Earlier: Peter Brimelow And John Lott Talk Cancellation And Anti-Conservative Bigotry In America

VDARE.com Editor Peter Brimelow writes: I recently interviewed the famously pugnacious economist John R. Lott, who will be speaking at VDARE.com’s April 26-28 Conference (livestream tickets still available!). This inspired VDARE.com’s James Fulford to retrieve the FORBES MAGAZINE article Lott and I discussed, long buried on the FORBES website: September 18, 2000. Needless to say, his conclusion about the collapse of the Rule of Law is exemplified by New York Attorney General Letitia James’ unprincipled assault on the VDARE Foundation right now.

“John Lott has few equals as a perceptive analyst of controversial public policy issues,” says Nobel laureate Milton Friedman. ”Controversial” is putting it mildly. The tall, gangling Lott, 42, a senior research scholar at Yale Law School, specializes in applying economic analysis to such matters as why governments provide education (indoctrination, concludes Lott); why campaign contributions are increasing (higher government spending); and whether enfranchising women means bigger government (yes; see chart).

FORBES interviewed him in his Swarthmore, Pa. home, where his wife, Gertrud Fremling, an economist born and raised in Sweden, home-schools their four sons. Ironically, she tried banning toy guns, but the boys used dolls as substitute weapons. We began by asking about his latest thunderbolt: More Guns, Less Crime (University of Chicago Press, 2000).

John Lott: Bad things happen with guns. But guns also make it easier for people to prevent bad things from happening. And the question I ask is, what is the net effect?

Only one kind of gun control law seems to produce any systematic benefit—so-called right-to-carry laws, which set up objective rules, after which a permit is automatically given. With the other gun laws, you see either no impact on crime rates or increases in crime. The Brady law, the national waiting period, seems to be associated with a relative increase in rape [the increase was 3.6% in affected states in the first three years].

Forbes: Is this argument making progress politically?

It’s not really my purview to judge. But it’s had an impact in academia. Quite a few academics have told me how much it has changed their opinion. Academics at 44 universities have asked for the data.

More generally, why the recent drop in crime?

Lots of reasons—increases in arrest rates, conviction rates, prison sentence lengths.

But one of the big factors has been the change in the drug market. Clinton cut the drug interdiction budget by about two-thirds. So you see a drop in drug prices, an increase in drug use, drugs coming in from many more sources. But the returns to gangs fighting to control turf have declined. The highest murder rate we ever had was in 1933, the last year of Prohibition. As soon as Prohibition ended we had about a 60% drop in murder. We haven’t had drug legalization, but the reduction in enforcement has meant a reduction in incentives for gangs to fight.

Does an academic consensus ultimately affect policy?

Look at antitrust. [Robert] Bork had a huge impact with his book [The Antitrust Paradox, 1978]. By 1980 the received wisdom among academics was that much antitrust intervention didn’t pay.

But then the economics profession moved away from that. There was the rise of game theory, associated with people like Paul Milgrom and John Roberts, who are at Stanford University now. They wanted to make things ”richer,” by having strategic interactions between parties, questions about who knows what when. They would try to think of stories, so-called possibility theorems, under which, for example, predation was possible—potential competitors could be persuaded not to enter a market because they saw the monopolist was willing to lose the farm to maintain market share. Economists didn’t have evidence that this was occurring. It was just a story about something that might happen.

And you come to today. The Clinton Administration has been much more active in antitrust. We have the Microsoft case, which is really a predation case. But it was preceded by almost 20 years of academic research, following after Bork, trying to make the case that in theory there could be abuses.

There is a natural affinity among professions for ideas that increase their roles. If somebody says he has a theory for why the government should get involved, that person is going to be very attractive.

It’s sad. The amount of wealth that has been destroyed by the Microsoft case has been huge. And I own five Macintosh computers. I wish everybody used Macs!

And you think game theory is having a bad effect on economics education?

I was teaching at UCLA in the early 1990s. Saddam Hussein invaded Kuwait, and the price of oil skyrocketed. One day I ran into a group of graduate econ students. One of them commented how price controls on gasoline would make it more affordable for everybody.

I was just shocked. I mean, this was the same place I’d gone to undergraduate and graduate school. And we got into a discussion about price controls. I said, ”Who do you think benefits from rent controls?” They said, ”Well, poor people.” I tried to distinguish for them: Well, maybe somebody who already has an apartment is better off. But what about the people who don’t? And when you have this below-market price, people are just going to compete in other ways.

It didn’t go down well at all. It was obvious that they had not even thought about these issues.

Later that same day I complained to a professor who had been teaching microeconomics. And he said, ”Well, you still think about things in terms of supply and demand curves.”

And nobody else does—which may mean that the enthusiasm for intervention could extend well beyond antitrust. Do you think that the lessons of the 1970s will have to be relearned? That we could get more price controls? Gas lines again?

Look at pharmaceuticals—a big issue in this election [2000]. There’s still this notion of centralized control. And if you put price controls on, it’s going to be incredibly hard to get rid of them. It will be four or five years before we stop seeing new drugs coming into the market. Ten years from now are we going to say, we haven’t had new drugs coming on, we should get rid of price controls—because in another ten years we’ll start seeing new drugs? The call then will be for more government involvement in research, subsidies, what have you.

Do you see other areas where government is intervening more?

Sure. The crackdown on white-collar crime. In 1987 about 3% of prisoners in federal prisons were white-collar criminals. Now it’s over 10%. I was chief economist for the U.S. Sentencing Commission, and it makes no sense in terms of the other consequences white-collar criminals suffer. Actual punishment disparities have increased. Judges have simply been deprived of discretion.

It’s not even clear to economists that insider trading should be a crime at all. Yet the Securities & Exchange Commission successfully resisted a clear definition of insider trading. They wanted to keep things vague so they could prosecute more easily.

That’s arbitrary power, not the Rule of Law.

Peter Brimelow [Email him] is the editor of VDARE.com. His best-selling book, Alien Nation: Common Sense About America’s Immigration Disaster, is now available in Kindle format.