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The Lighthouse is the weekly email newsletter of the Independent Institute.
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Volume 11, Issue 17: April 27, 2009

  1. Obama’s First 100 Days
  2. As Goes General Motors, So Goes the Country?
  3. Green Polices Warrant Scrutiny, Not Wishful Thinking
  4. Chavez Gives Obama an Idiotic Book
  5. This Week in The Beacon

1) Obama’s First 100 Days

After 100 days in the Oval Office, President Obama merits a mixed report card, according Ivan Eland, director of the Independent Institute’s Center on Peace & Liberty and author of Recarving Rushmore: Ranking the Presidents on Peace, Prosperity, and Liberty. “Although it is unfair to pass judgment this early on a new president, he can be compared to his predecessors and given interim grades on his various policies,” Eland writes.

Eland gives Obama a “B” for accelerating the withdrawal of U.S. forces from Iraq, a “D” for escalating U.S. involvement in Afghanistan, a “B” for ending torture and closing Guantanamo and CIA secret prisons, a “B” on accountability in defense spending, and a “D” on social spending. These grades, he stresses, are interim and might improve or plummet during the course of his tenure. “If Obama tries to use remaining taxpayer dollars allocated for bailouts to grab an even bigger government ownership share in the banks,” writes Eland, “he will combine an augmentation of the welfare state with the expansion of Bush’s outright socialism—earning him an ‘FF’ in economic management.”

Ultimately, Obama should be judged by results, not rhetoric. Writes Eland: “Results should be measured by the degree to which his actions, or his deliberate inaction, contribute to peace, prosperity and liberty.”

“Obama’s First 100 Days: A Mixed Record,” by Ivan Eland (4/27/09)

“Don’t Judge Obama’s Legacy on First 100 Days,” by Ivan Eland (San Francisco Chronicle, 4/26/09)

Partitioning for Peace: An Exit Strategy for Iraq, by Ivan Eland

Recarving Rushmore: Ranking the Presidents on Peace, Prosperity, and Liberty, by Ivan Eland

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

Ivan Eland on C-SPAN2. Interview by Rep. Ron Paul.

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2) As Goes General Motors, So Goes the Country?

The notion that General Motors should have been forced into Chapter 11 bankruptcy proceedings should look increasingly attractive to GM’s shareholders, suppliers and employees now that Obama’s “car czar”—Steven Rattner—has proposed micromanaging the GM product line. Independent Institute Senior Fellow William F. Shughart II explains why in his latest op-ed.

“It would have been far better to reconfigure GM under an orderly bankruptcy process, subject to the rule of law,” writes Shughart, “than to hand its administration to bureaucrats, whose discretionary powers are more vulnerable to political influence than to the wishes of either consumers or the company’s many ‘stakeholders.’”

Not only does political micromanagement circumvent the profit-and-loss system necessary to make businesses operate competitively, but so would a bailout without strings attached. Concludes Shughart: “If GM cannot survive without handouts, painful as it might be, it should hit the road.”

“United States Motors,” by William F. Shughart II (2/24/09)

Taxing Choice: The Predatory Politics of Fiscal Discrimination, by William F. Shughart II

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3) Green Polices Warrant Scrutiny, Not Wishful Thinking

Although Earth Day came and went last week with more media celebrations than scrutiny, two Independent Institute Research Fellows published articles questioning the value of various environmental policies. In an insightful piece for Forbes.com, Art Carden explained that many allegedly beneficial green laws cannot be evaluated objectively because they do not operate in a context that would enable people to determine whether they were efficient or wasteful—namely, the context provided by property rights and the price system.

“When resources are not owned and therefore outside the price system,” writes Carden, “the information we would need to evaluate the costs and benefits of different environmental initiatives literally does not exist.” In addition, some environmental policies are outright counterproductive: “Restrictions on land use in California drive up the price of housing there, causing people to move to less energy-efficient places—Houston suburbs, for example.

Andrew Morris, a contributor to the book Re-Thinking Green: Alternatives to Environmental Bureaucracy, takes aim at the wastefulness of most “green jobs.” Throwing money at environmental programs is not the best way to get the most benefits from scare resources, he explains. “Scrapping the existing sources of the electricity on which we depend for our homes, hospitals, factories and schools in favor of unproven technologies would be a mistake.”

“Environmental Economics,” by Art Carden (Forbes.com, 4/21/09)

“The Illusion of ‘Green Jobs,’” by Andrew P. Morriss (Baltimore Sun, 4/22/09) Spanish Translation

Re-Thinking Green: Alternatives to Environmental Bureaucracy, edited by Robert Higgs and Carl P. Close

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4) Chavez Gives Obama an Idiotic Book

A decade ago, Independent Institute Senior Fellow Alvaro Vargas Llosa called the book that Hugo Chavez gave Barack Obama at the recent Summit of the Americas, “the idiot’s bible.” Vargas Llosa criticized the 1971 book—Open Veins of Latin America by Eduardo Galeano—for its fallacies and far-out predictions. Notwithstanding Chavez’s enthusiasm for it, recent years have not been kind to Galeano’s book.

The developed countries of the Northern Hemisphere have not drained Latin America—precisely the opposite is true. In the past six years, strong exports have lifted about 40 million Latin Americans out of poverty. Foreign investment has boosted the demand for labor and increased the standard of living. “In the last seven years alone, Latin America has benefited from $300 billion in net capital flows,” writes Vargas Llosa, whose latest book, Lessons from the Poor: Triumph of the Entrepreneurial Spirit, celebrates entrepreneurship in Latin America and Africa.

Galeano even argued that greater economic freedom for businesses would require more prisons to incarcerate those who “suffer from business.” Writes Vargas Llosa, “Actually, the greater (though still insufficient) freedom given to business in the era of globalization has resulted in increasing prosperity in developing nations. This decade, the pace of economic growth per person has been four times higher in developing nations than in rich nations.”

“The Idiot’s Bible,” by Alvaro Vargas Llosa (4/22/09) Spanish Translation

Lessons from the Poor: Triumph of the Entrepreneurial Spirit, by Alvaro Vargas Llosa

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

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5) This Week in The Beacon

Below are the past week’s offerings from The Beacon, the web log of the Independent Institute. Your comments are greatly appreciated.

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