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The Lighthouse is the weekly email newsletter of the Independent Institute.
Subscribe now, or browse Back Issues.

Volume 9, Issue 16: April 16, 2007

  1. Trade Protectionists' Double Standards
  2. War Weariness as a Silver Lining
  3. Ominous Trends in Government Spending
  4. Is Wal-Mart Good or Bad for America? A Debate (Oakland, CA; 5/8/07)
  5. Anthony Gregory on Success for the Principles of Liberty (San Ramon, CA; 4/22/07)

1) Trade Protectionists' Double Standards

The same contentious environment that makes cumbersome “free trade agreements” (FTAs) politically expedient, compared to the unilateral adoption of free-trade policies, also makes the expanded trade sought by such agreements vulnerable to the politicking of protectionists. For example, Rep. Charles Rangel (D-NY), who heads the House Ways and Means Committee, and Sen. Max Baucus (D-MT), who heads the Senate Finance Committee, are holding up FTAs with Peru, Colombia, and Panama on the grounds that they should include stronger labor and environmental provisions. Their obstructionism, however, is indicative not of “fairness,” as they claim, but of politically motivated hypocrisy, according to Independent Institute Senior Fellow Alvaro Vargas Llosa.

“They want trade pacts with Latin American countries to guarantee enforcement of standards set by the U.N.’s International Labor Organization (ILO) that are in conflict with U.S. labor regulations,” Vargas Llosa writes in his latest column for the Washington Post Writers Group. “If they want to change their own labor laws, U.S. lawmakers can easily introduce legislation to bring U.S. rules in line with ILO standards, the chief difference being over replacement of striking workers. Why don’t they? Because they know that even with Democratic majorities in both houses and many legislatures across the country, they stand little chance of getting their wish.”

Meanwhile, under the FTA ratification process, Peruvian exports to the U.S. face no tariff—whereas American exports to Peru face an average tariff of 12 percent. As Vargas Llosa notes, American exporters are penalized during the arduous ratification process because key lawmakers “think Latin Americans should have labor standards that almost no one wants enforced in the U.S.!”

Concludes Vargas Llosa: “The saga of Latin Americans pleading for ratification in the U.S. Congress is one great reason why wordy and bureaucratic trade agreements are a less-than-convenient way to go about freeing trade. Estonia’s recipe from 1992—the unilateral elimination of commercial barriers—is a much quicker way. It’s also more dignified, since there is no pleading involved.”

“Pleading for Trade,” by Alvaro Vargas Llosa (4/11/07) Spanish Translation

Liberty for Latin America: How to Undo Five Hundred Years of State Oppression, by Alvaro Vargas Llosa

Center on Global Prosperity (Alvaro Vargas Llosa, Director)

Spanish-language Blog

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2) War Weariness as a Silver Lining

As the U.S. government’s failure in Iraq continues to be marked by horrible human tragedy, Americans may become weary of war in general and less supportive of U.S. intervention abroad, says Ivan Eland, Director of the Institute’s Center on Peace and Liberty, in a new op-ed.

Giving the Korean War and the Vietnam War as examples, Eland argues that the American public has frequently regarded wars of choice to have been stalemates, lost causes, or defeats, so has become more reluctant to engage in international interventionism, at least for a time. This can happen even after the U.S. defeats its military enemy, if the public sees it as a pyrrhic victory, such as with the Mexican War, the Spanish-American War, and World War I, after each of which American sentiment largely judged that the conflict had not been worth the cost in blood and treasure. Consequently, after each of these wars, the U.S. government became more restrained in its overseas adventures.

“The good news,” concludes Eland, “is that these twin failures, however tragic and painful, will likely usher in a new period of U.S. military restraint, the policy championed by America’s founders. The bad news is that proponents of non-interventionism will only have a limited amount of time before the public forgets the pain of unnecessary wars and America’s foreign policy elites begin rattling their sabers again.”

“The Coming Public Disillusionment with U.S. Overseas Military Adventures,” by Ivan Eland (4/16/07) Spanish Translation

The Empire Has No Clothes: U.S. Foreign Policy Exposed, by Ivan Eland

Center on Peace and Liberty (Ivan Eland, Director)

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3) Ominous Trends in Government Spending

For about a century, U.S. government expenditures reflected Adam Smith’s view that the state’s role should be limited to protecting citizens from aggression and supplying goods that the free market may not provide. Beginning in the late 1800s, however, government at all levels began to change its emphasis from carrying out these traditional roles to advancing the welfare state. According to economists Jody W. Lipford and Jerry Slice, in 2005 the share of federal spending on national defense, justice, transportation, and education was half what it was in 1962, and social spending as a percentage of total federal spending from has risen 23.4 percent in 1962 to about 60 percent in recent years.

If the present trend continues, it may ultimately threaten government’s capacity to provide the services that Adam Smith deemed essential to the maintenance of a safe and prosperous society, Lipford and Slice argue in “Adam Smith’s Roles for Government and Contemporary U.S. Roles: Is the Welfare State Crowding Out Government’s Basic Functions?” (The Independent Review, Spring 2007).

“As the data make clear, the share of spending on the duties Smith advocated has fallen precipitously over the past four decades,” write Lipford and Slice. “At the same time, federal spending on income redistribution—composed of spending on labor and social services, health, Medicare, income security, and Social Security—has escalated.... The longer these trends continue, the more difficult it will be politically to change them.”

“Adam Smith’s Roles for Government and Contemporary U.S. Roles: Is the Welfare State Crowding Out Government’s Basic Functions?” by Jody W. Lipford and Jerry Slice (The Independent Review, Spring 2007)

Subscribe to The Independent Review.

Spring 2007 Issue: Table of contents and links to selected articles and all book reviews.

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4) Is Wal-Mart Good or Bad for America? A Debate (Oakland, CA; 5/8/07)

http://www.independent.org/events/detail.asp?eventID=125

Wal-Mart’s detractors argue that the retail giant reduces living standards, hurts retail trade, disrupts communities, and relies on government programs to provide healthcare for many of its workers. Others, however, argue that Wal-Mart has improved Americans’ standard of living, with lower costs for consumers, greater employment opportunities, and healthier communities, and especially for the less affluent.

Is Wal-Mart a force for good or evil? Are local ordinances that prevent the company from opening new stores beneficial or harmful? Please join us as Ken Jacobs (Chair, U.C. Berkeley Labor Center) and Richard Vedder (co-author, The Wal-Mart Revolution) debate this timely issue.

SPEAKERS:

Ken Jacobs is Chair of the U.C. Berkeley Labor Center, and a former member of the Mayor’s Universal Health Care Council in San Francisco. He is the co-author of “Declining Job-Based Health Coverage for Working Families in California and the United States,” and “Hidden Costs of Wal-Mart Jobs.”

Richard K. Vedder is Senior Fellow at The Independent Institute and Distinguished Professor of Economics at Ohio University. He is the co-author of Out of Work: Unemployment and Government in Twentieth-Century America and The Wal-Mart Revolution: How Big-Box Stores Benefit Consumers, Workers, and the Economy.

WHEN:
Tuesday, May 8, 2007
Reception and book signing: 6:30 p.m.
Program: 7:00 p.m.

WHERE:
The Independent Institute Conference Center
100 Swan Way
Oakland, CA 94621-1428
Map and directions

TICKETS:

$15 per person ($10 for Independent Institute Members). Special offer: $30 includes admission and one copy of The Wal-Mart Revolution ($25 for Independent Institute Members). Reserve tickets by calling (510) 632-1366 or ordering on line.

Praise for The Wal-Mart Revolution, by Richard K. Vedder and Wendell Cox:

“The book should be required reading…with its reminder that while Wal-Mart may have taken away union jobs, it has delivered lower prices for poorer Americans.”
Financial Times

More information and ticket reservations

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5) Anthony Gregory on Success for the Principles of Liberty (San Ramon, CA; 4/22/07)

Have you been missing our Independent Policy Forums? On April 22, to tide you over until our next event, you can hear Independent Institute Research Analyst Anthony Gregory, in San Ramon, Calif.

Mr. Gregory will share his insights on “Real World Politics and Success for the Principles of Liberty” at the annual convention of the Libertarian Party of California. The convention is being held this weekend, April 20-22, at the San Ramon Valley Conference Center, and is open to the public. Mr. Gregory will be giving the breakfast address on Sunday, starting at 7:30 a.m.

Anthony Gregory earned his bachelor’s degree in American History from the University of California at Berkeley and gave the undergraduate history commencement speech in 2003. In addition to his work as Research Analyst with the Independent Institute, he regularly writes for numerous news and commentary web sites, including LewRockwell.com and the Future of Freedom Foundation. He is also the recipient of the Ron Paul Liberty in Media Award for his Independent Institute article, “An Anniversary that We Must Never Forget.”

The convention will feature other speakers and events you may also find interesting. For more information and to register for the event, visit http://www.NCLPC.org/convention.

Articles by Anthony Gregory

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