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The Lighthouse®

The Lighthouse® is the weekly email newsletter of the Independent Institute.
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Volume 14, Issue 28: July 10, 2012

  1. Health Contract with America
  2. Holding Attorneys General in Contempt
  3. Will Mexico Abandon the Drug War?
  4. Bullying in Academia
  5. New Blog Posts

1) Health Contract with America

Last week’s Lighthouse reported about a proposal to make tax fairness—the idea that health insurance purchased in the private market should receive the same tax credits as insurance obtained through an employer—a component of legislation aimed at replacing the Affordable Care Act. Independent Institute Research Fellow John C. Goodman includes four additional pillars in the new Health Contract with America. Let’s briefly explain two of them: portability and real insurance.

Workers want and need portable insurance that would follow them from job to job and while out of the labor market. But misguided federal laws prevent almost every state in the union from allowing employers to help their workers obtain portable insurance. Scrapping those laws should be a high priority for reformers in Congress. “If health insurance were portable the problem of pre-existing conditions would rarely arise,” Goodman writes.

Most of the remaining problems with pre-existing conditions could be solved with one simple innovation: health-status insurance. How would that work? “If you acquire a pre-existing condition and if you are forced to switch health plans, the current plan would pay the new plan any additional premium that is needed to reflect your higher health care cost,” Goodman continues. Health-status insurance would make healthcare coverage operate like real insurance rather than merely like pre-paid healthcare. In addition to health-status insurance, portability, and tax fairness, Goodman’s Health Contract with America calls for greater patient control of healthcare spending (via very flexible Health Savings Accounts) and local safety net institutions for the uninsured—funded by unused tax credits and the redirection of existing government spending on healthcare.

A Health Care Contract with America, by John C. Goodman and Peter J. Ferrara (7/7/12)

Health Contract with America, by John C. Goodman (Townhall, 7/7/12)

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)


2) Holding Attorneys General in Contempt

Fallout from “Fast and Furious”—the federal effort to track the flow of firearms from the United States to the Mexican drug cartels—has exposed hypocrisy in Congress. Accused of lying about his knowledge of the bungled program, Eric Holder is the first sitting U.S. attorney general to be held in criminal contempt by the House of Representatives, even though many of his predecessors—Alberto Gonzales, Janet Reno, Edwin Meese, John Mitchell, Robert F. Kennedy, and others—behaved badly while acting as the nation’s top law-enforcement official, according to Anthony Gregory, research editor at the Independent Institute, in his latest piece at the Huffington Post.

As head of the Justice Department under George W. Bush, Gonzales faced accusations of lying to Congress regarding warrantless wiretapping; he also politicized the staffing of the U.S. Attorney’s Office. Janet Reno—Bill Clinton’s Attorney General—flatly denied that the FBI used incendiary devices that might have caused the firestorm that ended the standoff at Waco, although an FBI spokesman later contradicted her; she also helped Clinton craft his claims of executive privilege. And Edwin Meese—Ronald Reagan’s AG—resigned under clouds of suspicion during the Wedtech military contracting scandal.

“Liberals are right to criticize Republicans for politicizing [the investigation of Fast and Furious],” Gregory writes. “Conservatives are right that Democrats would have been outraged and called for Gonzales’ or Ashcroft’s head if either had been implicated in Fast and Furious. It is unfortunate that each party can conduct major malfeasance and get away with it by pointing out that the other party behaved just as badly.”

Holding Attorneys General in Contempt, by Anthony Gregory (The Huffington Post, 7/5/12)


3) Will Mexico Abandon the Drug War?

Although the jury is still out, the election of Enrique Peña Nieto to the Mexican presidency may signal a new beginning. More than 50,000 civilians have been killed in recent years by drug violence, and the mayhem helps explain why voters were willing to bring back rule by PRI—the Institutional Revolutionary Party—after a twelve-year hiatus. Some in Washington fear that Peña Nieto will undermine the U.S.-supported drug war by making a secret and unofficial truce with the drug cartels—just as PRI had done during its earlier reign, but such a move would be preferable to the deadly status quo of the drug war, according to Independent Institute Senior Fellow Ivan Eland.

“In short, corruption is better than slaughter,” Eland writes. In fact, this was the strategy the U.S. military pursued in Iraq, when it paid the Sunni Awakening guerillas to redirect their wrath away from coalition targets in favor of al-Qaeda in Iraq. Violence fell, and the United States was able to move forward with an exit strategy.

Mexicans would be happy to see the new government pursue a similar policy, but don’t count on Washington to offer moral support. “If Peña Nieto pursues this course,” Eland continues, “the U.S. government will likely unfairly and hypocritically criticize him for doing so.”

The Drug War in Mexico: Corruption Is Better than Slaughter, by Ivan Eland (7/2/12)

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


4) Bullying in Academia

Although the quality of K-12 schooling in the United States suffers poorly compared to education in other developed nations, many of the world’s best universities call the U.S. home. One reason is that the faculty in America are more autonomous than counterparts in Europe, who increasingly labor under the yoke of educational central planners and an authoritarian mindset. Philosopher Aviezer Tucker puts forth this provocative thesis in his article, “Bully U: Central Planning and Higher Education,” published in the summer issue of The Independent Review. Reports of pending legal action against Tucker by the university where he used to work help support his claim.

“Almost every issue of the U.K. trade weekly Times Higher Education recounts conflicts between managers who cannot tolerate criticism and demand obedience and members of the faculty who are used to a culture of open critical discussion,” Tucker writes. “The worst bullying university, with 17 percent of staff reporting being always or often bullied, was the University of East London. The worst member of the Russell Group of 20 self-selected top research universities in the United Kingdom was Queens University Belfast, with 12 percent of staff reporting constant or frequent bullying.”

Queens University Belfast—which used to employ Tucker—reportedly is considering legal action against Tucker, according to the British newspaper The Independent (no relation to the Independent Institute). If so, this would be consistent with Tucker’s claim that the university employs heavy-handed tactics against independent-minded faculty. “I witnessed and was told by my students how managers used disaffected students as agent provocateurs: because managers had access to the university’s electronic databases, they could find out which students were at the bottom,” Tucker continues. “When they targeted a professor, they summoned these students directly or used an intermediary, such as a favored student, to connect with one or more of these students and to suggest that if the students lodged complaints against their professor, the managers would have grounds to revise their grades upward.”

Bully U: Central Planning and Higher Education, by Aviezer Tucker (The Independent Review, Summer 2012)

The Independent Review (Summer 2012)

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5) New Blog Posts

From The Beacon:

From MyGovCost News & Blog:

83% of Doctors May Quit Over ObamaCare
David Theroux (7/9/12)

A Lack of Follow Through
Craig Eyermann (7/9/12)

A Tax or a Penalty?
Craig Eyermann (7/5/12)

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


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