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The Lighthouse®

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Volume 20, Issue 13: March 27, 2018

  1. Student Safety Scholarships: Coming to a School Near You?
  2. The Omnibus Spending Bill Is Ominous
  3. Trump, Tariffs, and China
  4. Blockchains Can Unleash a Voluntary Society
  5. Independent Updates

1) Student Safety Scholarships: Coming to a School Near You?

If the nationwide March for Our Lives events succeed in raising awareness about the threat of gun violence against school children, they just might cause more states to do what Florida Governor Rick Scott did last week: He signed a bill offering students a scholarship for transferring to a safer school.

The Sunshine State’s new Hope Scholarship Program—the first of its kind in the nation—provides funding to students victimized by bullying or harassment to help them transfer to a safer public or private school. Here’s another novelty: The scholarships are funded by car-registration fees—car buyers who elect to have their fee go to the program may claim a dollar-for-dollar credit against their car sales tax.

The appeal of such a program is clear: Parents who transfer their harassed child to a safer school farther away from home face higher transportation costs; in the case of a transfer out of the public-school system, the parents also have new tuition payments. It’s not a sure thing that states will follow Florida’s lead, however. As Independent Institute Research Fellow Vicki Alger notes, 10 years ago California lawmakers considered giving students a path to safer schools, but the California Federation of Teachers successfully opposed it. In today’s climate, though, scholarships for student safety may be much harder to defeat.

Florida Becomes First State to Offer Student Safety Scholarships, by Vicki Alger (The Beacon, 3/21/18)

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

Customized Learning for California: Helping K–12 Students Thrive with Education Savings Accounts, by Vicki Alger


2) The Omnibus Spending Bill Is Ominous

What’s in the new $1.3 trillion omnibus spending bill? Broken promises—big ones. President Trump said he would cap or cut spending of various federal agencies. Under the bill he signed last week, however, some of the nation’s reigning bureaucrats will see their budgets grow, reports Independent Institute Research Fellow Craig Eyermann, creator of the Government Cost Calculator at

The Department of Defense will see a 14.2 percent increase above previously authorized spending levels. Transportation, Housing, and Urban Development will see a 21.9 percent boost. All told, the omnibus spending bill raises defense spending $80 billion and domestic spending $63 billion. You can bet this includes plenty of what Eyermann calls “corporate welfare or bureaucrat employment programs.”

The ominous omnibus spending plan does not include non-discretionary budget items. After adding in Social Security, Medicare, Medicaid, welfare programs, interest on the debt, and a few other odds and ends, “the U.S. government will spend somewhere around $4.2 trillion during its 2018 fiscal year,” Eyermann writes. Despite Trump’s “never again” proclamation during the bill’s signing, the president “has yet to clarify how he intends to live up to that new vow,” Eyermann concludes.

Inside President Trump’s FY 2018 Spending Bill, by Craig Eyermann (MyGovCost News & Blog, 3/26/18)

A Bigger, Badder and Uglier Budget, by Craig Eyermann (MyGovCost News & Blog, 3/22/18)


3) Trump, Tariffs, and China

President Trump’s steel and aluminum tariffs, which went into effect last Friday, will create a net harm to the U.S. economy, even without our trading partners erecting retaliatory trade barriers of their own. As President George W. Bush discovered after he imposed steel tariff hikes in 2002, U.S. manufacturers suffer materially when they face higher costs for imported inputs and that suffering can soon turn into political support for repeal. As Independent Institute Research Fellow Burton A. Abrams writes, “President Trump, instead of picking his own set of favored industries, would do better to set the United States on a course of zero tariffs and no quotas.”

Independent Institute Research Fellow Gary M. Galles, whose op-ed on free trade in The Hill we quoted in The Lighthouse last month, has new words for the Trump tariffs, this time in the Orange Counter Register: “Unfortunately, protectionism is a conspiracy between favored domestic producers and the government to harm domestic consumers (including the many exporters harmed by more costly inputs), and patriotism cannot justify helping American producers harming American consumers.”

President Trump has been especially bellicose on the subject of trade with China. Interestingly, Independent Institute Senior Fellow Ivan Eland suggests that the Middle Kingdom will see its economic engine slow down as Xi Jinping tightens regulations on the economy and rolls back the pro-market reforms of his predecessors. Xi’s recent abolition of term limits—which makes him eligible to become emperor for life—might, however, have a silver lining: His anti-democratic turn might curb popular nationalist sentiments that could otherwise create pressure for Chinese foreign-policy aggression, which invariably undermines free trade. Interesting times, indeed.

Trump’s Tariff Folly, by Burton A. Abrams (InsideSources, 3/21/18)

Trump’s Trade Policies Protect Producers Instead of Consumers, by Gary M. Galles (The Orange County Register, 3/26/18)

Does Xi Jinping’s Power Grab in China Have a Silver Lining for the World?, by Ivan Eland (InsideSources, 3/7/2018)


4) Blockchains Can Unleash a Voluntary Society

Could a new innovation that is making headlines enable people to fund public goods without the heavy hand of the tax man? For advocates of a free society, the answer is very encouraging, according to the authors of an article in the Summer 2018 issue of The Independent Review.

That innovation, according to economists Malavika Nair and Daniel Sutter, is the same digital backbone that supports Bitcoin and similar computer-based currencies. Called a “blockchain,” this distributed database acts like a constantly updated accountant’s ledger, recording every transaction and making this history transparent to anyone in the network.

By facilitating peer-to-peer trust, blockchain innovations offer tremendous potential for voluntary funding of services that overlap those provided by government. Examples of blockchain services now or soon in development include contract enforcement, automated contracts, regulation of corporations, assurance contracts, dispute resolution, and property-title registry. By documenting the actions of elected representatives and bureaucrats, the blockchain might even make it easier discover and penalize politicians who dole out favors to special interests.

The Blockchain and Increasing Cooperative Efficacy, by Malavika Nair and Daniel Sutter (The Independent Review, Spring 2018)

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5) Independent Updates

The Beacon: New Blog Posts

MyGovCost: New Blog Posts


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