They found that the benefits of deregulation in these industries now total roughly $40 billion to $60 billion annually -- nearly one percent of gross domestic product. Specifically, their study found:

• Since 1978 air fares adjusted for inflation have declined by about a third.

• Long-distance telephone rates have dropped by about half after inflation since 1984, when American Telephone & Telegraph Co. was broken up.

• Trucking and railroad freight rates have dropped 30 percent to 50 percent after inflation.

These industries were once considered "natural monopolies" or essential public services. In exchange for restrictions on new competitors -- which created monopolies or oligarchies -- they surrendered their pricing freedom and met some public service requirements.

The lessened competition and price controls impeded new investment and measures to increase productivity, causing high prices and/or poor service.

Deregulation has spurred innovation and productivity say Crandall and Ellig.

• In 1985, there were only 136,000 miles of fiber-optic cable in the AT&T system, but by 1994 there had 1.3 million miles -- slightly more than competitors Sprint and MCI.

• In 1978 about 14 percent of all passengers had to change airlines to reach their destinations, by 1995 that was about one percent.

• The share of households with phones rose from 92 percent in 1984 to 94 percent in 1995.

And although railroad employment has dropped by half, the amount of freight carried has increased, and workers' wages and benefits rose to an average of $48,000 in 1995.

Source: Robert J. Samuelson, "The Joy of Deregulation," Newsweek, February 3, 1997.

• They have demoted a "policy statement," expressing the agency's commitment to a market-based approach to regulating the radio spectrum, to the status of a "working paper" -- Washington bureaucratic lingo that means "we're having none of that."

• The issue involves the spectrum of electromagnetic frequencies used for everything from television to cellular phones to taxi radios.

• Under current rules the FCC decides how the spectrum is to be used and then issues licenses to specific service providers.

• But the market-oriented approach would allow those with winning bids at spectrum auctions to decide for themselves how to use their airwaves.

The working paper proposes that licensees be allowed to use spectrum in any way the market demands -- even transferring it to others without commission approval. It endorses a system which "endows" spectrum licensees "with certain attributes resembling private property rights."

By not accepting the paper as the basis for policy, the commissioners are saying that how the spectrum is used is for the government to decide.

Source: James Gattuso (Citizens for a Sound Economy Foundation), "The FCC Hangs Up on Competition," Wall Street Journal, February 12, 1997.

For more on Regulatory Policy visit the NCPA's Policy Digest archives at http://www.ncpa.org/pd/pdmonth.html

The biggest problem with CAFE is that there is virtually no evidence that it has reduced aggregate gasoline consumption.

• It is true that auto fuel efficiency has risen 70 percent since 1973, from 13.3 mpg on average to 22.56 mpg in 1995.

• However, the higher fuel efficiency has simply encouraged people to drive more: the average number of miles driven per year has risen 24 percent since 1980, from 9,141 miles to 11,329 in 1995 (see figure).

• Even though the average car now uses just 502 gallons of gasoline per year compared to 771 gallons in 1973, total fuel consumption has continued to rise.

Another problem with CAFE is that it has led to a loss of auto jobs in the U.S. Because there are separate CAFE standards for domestic and imported autos, domestic auto companies have had an incentive to increase the percentage of foreign parts used in some of their models in order to reclassify them as foreign-made.

For example, in 1989 Ford turned two of its least fuel efficient cars, the Crown Victoria and the Grand Marquis, into "imported" cars by reducing their domestic content from 90 percent to less than 75 percent. This allowed Ford to increase the average fuel economy of its domestically-produced cars, where it was having a problem meeting the new CAFE standard, while lowering the average for its imported models, where it had room to spare.

Finally, there is growing evidence that CAFE has been detrimental to safety. To increase fuel efficiency auto companies have had to produce smaller, lighter cars that are less safe than larger, heavier cars. And auto companies have often had to heavily discount these smaller models in order to increase their sales and lower their average corporate fuel economy. Thus a 1989 study estimated that CAFE standards would cost 2,200 to 3,900 lives over the next 10 years.

Virtually all economists agree that higher gasoline taxes would do a far better job of reducing gasoline consumption than CAFE -- assuming there is any real need to do so. At a minimum, there should be no further increase in CAFE standards.

Source: Bruce Bartlett, Senior Fellow, National Center for Policy Analysis, February 24, 1997.

For more on Regulatory Policy visit the NCPA's Policy Digest archives at http://www.ncpa.org/pd/pdmonth.html