Cato Studies: “A Century of Unprecedented Progress”

March/April 2000 • Policy Report

The 20th century created incredible progress, producing more improvement in living conditions in the United States than the entire world had seen in all previous centuries combined, write the authors of “The Greatest Century That Ever Was: 25 Miraculous Trends of the Past 100 Years” (Policy Analysis no. 364). Stephen Moore, director of fiscal policy studies at Cato, and the late Julian Simon, who was a distinguished senior fellow at Cato, outline 25 “heartening trends” of the 20th century, noting that the overall outlook is rosy, not gloomy. “Almost every indicator of health, wealth, safety, nutrition, affordability and availability of consumer goods and services, environmental quality, and social conditions indicates rapid improvement over the past century.” The authors attribute those gains to the free society in which we live, where “the unique American formula of individual liberty and free enterprise has encouraged risk taking, experimentation, innovation, and scientific exploration of a magnitude that is unprecedented in human history.” Countries that did not enjoy freedom, such as Maoist China and the Soviet Union, did not fare as well. “Repression by government short‐circuits the human spirit and produces sustained periods of stagnation and even anti‐progress.” The authors find that there has been only a handful of trends that have gotten worse in this century—taxes have increased and government is larger and more intrusive than it was 100 years ago. “The declinists are wrong when they say that mankind is on a collision course with doomsday,” they write.

Smart Growth Plans, Dumb Planners

The more activists push to reduce sprawl through restrictive local, state, and federal initiatives, the more likely they are to increase it, write the authors of “Critiquing Sprawl’s Critics” (Policy Analysis no. 365). Authors Peter Gordon and Harry W. Richardson of the University of Southern California note that even though Americans are living better than ever, many now see “urban sprawl” as the source of most of society’s problems. “The charge that urban sprawl fosters inequality, unemployment, and economic blight is disproven by the fact that human capital, not workplace inaccessibility, is the main cause of poverty.” Moreover, the authors argue that “smart growth” plans contribute to workplace inaccessibility by increasing housing costs, making it difficult for the poor to locate near areas that are growing economically.

Clinton Doctrine Creates a “Slippery Slope”

The U.S. policy of being the world’s policeman could cause the United States to have a deeper commitment in East Timor, writes Leon Hadar in “East Timor and the Slippery Slope Problem” (Foreign Policy Briefing no. 55). Hadar, a journalist and a research fellow in foreign policy at Cato, finds that “although a massive U.S.-led mission (as in Bosnia and Kosovo) is unlikely, there is still a danger that the limited U.S. financial and logistical support for UN peacekeeping forces could gradually lead to more extensive U.S. diplomatic and military commitments.” By refusing to take the lead in East Timor, the United States has rightly shifted responsibility to Australia and other regional players. Hadar argues that the United States should continue to resist pressure for deeper involvement, thus creating a precedent for making such crises regional rather than American concerns.

Got Milk (Subsidies)?

Congress should help consumers and efficient farmers by eliminating the federal dairy program, writes Kevin McNew in “Milking the Sacred Cow: A Case for Eliminating the Federal Dairy Program” (Policy Analysis no. 362). According to McNew, assistant professor of agricultural and resource economics at the University of Maryland, the federal dairy program is an “outdated relic of Depression‐era legislation” that fattens the coffers of milk producers at the expense of consumers and should be replaced with a free‐market system. Congress included in its latest spending bill a new set of pricing guidelines that continues to keep the cost of milk for consumers high. Congress also extended the Northeast Compact, a government‐maintained cartel that protects markets for dairy products from competition. McNew argues that federal milk marketing order regions, price supports, and dairy compacts hike milk prices for consumers, thus reducing milk consumption and adversely affecting people’s health. He notes that American dairy farmers received as much as $8 billion in assistance in the form of subsidies in 1995 alone. If the current government system “were eliminated, the free‐market system would function just as smoothly—but without price distortions.”

Proposals to Ban Internet Anonymity Violate First Amendment

Anonymity on the Internet should be protected and deserves to be treated no differently than anonymous pamphlets or other speech, writes attorney and software executive Jonathan D. Wallace in “Nameless in Cyberspace: Anonymity on the Internet” (Cato Briefing Paper no. 54). Wallace notes that U.S. and foreign law enforcement officials regard anonymity as a threat to public order and talk about limiting anonymity online. He takes a look at the role of anonymous speech in the founding of the United States and the subsequent legal history of such speech. “Anonymous and pseudonymous speech on the Internet forms a part of the rich tradition of such speech in prior media, including print, and is entitled to the same First Amendment protections,” Wallace writes. “Legislation against anonymity threatens to end that rich tradition and should be opposed. If such legislation is passed, we can be confident that the Supreme Court will again find it inconsistent with our Constitution and our history.” Many well‐known historical papers and articles, all controversial in their time, were written anonymously because the authors feared persecution if their identities were known. Classic examples include Thomas Paine’s Common Sense, written under the name “An Englishman”; the Federalist Papers, written under the name “Publius”; and Cato’s Letters, a series of essays on liberty written under the pseudonym “Cato,” after which the Cato Institute is named. Cato’s Letters was republished by John Peter Zenger, a German immigrant who was arrested for seditious libel in 1735 for printing anonymous essays attacking Gov. William Cosby of New York.

The Market Should Determine Ownership of Public Lands

Privatized federal land would yield better environmental quality, write the authors of “How and Why to Privatize Federal Lands” (Policy Analysis no. 363). Included in the 2000 budget bill was $652 million requested by President Clinton for his “Land Legacy” program that will provide funding to state, local, and federal agencies to preserve more open lands. Terry L. Anderson of the Political Economy Research Center; Vernon L. Smith of the University of Arizona; and Emily Simmons, formerly of PERC, argue that land should be auctioned, not for dollars, but for certificates to be distributed equally to all Americans. “Analysts on the left and the right agree that the federal government has done an exceedingly poor job of stewarding [land] resources,” they write. “Both environmental quality and economic efficiency would be enhanced by private rather than public ownership.” Instead of the president’s plan for the government to buy up even more land, the authors suggest four criteria to guide land‐reform efforts: land should be allocated to the highest‐valued use; transaction costs should be kept to a minimum; there must be broad participation in the divestiture process; and “squatters’ rights” should be protected. The paper drew fire from environmentalists because of Anderson’s role as an informal adviser to Republican candidate George W. Bush.

Online Commerce Isn’t Harming Local Businesses

Unrestricted Internet taxation would be an unfair extension of the states’ powers, argues Cato trade policy analyst Aaron Lukas in “Tax Bytes: A Primer on the Taxation of Electronic Commerce” (Trade Policy Analysis no. 9). According to Lukas, untaxed e‐commerce is neither emptying state coffers nor destroying local businesses. He notes that, as the birthplace of the Internet, the United States has a special role to play in ensuring that revenue‐hungry state and national governments do not stifle online commerce. “As Supreme Court Chief Justice John Marshall observed, the power to tax is indeed the power to destroy,” he writes. Lukas says that sound tax policy should continue and legislators should make sure that “states and foreign governments do not unfairly export their tax collection burdens, thereby impeding online commerce.” Lukas reviews specific alternatives to traditional tax structures that would resolve the current problems raised by remote electronic commerce, but he concludes that the best answer lies in more responsible fiscal policy. “The best course of action is for governments to embrace lower spending, if not in absolute terms, then as a decreasing share of the overall economic pie.”

This article originally appeared in the March/April 2000 edition of Cato Policy Report.