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Volume 12, Issue 36: September 7, 2010
- Federal Bailouts Impose Hidden Costs on U.S. Economy
- The Independent Review—Fall Issue Now Available
- Assessing the U.S. “Exit” from Iraq
- Is Democracy in Venezuela Doomed?
- This Week in The Beacon
Federal spending for the recent bailouts has surpassed $3.6 trillion—the cost of World War II in today’s dollars. The indirect, long-term costs of the federal bailouts are not trivial either, according to Independent Institute Senior Fellow William F. Shughart II.
First, as a result of the bailouts, private companies that might otherwise have exercised due caution now have incentives to make riskier decisions, knowing that the feds may come to the rescue were something to go wrong. Second, healthier businesses are now less healthy because the bailouts have siphoned off some of the resources they could have used in the absence of the bailouts. Third, political considerations shaped the government’s decisions about who does and who doesn’t warrant a bailout, thus distorting the political process as well as the economic system.
“If private companies find themselves in dire straits, it would be far better to allow the orderly processes of bankruptcy to determine who survives and who fails,” writes Shughart. “Taxpayers need to understand that the mega-billion-dollar numbers the politicians bandy about, like it’s only peanuts, is their money that will come out of their pockets, their children’s pockets, and even their grandchildren’s—year after year after year, as far as the eye can see.”
“The Costs of the Federal Bailouts,” by William F. Shughart II (Human Events, 8/31/10)
Taxing Choice: The Predatory Politics of Fiscal Discrimination, edited by William F. Shughart II
The Fall 2010 issue of the Independent Institute’s journal is hot off the press. Here are some of the questions it examines:
- Why has the idea of “social justice” gained popularity since the 1960s? Read the article.
- Why do F. A. Hayek and Alasdair MacIntyre blame the Enlightenment for the rise of social engineering and ethical nihilism?
- How effective is food safety regulation in the United States?
- How violent was the American West? Read the article.
- Why do public schools often perform poorly?
- Why did Woodrow Wilson abandon the policy prescriptions of classical economics in favor of progressivism? Read the article.
- Which ideals did Rose Wilder Lane promote in the most widely read African American newspaper of her time?
- What unseemly metaphor best conveys the fraud and corruption now rampant in legislative politics?
- What’s right and what’s wrong with Hayek’s concept of spontaneous order?
- What can the Austrian school of economics tell us about Western literature? Read the review.
- How should the U.S. financial system be fixed? Read the review.
- Why do many intellectuals substitute an economic analysis of the world’s problems with an uninformed moral condemnation? Read the review.
The Independent Review (Fall 2010)
Special offer for first-time subscribers: Subscribe online to The Independent Review and receive two complimentary issues—the next six issues for the price of four!
Last week, President Obama announced the near-complete withdrawal of U.S. combat troops from Iraq, a pull-out that leaves behind 50,000 military trainers and advisers—ten times the number of U.S. personnel stationed in Saudi Arabia at the time of the 9/11 terrorist attacks. Independent Institute Senior Fellows Ivan Eland and Charles Peña offer their evaluations.
“In the final analysis, keeping troops—even as military advisers—in Iraq undermines U.S. security,” writes Peña. “Drawing down from the 140,000 troops that were deployed in Iraq when President Obama took office in January 2009 to 50,000 today is significant progress. But bringing home the last 50,000 troops is just as important—if not more so.”
Eland’s complementary assessment pulls no punches. “The Iraq War was not only disastrous,” he writes, “it was one of the worst strategic blunders in the history of U.S. foreign policy. President Obama should not renegotiate the status of forces agreement with any government in Iraq. He should avoid any long-term U.S. military presence there that could be ensnared in future violence and withdraw the remaining 50,000 troops before the end of the year.”
“Faux Exit from Iraq,” by Charles Peña (9/1/10)
“Assessing the Iraq War,” by Ivan Eland (9/1/10) Spanish Translation
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
Partitioning for Peace: An Exit Strategy for Iraq, by Ivan Eland
Venezuelan opposition leader Ramón Guillermo Aveledo says that Hugo Chávez may try to steal this month’s parliamentary elections.
Chávez has become widely unpopular owing to his use of armed gangs, the rise of deadly violence in the nation’s capital, economic shortages, a judiciary that answers to political power rather than to the rule of law, and Chávez’s cosy relations with Cuba, Nicaragua, and Bolivia, according to Carlos Alberto Montaner, an adviser to the Independent Institute’s Center on Global Prosperity.
It is probably not hyperbole to say that the future of Venezuela hinges on the outcome of the September 26 elections. “If Venezuelans allow victory to be snatched from them,” writes Montaner, “the conclusion that democrats will reach is that in the future it will be meaningless to participate in rigged elections where the opposition is trampled before, during and after the trip to the polls.”
“Will Chávez Steal Parliamentary Elections?” by Carlos Alberto Montaner (Miami Herald, 8/31/10)
Liberty for Latin America: How to Undo Five Hundred Years of State Oppression, by Alvaro Vargas Llosa
Read the latest posts on the Independent Institute blog.�
- “Public School Spending Like There’s No Tomorrow,” by Mary Theroux (9/6/10)
- “Consumption Spending Is 70 Percent of GDP — So What?” by Robert Higgs (9/5/10)
- “The Business of Business Is to Make Profits,” by William Shughart (9/4/10)
- “Is Obama a Traitor to His Class?” by Robert Higgs (9/3/10)
- “Richard Fuld: Multi-Millionaire Whiner,” by Randall Holcombe (9/1/10)
- “Fewer Illegals, More anti-Illegal Sentiment,” by Anthony Gregory (9/1/10)
- “Do the Post-Panic Changes in Corporate Bond Yield Curves Indicate Regime Uncertainty or Only Expectations of Increased Inflation?” by Robert Higgs (9/1/10)
- “Macroeconomic Policy, European-Style,” by Randall Holcombe (9/1/10)
- “‘Liberal’ Appeals Court OKs Warrantless GPS Tracking by Feds,” by Mary Theroux (8/31/10)
- “The Costs of Federal Bailouts—How Much do YOU Pay??” by Lindsay Boyd (8/31/10)
- “MyGovCost’s Government Cost Calculator: Buzz Begins!” by Lindsay Boyd (8/31/10)
