Opinion
Wednesday, July 22, 1981

The Michigan Daily
Vol.XCI No. 45-S
Ninety Years of Editorial Freedom
Edited and managed by students
at the University of Michigan
The F-16s
can wait
T HE REAGAN administration was
unquestionably wise to withhold its latest
shipment of F-16 jets to Israel. The Middle
East country has been excessively
provocative in recent weeks, last week's
large-scale bombing of Beirut being the last
straw. To deliver more warplanes to the
region, given the deepening bloodbath there,
would have been patently irresponsible.
The critical question, which remains up in
the air, is under what specific circumstances
delivery of the planes should be made. So far,
the official line is that "future violence in the
area" will dictate American policy in referen-
ce to future arms sales. Such a stand is
inadequate.
For Israel and Palestine to temporarily set
aside their weaponry will only cause tem-
peratures to boil ever higher. The Israeli
leadership feels that it is the victim of vicious
and indefensible acts of war on the part of an
embittered band of zealots, whose sole
motivation is to eliminate the Jewish people.
The Palestinians see themselves as the vic-
tims of an imperialist menace that has robbed
their land and intransigently continues to oc-
cupy it. A momentary ceasefire can at best be
considered a cosmetic solution.
Clearly, the time has come, once and for all,
to settle the Palestinian issue. The recent
years of unrelenting conflict in the region
point to this as the only avenue to peace.
Both Israeli Prime Minister Menachem
Begin and PLO leader Yasir Arafat, as per-
sonally disdainful as they are of each other,
must acknowledge the legitimacy of each
other's nations. And they must begin the
process of negotiating for an independent
Palestinian state-and peaceful coexistence.
(Arafat, surprisingly, has softened his
passionate anti-Israel rhetoric recently, and
calls Palestinian independence-not the ex-
tinction of Israel-his ultimate goal. Begin,
swept up in his own belligerence, would do
well to follow suit and end his vows of endless
bloodletting.)
President Reagan can take this opportune
political moment to direct some desperately
needed progress. There are no elections
coming up that demand political pussyfooting.
In any case, Begin's actions have caused an
erosion of support from Jews and non-Jews
alike, and it may now be possible to pressure
him into reassessing his adamant views.
The status quo in the Middle East is wholly
unacceptable, and Reagan's decision may be
a vital step in the right direction.

Let free
enterprise
cure the
3rd World

By Doug Newman
On a recent evening, I spent
three hours arguing the virtues of
capitalism with a friend of mine,
whose politics are distinctly to
the left. As I defended free enter-
prise and attacked the evils of
socialism, he disagreed virtually
step for step.
AS I referred to the Berlin Wall
as an example of hideous Com-
munism, he cited the oppression
of American corporations, which
pay Brazilians bare wages so that
our Cadillacs may have deluxe
tires, and which exploit the
Taiwanese so our nation's
children may have cheap Snoopy
dolls at Christmas.
He touched on a subject that
has always troubled me. I knew
that capitalism had a tendency to
grow and seek out the most
promising markets for labor,
resources, and finished products.
But the corrugated steel shacks,
the 35-cent-an-hour wages for
African natives who drill for our
oil, and the thousands of
Panamanians who pick our
bananas-raised many unsettling
questions. Why must these
people, with Coca-Cola and
Exxon logos indelibly etched on
their brains, be bound to such
barbaric existences?
I thought back to 1945 when the
United States emerged as the un-
disputed leader of the Free
world. Because of the Great
Depression, we had lost faith in
private enterprise. The
Keynesian beliefs in
redistribution and pump-priming
held a stranglehold on economic
thought. When underdeveloped
countries came to us for
economic advice we counseled
them that progressive taxation,
strong central planning, and
massive transfusions of foreign
aid were necessary to put them
on the road to prosperity. We in-
stituted the Marshall Plan, the
Truman Doctrine, the Alliance
for Progress, etc.
IRONICALLY, the countries
that ignored our advice have
been the most successful. In the
words of Congressman Jack
Kemp, "The Japanese economic

miracle,' like the German.
'miracle,' was nothing more than
the non-miraculous result of an
American idea American
economists had forgotten about."
Hong Kong is the classic exam-
ple of what low taxes and the
abolition of controls can do to a
country. After World War II, the
powers that be in Hong Kong
eliminated all tariffs, price con-
trols, and minimum wage laws.
The result has been an economic
explosion. The government plays
a minor role in transportation
and communication, and
provides some housing for
Chinese refugees. But by and
large, people are free to buy what
they want, sell what they want,
and work for whomever they
want. As a result, the rich are
getting richer and the poor are
getting richer, at a rate that far
exceeds any that could arise from
centralized planning.
In the countries that adopted
Keynesian principles-especially
those in Africa, Latin America,
and the Asian sub-continent-the
results have been disastrous.
Grinding poverty and mass star-
vation are commonplace. Despite
the massive influx of foreign aid,
and the proposals for building
dams, hospitals, roads, and
schools, the people have precious
little incentive to wring more
than a bare subsistence out of the
earth, which is often bountiful.
TWO CENTURIES ago, a
rural-urban population ratio of
nine to one was necessary to
provide America with its daily

bread. Today, four percent of our
population makes its living tilling
the earth and we are the world's
number one food exporter. We
have so much food here at home
that overeating is a major
problem. By contrast, 30 percent
of Russia's population consists of
farmers and food shortages are a
way of life; mass quantities of
food still have to be imported.
Capitalist Japan, with a very
high population density, has no
trouble feeding its people, despite
its scarcity of natural resources.
Socialist India, on the other han-
d, has plenty of agricultural
potential and mass starvation.
Population growth is not nearly
as much of a problem in
capitalist countries as it is in
socialist ones. Population density
and resources mean little;
economic systems are of ulimate
importance.
The capitalist system can
disseminate valuable infor-
mation regarding birth control,
nutrition, and health care more
readily than any centralized
economy possibly could.
Before we blame Exxon, IBM,
and Coca-Cola for the plight of the
Third World we would do well to
examine the kind of thinking that
gives rise to those accusations.
This kind of thinking exists when
an affluent society loses faith
in-and apologizes for-the
system that made it affluent.
Doug Newman, a frequent
contributor to this page, is a
student at the University.

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