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The Lighthouse®

The Lighthouse® is the weekly email newsletter of the Independent Institute.
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Volume 19, Issue 20: May 16, 2017

  1. Getting Schooled on Choice
  2. Business as Usual at the Federal Trade Commission
  3. Venezuela’s Predictable Chaos
  4. Is Global Warming Data Reliable?
  5. Independent Updates

1) Getting Schooled on Choice

Opponents of school choice typically complain that publicly funded vouchers exact a heavy toll for public schools that would lose students to private schools. Arizonans may disagree. As Independent Institute Research Fellow Vicki E. Alger explains in a new op-ed, the Grand Canyon State has just enacted educational savings account (ESA) legislation that will give parents about $5,600 to spend on educational resources for their child—the equivalent of 90 percent of the cost for a child in the public schools. This means that the remaining 10 percent could be spent on the public schools. Moreover, it's estimated that Arizona’s ESA program will actually save the state about $3 million after its four-year phase-in period. Yet school-choice opponents are unmoved.

This is because the opposition to school choice was never really about money, according to Alger, author of Failure: The Federal Misedukation of America’s Children. It was about “who has the right and responsibility for the education and upbringing of children,” she writes. In other words, it amounts to a showdown between government bureaucrats (and their supporters) and the parents.

Under Arizona’s ESA program, parents will be permitted to exercise more choice than in any other school-choice program, allowing them to customize their child’s education by spending the funds on private school tuition, home-schooling resources, tutors, online classes, and more, subject only to expense reporting and auditing to ensure that the money is spent only on education. “This is a far cry from the one-size-fits-all vision animating the Department of Education,” Alger writes.

The Real Educational Choice Debate, by Vicki E. Alger (, 5/3/17)

Failure: The Federal Misedukation of America’s Children, by Vicki E. Alger

Returning Education to the Schools and Parents, by Vicki E. Alger (Independent Institute Executive Summary, 4/25/17)

Video: Parental Choice in Education, by Vicki E. Alger (11/8/17)


2) Business as Usual at the Federal Trade Commission

A free-market economy has no place for a Federal Trade Commission (FTC) to promote competition: Such an economy is “regulated” only by market discipline—in the form of rivalry for consumer dollars and private investment, threats of private lawsuits and hostile takeovers, and shareholder activism. But what should be done with such an agency in a mixed economy, when there is no short-term possibility of dismantling it? The answer may be trickier than you think, as a new op-ed by Independent Institute Research Fellow William F. Shughart II suggests.

The policies and enforcement actions of the FTC are famously vulnerable to “capture”—meaning that they fall prey to the machinations of regulated industries and the companies with the most pull. Casual observers aware of this problem might therefore have little concern for the three vacancies at the top of the agency’s five-person commission today under the Trump administration. This ambivalence is short-sighted.

In reality, an FTC with only two commissioners is a prisoner of the status quo: It can’t roll back what Shughart calls “President Obama’s anti-business legacy.” It can’t expedite proposed corporate mergers stuck in antitrust limbo. “No matter what you think about its performance, nowadays or in the past, it cannot do much of anything until its three vacant seats are filled,” Shughart concludes.

Gridlock at the FTC Prolongs Washington’s Regulatory Status Quo, by William F. Shughart II (Real Clear Markets, 5/11/17)

Antitrust, Regulation and the ‘Chicago School’, by William F. Shughart II (, 2/15/17)

Taxing Choice: The Predatory Politics of Fiscal Discrimination, edited by William F. Shughart II

Antitrust and Monopoly: Anatomy of a Policy Failure, by Dominick T. Armentano


3) Venezuela’s Predictable Chaos

Venezuela is in turmoil—economic production has plunged, price inflation has soared, consumer goods are in short supply, protestors have taken to the streets, and the government of Nicholas Maduro has cracked down hard. It’s a dramatic reversal from the glory days of his predecessor and mentor, socialist icon Hugo Chavez, when a commodities boom enabled the leftwing government to nationalize businesses, heap generous benefits on various interest groups, and impose price controls with little opposition, as Independent Institute Research Fellow Robert P. Murphy explains in a recent op-ed for American Thinker.

The basic pattern—redistributionism and intense regulation followed by economic chaos and civil strife—was explained decades ago by Austrian school economist Ludwig von Mises (1881-1973), in books such as Socialism and Human Action. Yet famous American politicians and economists, including Sen. Bernie Sanders and Nobel Prize economist Joseph Stiglitz, never got the message: They gave the Chavez regime their blessings and wished that more countries would follow in its steps.

“The worst part of Venezuela’s tragedy is that it was so obviously predictable. Economists familiar with the work of Ludwig von Mises understood the necessary results of socialist policies,” Murphy writes. “A sound money and freely floating prices provide a society with functioning markets that deliver the goods to the people. The market economy is true populism.”

The Venezuelan Crisis Is Due to Economic Ignorance, by Robert P. Murphy (American Thinker, 5/6/17)

Choice: Cooperation, Enterprise, and Human Action, by Robert P. Murphy

Video: Why Does Freedom Work?, by Robert P. Murphy (4/5/17)


4) Is Global Warming Data Reliable?

For pundits and the press, it’s a given that increases in greenhouse gas emissions have caused an observed increase in global temperatures since the early twentieth century. There are, however, several premises underneath that assumption that don’t hold up to scrutiny, according to Independent Institute Research Fellow S. Fred Singer, in a recent op-ed for American Thinker. One goes to the reliability of the data.

Not all data sets are created equal. The apparent warming interval of 1910 to 1942 is based on proxy data from many sources (tree rings, ice cores, etc.) that are consistent with one another, whereas the apparent warming interval of 1977 to 2000 comes from data sources (weather stations, sea temperatures, nighttime marine air-temperatures, microwave sounding units, etc.) that are often inconsistent with one another, according to Singer. The “warming” believed to have occurred during this second interval is therefore likely an erroneous by-product of the data-gathering process.

Consider temperature-gathering at airports. The number of weather stations at airports fell significantly from 1970 to 1995, but the number of weather stations overall fell by even more. As a result, the relative weight of data gathered at airports rose significantly, from 35 percent to 80 percent of all weather stations. During this period, air traffic increased “about 5 percent per year worldwide,” Singer writes. Consequently, the “observed” trend of warming from 1977 to 2000 isn’t terribly well supported. “Obviously, if there is no warming trend, these demonstrations [cited by the Intergovernmental Panel on Climate Change] fail—and so do their proofs for AGW [anthropogenic global warming],” Singer concludes.

A Global Warming Surprise, by S. Fred Singer (American Thinker, 5/11/17)

Hot Talk, Cold Science: Global Warming’s Unfinished Business, by S. Fred Singer

Video: Global Warming: Science Fact or Fiction?, by S. Fred Singer (1/23/15)


5) Independent Updates
The Beacon: New Blog Posts
MyGovCost: New Blog Posts
Featured Video
News Alert


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