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The Lighthouse®

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Volume 16, Issue 22: June 3, 2014

  1. Latin American Writer Renounces His Anti-U.S. Book
  2. Imports Add to American Prosperity
  3. How Victimizers Devalue Themselves
  4. East Asia “Pivot” Raises Security Risk for United States
  5. New Blog Posts
  6. Selected News Alerts

1) Latin American Writer Renounces His Anti-U.S. Book

In 2009, when the two presidents first met, Venezuela’s Hugo Chavez presented Barack Obama with a favorite book: The Open Veins of Latin America by Uruguayan writer Eduardo Galeano. His choice of gift was no surprise. Since its publication in 1971, Galeano’s international bestseller has been the Left’s go-to sourcebook for why Central and South America are poor and underdeveloped and the United States is not. Its message has been incorporated into countless speeches, pamphlets, placards, and even college courses: The root causes of the region’s social, economic, and political ills are policies of the United States and Western Europe deliberately designed to hold Latin America back. But an important development occurred last month that may well topple Open Veins from its lofty place in the left-wing canon: At a conference in Brazil, Galeano himself called his book’s left-wing rhetoric “awful” and confessed that he had not been qualified to write about economic issues.

Carlos Alberto Montaner, an advisor to the Independent Institute’s Center on Global Prosperity, credits Galeano for his honesty. “As a political writer myself, I know it took real courage—even gallantry—for Galeano to publicly correct himself,” Montaner writes in National Review. “It’s not easy to admit when you are wrong. And it is even more difficult when you are a hero to so many, as Galeano has been.”

It’s hard to overestimate the significance of the retraction. Leftist true believers will now struggle to account for their hero’s change of heart; some may even take a second look at their ideology. But what caused Galeano to give up his belief that the United States and Western Europe were trying to stifle Latin America through policies of “imperialism” and “capitalism”? Montaner suggests that Galeano’s about face resulted from opening his eyes: South Korea, Taiwan, Estonia, Singapore, Hong Kong, Israel, and Chile show that poor countries can lift themselves out of poverty by enforcing property rights, cutting red tape, and pursuing freer trade policies.

The dethroning of Open Veins provides an important opportunity—the chance to coronate a book that informs readers about the true causes of Latin America’s predicament. Without reservation, we nominate Liberty for Latin America: How to Undo Five Hundred Years of State Oppression, by Independent Institute Senior Fellow Alvaro Vargas Llosa.

The Idiots Lose Their Religion, by Carlos Alberto Montaner (National Review, 5/31/14)

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) Imports Add to American Prosperity

President Obama commemorated World Trade Week in May by touting his administration’s policies to stimulate U.S. export growth. The president deserves some credit: He rightly hailed international trade as a critical tool for raising a country’s standard of living. But he’s wrong to emphasize exports. The current resident of the Oval Office is hardly unique in this regard, of course. People from all walks of life—politicians, pundits, and members of the general public—typically talk up the benefits of exports while downplaying or even ignoring the benefits of imports. But as Independent Institute Senior Fellow Benjamin W. Powell notes, the export bias has matters exactly backward. “Imports are what improve our lives, whereas exports are merely the price we have to pay to get them,” he writes in the Huffington Post.

Powell attributes the export bias to the fact that the jobs exports create tend to be more concentrated in particular regions and sectors, and hence are more visible to the untrained eye than are jobs attributable more to imports. He also identifies the worst problem caused by the export bias: it entices U.S. politicians to threaten retaliation if a country sends goods to the United States but erects trade barriers against products that American firms would like to sell there.

Finally, Powell likens labor mobility to international trade, and on that basis argues in favor of policies to allow more immigration. “World Trade Week is welcome recognition for the importance of trade,” he writes, “but we’d be better off if it emphasized the mutually beneficial nature of trade, rather than the supposed benefits of exports, and if it focused more on the benefits of labor mobility—in other words, immigration of eager workers—rather than just trade in goods and services.”

Celebrating Imports, by Benjamin W. Powell (The Huffington Post, 5/30/14)

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


3) How Victimizers Devalue Themselves

Frederick Douglass, the abolitionist and former slave, wrote in his 1845 autobiography that slavery can kill the soul of the slave owner, just as it dehumanizes the slave. He saw it happen. As a young boy in Baltimore, Douglass had a mistress, Sophia Auld, who treated him with the kindness, even teaching him how to read and write. This did not sit well with her husband, Hugh. Soon Mrs. Auld began to treat young Frederick cruelly. When her warmth, generosity, and compassion evaporated, she lost some of her humanity. As Independent Institute Research Fellow Wendy McElroy notes, such erosions of character are not limited to slave owners.

McElroy thought of Douglass’s insight during a recent heated discussion with a mainstream feminist. McElroy, we must first explain, considers herself an individualist feminist—a classical liberal who embraces “legal equality under just law”—not a mainstream feminist. Feminists of the mainstream variety, she suggests, are collectivists willing to pronounce all men as oppressors, oppressors in waiting, or purveyors of “the rape culture.” Moreover, such feminists are working to lower the due process standards for college men accused of sexual harassment or assault because they believe justice demands it. This, at least, was the agenda of the feminist that McElroy recently encountered.

“No wonder the woman was furious with me,” McElroy writes. “Like abolitionists, I held up a mirror on her own contempt for genuine decency and justice. She needed to shout down anyone or anything that reflected her real image too clearly.” There’s a greater lesson to learn, McElroy continues. “If both the victim and the victimizer are harmed by a sustained oppression, then both parties benefit from its elimination. Both should argue for equality out of rational self-interest. The greater benefit would definitely be experienced by the one who is no longer victimized. But the greater return of humanity may be experienced by the one who no longer oppresses.”

The Soul-Killing Effect of Owning Slaves and Some Feminism, by Wendy McElroy (The Daily Bell, 6/2/14)

Liberty for Women: Freedom and Feminism in the Twenty-First Century, edited by Wendy McElroy


4) East Asia “Pivot” Raises Security Risk for United States

President Obama’s new foreign-policy priority, it’s been said, is to “pivot” toward Asia. In an effort to contain a rising China, the White House is strengthening U.S. ties with several allies in the region. This strategy could have monumental consequences for the United States—it could eventually drag the nation into war—but for most Americans there is no upside to the president’s maneuver. Some of these allies—Japan, South Korea, Taiwan, and Australia—can afford to do more to defend themselves militarily. Others are small countries that would do well to resolve their differences with China by entering into bilateral talks with Beijing. Unfortunately, their incentives to negotiate are weak because the United States has given assurances that they’re protected by a U.S. security umbrella.

The differences between China’s relationship with the Philippines and its dealings with Vietnam are instructive, explains Independent Institute Senior Fellow Ivan Eland. Manila, an ally of the United States, has refused to negotiate maritime territorial claims with Beijing and is pursuing its grievances in a United Nations tribunal. Hanoi, in contrast, is not a U.S. ally and is negotiating directly with its northern neighbor to resolve maritime territorial disputes. This doesn’t mean relations between Vietnam and China are never heated—their recent altercation regarding an oil rig at sea is proof—but the negotiations provide a promising framework to keep such conflicts from turning into full-blown war.

Eland offers an alternative to Obama’s risky strategy: get rid of the containment policy, sever military alliances with wealthy countries in East Asia, and limit the U.S. military role in the region. “Such a new American ‘balancer-of-last resort’” strategy, better than Obama’s more-of-the-same ‘pivot,’ would allow the United States to pay down its debt and recharge its economy, thus ensuring that it will be an influential player in East Asia and the international system for decades and perhaps centuries to come.”

U.S. Alliances Encourage Asian Allies to Be More Antagonistic Toward China, by Ivan Eland (The Huffington Post, 5/20/14)

VIDEO: Ivan Eland on Edward Snowden’s NBC News Interview (Canada’s CTV, 5/28/14)

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


5) New Blog Posts

From The Beacon:

From MyGovCost News & Blog:

How “Smarter” Government Actually Works
Craig Eyermann (6/1/14)

VA Bosses Bagged Bonuses
K. Lloyd Billingsley (5/30/14)

The Tip of the Government Health Care Iceberg
Craig Eyermann (5/29/14)

The BOE Bottomless Money Pit
K. Lloyd Billingsley (5/28/14)

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


6) Selected News Alerts


  • Catalyst
  • Beyond Homeless