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Volume 10, Issue 47: November 24, 2008

  1. What Obama Can Learn from Lincoln and Carter
  2. Would a New New Deal Foster Economic Recovery?
  3. The Obama Defense Budget
  4. No Angels in Congo’s War
  5. This Week in The Beacon

1) What Obama Can Learn from Lincoln and Carter

U.S. presidents may sometimes have moral justification and constitutional authority to exercise military force, but this doesn’t necessarily make a military option a smart choice. In his latest op-ed, Independent Institute Senior Fellow Ivan Eland illustrates this point by comparing Abraham Lincoln’s decision to risk a civil war by re-supplying Fort Sumter and Jimmy Carter’s decision not to attack Iran during the hostage crisis.

“Although Carter had a moral right to militarily retaliate against Iran for attacking the U.S. embassy—technically U.S. soil—he wisely avoided this option,” Eland writes. “Although Carter and Lincoln both had the right to use military force, Carter was the wiser of the two men for avoiding it.” Lincoln should have pursued compensated emancipation if he wished to eradicate slavery, Eland suggests.

The wisdom of military restraint is a principle that Barack Obama should keep in mind as he pursues al Qaeda terrorists, argues Eland. “Although the president-elect should keep pressuring the Pakistani government to capture or kill Osama bin Laden and crew and up the bounty on the heads of the group’s leadership, the U.S. occupation of Afghanistan and attacks into Pakistan are fueling the diffuse radical Islamism around the world that is leading to increased terrorism,” writes Eland. “Thus, Obama should avoid knee jerk U.S. military responses that have become all too common and counterproductive and instead adopt a smarter policy of restraint.”

“Military Action May Sometimes Be Moral and Constitutional, but Not Smart,” by Ivan Eland (11/22/08)

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

The Empire Has No Clothes: U.S. Foreign Policy Exposed (Updated Edition), by Ivan Eland

Putting “Defense” Back into U.S. Defense Policy, by Ivan Eland


2) Would a New New Deal Foster Economic Recovery?

Comparisons between the slowing U.S. economy and the early years of the Great Depression have prompted many politicians to push for a new economic stimulus package, à la the New Deal, but the analogy between then and now is very weak, according to noted economic historian Price Fishback, writing on the New York Times’ Freakonomics blog.

Although federal spending as a percentage of gross domestic product doubled during the New Deal, it didn’t really qualify as a Keynesian-style stimulus program. That’s because G.D.P. during the Great Depression was much lower than it was during the preceding years. New Deal spending was simply too small to have much of an expansionary impact, according to Keynesian theory. Thus, even Keynes himself exhorted Franklin Roosevelt to run larger deficits than he was running. (Not that the predictive powers of Keynes’s theoretical framework are all that great: Keynesians predicted a recession following the collapse of government spending after World War II, but a surge in private consumption and private investment more than compensated, as Robert Higgs explains in Depression, War, and Cold War.)

Fishback writes: “If not Keynesian policy, what was the New Deal? It was a broad-ranging mix of spending, regulation, lending, taxation, and monetary policies that can best be described as ‘See a problem and try to fix it.’ In many situations the fix for one problem exacerbated other problems. The programs to raise farm prices hurt work relief recipients, while attempts to raise wages and prices contributed to more unemployment, and thus a greater need for relief spending.”

The costs of trying to replicate the New Deal in 2008 and 2009 would not be cheap, Fishback warns: “Today, with unemployment rates below 7 percent, it is likely that such public-works spending would crowd out a significant amount of construction.”

“What Do the New Deal and World War II Tell Us About the Prospects for a Stimulus Package?” by Price Fishback (New York Times, 11/21/08)

Depression, War, and Cold War, by Robert Higgs


3) The Obama Defense Budget

Barack Obama pledged to increase the U.S. defense budget, but according to Independent Institute Senior Fellow Charles Peña he has yet to make the case that doing so would make Americans more secure. Although military spending is already higher in inflation-adjusted terms than at any time other than 1945-46 (when World War II was ending) and 1952 (when the Cold War was just beginning), the United States does not face a large military adversary, argues Peña. Moreover, excessive military spending may invite what Peña calls the Madeleine Albright syndrome: if spending for the military is high, U.S. leaders will want to use it more than they should.

“Such thinking has encouraged policy-makers to use military force even when it’s not needed,” writes Peña. “This, in turn, has helped incite anti-Americanism in much of the world, especially the Muslim world.”

America’s defense needs can be met with a smaller defense budget, Peña argues. “The time has come for the United States to plan not only its exit from Iraq, but from other countries where our military presence is unnecessary and often unappreciated. We don’t need U.S. troops in Europe, for example, where there is no military threat to NATO, nor in South Korea or Japan. Our European and Asian allies are wealthy enough to pay for their own security needs.”

“Record Defense Spending, Less Security,” by Charles Peña (11/13/08)

Winning the Un-War: A New Strategy for the War on Terrorism, by Charles Peña

More by Charles Peña


4) No Angels in Congo’s War

The cacophony of war becomes all the more disorienting when leaders on both sides have legitimate grievances. Such is the case of Congo today, as Independent Institute Senior Fellow Alvaro Vargas Llosa explains in his latest column, “Congo, Death with No Angels.”

On one side, rebel leader Laurent Nkunda claims he is defending the Tutsi minority from rape and pillage by Hutus driven out of Rwanda. (Rwandan Hutus killed an estimated 800,000 Tutsis in the Rwandan conflict of the mid-1990s.) On the other side, Congo’s leader Joseph Kabila accuses Nkunda of plundering eastern Congo of its vast resources, and doing the dirty work of the Rwandan government. (Rwanda has invaded Congo twice.)

“We are in the face of a classic tragedy,” writes Vargas Llosa. “In Congo’s war there are no angels. Both sides are profoundly responsible for what looks like a descent into the abyss from which Congo once appeared to be emerging. And the international community, which turned a blind eye to Kabila’s cynical tolerance of Hutu extremists in eastern Congo and showered the Rwandan government with international respect while it was inflaming the crisis next door, has little honor to claim in this conflict.”

Congo, Death with No Angels,” by Alvaro Vargas Llosa (11/19/08) 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


5) This Week in The Beacon

Below are the past week’s offerings from The Beacon, the web log of the Independent Institute. Please post your comments to the blog.


  • Catalyst
  • Beyond Homeless