Volume 13, Issue 10: March 8, 2011
- Oil Prices Will Continue to Rise
- What Federal Spending Will Cost You
- Criminals in College Football
- Somali Pirates, Murder, and Blame
- Development Director Needed, Plus New Blog Posts
1) Oil Prices Will Continue to Rise
Sixty percent of the world’s known oil reserves lies under the sands of North Africa and the Middle East. That gas prices would shoot up as a result of production disruptions and political uncertainties in that region isn’t surprising. What is surprising is that some would suggest that utilizing spare capacity in Saudi Arabia, estimated to be 4 million barrels per day, would tame price hikes significantly beyond the very short term. With daily demand increasing by 2.7 million barrels last year, much of that increase due to China’s and India’s growing thirst for petroleum, oil will be expensive for a very long time, according to Alvaro Vargas Llosa, senior fellow at the Independent Institute’s Center on Global Prosperity.
Moreover, higher oil prices will have political consequences across the world, Vargas Llosa argues. “If gas at the pump reaches $4.50 or $5 per gallon in the United States, Barack Obama will probably be in big trouble in 2012,” he writes.
The President might survive his presumed bid to win re-election if he were to undo his anti-oil policies. Writes economist and Independent Institute Senior Fellow William Shughart: “Mr. Obama has prohibited drilling in onshore areas that already have been leased to oil companies; he has intentionally slowed the issuance of permits to producers for drilling in deepwater and shallow areas of the Gulf; and he has put on hold for seven years drilling in new areas of the Outer Continental Shelf.” Unfortunately, a policy reversal is unlikely anytime soon, Shughart concludes.
“U.S. Energy Policy Holds Us Hostage to Events Abroad,” by William F. Shughart II (Clarion Ledger, 2/28/11)
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
2) What Federal Spending Will Cost You
The federal government will spend $3.5 trillion this fiscal year, but that number is so large that most people have troubling wrapping their minds around it. Fortunately, the Government Cost Calculator at MyGovCost.org allows you to see what the profligacy of our leaders in Washington, DC, is going to cost you across your entire lifetime.
Here’s an example. A 33-year-old college graduate in Fort Worth, Texas, who earns the average annual salary for that area ($39,514) will pay more than $426,297 in future taxes to finance government spending, explains Independent Institute Research Fellow Emily Skarbek, the director of MyGovCost.org
“Some $61,223 in taxes will go to pay interest on the federal debt,” Skarbek writes in a piece for the Fort Worth Star-Telegram. “If this suburbanite didn’t have to pay that $61,223 in taxes to help finance the government’s debt, the money could be invested in a private account and over time would grow to an estimated $278,880.... Government administrative costs and personnel benefits will cost this same individual some $22,962. Trimming these costs could earn the average person up to $135,000. He or she will pay an estimated $72,979 in taxes to help finance our national defense. Medicaid will cost $43,109; welfare $32,525; Medicare $87,140; Social Security $85,955.”
“Those Numbing Budget Numbers Mean Something,” by Emily Skarbek (Star-Telegram, 2/19/11)
3) Criminals in College Football
A six-month investigation by CBS News and Sports Illustrated found an alarming rate of criminal recordsincluding aggravated assaultscommitted by college football players with the top 25 teams in the country. Worse, nothing is being done to rectify this moral outrage, argues Independent Institute Senior Fellow Richard K. Vedder in the Chronicle of Higher Education.
College administrators and team coaches treat football playerscriminals and law-abiding athletes alikeas economic resources worthy of generous scholarship. At the same time they often overlook the financial needs of deserving non-athletic students. Moreover, the NCAA ignores the coaches’ recruiting and retention of criminal athletesperhaps out of recognition that doing otherwise would weaken its cartel, foster a more competitive market for student athletes, and lead to a reduction of coaches’ salaries, Vedder argues.
Colleges should not tolerate criminal behavior among their student athletes, nor should they reward coaches for recruiting good football players who are violent off the playing field. “Coaches who persist in hiring (and that is what it is) criminals to play should be banned from coaching,” Vedder writes. “Teams with high percentages of criminals (e.g., the University of Pittsburgh, University of Iowa) should lose the right to play NCAA teams, or, at the minimum, be excluded for several years from bowl competition and lose their share of television broadcast rights money. Coaches who do a bait-and-switch act on high school recruits should, at the minimum, face similar penalties....”
“Crime and Punishment in American College Sports,” by Richard K. Vedder (The Chronicle of Higher Education, 3/2/11)
The Academy in Crisis: The Political Economy of Higher Education, edited by John W. Sommer
4) Somali Pirates, Murder, and Blame
Somali pirates have taken more than 50 ships and 800 people hostage. On February 22, U.S. naval authorities patrolling the Indian Ocean boarded the Quest, a 58-foot-long private yacht that had been abducted by pirates, and found its four crewmates dead.
Did the pirates murder their hostages because negotiations with the navy had broken down? Did they murder the boaters in order to avenge the deaths of fellow pirates who died while trying to capture the Maersk Alabama in 2009? Do the yachtsmen themselves bear responsibility for their own deaths because they sailed away from their protective flotilla and into harm’s way? Ivan Eland, director of the Independent Institute’s Center on Peace & Liberty, argues that there was plenty of contributory negligence to go around.
Even the U.S. government shares culpability. By patrolling pirate-invested waters, the U.S. government subsidized the foolish risk-taking that likely contributed to the deaths of the crew of the Quest. “This horrible outcome casts doubt about whether the United States should be using warships to protect stupid adventure-seekers or reckless commercial ships that ply these dangerous waters,” Eland writes in his latest op-ed. “Like U.S. government rescues of people who travel to or live in perilous countriesfor example, President Ronald Regan’s invasion of Grenada in 1982 to rescue American medical studentssuch ill-advised military actions should be avoided.”
“Should the U.S. Government Encourage Potential Darwin Award Winners?” by Ivan Eland (3/2/11) Spanish Translation
The Empire Has No Clothes: U.S. Foreign Policy Exposed, by Ivan Eland
Partitioning for Peace: An Exit Strategy for Iraq, by Ivan Eland
5) Development Director Needed, Plus New Blog Posts
The Independent Institute is currently seeking an experienced Development professional with a strong commitment to individual liberty to head up its Development Department. For details, go here.
Here are this week’s posts from the Independent Institute’s blogs.
From The Beacon:
- “The U.S. Surveillance State: Big Brother on Steroids,” by Mary Theroux (3/7/11)
- “The Past and Future of American Antimilitarism,” by Anthony Gregory (3/6/11)
- “Derek Leebaert’s ‘Magic and Mayhem,’” by Robert Higgs (3/6/11)
- “Leadership in Politics and in Commerce,” by Randall Holcombe (3/4/11)
- “Extreme Aggregation Misleads Macroeconomists and the Fed,” by Robert Higgs (3/1/11)
- “The Matchmakers of Predatory Politics,” by Carl Close (3/1/11)
From MyGovCost News & Blog:
- “The Union Stronghold on California,” by Emily Skarbek (3/7/11)
- “Obamacare Waivers Climb to Over 1,000,” by David Theroux (3/6/11)
- “Medicare Fraud: $48 Billion at a Minimum,” by David Theroux (3/3/11)
- “Turning Around the Dire Fiscal Situation of ‘USA, Inc.,’” by Craig Eyermann (3/2/11)
- “GAO’s Latest Spending Report Identifies Duplicate Programs,” by Lindsay Boyd (3/1/11)
And for you Spanish speakers, be sure to visit our Spanish-language blog here.