The Lighthouse^®

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The Lighthouse^® is the weekly email newsletter of the Independent Institute.
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Volume 14, Issue 27: July 3, 2012

1. Obamacare: What’s Next?
2. Join Us at FreedomFest in Las Vegas
3. Syria’s Slippery Slope
4. Economics versus Environmentalism
5. Pandemonium in Paraguay
6. New Blog Posts

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Repeal and replace. That’s what Independent Institute Research Fellow John C. Goodman urges Congress to do in the aftermath of last week’s Supreme Court affirmation of most of the Affordable Care Act. Goodman offers several reasons to scrap it. For starters, President Obama’s signature legislative accomplishment imposes heavy costs on employment: workers who make $15 per hour “will be forced to buy insurance whose costs (for a family) will equal half the employees’ wages,” he writes in the Daily Caller. �This extra cost—and the still unanswered question of how businesses will respond as the healthcare law gets implemented—make for an uncertain employment climate at a time when hiring is sluggish.

Moreover, Obamacare creates a bizarre system of subsidies that, among other problems, will cause a massive and wasteful restructuring of American industry. Because the amount of the federal tax subsidy depends on an employee’s tax bracket, high-income employees will seek employers that offer health insurance, whereas low-income employees will look for employers that don’t. Companies will need to reorganize to accommodate the new worker preferences if they want to survive. Goodman also argues that the new healthcare law will make it hard for many Medicare patients to find a doctor who will see them.

What should replace Obamacare? Goodman proposes reforms designed to foster universal coverage without a mandate—a program that’s bolder than the timid proposals of the Republicans in Congress. In his plan, every individual would receive a refundable federal tax credit for the purchase of health insurance, worth, say, $2,500 for every adult and $1,500 for every child. “If an individual chooses to be uninsured, the unclaimed tax credit should be sent to a safety net agency in the community where the person lives—in case he generates medical bills he cannot pay from his own resources,” Goodman writes in a separate op-ed for Townhall. The proposal would be funded by (1) eliminating the $300 billion in tax subsidies that currently go toward private insurance, (2) ending current federal, state, and local government spending on indigent care, and (3) making the current $1,000 child tax credit conditional on proof of insurance for a child. This proposal would enable people to pay for catastrophic insurance (additional coverage could be made with an employer’s or employee’s after-tax dollars). Goodman also recommends opening Medicaid to everyone and allowing everyone who is currently eligible for the program to apply their Medicaid dollars to the purchase of private insurance.

Let’s Repeal and Replace Obamacare, by John C. Goodman (The Daily Caller, 6/28/12)

Repeal and Replace, by John C. Goodman (Townhall, 6/30/12)

Priceless: Curing the Healthcare Crisis, by John C. Goodman

Event Alert: John Goodman, Anthony Gregory and Robert Murphy to Speak at FreedomFest! (Las Vegas, July 11-14, 2012)

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The Independent Institute is pleased to announce that John C. Goodman, Anthony Gregory, and Robert P. Murphy have joined the line-up of speakers at FreedomFest, the largest annual pro-liberty conference in the United States. FreedomFest 2012 will take place July 11 to 14 at Bally’s Las Vegas. Don’t miss this intellectually stimulating event!

Research Fellow John Goodman will speak twice. His first talk is entitled, “ObamaCare: The Supreme Court Decision and What it Means for Your Healthcare.” His second talk is devoted to his new book, Priceless: Curing the Healthcare Crisis.

Research Editor Anthony Gregory, who has just completed a book manuscript about the writ of habeas corpus, will debate John Browne, former member of the House of Parliament under Margaret Thatcher, on the topic: “Sir Winston Churchill: 20th Century’s Greatest Statesman or a Warmonger?”

Robert P. Murphy, who is writing a new Institute book on the economic principles in Ludwig von Mises’s seminal book Human Action, will speak at a panel entitled, “Live Better, Live Liberty: The Quest to Get Government Out of Our Lives.”

More information: John Goodman, Anthony Gregory and Robert Murphy to Speak at FreedomFest! (Las Vegas, July 11-14, 2012)

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In the 1980s, the U.S. government favored Saddam Hussein in the Iraq-Iran War, sending the tyrant intelligence technology, helping to plan his military attacks, and encouraging European allies to sell him weapons. Now the United States is providing the Syrian opposition movement with “non-lethal” communications equipment and keeping weapons exporters apprised of the rebels’ capabilities. Opponents of the regime have legitimate grievances—Bashar al-Assad has killed more than 10,000 of his countrymen—but this does not mean it is in the interests of the United States to equip them, Independent Institute Senior Fellow Ivan Eland argues in his latest op-ed.

“Regardless of what the Russians do, the United States has no vital strategic interest in Syria and should quit stoking the conflict in any form,” Eland writes. “Although the Israelis may have such a strategic interest there, Islamists could hijack the rebellion as they have in Egypt—making Israel and the United States nostalgic for Bashar al-Assad’s dictatorial rule.”

Pressures for the United States to support the Syrian rebels may intensify as Turkey, Qatar, and Saudi Arabia increase their support, Eland suggests. Such pressures, however, should be resisted. Both the United States and Syria’s benefactor, Russia, “should avoid fueling what is rapidly becoming a civil war that could overflow Syria’s borders and become a regional sectarian war,” Eland writes.

Stay Out of Syria, by Ivan Eland (6/28/12)

No War for Oil: U.S. Dependency and the Middle East, by Ivan Eland

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Anyone who has followed the op-ed pages of leading newspapers or attended city council meetings has noticed two groups of people who can’t seem to stop quarreling with each other: economists and environmentalists. Why can’t they just get along? According to Independent Institute Senior Fellow Robert H. Nelson, the mutual animus of economists and environmentalists stems from their conflicting values regarding man’s relationship to nature. In other words, theirs is a conflict between clashing religions, albeit secular ones.

Environmentalists, Nelson notes in his cover article in the summer issue of The Independent Review, often view pristine wilderness as sacred and human encroachment on it as a moral transgression. Economists, on the other hand, tend to place a high value on economic growth but generally make no scientific effort to show that material progress across the board is exempt from the law of diminishing returns. Both sides treat their assumptions as articles of faith. Nelson isn’t challenging these beliefs so much as he is pointing out their religious character.

Greater recognition that economics and environmentalism are secular religions can help foster several benefits, Nelson argues. One benefit would be the crafting of legislation that has a greater likelihood of acceptance by both sides of the divide. “Moreover,” he concludes, “it might help to reduce the hypocrisy involved when powerful religious values are advanced in the name of objective economic or environmental ‘science.’” Nelson elaborates on the nature and consequences of this issue in his Eric Hoffer Book Award Grand Prize winner, The New Holy Wars: Economic Religion vs. Environmental Religion in Contemporary America.

Economics and Environmentalism: Belief Systems at Odds, by Robert H. Nelson (The Independent Review, Summer 2012)

The New Holy Wars: Economic Religion vs. Environmental Religion in Contemporary America, by Robert H. Nelson

The Independent Review (Summer 2012)

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When Fernando Lugo became the president of Paraguay four years ago, the former Catholic bishop pledged to end the era of the Colorado Party. Ultimately, he lost. His impeachment on June 22, led by that party but aided by former allies in the Authentic Radical Liberal Party, demonstrates the huge political risks that even moderate reformers face when they antagonize entrenched interest groups—in this case, disgruntled landowners who thought Lugo wasn’t doing enough to suppress the country’s periodic peasant land invasions. Although it didn’t amount to a coup d’état—constitutional procedures were followed and next year’s elections have not been cancelled—the impeachment was a big setback for a region that needs greater political stability, according to Independent Institute Senior Fellow Alvaro Vargas Llosa.

“It was a vile and stupid move by a disparate group of politicians beholden to vested interests with little in common except contempt for Lugo,” writes Vargas Llosa in The National Interest.

For the sake of strengthening Paraguay’s democratic institutions, Lugo’s foes should have focused their efforts on voting him out of office during next April’s elections. Instead, they gave in to short-term impulses and gave the undemocratic heads of Venezuela, Bolivia, Ecuador, and Argentina something to complain about. “This is another good reason why the impeachment of president Lugo was a crass mistake,” Vargas Llosa continues. “It has given the worst governments of Latin America a cause around which to rally, exposing the better half of South America as lacking in diplomatic backbone and self-confidence. The effect will be to weaken the region’s democratic institutions.”

Paraguay’s Big Mistake, by Alvaro Vargas Llosa (The National Interest, 7/2/12)

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

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

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From The Beacon:

From MyGovCost News & Blog:

You can find the Independent Institute’s Spanish-language blog here.

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