared that its reputation as a respected source of news might be irreparably damaged.

CNN's founder, Ted Turner, announced the creation of an ombudsman-like office that would vet future investigative stories before the network aired them.

But the controversy continues, primarily because CNN didn't fire correspondent Peter Arnett, who reported the story on-air but later claimed he had nothing else to do with it.

NOT SO LONG AGO, most people got pretty much all their news from the big three networks and their local daily newspaper.

Many who work in today's prestige media prefer the old regime. Now, laments Kalb, NBC and its cable outlets MSNBC and CNBC offer 27 hours of national news every day; most network affiliates add two to three additional hours of local news. And that's just one media group.

Plenty of additional viewing and listening options are offered by C-Span, CNN, Fox, Public Broadcasting, National Public Radio and local radio stations offering news and talk shows. The rise of the Internet has seen further competition from Web pages that link to wire services. In short, a 24-hour market now serves news junkies.

AUDIENCES accustomed to channel (and Web) surfing are less likely to accept what they see without question, especially when hundreds of alternatives bid for their time and attention.

There's actually more pressure on reporters and editors to be careful in verifying stories before airing them. If a media outlet gets something wrong, there are countless competitors eager to point out mistakes before their news-hungry audiences.

What Marvin Kalb decries as the "nonstop demand for profitable news" actually offers a great public service. It encourages dissemination of the truth.

THE CEASELESS QUEST to maintain credibility leads media outlets to investigate their own work, for in the marketplace, reputation is one major factor that separates prestigious institutions from fly-by-night operators and other fast-buck artists.

Competitive forces have broken up the near-monopoly powers major media providers once enjoyed. As with the end of any monopoly, consumers–in this case, news lovers–are the ultimate victors.

Balance Sheet

info@reason.com (Rick Henderson) — Sat, 01 Aug 1998 00:00:00 EDT

Assets

Clear Language. California's Proposition 227, the "English for the Children" initiative, passes with nearly 61 percent of the vote. (See "Loco, Completamente Loco," January.) The initiative, which will end most of the Golden State's bilingual education programs, gets one of the largest victory margins of any contested referendum since Proposition 13 passed 20 years ago.

Moon Shot. Hughes Global Services Inc. completes the first commercial flight to the moon. The HGS-1 satellite circles the moon twice before settling in a geosynchronous orbit, where it will provide communications services for government agencies and private customers.

Choice Chances. For the first time, a state supreme court lets low-income students use tax-funded vouchers at private religious schools, as Wisconsin's high court upholds the Milwaukee program. And through the CEO America Foundation, financier Ted Forstmann and retailer John Walton (of Wal-Mart fame) commit $100 million to underwrite scholarships for impoverished kids. Their antes will be matched by donors nationwide.

Speed Dial. The cost of joining the information revolution plummets. Sprint's Integrated On-Demand Network will provide voice, fax, video, and high-speed Internet transmissions over one line. The network, available to residential customers late next year, will reduce the cost of long-distance calls by 70 percent and deliver Internet connections at 100 times the speed of a typical modem. ION also includes local service, which could obliterate local telephone monopolies.

Liabilities

Civic Removal. First sex shops. Then taxis. Now hot dog vendors. New York Mayor Rudolph Giuliani's quest to disinfect the Big Apple targets food and clothing vendors who sell their wares on the city's streets. If Giuliani succeeds, he may move these entry-level entrepreneurs off the streets and into welfare lines.

Running Scared. Trying to protect their phony-baloney jobs, Republicans cast aside any remaining limited-government inclinations. Before the November election we'll see GOP-led votes to restrict political speech (a.k.a campaign reform), private contracts (HMO regulations), freedom of conscience (the school prayer amendment), and other calls for mobocracy.

No Satisfaction. Onetime London School of Economics student Mick Jagger demonstrates his understanding of supply-side economics. The Rolling Stones cancel the four British concerts on their world tour after the Labor government repeals a 20-year-old tax break for part-time residents who earn money outside the U.K. Jagger says the Stones would have had to pay $20 million in taxes if they played a single show on British soil.

Excessive Success. The Clinton administration's war on commerce proceeds with the Federal Trade Commission's bizarre antitrust suit against computer chip giant Intel. Message from the White House to America's entrepreneurs: If you deliver goods and services effectively to consumers, we'll see you in court.

Armed Forces

info@reason.com (Rick Henderson) — Sat, 01 Aug 1998 00:00:00 EDT

The federal law enforcement agency with the most gun-toting officers is neither the FBI nor the Bureau of Prisons but the Immigration and Naturalization Service. A Bureau of Justice Statistics report reveals that the INS employs some 12,400 armed agents, an increase of 31 percent since the last BJS survey in 1993. The Bureau of Prisons ranks second, with 11,300 armed officers (a 13 percent increase since 1993), and the FBI third, with 10,400 (up 3 percent).

Of the federal agencies with at least 500 armed officers, which grew the most? The Fish and Wildlife Service, at 40 percent.

Lasorda Bleeds Red, White & Blue

info@reason.com (Rick Henderson) — Sun, 12 Jul 1998 00:00:00 EDT

If actress Meryl Streep is credible enough to explain the presumed health risks of pesticides before Congress, then Los Angeles Dodgers General Manager Tommy Lasorda is certainly qualified to pose as a constitutional scholar and decry flag burning on Capitol Hill. Lasorda wants the Senate to pass a resolution that calls for a constitutional amendment to outlaw "desecration" of the American flag, and he testified before that body's subcommittee on the Constitution July 8. (The House passed a similar amendment by an overwhelming margin of 310 to 114 last June.)

Lasorda told a compelling story of the outrage he experienced as he witnessed a flag burning on the field at Dodger Stadium between innings of a game in 1976, and the pride he felt when outfielder Rick Monday ran from the dugout, grabbed the flaming flag from the protesters, and ran off the field with it. The assembled crowd there showed its appreciation, he recalled, by spontanteously bursting into a chorus of "God Bless America."

No doubt the protesters were punished that day, as they should have been, for trespassing, and perhaps disturbing the peace. But elevating their foolish actions to a constitutional matter would cheapen what the flag represents and the Constitution itself.

In the 1989 Texas v. Johnson decision, the U.S. Supreme Court ruled that flag burning was a form of speech protected by the First Amendment. The 5-to-4 majority rebuffed the notion that Congress or state legislatures could punish individuals for mutilating or otherwise publicly defacing certain manifestations of our national symbol.

While civil libertarians cheered the Court's decision, the majority didn't go far enough. It could have set forth a principled way to discourage flag burning without damaging the freedoms the flag represents. By not doing so, it's likely that every state legislature will spend the next several years being asked to ratify the amendment and, in the process, determine what constitutes an American flag. And we may end up with a silly and confusing "anti-desecration" law that does an injustice to the liberties of all Americans.

In the Texas case, Gregory Lee Johnson joined a demonstration in Dallas by taking a flag from the federal building and burning it while chanting anti- American slogans. A Texas law at that time prohibited "publicly mutilating, defacing, defiling, burning, or trampling" on any "flag of the United States." The Supreme Court struck down that law. But the majority never suggested that Johnson could have been legitimately prosecuted, say, for defacing public property (the flag he burned wasn't his, after all). By leaving what appears to be no way to punish those who destroy property as long as that property is an American flag, the Court may have encouraged much of the amendment fever that Tommy Lasorda's congressional testimony exemplifies.

If the amendment is ratified, Congress will have to define what constitutes a flag. And that won't be an easy job. The Texas statute Johnson violated, for instance, made it a crime to publicly deface any representation of the American flag. It didn't matter how many stars or stripes it had. It didn't even have to be a piece of cloth. As long as the person bringing the complaint believed he was witnessing the mutiliation of something that represented the American flag, a crime had been committed. (A similar anti-mutilation law remains on the books in the District of Columbia.) During the House of Representatives' debate on the proposed amendment earlier this year, Rep. Gary Ackerman (D-N.Y.) demonstrated that everything from party napkins to boxer shorts could conceivably be targets of a federal "anti-desecration" suit.

Sadly, the Supreme Court may get an opportunity to revisit this issue: The amendment has 60 Senate co-sponsors, only seven votes short of the total needed to send it to the states for ratification. If the amendment passes the Senate, and 38 state legislatures ratify it, Congress will have to determine whether, say, your album covers are your property or a protected national symbol. The Court could have caused a lot less consternation if it had said the American flag is an important symbol, but representations of it are private property, nothing more or less.

This article appeared in the Orange County Register, July 12, 1998.

Data: Team Colors

mwlynch@reason.com (Michael W. Lynch) info@reason.com (Rick Henderson) — Wed, 01 Jul 1998 00:00:00 EDT

When President Clinton participated in ESPN's town meeting on race and sports in Houston on April 14, he repeated the widely held perception that professional sports franchises are slow to bring African Americans and Latinos into ownership and management. The president hinted that, if practices didn't change, the heavy hand of civil rights enforcement may someday bear down on franchise owners.

Comparing the racial and ethnic makeups of team rosters to those who operate franchises strongly suggests that discrimination exists. But the way in which government bean counters measure such "imbalances" would actually make front offices seem like stellar examples of compliance with civil rights laws. "Federal affirmative action policies state that the workplace should reflect the percentage of the people in the racial group in the population," notes the most recent "Racial Report Card" prepared by Northeastern University's Center for the Study of Sport in Society. Using such quotas, sports organizations do fine: Their managers, coaches, and professional staff look a lot like America. It's the rosters that are out of whack.

Balance Sheet

info@reason.com (Rick Henderson) — Wed, 01 Jul 1998 00:00:00 EDT

Assets

Nature's Course? Hopeful medical news has bio-Luddites on the run. The massive popularity of Viagra shows that men no longer consider impotence a "natural" condition they must accept. And the tumor-shrinking cancer treatment discovered by Boston physician Judah Folkman suggests that biotech may conquer the disease we fear most.

Welfare Relief. North Carolinians resoundingly say no to tax handouts for Major League Baseball. (See "Squeeze Play," page 74.) More than 60 percent of voters in Forsyth and Guilford Counties reject an initiative to raise taxes for a $210 million stadium intended to lure the struggling Minnesota Twins to the Piedmont Triad.

Cash Rebates. The Congressional Budget Office estimates the 1998 budget surplus will be $68 billion, up from a projected $5 billion in April. Perennial presidential hopeful Jack Kemp suggests several simple, nondistortionary ways to give that money back, including: Repeal the Bush/Clinton tax hikes; increase the standard deduction for individual income taxes; and raise the income people can earn before they're kicked from the 15 percent into the 28 percent tax bracket.

Honor Roll. Gov. Pete Wilson signs a bill jump-starting California's charter schools. (See "Class Acts," April.) The bill will increase the number of charters from 100 to 250 this fall, adding up to 100 additional charter schools each succeeding year. It also lets parents or teachers petition to convert existing public schools into charter facilities.

Liabilities

Safe Harbors? While you contemplate summer vacation, the Occupational Safety and Health Administration works overtime. OSHA wants to require every convenience store to install bulletproof glass and have at least two clerks on the clock during late shifts. It also plans to make contractors increase the number of porta-potties on construction sites.

Silicon Ceiling. Asserting that lightly regulated high-tech companies treat women more shabbily than men, Rep. Connie Morella (R-Md.), chair of the House technology subcommittee, calls for a federal Commission on Women in Science, Engineering, and Technology Development. Science says the commission could call for new, gender-based regulations for tech firms.

Pig Feed. House Speaker Newt Gingrich personally guarantees a corporate welfare hog stays at the tax trough. Gingrich restores the $600 million annual ethanol subsidy through 2007. Most of the money goes to Archer Daniels Midland, a bipartisan source of campaign cash.

Dixie Dregs. Alabama's legislature unanimously enacts the nation's toughest restrictions on adult entertainment. One provision would designate any store that sells, rents, or distributes materials that depict nudity an "adult" business subject to advertising and promotional restrictions. Cinemas may not be able to post billboards for Titanic; bookstores may have to keep collections of Michaelangelo's work under the counter; and newsstands may have to shrinkwrap the June issue of REASON.

Balance Sheet

info@reason.com (Rick Henderson) — Mon, 01 Jun 1998 00:00:00 EDT

Assets

Equality Time. California Gov. Pete Wilson ends race- and gender-based contracting in the Golden State. A March 10 executive order ends all goals and preferences for awarding construction contracts to firms that are owned by women or members of racial minorities. Contracts awarded after March 10 were scrapped and will be rebid "solely on the basis of the individual merits of the bid."

Bottoms Up. Raise your glasses, federalists: Congress temporarily refuses to tighten the national standard for drunk driving. A proposal to cut federal highway funds to states that don't cut their blood-alcohol threshold to 0.08 percent is excluded from the House version of the highway bill.

Tube Triumph. The Federal Communications Commission rules that personal computers aren't TV sets (duh) and can't be forced to incorporate V-chips in their circuitry. The ruling also ends the prospect that the FCC would try to impose sex, language, or violence ratings on the Internet.

Flight Upgrades. The United States and France agree to deregulate air travel between the two countries. Passenger flights will expand by 40 percent in June, price controls will end in two years, and the frequency of flights will be completely set by consumer demand within five years. Shipping to Europe should also get cheaper, as the agreement lets FedEx dramatically expand its hub in Paris.

Liabilities

System Crash. As if Microsoft didn't have enough trouble with the feds, 11 states prepare to bring antitrust actions against the software giant. (See "Creative Insecurity," January.) California, New York, and Texas are among the states pushing the Justice Department to sock Microsoft before it releases Windows 98.

Illegal Fees. Are Bill Clinton's pecadilloes lightening your wallet? Sen. Ben Nighthorse Campbell (R-Colo.) says the White House counsel's staff has expanded from four in 1993 to as many as 100 today. Campbell claims the office illegally uses tax money to perform personal legal work for the Clintons. The White House concedes that 19 attorneys work full time in the counsel's office and additional lawyers are "on loan" from other federal agencies.

Fright Night. Better get that Freddy Krueger costume out of mothballs: A bill sponsored by Sen. Al D'Amato (R-N.Y.) would reclassify imported Halloween costumes as wearing apparel, subjecting them to punitive tariffs. The bill would give a near-monopoly to Long Island-based Rubie Costumes Co., the nation's largest maker of under-$15 outfits.

Tribal Thunder. Cleveland Indians owner Richard Jacobs hopes to raise more than $60 million by selling shares of stock in baseball's most profitable franchise. But Jacobs, who will retain 99.9 percent of the voting shares, will use none of this money to pay down the debt on the taxpayer-financed Jacobs Field, which has cost the locals more than $200 million.

Head Count

info@reason.com (Rick Henderson) — Mon, 01 Jun 1998 00:00:00 EDT

"Acceptance of Blacks, Latinos to UC Plunges," blared the Los Angeles Times in a front-page headline April 1. The New York Times, Washington Post, USA Today, and scores of other newspapers similarly reported statistics released by the University of California for the fall freshman class, the first group of students admitted since the system abandoned racial preferences. UC-Berkeley has admitted 66 percent fewer African-American students and 53 percent fewer Latino students to the class of 2002. At UCLA, the drop in African-American and Latino freshmen was 43 percent and 33 percent, respectively.

But figures released by the University of California system the following day tell a more nuanced story: Overall enrollment of self-identified minority students throughout the eight-campus system did fall, but not so drastically. The UC system as a whole admitted 18 percent fewer African Americans and 7 percent fewer Latinos this year than last year overall.

These statistics, reported in the Sacramento Bee, probably understate the number of "minority" students who were actually accepted at a UC campus. One in seven of this fall's applicants--14.3 percent--refused to state their ethnicity, nearly three times as many as last year. And since the UC system, which will admit nearly 45,000 freshmen this fall, guarantees a slot at some campus to any student who meets minimum academic standards, as many as 4,000 additional students who had not been accepted as of April 1 remain eligible to enroll.

Puff Daddies

info@reason.com (Rick Henderson) — Mon, 01 Jun 1998 00:00:00 EDT

"This is the first act of civil disobedience in my life," laughed comedian and nonsmoker Drew Carey, as he lit a cigarette in the popular West Hollywood restaurant Barney's Beanery March 31. "Lock me up."

Before a crush of microphones, cameras, reporters, and fellow protesters, the stand-up comic and ABC sitcom star publicly flouted the ban on smoking in bars and restaurants that took effect in California January 1. The event, which also promoted REASON Senior Editor Jacob Sullum's new book For Your Own Good: The Anti-Smoking Movement and the Tyranny of Public Health, attracted lots of press attention. Entertainment Tonight, Access Hollywood, CNN, VH-1, and E! Entertainment News sent camera crews and correspondents, as did the local network affiliates and two independent stations.

"I want to have the right myself to ostracize [smokers], I don't want the government to do it," said magician/comedian/nonsmoker Penn Jillette, who took a drag from a bystander's cigar. Print reporters from USA Today, the Associated Press, Daily Variety, and Hollywood Reporter covered the smoke-in, as did Los Angeles Times columnist Mike Downey. Along with the camera crews and reporters, two other stars of The Drew Carey Show--Ryan Stiles (Lewis) and Nan Martin (Mrs. Louder)--and about two dozen grassroots protesters joined the smoke-in.

Irwin Held, owner of Barney's, gladly hosted the event because he says the ban has reduced his business by 30 percent to 40 percent. This loss of commerce doesn't seem to bother West Hollywood Mayor Steve Martin (not the actor), who said he was "disappointed" in the positive publicity Carey and his fellow scofflaws attracted. "The ban is here to stay," Martin said. "The government is looking out for the majority, and the smoking ban makes good sense for the majority."

Plan Obsolescence

info@reason.com (Adrian Moore) info@reason.com (Rick Henderson) — Mon, 01 Jun 1998 00:00:00 EDT

Life in America's suburbs is under attack. In journals ranging from The Nation, The Atlantic Monthly, and Utne Reader to The American Enterprise and The Weekly Standard, critics of suburbia argue that policies implemented since World War II--from the home-mortgage income tax deduction to subsidies for automobile operation to inflexible zoning laws--have lured Americans away from traditional downtowns and urban neighborhoods into soulless suburbs, where a landscape littered with strip malls and tract housing makes it nearly impossible for people to form genuine communal bonds with their neighbors. Contemporary suburbanites are condemned, in the words of the left-leaning L.A. Weekly, to "a future of endless sprawl and equally endless commutes."

To save suburban dwellers from this hellish existence, urban planners have devised massive subway construction projects, controls on the development of neighborhoods with single-family homes, "mixed-use" zoning districts that allow commercial operations to coexist with residences, and "urban growth boundaries" that have made it illegal to build homes or locate businesses on the outskirts of such cities as Portland, Oregon.

Enter Peter Gordon, a professor of planning and economics at the University of Southern California's School of Urban Planning and Development. For nearly three decades, Gordon, along with his USC colleague Harry Richardson, has challenged conventional views about gridlock and sprawl, finding that the data don't match the received wisdom: "Suburbanization" is not an artifact of late 20th-century America but a process that has unfolded as long as people have possessed the means to travel and relocate. Commute times are no longer than they were 15 years ago. Individuals are finding the types of living arrangements they prefer. And while Los Angeles-style sprawl is vilified in the traditional planning literature, as well as in most popular accounts of urban life, Los Angeles has the highest population density of any major metropolitan area in the country.

Gordon, who received his Ph.D. from the University of Pennsylvania, has published dozens of articles in popular publications and peer-reviewed journals. He is co-editor of Planning and Markets, a new online publication that focuses on land-use and transportation issues (www~pam.usc.edu). While he may be considered a lightning rod in the planning community, in person he's gentle and patient, hardly the sort of firebrand his heretical views suggest.

REASON Managing Editor Rick Henderson and Adrian T. Moore, director of economic studies at the Reason Public Policy Institute, interviewed Gordon at his Brentwood home in March.

Reason: There is a pervasive argument among traditional planners that compact cities built around a traditional downtown are intrinsically good. While cities once developed around transit centers, raw materials sites, or natural harbors, contemporary cities seem to be more the artificial creations of planners. What has happened?

Gordon: Compact cities are archaic forms, and they are not coming back. When you study the economics of location, all the textbook models say a firm wants to locate near the urban core or other advantageous sites, and workers must make their living arrangements so that they are close to their jobs. That may be the way it was once upon a time.

But all these firms have become much more footloose. And they go where the workers want to live. The orientation has flip-flopped. Even manufacturing businesses are no longer locked into specific sites, so they have more locational choices. They want to go where the labor force wants to go. The workers and their families want to live where the land is cheap and the air is clean and the schools are good and there are high amenities and so forth. There's a lot more spatial flexibility than ever before, and the consequences are pretty benign.

People don't have to live near work. They can be near good schools if they want to be without paying the price in longer- duration commutes. If you make travel less expensive, there will be more travel.

Reason: You've shown that the average-duration commute has stayed the same over the past 15 years or so. Why does everyone believe that traffic congestion is getting worse?

Gordon: What's interesting is how little congestion there is. If you take a resident of any large foreign city like Tokyo and transplant him or her to Los Angeles, they think they've died and gone to heaven, because the commutes are less than half, on average, here than they are there. Something like 10 percent of the people nationwide commute more than 40 minutes one way. There is a lot of self-correction going on. For 1995, the average automobile commute in L.A. was 23.5 minutes one way.

People are part of a spontaneous order. I think it's not only pessimistic but even ignorant to believe that people are going to sit tight while their lives go to hell. That's never happened. Even where the commuting distances have increased, the trip durations have not, which means commuting speeds are up. It is the opposite of impending gridlock, and it means people can have their cake and eat it, too.

Reason: So why don't people in Tokyo correct in the same way Angelenos do?

Gordon: Many Japanese choose long train commutes because they have a much smaller scope of trade-offs available. Automobile travel is much more expensive [in Japan]. Land doesn't change hands as frequently. There are all kinds of things standing in the way of the fluidity that we're used to.

Reason: You're a critic of the New Urbanism, which is the hot thing in the planning profession. Here's how Alan Ehrenhalt describes the principles of New Urbanism in Governing magazine: "The automobile, and four decades of building homes, streets and suburbs for the automobile's convenience, were draining American places of the community and intimacy that human beings naturally desire." The New Urbanists claim that people want neighborhoods with tree-lined streets, and parks and shops all within walking distance of homes. What's wrong with that?

Gordon: I think the development of neighborhoods by private developers is driven by markets, not by public policy. People are getting the neighborhoods they want. And I trust that competing developers are reading the trade-offs that you and I are willing to make and that those trade-offs include our demand for community. Our demands for community are met in many ways. We can use the automobile [to meet those demands], or we can even use the Internet.

People are getting a sense of community in the neighborhoods we have. We know that 20 percent of all trips by automobile are for work, 20 percent are for shopping, and 60 percent are for things I would call social. The U.S. Department of Transportation uses categories like family/personal business, school, church, visits to relatives, and other social or recreational uses, but you could easily call all these social or "community" trips.

New Urbanism is heavy on intervention, and it's tied into the "civil society," or communitarian, discussion. It dances around defining whether there's a problem with the way we live and says, "There's a problem--automobile use--and we have a solution." I'm not sure we all agree there's a problem. And it's a long shot to say that there's a design fix and we know what that design fix is.

Reason: Conservatives such as Karl Zinsmeister at the American Enterprise Institute have become big boosters of New Urbanism. They argue that the fatal conceit of traditional planning and zoning has led to these soulless suburbs. But aren't the conservatives substituting their own fatal conceit, that everyone wants to live in Small Town, USA?

Gordon: That's the weak link in the New Urbanism. If there were a grain of truth in their view, we would soon see people demanding it, and developers would strive to provide it. Builders are not ideologues.

New Urbanists say there are land use configurations that will lead to lower trip frequency. And if we object to the use of the automobile, then we can develop a land use solution. They have advanced all kinds of street designs, and hypothesized how to lay out homes and neighborhoods more compactly, and say if people can walk to all the places they need to go, presto, there will be less automobile use. The smallest introspection will show that trip frequency isn't fixed.

The New Urbanists certainly haven't done their homework. They certainly don't look at the facts a lot, so I keep going back to the international comparison. We've all traveled, we've all seen suburbanization in other parts in the world. There's clearly a universal demand for and use of automobiles that's reflected in the data.

International studies, like those from the Organization of Economic Cooperation and Development, are always funny to read, because the authors prejudge everything. At the beginning you have all these conclusions articulated that the automobile is the problem, what are we going to do with the automobile, how can we keep people out of automobiles, and so on. But what's revealing is that the authors lament automobile use in all these places. You have a tough time blaming American policy for automobile use [in other countries], and when you get rid of that explanation, you have to end up saying the reason people drive is consumer preference. Preference is a pretty powerful explanation compared to the one suggested by the New Urbanism.

Not just that, but the New Urbanists claim suburban development, which they call "sprawl," is something that people are using against their better judgment. One of the favorite themes of planners is that people haven't got enough choices, and builders are restricted by zoning codes to give people stuff that they don't really want. That's of course inconsistent with the other story the New Urbanists tell: that planners are beholden to builders. Well, if that's true, and just one of these greedy builders would figure out that people wanted to live in neotraditional settlements, then that greedy builder would overcome political barriers and we'd have the neotraditional developments.

Reason: Aren't there private attempts to create the type of places the New Urbanists want?

Gordon: I don't know of a lot of success stories. A lot of these developments are too new to judge. A lot of attention has been paid to the Disney-built community in Florida [Celebration], but the reviews of it have been mixed. Even that refers more to opinions of reviewers and less to the judgment of the market.

Reason: The New York Times Magazine has suggested it's more like living in a Disney-built theme park than in a real community.

Gordon: But social arrangements that are provided in the marketplace are constantly evolving. We would expect that savvy builders are evolving and experimenting in providing new things. It's a wonderful process.

If the New Urbanists have something to contribute to that evolution, that's wonderful. But instead they want to make a clean break and say that society is marching one way and we know the way it ought to go instead.

Reason: What's good about suburban living?

Gordon: Those of us who believe in markets place a lot of value on living arrangements that are an expression of consumer preferences. People are voting for spacious living, so by all means let them have what they are voting for. They're voting for access to their schools, they are voting for clean air and those kinds of things. By any measure, suburban living has to be a success story.

Americans run to [visit] Europe because, hell, those are cities. Now, that doesn't mean we choose to live there; it's just a nice place to visit. Traditional cities are fun for tourists. [That has] nothing to do with whether you want to live there.

There is the presumption that suburbanites are living these lives of quiet desperation and isolation, and they really hate being there. You see trotted out ideas about community being missing. And to have community, you've got to be in Manhattan. There are a lot of ex-Manhattanites that would challenge that theory very seriously.

Reason: A lot of people seem to think that auto travel is heavily subsidized but mass transit isn't.

Gordon: Federal transit subsidies go back to the 1960s, and for the first 10 years they were capital subsidies only. You had all this overbuilding of rail transit and a lot of people wrote articles that said overbuilding occurred because the feds subsidize only one part of the activity, and that's building. In 1974 the feds began subsidizing operation as well as building of transit systems. The whole idea of a federal transit policy may be silly, but as long as all this money is funneled though Washington, locals want to get in line to get theirs.

Whether you [do] it per mile or per trip, transit subsidies are hugely greater than any subsidies to the automobile. Per passenger mile, transit subsidies are 50 times what auto subsidies are. And the L.A. experience suggests that we spend a lot of money and get less transit use. We're spending more to get rid of riders. Back-of-the-envelope calculations show that about $7 billion has been spent on rail so far, and we know that they've lost an aggregate of about 1 billion riders over a 10-year span. So they've spent $7.00 for every transit rider eliminated.

Reason: How does that loss of ridership compare to the national average?

Gordon: There have been market-share losses in all of the new rail cities. The other thing you want to control for is background growth. So this is over a period where L.A. County added 12 percent to the population, and a lot of those were lower-skilled immigrants, who are sort of a natural constituency for mass transit. So to spend that much money and lose that many riders, that's not simple. You've really got to work at it.

Reason: Is any public transportation economically viable?

Gordon: At best, a maybe if you legalized vans. There's a big fight in New York City over them right now. Los Angeles legalized airport vans, and now Super Shuttle wants to get in the way of new entrants. But whatever [form of public transit] you come up with would be running neck and neck with large numbers of used cars. The transportation mode of choice of low-income people is used cars.

Reason: The communities that are held out as almost utopian by the New Urbanists--Portland, Oregon, or the Kentlands in suburban D.C.--have intensely politicized almost every private land use decision. Is putting every decision about painting your roof before a plebiscite the way people really want to live?

Gordon: That scares off a lot of people because they fear that their own property rights are up for grabs. If their own property rights are subject to being put in a common pool, a lot of people will say, "No, thank you."

On the other side, we have the growth of community associations, or what some people are calling entrepreneurial communities. When everything is contractual, then you're not going to have these surprises. So people are making ever more such choices, and it puts them in the category of getting out of harm's way and providing insurance for my property rights, because my property rights are ever more up for grabs, [depending upon what] judges are doing or not doing, or what the zoning board is doing in response to organized groups, and all that. The entrepreneurial communities--or whatever you what to call them, community associations--are a mechanism that fits very well.

Reason: But can't community associations become political organizations that have as much power as zoning boards?

Gordon: If everything is covered by contract, there are no misunderstandings and no surprises. We either bargain for the contract that we want or we go look for another one somewhere else.

Reason: But contracts can't anticipate everything. An entrepreneurial community established 20 years ago could have never anticipated the development of 18-inch satellite dishes, which might well be banned in such a place.

Gordon: More adaptive forms will have to come on the market. My friend Spencer MacCallum, an anthropologist who writes on these issues, says that we may see the development of leasehold arrangements rather than traditional contract arrangements. The model he uses is that of hotels and shopping malls, where entrepreneurs provide services that people want. Leaseholds may provide much more flexible property arrangements than we typically imagine.

Reason: You mean the neighborhood association may renegotiate parts of its contract every year? We won't let you build a deck on the back of your house this year, but next year we'll think about it? Or people could decide to live in rigidly defined communities with extremely inflexible contracts if there's a demand for them?

Gordon: Right. All in the direction of increasing competition. People are more mobile than ever, and they have an easier time moving from one place to another as their requirements change.

The downside of these entrepreneurial communities, of course, is that as more affluent people withdraw from cities the interest groups that are left behind become ever more powerful. The people who are victims are the people who are least likely to move. We condemn the poorest to the worst public schools and the worst public services.

Reason: So are decaying urban cores part of an evolutionary process that no planning can overcome?

Gordon: The best thing that's happening to old urban cores is the immigrants, and immigrants have almost nothing to do with the planners except for the fact that planners often give them a hard time when they want to get occupational licenses. The infusion of capital and entrepreneurial skills in the core areas is coming entirely from the immigrants. If we make it our business to chase them out, then we may be hastening the decay of those urban cores.

Reason: You don't fit the profile of the typical urban planner, advocating top-down remedies. How did you arrive where you are? Are you indeed atypical?

Gordon: Planning is so eclectic it draws people from everywhere: architecture, the social sciences, the natural sciences. You really get an odd stew. I have a very Hayekian view of the world, and given the way that I view the evolution of the built environment, the Hayekian view has a lot to say. I teach about markets, so I'm less suspicious of market mechanisms than most of my planning colleagues.

And even when I speak with like-minded colleagues, I have to ask if market-friendly planning is realistic or plausible. Is there any mileage in doing market-friendly planning, or are spontaneous orders or spontaneous adjustments going to outdistance what planners try to do all the time? And that's why it's interesting to look at the migrations that are going on into the exurbs and into private communities, because those are going on in spite of any planning or any policy.

If we have local policy interests, and we have an understanding of the role of markets, then I think you reach the conclusion that a lot of the conventional, command-and-control stuff is disastrous. Spending $7.00 per rider to lose a billion transit riders is disastrous. So I think we have a huge case study which does not offer us any cause for optimism for traditional planning.

What can we, as researchers, really do? We can quit, or we can keep believing--let's unearth some of these facts and ideas, present them as best we can, and maybe somebody will learn something.

Reason: How are you perceived in the planning community? Are you on the fringe?

Gordon: I'm at the edge of the fringe.

Reason: So when you go to the American Planning Association's convention, do you drink alone?

Gordon: Well, I don't go very often. When I'm invited to speak at certain places, I think it's as a curiosity. There's the usual handful of people who thank you. God knows if they thank you because they've been informed or entertained or whatever.

But the intent is to uncover some facts, support them as best you can, put them in context, because there are all sorts of unfounded assertions out there.

Reason: Even so, the traditional planning community doesn't seem to shun you completely. In the Winter 1997 issue of the American Planning Association Journal, you and your USC colleague Harry Richardson engaged in a fascinating debate with Florida International University planning professor Reid Ewing. Your article, "Are Compact Cities a Desirable Goal?," was a straightforward exposition of the case against traditional planning and for consumer preferences. Ewing's "Is Los Angeles-Style Sprawl Desirable?" directly challenged your arguments. How did that come about?

Gordon: We sent them our article, and they wrote back and said, "We can run this if we run it with a counterpoint." There wasn't even the suggestion that they would run ours alone. I'm happy they did run both, because I want that discussion to be out there. Nevertheless, the editors of the journal of the APA felt they needed the safety of a counterpoint before even letting us present our side. But Harry and I were pleased to find out that the editors awarded us honorable mention for feature article of the year.

I was asked to address the L.A. City Planning Commission two years ago because there was a draft of their plan which favored transit-oriented development. And I said, "Here are the various reasons why it will not work." The response I got was a big yawn. There was zero interest in that, either [from] the commissioners who for some reason invited me, or [from] a lot of the staff people who were there. I just said their document was full of holes, but there was no interest as to asking why, or can you tell us what's wrong, or anything like that.

Reason: Is traditional planning becoming inconsequential? Are today's academic planners comparable to the slide-rule designers of 20 years ago, preparing to offer a product which has no market?

Gordon: We are trending away from planners in the traditional form, who primarily serve the interests of municipalities. But property arrangements are coming on line which require the developer to wear the planner's hat or the planner to wear the developer's hat. You could call this role "planning," but it's not traditional or public-sector planning.

People who are savvy enough to see the opportunities may be called planners, but they are less likely to operate in city hall and are more likely to operate in a development group, to arrange the types of developments that are successful. They will need a more sophisticated range of skills.

Maybe the world is changing so fast that what's coming out of the academy will lag behind [what the real world demands]. Maybe students will come out of the academy being trained in one way and find, once they leave, they need skills that direct them in another.

But that may be true of any number of other disciplines. It may be a problem professional schools in general face. We know universities are having a hard time keeping up. That's why we have think tanks [laughs].

Balance Sheet

info@reason.com (Rick Henderson) — Fri, 01 May 1998 00:00:00 EDT

Assets

Elder Statesman. A key Democrat may stifle President Clinton's plan to let nonretirees "buy" Medicare coverage. Clinton pal Sen. John Breaux (D-La.), head of a bipartisan
Medicare advisory panel, tells The New York Times Congress shouldn't rush to expand Medicare coverage in an election year, "when it will become a political football."

Juiced. El Salvador concludes Central America's first electricity privatization. Ownership groups from Chile, Venezuela, and the United States pay nearly $600 million for majority shares in El Salvador's four electric utilities.

Access Denied. Bill Clinton backs the Cox-Wyden Internet Tax Freedom Act, which would declare a six-year moratorium on new cyberspace taxes. Citing the chaos that could result if 30,000 governing authorities taxed online services, Clinton tells a high-tech conference in San Francisco, "We can't allow unfair taxation to weigh [the Internet] down."

Good Gridlock. Potentially unconstitutional limits on political speech (a.k.a "campaign reform") may be dead for one more year. Procedural hurdles and killer amendments crafted by Senate Majority Leader Trent Lott (R-Miss.) keep the McCain-Feingold bill off the legislative agenda indefinitely.

Liabilities

Drug Slug. From staplers to aspirin, the government's war on commerce continues. The Federal Trade Commission rejects proposed mergers of drug wholesalers Bergen Brunswig Corp. with Cardinal Health and McKesson with AmeriSource Health Corp. The two new firms would have owned 80 percent of the U.S. wholesale drug business, a concentration the FTC considers monopolistic.

Stadium Scam. Arena frenzy continues in Texas. (See "Edifice Complex," August/September.) Dallas voters agree to pay more than half the cost of a $230 million facility for the NBA Mavericks (owned by Ross Perot Jr.) and the NHL Stars. And the Harris County Sports Authority approves a construction contract for a $230 million site for baseball's Houston Astros.

Bets Off. A U.S. attorney in New York indicts 14 U.S. citizens operating Internet gambling services that are headquartered in Central and South America. Janet Reno claims all Internet gambling is illegal, citing laws dating from Al Capone's heyday that make transmitting gambling information by phone a federal crime.

Laser Tag. The national ID card is here. More than 5 million Mexicans who frequently cross the U.S. border to conduct business or visit relatives must now carry "laser visa" cards. The cards, which contain digital photos, fingerprints, and other personal information, are a model for the ID cards all Americans must soon have.

Clipping Encryption

info@reason.com (Rick Henderson) — Fri, 01 May 1998 00:00:00 EDT

President Clinton raised a few eyebrows when he announced his support for the Internet Tax Freedom Act, a bill that would place a six-year moratorium on new taxes that apply only to the Internet. The National Governors Association had stridently attacked the bill, and the group assumed its old colleague from Arkansas would follow suit.

Clinton cited the "remarkable growth" of commerce on the Internet and his desire to help "further its growth" as reasons for supporting the tax moratorium. And the president is right to be concerned that the nation's 30,000 state and local taxing authorities could strangle electronic trade with new levies. But there's another set of policies the Clinton administration supports that has shackled the development of Internet commerce and hampered the Net's use as a communications tool: controls on data encryption.

Encryption programs are mathematical formulas that scramble messages sent over data networks. Effective encryption could make any electronic message--e-mail, cell-phone call, or wire transfer--indecipherable to anyone except the sender and the intended recipient. As more people rely on computers, the demand for security in cyberspace will skyrocket.

In an online world, encryption can be an effective way for people to enhance their security. And the Fourth Amendment to the Constitution affirms the right of all individuals to "be secure in their persons, houses, papers, and effects against unreasonable searches and seizures." But the Clinton administration and its allies in law enforcement don't want your communications to be private. With this in mind, the Department of Commerce recently established the President's Export Council Subcommittee on Encryption, a 20-member panel with representatives from law enforcement agencies, high-tech companies, and financial institutions that will advise the White House. This group won't be debating the merits of strong encryption; instead, it will merely rubber-stamp proposals to compromise your privacy that the administration has been hawking unsuccessfully for six years.

Whenever possible, the Clinton administration has conducted discussions about encryption policy away from public scrutiny. The panel will continue that practice. The Web site operated by the Department of Commerce doesn't list the subcommittee, its mission, or its members; nor does the main White House Web site. An article in the CyberWire Dispatch newsletter notes that "all members have received security clearances, and some future meetings will be closed to the public."

Despite the importance of the subcommittee's work, it has garnered little attention from the mainstream press. One week after the panel's first public meeting on February 23, a Nexis search listed only three references to the group: a press release issued by one of the corporate members and two notices of the meeting in a federal daybook for reporters. No major news service covered it.

But if encryption policy is set behind closed doors, the privacy of every law-abiding American will be left to the whims of regulators, cops, and spooks. Current controls date back to the Cold War, when encryption was treated like a weapon. The Department of Commerce now regulates encryption, and it has relaxed some controls. But the restrictions have frozen a fast-moving technology in place, making it vulnerable to hacker attacks. And the feds aren't interested in loosening their grip on encryption without a struggle.

Consider key recovery, the Clinton administration's latest plan to monitor the communications of anyone who uses online services or wireless phones. Users of key recovery software would have to deposit the "keys" that scramble and unscramble their messages with a "trusted third party" (something resembling an escrow agency) which the government could approach if it wanted to intercept private transmissions.

Buying key recovery software to protect your cell phone or your e-mail would be no different from giving government agents the key to your house and trusting that they will never drop by unannounced. It's an invitation for law enforcement agencies (including tax collectors) to monitor anyone who uses encryption.

And if you think constitutional guarantees would protect your privacy as long as you keep your nose clean, you haven't been reading the key recovery proposals Congress is considering. One bill would allow the cops to acquire your keys if they obtained an easy-to-get subpoena, rather than the search warrant typically required to tap a telephone conversation or bug a location for sound. Another would make the mere possession of encryption software that doesn't contain key recovery features (such as the readily available Pretty Good Privacy programs) a criminal offense. The National Sheriffs Association, whose president is a member of the new encryption panel, wants the cops to have access to encrypted messages at any time, without having to go through the inconvenient process of getting a search warrant, or even a subpoena. FBI Director Louis Freeh has testified frequently before Congress, saying that the administration would demand key recovery provisions as part of any new encryption law.

Law enforcement officials claim that allowing strong encryption will prevent them from stopping terrorists, drug dealers, and pedophiles. But criminals won't apply for export licenses--and they won't hand their encryption keys over to a government-friendly third party. Secure encryption can help make sure that the Fourth Amendment remains as important in the online world as it was in the days of quill pens and inkwells.

Balance Sheet

info@reason.com (Rick Henderson) — Wed, 01 Apr 1998 00:00:00 EST

Assets

Democratic Capitalism. The bull market isn't just for fat cats. More than half of Americans own some type of stock or mutual fund. And for the first time in 30 years, Americans have more of their wealth in stocks than in real estate or any other investment. Federal Reserve data reported by The New York Times shows that 28 percent of household wealth is in the stock market, up from 12 percent in 1990.

Reel Recognition. "Lunatic fringe" ideas get a thumbs-up from Hollywood. Ayn Rand: A Sense of Life and the widely acclaimed Waco: The Rules of Engagement receive Oscar nominations for Best Documentary Feature.

Reorganization Men. White-collar jobs "destroyed" by corporate downsizing miraculously reappear. The Educational Testing Service says 37 percent of the new jobs created from 1989 to 1995 were for managers and professionals, compared with 20 percent from 1969 to 1979. ETS study co-author Steven Rose attributes the rise to global competition, which places a premium on people who can manage employees, market products, and satisfy customers.

Solid Ground. The Commerce Clause returns, this time in a wetlands case. The U.S. Court of Appeals for the 4th Circuit overturns a four-count criminal conviction of Maryland developer James J. Wilson. Wilson had received a 21-month prison sentence for altering 50 acres of residential private property six miles from any "navigable" waterway. The court demands a new trial, saying Clean Water Act regulations used against Wilson exceed the constitutional authority of the federal government to regulate interstate commerce.

Liabilities

Pay Scale. President Clinton supports yet another hike in the minimum wage, less than six months after its most recent increase. A booming economy and tight labor market may be able to absorb such higher costs. But when the next recession hits, watch those unemployment numbers soar.

Doctor Redundant. David Satcher becomes the new surgeon general of the United States. The job was vacant for three years. Assuming you noticed, did you think the revolutionary Republicans had abolished the office? No such luck--despite record-high life expectancy and plummeting mortality rates.

Debt Service. How not to help minority entrepreneurs: Stick them with bad loans. Al Gore orders the Small Business Administration to double its loan guarantees to African Americans by 2000. The SBA has already pledged to triple loan guarantees to Latinos over the same period. Since the SBA can only pledge money to people who can't get bank loans, this do-goodism will result in bankruptcies rather than success stories.

Butt Out. Cigar smoking can be hazardous to your health. And it's news to the Federal Trade Commission. The FTC forces the five largest domestic cigar rollers to submit the same advertising and promotion information it gets from makers of cigarettes and smokeless tobacco. The move may be a prelude to further regulation of cigars, including warning labels and advertising restrictions.

Executive Privilege

info@reason.com (Rick Henderson) — Wed, 01 Apr 1998 00:00:00 EST

It's not clear if President Clinton will survive the allegations surrounding former intern Monica Lewinsky. Many partisan defenders of the administration have contended that the president has done no wrong, and even if he did engage in a dalliance, Bill Clinton's personal life is nobody's business. But it is certain that, through his own actions and those of his subordinates, Clinton has continually undermined the theme that has dominated his administration's domestic agenda: personal responsibility.

In 1992, candidate Clinton pledged to promote policies that help people who "work hard and play by the rules." Over the past three years, in radio addresses
on topics as diverse as cracking down on deadbeat parents ("We need everyone to take responsibility, to give children the love and support they need and deserve"), welfare reform ("We have begun to put an end to the culture of dependency, and to elevate our values of family, work and responsibility"), targeted tax cuts ("a new covenant with the American people that offers more opportunity to everyone willing to assume personal responsibility for their own lives"), and praising U.S. Olympic athletes ("They took personal responsibility and did the hard work"), the theme of responsibility has remained the center of the Clinton presidency.

Even the allegations of an illicit affair with Monica Lewinsky and an associated cover-up didn't keep Clinton from speaking of responsibility in the State of the Union Address: "We are moving steadily toward an even stronger America in the 21st century," he said. "An economy that offers opportunity, a society rooted in responsibility, and a nation that lives as a community."

It is an open question whether requiring grade-school students to wear uniforms--one Clinton recommendation--or bribing college students through AmeriCorps to do community service makes young people responsible or merely compliant. Regardless, as the current scandal reminds us, there's a serious disconnection between the administration's stated policy agenda and the actual conduct of Bill and Hillary Clinton in their professional lives: From Vincent Foster and Susan McDougal to the Travel Office staff and Monica Lewinsky, the Clintons have repeatedly evaded responsibility for their own shortcomings when it was more convenient to let somebody else take a fall. The president and first lady might have avoided a lot of trouble had they followed their own advice about personal responsibility.

When White House lawyer Vincent Foster committed suicide six months after Clinton took office, there was a lot on Foster's mind: the Whitewater investigation, the use of the FBI and the IRS to harass the recently fired employees of the Travel Office, and the unsubstantiated rumors that he was having an affair with Hillary Clinton. We may never know why Foster killed himself. Yet three years after Foster's death, the White House was indirectly blaming him for "Filegate," the scandal involving illegal snooping in the FBI files of more than 900 former White House employees. As congressional investigators tried to determine if Hillary Clinton might have ordered security chief Craig Livingstone to obtain the files, former White House counsel Bernie Nussbaum testified that Livingstone didn't report to Hillary; Vince Foster was his boss. Rather than subject Mrs. Clinton to direct questioning about her role in the FBI file scandal, the administration chose to "Blame the Dead Guy," as an Investor's Business Daily editorial noted.

Then there's former Justice Department official Webster Hubbell, one of Independent Counsel Kenneth Starr's first targets, who pleaded guilty to falsifying billing records while he was Hillary Clinton's law partner in Arkansas. Hubbell had also cut a deal with the independent counsel's office in which it was believed he would agree to exchange damaging testimony about the Clintons for a reduced prison term. But while Starr was investigating Hubbell, Clinton buddy Vernon Jordan (a key player in the Lewinsky scandal) arranged for Hubbell to get a "consulting" job which steered hundreds of thousands of dollars his way, a move that looks a lot like buying Hubbell's silence.

Meanwhile, Susan McDougal, one of the Clintons' Whitewater business partners, has been jailed since the summer of 1996 for contempt of court. McDougal had received immunity from prosecution in exchange for information she had about the truthfulness of Bill and Hillary Clinton's statements to federal investigators. But McDougal has refused to talk and seems willing to remain incarcerated indefinitely. If the Clintons did no wrong, why would Susan McDougal go to prison? As with Hubbell, McDougal looks suspiciously like someone who was promised to be taken care of if she didn't reveal unseemly information about the Clintons.

But the Clintons have victimized more than their friends and business partners. When the White House replaced the Travel Office employees with friends and relatives of the Clintons from Arkansas--an action that was perfectly within the administration's rights--the White House didn't allow an orderly transition to a new regime. Without warning, the Travel Office employees were given a matter of hours to clear their desks, after which they were shuttled out of their office in a van and then falsely accused of embezzlement. Billy Dale, who ran the Travel Office for more than 20 years, was financially ruined by the legal fees he accumulated, even though he was acquitted by a jury that deliberated less than two hours.

Among those people the Clintons directly supervised, Hillary Clinton's former Chief of Staff Maggie Williams claims to have run up more than $250,000 in legal bills stemming from her knowledge of details surrounding Foster's death, the FBI files, and Travelgate.

When he left the White House, former Communications Director Mark Gearan owed more than $100,000. Even ABC pundit and former Counselor to the President George Stephanopoulos claims he owes some $50,000 in attorneys' fees from his White House service. The Clintons promised to repay all their subordinates' legal bills. But they closed down their legal defense fund earlier this year, still owing more than $3 million themselves.

More victims of the Clintons' obfuscations await. Betty Currie, the president's personal secretary, testified before Kenneth Starr's grand jury, as did Stephanopoulos, former White House Chief of Staff Leon Panetta, and his deputy, Evelyn Lieberman. Each will have to pay attorneys as a consequence. Who knows how high Monica Lewinsky's legal bills will rise even if she does get immunity from prosecution? And let's not forget Paula Jones. Even if her accusations are groundless, had Clinton simply offered an apology, rather than trashing Jones's character, we would have never heard of Monica Lewinsky, nor would we face a potential constitutional crisis.

Finally, there's the first lady. In interviews on NBC's Today and ABC's Good Morning America, Mrs. Clinton blamed a "vast, right-wing conspiracy" for the president's troubles. Set aside the fact that Attorney General Janet Reno asked a panel of federal judges to expand Starr's authority so he could investigate allegations of perjury and obstruction of justice against the president. Here's what Hillary Clinton is really saying: The people who are accusing my husband have vile motives; as a consequence, whatever my husband did, he isn't responsible for his actions.

The Clintons may survive this latest scandal. But it offers the American public another nasty example of people who would rather do anything than accept personal responsibility. Then again, truly responsible folks typically don't get themselves in such compromising positions in the first place.

Beating the Sports Subsidy Trap

info@reason.com (Rick Henderson) — Sat, 21 Mar 1998 00:00:00 EST

As you no doubt know, the Los Angeles Dodgers were sold to the Fox Group this week for $311 million. The Dodgers story is important for the sports fan and for the concerned taxpayer in a number of respects:

The Dodgers are one of the last financially successful major sports franchises that has remained under family ownership for a long period. The O'Malleys have owned the Dodgers for a half-century. Most other teams with national followings that are financial successes even if they haven't always performed well on the fieldthe Atlanta Braves, the Chicago Cubs, the Baltimore Orioles, the New York Yankees, the Cleveland Indiansare owned by large conglomerates like Fox or by ownership groups. In recent years, you associate the Orioles with principal owner Peter Angelos or the Yankees with George Steinbrenner.

And while a few family owned franchises remain successfulthe Lakers, the Washington Redskins, and the San Francisco 49ers come to mindmany others are struggling, like the Minnesota Twins and the Milwaukee Brewers.

The Dodgers story is important in another, less-reported respect: The team built Dodger Stadium in the early 1960s and has owned it from the day it opened. Indiana University economist Mark Rosentraub, whose book Major League Losers is the most accessible story of sports welfare I've seen, believes that Dodger Stadium may well be the only major sports arena that operates profitably, and it may be the only one that has turned a profit consistently since World War II.

Think of that: there are dozens of major sports arenas across the country, yet only one may operate profitably. And with few exceptions--indeed, you can probably count the exceptions on the fingers of both hands--all the major sports arenas are publicly owned. The losses these facilities incur are picked up by taxpayers.

At this time nearly three dozen cities, counties, and states have tax-financed stadium proposals of at least $100 million possible, pending, or already under construction. And the list keeps growing every day.

Cincinnati's 30-year-old Riverfront Stadium (now called Cinergy Park) is unpopular with both the Reds and the Bengals. After threatening to move the Bengals to Cleveland, the city's hated rival, Cincinnati has agreed to build the $280-million Paul Brown Stadium; area taxpayers will pick up at least $240 million of that cost.

The Minnesota legislature voted 84 to 47 against funding a new $410 million, retractable roof arena for baseball's Twins last November. So the franchise may move to North Carolina to play in a yet-to-be constructed facility in a yet-to-be determined location. In early April, taxpayers in Winston-Salem will vote on a sales tax increase that would finance a new stadium, but if that doesn't pass, would-be owner Don Beaver says he'll try to get a taxpayer-financed stadium in Charlotte.

The Twins have been a financially viable franchise only when the team has played well on the field; even after the team won the World Series in 1991, management had to clean house because the local market wasn't large enough to support a championship payroll. You may have recently read that when the World Champion Florida Marlins visited the White House last month, only 13 of the 25 players from that team were still on the roster; the team had dumped the salaries of almost all their stars.

Andreturning to Minnesotasince the Twins aren't getting a new ballpark, the football Vikings are threatening to leave if they don't get a new domed stadium. We could see the Vikings move to L.A. and play in a refurbished Coliseum (retrofitted, no doubt, at taxpayer expense).

George Steinbrenner is threatening to move the New York Yankees to Jersey unless he gets a new ballpark for free. Mayor Rudy Giuliani wants the team to move to Manhattan. But guess how much it will cost to build a new Yankee Stadium in the high-rent district? Upwards of $700 million.

I'm a big fan of the free enterprise and hate welfare, especially corporate welfare. I suppose anyone who has worked eight years for a publication with the subtitle "Free Minds and Free Markets" ought to. But if there's a socialist sector in the U.S. economy, big-time sports is itfrom outright subsidies to sweetheart deals for the politically connected to monopoly profits. In the public eye, stadium battles tend to swirl around civic pride, fan support, and regional development, but they're really all about one thing and one thing onlymoney.

The Dallas Cowboys get something like $75 million in revenues a year from luxury seating alone at Texas Stadium. The Cleveland Cavaliers get around $20 million a season from luxury revenues in Gund Arena. And, once you figure in parking, luxury seating, and all concessions, the Atlanta Braves took in more than $100 million last season, its first at the brand-new Turner Field.

The opening of Camden Yards in Baltimore in 1992 kicked off a rash of new arena contruction, featuring buildings with state of the art facilities, terrific sight lines, lots of restaurants and rest rooms, and luxury boxes. As you may have picked up from my earlier comments, the price of stadiums has skyrocketed: The then-state-of-the art Florida Suncoast Dome in St. Petersburg was completed in 1990 for about $110 million; the proposed ballpark for the Minnesota Twins would cost almost four times that much. The typical outdoor arena runs $200 million or more. And despite a small flurry of arenas that got most of their money from private sources, in Washington, D.C., Charlotte, Chicago, and the downtown arena that will go up soon in L.A., the typical arena under construction or on the books will get almost every dollar from taxpayers.

The arrangements can get pretty perverse. My favorite horror stories used to be in Seattle, where Microsoft co-owner Paul Allen got taxpayers to give hime $300 million for a new stadium for the Seahawks, even though he's worth billions and hadn't yet bought the team. Or San Francisco, where earlier this year taxpayers narrowly approved a $110 tax subsidy for a new football-only stadium for the 49ers. The tax itself was pretty outrageous. But if the tax had failed, the 49ers would have received $125 million from taxpayers to renovate Candlestick/3Com Park, and then could have walked out on their lease. The locals were being blackmailed however the vote turned out.

But those are now paled by Cleveland, which lost the Browns in 1994, passed a sales tax to build a new football stadium after they had no team to play in the new park, and then got a promise from the NFL that a new team would be in place by the fall of 1999. Unfortunately, no local owner has stepped up to buy the team, so the league may actually buy an existing team and move it to Cleveland or create a brand new franchise. The NFL may own the Browns, leaving the city to deal with the costs of operating its new ballpark.

Along with the outrageous capital and construction costs taxpayers are expected to pick up, teams often get free or reduced rent, what amounts to operating subsidies at taxpayer expense. In Baltimore, for instance, the Orioles pay no rent on Camden Yards, which was built with tax dollars. And when the new, tax-financed football stadium for the Ravens opens near Camden Yards, the Ravens will play there rent free as well. The Cleveland Indians are required to pay rent on Jacobs Field only after the team sells 3 million tickets in a given seasona feat they've accomplished every year since the stadium opened in 1994. But when the Indians were 40-year doormats, the team averaged less than 1 million fans a season. Some estimate, in fact, that the Gateway sports complex which houses the Jake, the Gund basketball arena, and the forthcoming football stadium, will eventually cost local taxpayers $1 billion, or about three times the intially estimated construction costs. Paul Brown Stadium in Cincinnati will cost taxpayers $240 million in construction costs, but it's been little reported that the locals will also pay building and operating costs for a $10 million practice site for the Bengals that will not be open to the public nor available for use by anyone other than the team.

And of course, I've only skimmed the surface with stories about major league teams. As you probably know, minor league owners are now in the subsidy game; they don't expect luxury seating, but they do want a place for their teams to play and they would prefer not to pay for it.

You've probably heard enough horror stories, so what can you do? The good news is, for any Star Trek fans in the audience, Resistance Is Not Futile. These success stories show that it's possible to beat a sports owner when he comes begging for money from the taxpayers:

By a margin of nearly two to one, last November voters in Western Pennsylvania rejected a sales tax increase that would have paid for new stadiums for the Pittsburgh Pirates and the Steelers.

A coalition of taxpayer advocates and civic leaders from organizations like the League of Women Voters pressured the Charlotte City Council to reject a tax-funded replacement for the 10-year-old Coliseum, home of the NBA Hornets. Owner George Shinn makes a convincing case that the Coliseum, which contains only about one-fourth as much luxury seating as newer arenas, can't generate enough revenue to let him pay competitive salaries. But local activists made the issue of tax funding radioactive, which has made Shinn reconsider his position and instead offer to buy the Coliseum from the city for the amount of debt still owed. And it gets better. Once the council heard Shinn's initial offer, other area business leaders started a bidding war, offering to pay more for the Coliseum than the city owes and then leasing it back to the Hornets.

Then there's the new downtown Sports Arena in Los Angeles. While all the details aren't complete, taxpayers are on the hook for a lot less now than they were 9 months ago. Last June, when the LA Times published an op-ed by me on the topic, the City Council was prepared to give the project's developers at least $70 million in outright subsidies to build the arena. Thanks to the efforts of Councilman Joel Wachs and Times columnist Bill Boyarsky, the developers and the council were forced to back down; the developers must repay any money the city borrows to purchase property, make capital improvements, and so on. It's not a perfect resolution, but given what was likely to happen nine months ago (especially considering how strongly the political establishment backed the subsidies), it's a big improvement.

What can a group of citizens who oppose sports subsidies learn from these examples?

1) When a sports owner comes begging for money, form alliances with folks you might not usually approach. In Charlotte, the alliance against the Hornets argued that any money spent on a new Coliseum would be money that couldn't be spent on schools, roads, law enforcement, or tax relief. This way you can get PTA members, taxpayer advocates, and the local police associations all on the same pagesomething that doesn't often happen. When Mayor Pat McCrory took on the Hornets in public, he asked the city's taxpayers if they were satisfied enough with the city's public services to hand over money to George Shinn. It had a big impact on the debate. Use a similar message in your town, and find civic leaders to help you out.

2) Use every legal weapon in your arsenal. Thanks to the Gann Amendment and other local tax, spending, and borrowing limitations, it's no longer easy for California elected officials to get these things done without facing public scrutiny. You may be aware of what's going on in San Diego with the proposed convention center, and you'll probably hear more later. But be prepared to force the proponents of new tax-funded arenas to make their case to voters. Time and sunshine are your best friends.

3) Be prepared. And be ready to challenge the so-called economic impact reports that the arena proponents will commission. Anytime an economic report comes out predicting job creation and increased economic activity, take it with a barrel of salt. These projects never pay their own way, and common sense suggests why.

Sports is merely another form of entertainment, so money people spend on tickets, parking, and food at the ballpark is the same money they would spend on movies, trips to the park, or video rentals. Many of these studies assume that the typical sports fan travels long distances, stays in a hotel, eats at fancy restaurants, and spends a bundle on souvenirs. No doubt, some people do that. But most sports fans who attend games live in or near the team's home city, so their money is just being moved around from one segment of the economy to another.

Finally, don't be afraid to speak frankly. Owners of sports franchises are business people, after all. And we're supposed to live in a free-market system, in which entrepreneurs succeed or fail without the help of government. If Republicans and Democrats can agree to scrap open-ended welfare entitlements for the needy, why can't concerned taxpayers get rid of corporate welfare for sports teams?

Keep Cops And Spooks At Bay

info@reason.com (Rick Henderson) — Wed, 18 Mar 1998 00:00:00 EST

President Clinton raised a few eyebrows recently when he announced support for the Internet Tax Freedom Act, a bill that places a moratorium on new taxes applying only to the Internet.

The president is right to be concerned. The nation's 30,000 state and local taxing authorities could well strangle cyberspace with new levies.

But another set of policies supported by the Clinton administration has shackled Internet commerce and hampered the Net's communications potential: controls on data encryption.

Encryption programs are mathematical formulas that scramble messages sent over data networks.

Effective encryption could make any electronic messageincluding e-mail, a cell-phone call or a wire transferindecipherable to anyone except the sender and the intended recipient.

As more people rely on computers, the demand for security in cyberspace will skyrocket. In an online world, encryption can be an effective way for people to enhance their security.

The Fourth Amendment to the U.S. Constitution affirms the right of all individuals to "be secure in their persons, houses, papers, and effects against unreasonable searches and seizures."

But the Clinton administration and its allies in law enforcement don't want communications to be private.

With this in mind, the Department of Commerce recently established the President's Export Council Subcommittee on Encryption, a 20-member panel with representatives from law enforcement agencies, high-tech companies and financial institutions.

But it won't be debating the merits of strong encryption. Instead, it will merely rubber-stamp proposals to compromise your privacy that the administration has been hawking unsuccessfully for six years.

Whenever possible, the Clinton administration has discussed encryption policy away from public scrutiny. The panel will continue that practice.

Neither the Web site operated by the Department of Commerce (www.doc.gov) nor the main White House site (www.whitehouse.gov) lists the subcommittee, its mission or its members.

An article in CyberWire Dispatch newsletter notes that ""all members have received security clearances, and some future meetings will be closed to the public.''Despite its importance, the subcommittee has attracted little attention from the mainstream press.

A search of the commercial database Nexis lists only three references to the group: a press release from a corporate member and two federal daybook notices of an initial Feb. 23 meeting, which no major news service covered.

If encryption policy is set behind closed doors, the privacy of every law-abiding American will be left to the whims of regulators, cops and spooks. Current controls date back to the Cold War, when encryption was treated like a weapon. Commerce now regulates encryption, and it has relaxed some controls.

But the restrictions have frozen a fast-moving technology in place, making it vulnerable to hacker attacks, with the feds unwilling to loosen their grip on encryption without a struggle.

Consider "key recovery," the Clinton administration's latest plan to monitor the communications of anyone who uses online services or wireless phones.

Anyone using key-recovery software would have to deposit the "keys" that scramble and un scramble their messages with a "trusted third party" (something resembling an escrow agency) that the government could approach if it wanted to intercept private transmissions.

Buying key-recovery software would amount to giving government agents the key to your house and trusting that they will never drop by unannounced.

It's an invitation for law enforcement agencies (including tax collectors) to monitor anyone who uses encryption programs.

And if you think constitutional guarantees would protect your privacy as long as you keep your nose clean, you haven't been reading the key-recovery proposals Congress is considering.

One bill would allow the cops to acquire your keys if they obtained a subpoenaeasy to getrather than the search warrant typically required to tap a telephone.

Another would have made the mere possession of encryption software without key-recovery features a criminal offense.

The National Sheriffs' Association, whose president is part of the new panel, wants the cops given immediate access to encrypted messages without even obtaining a search warrant or even a subpoena.

FBI Director Louis Freeh has repeatedly told Congress the administration would demand key- recovery provisions as part of any new encryption law.

Law enforcement officials claim that allowing strong encryption will prevent them from stopping terrorists, drug dealers and pedophiles. But criminals won't hand their encryption keys over to a government-friendly third party.

Secure encryption can help make sure the Fourth Amendment remains as important in the online world as it was in the days of quill pens and inkwells.