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The Lighthouse


The Lighthouse is the weekly email newsletter of the Independent Institute.
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Volume 16, Issue 44: November 4, 2014

  1. The Obamacare Deception
  2. Trump, Obama, and the Worst of the Worst
  3. Asset Seizures Are Legalized Theft
  4. Two Cheers for Cornyn’s Patent Abuse Legislation
  5. New Blog Posts
  6. Selected News Alerts


1) The Obamacare Deception

The administration that promised to be the most transparent ever to occupy the White House has taken another step in the opposite direction: It has sent a strongly worded email to health-insurance companies that participate in the Obamacare exchanges, discouraging them from disclosing the premiums of plans they will offer through the exchanges when the next open-enrollment period starts on November 15. “That’s not how things are supposed to work under a government of laws,” writes Independent Institute Senior Fellow John C. Goodman in Forbes. “That’s how they work in a banana republic.”

But that isn’t the Obama administration’s only effort to keep the public in the dark. Notice the date that open enrollment in the exchanges is set to begin—November 15. Last year it began October 1. The administration’s decision to push the day back until more than a week after the midterm election is motivated, according to Goodman, by nothing more than “a desire to keep voters from knowing much about this year’s round of choices before they have to vote.”

Fortunately, about 19 states have required insurers to publicize their premiums, although consumers eligible for tax credits through the exchanges will remain in the dark about their net costs until open enrollment begins. According to Investor’s Business Daily, middle-income consumers can expect premiums for the Bronze plan to rise about 14 percent in several major cities and much higher elsewhere: 22 percent in Las Vegas, 26 percent in Denver, 27 percent in Los Angeles, 38 percent in Providence, and 64 percent in Seattle. However, although Obamacare is claiming a growing share of Americans’ wallets, the current crop of Republicans in Congress can’t agree on an alternative, Goodman notes.

The Truth about Obamacare, by John C. Goodman (Forbes, 10/23/14)

Is There a Republican Alternative?, by John C. Goodman (Forbes, 10/24/14)

Priceless: Curing the Healthcare Crisis, by John C. Goodman

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2) Trump, Obama, and the Worst of the Worst

Donald Trump may be an astute businessman, but when it comes to ranking the U.S. presidents he’s a rank amateur. After Independent Institute Senior Fellow Ivan Eland appeared recently on Fox News’s “Fox and Friends” to discuss his new book on the presidents, the real-estate magnate attacked Eland’s credibility because he had the temerity to suggest that Barack Obama is not the worst president in American history—bad, from Eland’s perspective, but not the worst.

When assessing a nation’s leader, one must avoid overemphasizing current events and losing the proper, long-term perspective, Eland argues in an op-ed for the Huffington Post. That’s why, when he was writing Recarving Rushmore, Eland took pains to rank the presidents according to how well their policies fared when it came to promoting peace, prosperity, and liberty under the U.S. Constitution. Consequently, of the 41 presidents rated in the book, Obama ranks 34th out of 41. However, Eland views Obama’s current ranking as even lower than that, in part because the president’s war against ISIS “is likely to make Islamic radicalism and terrorism worse.”

But despite Obama’s blunders, Eland doesn’t believe the current occupant of the White House is among the very worst of the worst U.S. presidents. Instead, that dishonor goes to four presidents: James Polk (whom Eland takes to task mainly for his war of conquest against Mexico), William McKinley (who dragged the United States into a war with Spain and turned America into an interventionist power with colonies around the globe), Harry Truman (who established the national-security state and the cult of the “imperial” presidency), and—the absolute worst by Eland’s reckoning—Woodrow Wilson (who dragged the nation into World War I and thereby created precedents for FDR’s disastrous domestic and foreign policies). “Woodrow Wilson is the worst president in American history,” Eland writes, “because he ruined the 20th century and is now working on the 21st.”

Is Barack Obama the Worst President in American History?, by Ivan Eland (The Huffington Post, 10/28/14)

Recarving Rushmore: Ranking the Presidents on Peace, Prosperity, and Liberty (Updated Edition), by Ivan Eland

Video: Ivan Eland on Ranking US Presidents (Fox and Friends, Fox News Channel, 10/26/14)

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3) Asset Seizures Are Legalized Theft

In Virginia, a church secretary carrying $28,000 in his car to purchase property for his church was pulled over by state police, who seized his cash holdings and ultimately kept 80 percent of the money. In Houston, a couple driving with a large wad of dough with which to buy a car suffered a similar fate. In Philadelphia, a husband and wife lost their house to a city “public nuisance” task force because their 22-year old son had allegedly dealt drugs just outside their home. In these cases and scores of others, law-enforcement agencies never had to prove in a courtroom that the property owners committed a crime; they needed only to assert that the circumstances seemed “suspicious.”

Asset seizures have been a growing cash cow for law enforcement agencies across the United States—raising $1.8 billion for the Department of Justice’s Asset Forfeiture Fund in 2011 alone—and the trend is the direct result of bad incentives having been written into local, state, and federal crime statutes. “The perverse incentives of [asset forfeiture] programs should be obvious,” Independent Institute Research Fellow Abigail R. Hall writes in American Thinker. “If an agency’s budget or individual’s pay is directly tied to forfeited assets, then those within the agency will seek out opportunities to seize assets.”

How can the travesty be halted? Hall makes two recommendations: “First, salaries and bonuses of public servants should be disconnected from asset seizures.... Second, people facing asset seizures should be given additional legal rights. Those facing forfeiture should have the right to state legal representation.... Law-abiding property owners shouldn’t have to look over their shoulders, in fear that opportunistic prosecutors or police departments have them in their sights.”

Asset Forfeiture and Perverse Incentives, by Abigail R. Hall (American Thinker, 10/26/14)

More by Abigail Hall

Audio: Abby Hall on The Scott Horton Radio Show (9/19/14)

Civil Forfeiture as a “Sin Tax,” by Donald J. Boudreaux and Adam C. Pritchard (Independent Policy Report)

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4) Two Cheers for Cornyn’s Patent Abuse Legislation

If Senator John Cornyn of Texas wins his re-election bid on November 4, the cause of patent reform may inch closer to the finish line. That’s because the lawmaker reintroduced the Patent Abuse Reduction Act to Congress. Unfortunately, the legislation would fall short of its goal of ending frivolous patent lawsuits, according to intellectual property expert and Independent Institute Research Fellow William J. Watkins, Jr. First, let’s examine what he regards as the bill’s pluses.

Patent lawsuits by so-called patent trolls—companies that don’t make anything other than paperwork and headaches for companies that make actual products—cost the economy more than $500 million from 1990 through 2010. The Patent Abuse Reduction Act attempts to curb their frivolous lawsuits, by requiring them to make specific claims of harm through intellectual-property infringements, by making it easier for defendants to join together, and by shifting the cost of frivolous lawsuits to the losing party. These measures and others in the bill would be helpful, but they don’t go far enough to discourage patent trolling.

What other measures should lawmakers consider? In an op-ed for The Hill, Watkins recommends that companies filing patent lawsuits be required to show that they are active participants in the industry related to the patent, rather than merely non-practicing entities whose main business is to sue manufacturers. Such a requirement would be similar to one imposed by the U.S. International Trade Commission for patent lawsuits involving imported goods. Also, patent law could require plaintiffs to prove that they intended to use their patent. “Trolls would undoubtedly try to devise nominal uses of the technology to meet the use requirement,” Watkins writes, “but the courts could evaluate the alleged use and determine if it represents a good faith attempt to practice the invention or is merely a minimal effort meant to secure an open courthouse door.”

Adding Punch to Senator Cornyn’s Patent Reforms, by William J. Watkins, Jr. (The Hill, 10/22/14)

Patent Trolls: Predatory Litigation and the Smothering of Innovation, by William J. Watkins, Jr.

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5) New Blog Posts

From The Beacon:

From MyGovCost News & Blog:

Government Pension Surge Drives Tax Increases
K. Lloyd Billingsley (11/3/14)

The Bureaucrats’ Secret Buying Spree
Craig Eyermann (11/1/14)

Bay Bridge Escapes Criminal Investigation
K. Lloyd Billingsley (10/29/14)

The Hidden Deficit
Craig Eyermann (10/28/14)

You can find the Independent Institute’s Spanish-language website here and blog here.

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6) Selected News Alerts

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  • MyGovCost.org
  • FDAReview.org
  • OnPower.org
  • elindependent.org