The Independent Institute


Mere Optimism Is Not a Good Substitute for Sound Theory and Far-reaching Evidence

thinking_MLAs elderly people get older they tend toward feeble-mindedness. Not in every case, of course, but as a general rule applicable to any given cohort. I am acutely aware of this tendency whenever I express an opinion or explain a conclusion: I may simply be losing my grip. Moreover, older people tend to become stuck in their ways. So they may often fail to see how the world is changing, not to mention why it is changing as it is.

With the foregoing declarations as my preface, you may wish to disregard what I now have to say, which is—if you’ve decided to stick with me—that I find many people’s outlooks, especially my fellow libertarians’ outlooks, touchingly sweet, innocent, and cheerful. Oh, they complain bitterly about all sorts of injustice and destruction, especially the instances perpetrated by the people who fancy themselves fit to rule the rest of us, but nevertheless my fellow libertarians, the younger ones in particular, tend to see the future as turning out much for the better. For them the present is akin to the situation that Wordsworth described more than two centuries ago:

Bliss was it in that dawn to be alive,

But to be young was very heaven!

Clinton Cash Film Premieres

sb6The powerful, new, documentary-film version of Peter Schweizer’s bombshell, New York Times-bestselling book on the massive corruption, cronyism and hypocrisy of Bill and Hillary Clinton and the Clinton Foundation, Clinton Cash: The Untold Story of How and Why Foreign Governments and Businesses Helped Make Bill and Hillary Rich, has premiered on YouTube for selectively timed viewings. According to the film received 500,000 views in the first 48 hours and all on the eve of the Democratic Party’s National Convention in Philadelphia. The film is receiving massive support in social media across the political spectrum, as both conservatives and liberals are recommending it for its bold coverage of the massive self-dealing of the Clintons to enrich themselves by using government power to reward those who “pay to play”: private gain at public expense., whose Executive Chairman Stephen K. Bannon produced the film, modestly notes that:

Clinton Cash exposes the disturbing pattern of record-high speaking fees to Bill Clinton and donations to the Clinton Foundation from foreign contributors, which conspicuously coincided with favors for those closest to the Clintons and their foundation donors while Hillary Clinton served as Secretary of State.

Here is the official trailer, here is the film, and here is the director’s cut of the film that begins with a 14:56 minute discussion with Bannon and Schweizer.

In addition, the Clinton Cash: A Graphic Novel version of the book is scheduled for release on August 8th.

Decisive Brexit Referendum: What Happens Next? Part 4: The EU Enters Its Endgame

40649817 - power struggle between the uk and europe the black map of europe has been deposited with the flags of britain and europe

[See Part 1 here, Part 2 here, and Part 3 here.]

The Brexit vote was never just about whether the Brits would reject rule from Brussels. The real issues were much broader and felt across the whole EU—an arrogant and undemocratic elite, its disastrous economic policies and an increasing gap between haves and have-nots, the first being the cause of the second and the second the cause of the third. To paraphrase what one disillusioned British voter told The Guardian: if you’ve got money, you vote in; if you ain’t got no money, you vote out.

In this context, I would like to quote two poignant open letters from European friends that were sent out just before the UK referendum.

The first is from a group of prominent Greek opinion leaders. Their letter started with the

basic idea, as it was explained to the people in Europe, [which] was [that the EU] was a community of European nations in friendship, solidarity, mutual benefit and democracy: Basic European Values.

It continued:

Unfortunately, these inviting promises proved to be false or failed. There is nothing about freedom, solidarity or friendship in the European Union. The European Union has proven to act on behalf of the interest of banks, multi-national enterprises and groups in the shadow, as advised by professional think-tanks and lobbyists, not in favor of its people. . . . The European Union is designed as a cartel and typically, there is a lack of democratic structures and processes: democracy becomes a disturbing factor.

Big Government, Racial Violence, and the Police

31088896 - close up portrait of hand cuffed black man

In August 1965, the streets of Los Angeles erupted in fire, as black rioters burned hundreds of stores and ill-equipped police withdrew from the violent scene. Initiated by a minor altercation with a police officer, Watts was followed by worse riots, often sparked by encounters with police, turning cities like Detroit into burnt-over districts. The “liberal” solution (more welfare spending) and the “conservative” response (militarization of the police) both went into effect. Yet, here we are in 2016 with violence between police and blacks, as if policymakers have done nothing. In fact, the solutions pursued compounded the problems they meant to solve: government has grown too big to be trusted and it is trusted least of all when young black men encounter police. And, yet, unlimited, untrustworthy government is a problem we all face.

Social welfare programs did not deliver on the promise to end poverty, crime and entrapment in low-income neighborhoods—such measures have instead destroyed black families and urban-based, private enterprises. The expansion of police power did not reduce crime until other policies were changed, including a willingness to prosecute and imprison violent criminals—which benefited African Americans who are by far the major victims by crime. Even so, police relations with blacks remained tense.

Decisive Brexit Referendum: What Happens Next? Part 3: Bust Banks, Banksters, & Bailouts

40649817 - power struggle between the uk and europe the black map of europe has been deposited with the flags of britain and europe

[See Part 1 Here and Part 2 Here]

A lot has happened since my last posting on the June 23rd Brexit vote. A new government in the UK, the petition for a new referendum vote has been exposed as a scam, most markets have stabilized as anticipated and the Labour Party civil war over its leader’s leadership—or lack thereof, depending on your point of view—is deepening.[1]

Yet the interesting developments are overseas. The one that immediately matters is the reaction of European banks’ share prices, which fell sharply.[2] The focus immediately switched to Italy: Italian banks’ share prices had fallen 20 to 25% in just two days. Monte dei Paschi, the world’s oldest bank, and Unicredit, Italy’s biggest bank, looked to be on their last legs, and it was reckoned that Italian banks had more than €360 billion in bad loans, four times what they were in 2008, a quarter of the Italian GDP.[3] Even before the Brexit vote, the Italian government had already proposed yet another taxpayer-financed bailout of its banking system.

Slight problem, and it’s not the one you might first think of. A taxpayer bailout might be viewed as a bad idea? Nope. A taxpayer bailout would overload Italian public finances, which are already in dire straits with a public debt-to-GDP ratio of over 130%, the highest in the EU after Greece? Nope. Not having a taxpayer bailout of the Italian banks would provoke a run on the Italian banking system and possibly a run on the entire European banking system? Nope.

Rulers the People Deserve?

Like proverbial fish,
Fearmongers and warmongers
Stink, many people think
From the head down


But in truth the guts stink first
And the viscera’s putrefaction
Encourages the heads
To rot opportunistically

Black Lives Matter

39151888_MLMy initial reaction to the Black Lives Matter movement, like many old white guys, was that All Lives Matter. But recent events have changed my thinking on this.

My old thinking: Racial discrimination is a reality, but race is just one of many personal characteristics on which people discriminate. Good-looking people tend to be favored over ugly people. Tall people tend to be favored over short people. People with British accents tend to be favored over people with Southern accents.

Everyone should be treated as an individual and not judged based on personal characteristics over which they have no control. That doesn’t always happen, but a free society does not force people to deal with others except on terms that are mutually agreeable. If someone discriminates based on race or any other characteristic, those discriminated against must deal with this as best they can. People can’t be forced to drop their biases.

Medical Marijuana Saves Taxpayers Money

12566026 - cannabis bud sitting on a prescription pad, near a stethoscopeIn a fascinating article in Health Affairs, Ashley Bradford and David Bradford of the University of Georgia have estimated that medical marijuana has benefited taxpayers:

Using data on all prescriptions filled by Medicare Part D enrollees from 2010 to 2013, we found that the use of prescription drugs for which marijuana could serve as a clinical alternative fell significantly, once a medical marijuana law was implemented. National overall reductions in Medicare program and enrollee spending when states implemented medical marijuana laws were estimated to be $165.2 million per year in 2013. The availability of medical marijuana has a significant effect on prescribing patterns and spending in Medicare Part D.

(Ashley C. Bradford and W. David Bradford, “Medical Marijuana Laws Reduce Prescription Medication Use in Medicare Part D,” Health Affairs, 35 (7) July 2016, pp. 1230-1236.)

Let’s not get carried away, here. The Medicare Part D prescription drug program spent $69 billion on benefits in 2013, of which $59 was funded by taxpayers (not premiums). So, medical marijuana is making an insignificant dent in the burden of this entitlement.

Nevertheless, there are some lessons to be learned. Allowing states the freedom to legislate controversial issues like medical marijuana (instead of the federal government overriding states’ general police powers) has benefits. Sure, it allows laws to be made by a government that is closer to its people than Congress is. However, it also allows information to emerge because scholars can observe and assess different outcomes in different legal regimes. Once Congress acts to impose one rule nationwide, no such information can arise from which the people and legislators can learn.

It is also important to recognize that people buy medical marijuana with their own money, not taxpayers’. This research highlights that Medicare Part D entitlement was not necessary for seniors to gain access to medically necessary drugs. Seventy percent of the elderly already had prescription coverage, and $12 of $13 of Part D spending substituted for drug spending that seniors already incurred.

Here’s a question: Some states have saved the federal government money by legalizing medical marijuana. Should those states get some kind of rebate from the federal government for this public service?

Yet Another Socialist Regime Turns Military Despot

Democratic presidential candidate Bernie Sanders speaks at a campaign rally at Ventura College

Democratic presidential candidate Bernie Sanders speaks at a campaign rally at Ventura College

If Bernie actually succeeded in becoming president and implementing his policies, you could expect to see the guy in the foreground, right, to soon be exchanged for a full flack-jacketed army cordon.

After all, that’s what’s happened in every other country that’s followed the socialist path.

As the latest case-in-point, the socialist government of Venezuela earlier this week turned the last remaining sector—food—over to its military. In a televised address Monday evening, Venezuela’s president Nicolás Maduro announced that the armed forces are now in charge of a new food supply system, the “Great Sovereign Supply Mission:”

“All the ministries, all the ministers, all the state institutions are at the service and in absolute subordination [to the head of the armed forces, Defense Minister Vladimir Padrino].”

Generals are already in charge of state companies importing the bulk of Venezuela’s food. They also run the country’s largest bank, a television station, and a state mining company. In addition to the food supply chain, Maduro on Monday also ordered the takeover of the local Kimberly-Clark plant, after the maker of toilet paper and diapers said it had to halt production because of raw-material shortages.

“If all the factories now have to run everything by the military, this isn’t going to make raw materials appear all of the sudden,” said Juan Pablo Olalquiaga, president of Venezuela’s industrial chamber, Conindustria. “The president is showing he does not understand how to manage the economy.”*

Obamacare’s Perverse Job-Creation Program

22854301 - portrait of medical center team, doctors, nurses.The latest jobs report gave the stock market a boost and injected some optimism into public sentiment about our economic prospects. Unfortunately, there’s a problem with the current employment situation that few understand: Obamacare has likely led to too many jobs in health care, drawing labor from more productive functions.

Dan Diamond of Politico reports jobs in health care have grown 23 percent since 2005, while jobs overall have grown only 6 percent. Much of this growth was driven by the collapse of non-health jobs in 2008-2010, while health jobs remained undisturbed. As the economy recovered, Obamacare kept layering jobs onto health care that did not actually improve health care: