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

Volume 12, Issue 34: August 23, 2010

  1. Vargas Llosa Lauds Britain’s Budget Cuts
  2. Watkins Criticizes Nationalizing Marriage
  3. Private Police to Reduce Costs and Make Cities Safer
  4. Free-Market Entrepreneurship Is Essential
  5. This Week in The Beacon

1) Vargas Llosa Lauds Britain’s Budget Cuts

British Prime Minister David Cameron is attempting to roll back the state. How significant are his efforts? Very. Cameron has “unleashed the boldest assault on public spending and centralized bureaucracy anywhere today—and not a moment too soon,” writes Independent Institute Senior Fellow Alvaro Vargas Llosa.

Cameron proposes to close Britain’s 90 billion pound deficit with a mix of 80 percent in public spending cuts, including cuts to defense and education, and 20 percent in tax hikes. On average, various government departments will sustain a 15 percent reduction in their budgets, but some agencies will face a 25 percent cut.

“Even the sacred National Health Services, the jewel of Britain’s postwar welfare state, will be shaken up under a plan to bring choice and decentralization,” Vargas Llosa continues. “It is early to say whether Cameron will deliver, and one cannot make too many assumptions about the unlikely coalition that sustains him. But the prime minister’s opening shots mark an inspiring contrast with the platitudes and bromides we have become accustomed to hearing at G-20 meetings.”

“The Surprising Mr. Cameron,” by Alvaro Vargas Llosa (8/17/10) Spanish Translation

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

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

The Che Guevara Myth and the Future of Liberty, by Alvaro Vargas Llosa

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2) Watkins Criticizes Nationalizing Marriage

When U.S. District Judge Vaughn Walker struck down as unconstitutional Proposition 8—a 2008 ballot measure in California that banned same-sex marriages in the state—he ran roughshod over a key constitutional stricture: the Tenth Amendment, according to Independent Institute Research Fellow William J. Watkins, Jr.

“That amendment states that powers not delegated to the federal government by the Constitution, nor prohibited by it, ‘are reserved to the States respectively, or to the people,’” writes Watkins. Walker’s decision in the case, Perry v. Schwarzenegger, reflects the judge’s personal views about the merits of same-sex marriage, rather than the constitutionality of Prop. 8 and, should the decision stand, would nationalize marriage, argues Watkins. In addition, Watkins criticizes the reasoning of an earlier judicial ruling that helped make the Perry decision possible: Supreme Court Justice Anthony Kennedy’s opinion in the 2003 case of Lawrence v. Texas.

Despite his criticism of Walker’s ruling, Watkins suggests that the institution of marriage is in need of legal reform. “In the best of all worlds,” writes Watkins, “marriage would be privatized so that consenting adults would be free to enter into binding, legal agreements without permission from the state.”

 “Nationalizing Marriage,” by William J. Watkins, Jr. (The Washington Times, 8/17/10) Spanish Translation

“Marriage Proposal: Why Not Privatize?” by Colin P. A. Jones (San Francisco Chronicle, 1/22/06)

“A Marriage Proposal: Privatize It,” by Colin P. A. Jones (The Independent Review, Summer 2006)

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3) Private Police to Reduce Costs and Make Cities Safer

When a municipal agency threatens to cut services if benefits are reduced or pay raises aren’t forthcoming, cities and citizens should do what too many consider unthinkable: call the agency’s bluff. According to Independent Institute Senior Fellow Bruce L. Benson, they may find a better, cheaper alternative from the private sector.

Consider Oakland, Calif., which is grappling with a $30 million budget deficit. When the city asked that police officers help by contributing to their own pensions, as is done in San Francisco and Los Angeles, the police union said no—not without a guarantee of no layoffs for three years. The city council responded to that rejection by taking steps to replace some police officers with private security workers to patrol high-crime areas.

“Four private patrolmen will cost the city about $200,000 a year—a fifth of what four city policy officers would cost,” writes Benson. It’s a small, but important step forward.” Using the same personnel to make arrests and to respond to auto accidents is a costly waste of manpower and is uncommon in the private sector, Benson argues.

“Cities Can’t Give In to Protection Racket,” by Bruce L. Benson (Investors Business Daily, 8/16/10)

To Serve and Protection: Privatization and Community in Criminal Justice, by Bruce L. Benson

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4) Free-Market Entrepreneurship Is Essential

At the Presidential Summit on Entrepreneurship last April, an advisor to the U.S. Department of State extolled the virtues of private entrepreneurship—to an audience that included the secretary of commerce, the head of the Small Business Administration, and several prominent White House honchos.

According to Independent Institute President David J. Theroux it is common for Washington bureaucrats and politicians to say they uphold private entrepreneurship when it suits them, only to turn around and undermine entrepreneurs either directly through burdensome regulation or indirectly through offering government loans, subsidies and training that tilt the economic playing field in favor of those who are most willing and able to jump through government hoops.

“Numerous economists have shown that without the freedom to learn, discover, and act, the process of entrepreneurship is stymied, and economic progress is not possible,” writes Theroux. “In short, market-based proprietary development and voluntary, community-based entrepreneurship, not government command and control, are what makes progress in human well-being possible.”

“‘We’re Hosting No Government Officials as Part of This,’” by David J. Theroux (8/12/10)

Making Poor Nations Rich: Entrepreneurship and the Process of Economic Development, edited by Benjamin Powell

The Voluntary City: Choice, Community, and Civil Society, edited by David Beito, Peter Gordon, and Alexander Tabarrok

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

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5) This Week in The Beacon

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