Tag: cato institute

The FDA Caused the Opioid Epidemic by Banning Darvocet

Dr. Warren Albrecht | United States

Mark Thornton, of the Mises Institute, points to the Iron Law of Prohibition as a contributor to the opioid problem. Any prohibition will cause a switch from lower potency of drugs to higher potency. Examples are states with cannabis legalization who have fewer overdoses. But what if a good, middle of the road potent drug was removed from the options leaving the only low strength and high strength medication? When the FDA removed Propoxyphene (Pp), most commonly known as Darvon or Darvocet from, the market, they caused the opioid epidemic in 2010. A snowball effect began.

Continue reading “The FDA Caused the Opioid Epidemic by Banning Darvocet”

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This Blockchain Project Could Save Venezuela

James Sweet III | United States

Venezuela’s currency, the Bolivar, is worthless due to hyperinflation that shows no sign of stopping. Venezuelan citizens are starving, forcing them to resort to rationing the little bit of food they have and stealing food that they can find. The crisis is constantly evolving due to the failed policies of the Maduro regime, but with the help of the blockchain, the situation could become stabilized, saving the families of the nation.

AirdropVenezuela wants to help the impoverished families of Venezuela by donating $10 to 100,000 Venezuelan households, which can be achieved by raising $1 million via cryptocurrency donations. The money, once received, will be converted into the local currency, allowing the families to purchase supplies that they desperately need. The leader of AirdropVenezuela is Steve H. Hanke, a professor at John Hopkins University. Hanke is also a Senior Fellow at the Cato Institute, serving as Director of the Troubled Currencies Project. The project is based on the Airtm platform, which allows you to save your local currency’s value by pinning it to a more stable currency, specifically the United States Dollar.

The civil unrest in the nation makes it dangerous to leave your house, which is another reason why Hanke is leading the AirdropVenezuela project. “We provide in effect a clearinghouse that allows for the exchange of bolivars for dollars and vice versa,” said Hanke to Forbes.  By allowing money to be stored and transferred via the blockchain and the cloud, the time that Venezuelans spend in public is minimized, allowing them to live a safer life while also getting the resources that they need to provide for their families.

The project, while mainly benefitting the families of Venezuela, could help boost the cryptocurrency market. Instead of being risky investments, cryptocurrencies will become a medium of exchange pinned to more stable currencies. Airtm, if successful, will revolutionize the use of blockchain technology by allowing it to have a more practical use. “You could now have the additional demand for cryptos for use as a medium of exchange versus what you have now which is only the speculative demand,” says Hanke.

The Airtm platform will also show the possibility of putting into place a free market exchange rate. Venezuela has a fixed exchange rate, making it hard to exchange Bolivars in the market. If you want to donate to or learn more about the AirdropVenezuela project, you can click here to visit their website.


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Envy is Evil, not the Desire for Wealth

Thomas Calabro | United States

The desire for money is often viewed with disdain by those who believe in a more altruistic approach. They believe themselves to be noble in their morals, and while that may be so, they usually believe in using more government controls to enforce their altruism. They intend to enforce desired actions to reach certain end goals, either with tighter controls of small fines, regulations on how something is made, or with the complete seizure of the means of production. These end goals usually look to end or reduce inequality of income and distribution of resources, and their morals are seen as enough reason for action.

When talking about capitalism, one must see how greediness for money energizes most of the system in an efficient way. The greedy strive for profits push businesses to create and distribute products where it is demanded by their customers. While there are some organizations whose main goals are to give back rather than making money, the desire for wealth ultimately allows scarce resources to be allocated appropriately with very little to no waste. This approach, while rooted in individual self-interest proves far better at not only distributing the resources where necessary but helps create jobs, raise wages and increase the standard of living.

But why is such a system of economic freedom and prosperity, as well as it’s drive to make profits seen as horrific to one group, but not the other? Perhaps it is that many libertarians, anarcho-capitalists, and objectivists do not see the desire for money as the issue. Rather they see the desire for someone else’s earnings as the true face of evil: envy.

Before we begin talking about envy, we must first define what envy is, as well as any misconceptions that may create confusion. Envy can be defined as the “painful or resentful awareness of an advantage enjoyed by another joined with a desire to possess the same advantage. However, many in the libertarian camp see this approach as an issue when the government is used as a force to obtain the fruits of other’s labor.

One could make the argument that envy is what drives entrepreneurs to maximize profits in a free market system, those who use voluntary exchange are not only supplying market demand but also working hard to create wealth.

While we may consider ourselves in a free market where hard work can create profits, we have many controls in our government that stifle economic growth for many people. The most prevalent of which is the war on drugs, which perpetuates a cycle of poverty towards the victims of those policies of mass incarceration. Any government controls that prevent profitable innovations should be removed.

A paper from the Cato Institute’s Brink Lindsey recognizes 4 areas of interest: copyright and patents, occupational licensing, land use restrictions, and restrictions on immigration, as being subjected to “regressive regulations” and government controls that hinder income equality, as well as the free market. These deregulations can help the US to continue to be a melting pot of ideas and innovations that create jobs, raise wages, increase the standard of living, but also reduce inequality and combat the envious urges to take from hard-working Americans.


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New Studies Find Few Costs, Many Benefits to Carbon Tax

By Max Bibeau | United States

In the aftermath of an outpouring of scientific research in recent years warning against the negative environmental impacts of carbon dioxide on the environment, legislators and institutions alike have proposed countless ways to reduce emissions. While many exist, one is a clear frontrunner for many: the carbon tax.

The idea is simple – tax the emissions of carbon at a set rate per ton. Theoretically, this monetary incentive should cause companies and individuals to avoid causing high levels of emissions. They could either streamline and modernize factories or by driving more fuel-efficient cars. However, many criticize the economic impacts of such a plan. The libertarian Cato Institute, for example, believes it would discourage economic growth.

The Carbon Tax Studies

In July of this year, a series of new studies came out that should suppress such concerns. The studies make up the Carbon Tax Research Initiative, which began in early 2018. The initiative is spearheaded by four different, independent think tanks (The Center on Global Energy Policy at Columbia University, The Rhodium Group, The Urban-Brookings Tax Policy Center, and The Baker Institute for Public Policy at Rice University). All of these groups are nationally renowned for their nonpartisan research and analysis.

The studies, made public on July 17th, came to similar conclusions – a carbon tax would have negligible negative economic costs, yet a plethora of positive environmental and economic benefits.

The studies analyzed three levels of taxation in order to analyze all possible policy options. The studies all simulated a low level of $14/ton, a medium level of $50/ton, and a high level of $73/ton.

Increased Revenue

The first area to examine is government revenue that the tax itself will generate. On the low level of taxation ($14/ton), government revenue was not outstanding, but was far from meager, raising an estimated $650 – $750 billion over a 10 year period. The high level of taxation ($73/ton), however, could raise enough revenue to completely change the US budget, raising between $1.5 – $3 trillion over a 10 year period. This government revenue could be critical to solving the ever-growing budget problem in the United States, providing a new and reliable stream of revenue when the state most desperately needs it.

Lowered Carbon Emission

When it comes to reducing emissions, the carbon tax also performed extremely well, lowering them across the charts. The low level of taxation reduced emissions by around 27% by 2030, coming close to, but not quite reaching the goals set by the Paris Climate Accord (28% reduction in emissions). The medium level surprisingly performed the best of all three levels, decreasing emissions by up to 46% by 2030, reaching and surpassing the Paris Accord’s goal. The high level of taxation reached a plateau in the late 2020s, reducing emissions by a still impressive 41%.

Economic Impact

As for economic criticisms, the series of studies found that most, if not all claims about a hurting economy would not occur. Almost all emissions reduction (over 80%) would take place in the power sector of the economy. The tax would have an extremely minimal impact on gas prices, increasing the price of gas by around 1¢ /gallon, per dollar added to the tax. This impact would be only temporary, however, and would actually serve as a beneficial incentive to push individuals towards electric cars.

The only market severely affected is the coal market, which would fall between 28% and 84%, depending on the rate of taxation. However, this makes sense, as there are many alternatives to coal that are already in use today. The tax would simply expedite their use. Other industries, such as oil and natural gas, would not see much of a dip at all, especially as petroleum will likely still be the primary fuel for transportation in 2030.

In stark contrast to the claims of an economic downturn, some of the studies even found potential economic benefit from the carbon tax. In the early years of the tax, GDP growth would likely stagger. However, later on, GDP is expected to increase up to 0.5% as the new revenue from the carbon tax is able to lower other taxes, such as the corporate income tax, and reduce the national deficit.

A Beneficial Policy in Nearly Every Way

While definitive research surrounding the impacts of a carbon tax on the United States were previously in short supply, the information that the groups provide paints a clear picture of the US under the policy. Government revenue could see a critical new source, bringing in up to $3 trillion in only 10 years under the tax. Also, depending on the rate of taxation, emissions could be reduced by up to 46%, far surpassing the goals of the Paris Climate Accord. Finally, the economic impacts of the carbon tax could be, contrary to popular belief, extremely beneficial, raising the GDP of the US in the long run.

Read the full studies here:

General Page

The Rhodium Group

The Urban-Brookings Tax Policy Center

The Baker Institute for Public Policy

The Center on Global Energy Policy


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The Koch Brothers and Libertarianism

By Kenneth Casey | United States

The Koch Brothers have found themselves in the news again recently, this time by once again distancing themselves from one of the biggest policies that have defined the Trump Presidency: his support for protectionism through tariffs. The Koch brothers differ from Trump on this issue because they believe in the elimination of tariffs. President Trump sees tariffs as a necessity to compete with strength in the global economy. Due to this difference and their belief that the party has drifted more towards economic nationalism and right-populism in the age of Trump, they have threatened to not support Republican federal candidates who agree with the President on the issue of trade.

Many in the media have pointed to this conflict as one of the many examples of disillusionment between Trump Republicans and ‘libertarian’ Republicans. The Koch brothers are widely regarded as two of the biggest and most influential small-l libertarians in the country. Why are the Koch brothers so widely regarded as libertarian and do all of their political activities and money spent towards specific issues align with their libertarian beliefs? 

One of the things the Koch brothers do that earns them the approval of libertarians is their involvement with the Cato Institute, the biggest libertarian think tank in the United States and arguably the second largest right-wing think tank in the country. Charles Koch was among one of the founding members of the institute, along with libertarian activist Ed Crane and the founder of the anarcho-capitalist school of thought Murray Rothbard. There’s no denying that the Cato Institute, since its founding, has done inspired work in making the case for limited government, individual liberty and non-interventionism through policy studies and libertarianism in the United States through intellect and reason. Through the institute, The Kochs have pushed for many libertarian policies such as lower taxes, privatization of government services, civil liberties, gay marriage/marriage privatization, criminal justice reform, marijuana legalization, and much more.

Additionally, David Koch founded Citizens for a Sound Economy, which has since split into two organizations: FreedomWorks and Americans for Prosperity. FreedomWorks is a conservative and libertarian advocacy group that supports like-minded candidates for office and produces a scorecard which grades Congressmen on how often they vote in line with the libertarian principles FreedomWorks embodies. Americans for Prosperity serves much of the same purpose as FreedomWorks – electing like-minded liberty-friendly candidates – but is under different leadership.

Furthermore, they’ve also voiced their opinions and spent money towards fighting legislation like the Patriot Act, in which they gave an amount of money Reason Magazine declared to be around $20 million to the ACLU to promote opposition to the Patriot Act and government surveillance in general (to be completely fair, in an update to the article, Reason announced they were unable to confirm the amount the Koch Brothers gave to the ACLU, or that it existed). They were also one of the biggest vocal opponents of the Affordable Care Act and promoted a free-market approach to health care, in which they used their funds towards Americans for Prosperity to run anti-Obamacare ads worth around $3 million.

Based all of this, I’d say it’s fair to come to the conclusion that their political activities within their supported organizations have done much good for the cause of liberty and limited government, and it’s great that libertarianism has such powerful allies in that sense.

But what about the thing you hear in regards to the Koch brothers the most – their involvement in elections and their support of a plethora of Republican candidates? Based off everything else I’ve written so far, you might assume that the Kochs have a strict qualification for candidates and only support those who consistently align with their views of limited government and philosophical libertarianism, but that’s not always (and not usually) the case.

Most the money the Kochs spend in elections goes towards supporting establishment-friendly mainstream Republicans. According to the website OpenSecrets, the top 10 candidates for election in 2018 that have received the most money from the Koch Brothers are Marsha Blackburn, Orrin Hatch, Lee Zeldin, Ron Estes, Karen Handel, Patrick Morrisey, John Barrasso, Ralph Norman, Claudia Tenney, and Mimi Walters. All of these ten candidates, besides perhaps Morrisey, are establishment-backed Republicans who are nowhere close to representing the libertarian values the Koch Brothers hold dear.

To their credit, I have to note that the Kochs do also support and have donated to the very few libertarians in Congress like Rand Paul, Justin Amash, and Thomas Massie, but there’s no doubt the money they’ve given to establishment big government Republicans outnumbers the money they’ve given to true small-l libertarians. Even when America had the chance to elect Rand Paul, who no doubt represented libertarian the best in the Republican primaries, they decided not to get involved whilst stating they had a favorable view of Rand as well as Ted Cruz and establishment favorites Jeb Bush, Marco Rubio, and Scott Walker (whom many speculated was their preferred candidate, even over Rand).

One thing is clear from all this: they’re not interested in electing liberty candidates, they’re just interested in electing Republicans. They support Republican leaders such as Paul Ryan and Mitch McConnell many of whom are to blame for the scope of government still getting bigger even under a Republican president and a Republican majority in Congress.

The issue I find with this is that if we keep electing the type of Republicans the Koch brothers have shown the most support to, how will we ever get the country to become more libertarian as the Kochs apparently obviously desire? They’re supporting the same wing of the Republican Party that have advanced authoritarian big government policies such as unnecessary wars overseas, the Patriot Act, big spending bills, and the war on drugs. It is a fair argument that voting isn’t the best ways to change society’s outlook on government and certain issues, but in my opinion, to not focus on elections is wasting an opportunity to see liberty in our lifetime.

If we look at legislation that’s in favor of big government, some Koch-backed candidates have often sided with raising the scope of government instead of the positions the Koch Brothers take on limited government. 3 of the Republicans who voted against the partial repeal of the Affordable Care Act in 2017 which the Koch Brothers enthusiastically supported, have received funding from the Koch Brothers in the past: Dean Heller, Shelley Moore Capito, and Rob Portman.

Another piece of legislation that raises the scope of government that has been enacted under the Trump administration was the $1.3 trillion omnibus spending bill passed with some Koch funded candidates backing it in the Senate such as Majority Leader Mitch McConnell, Orrin Hatch, Marco Rubio, Rob Portman, Tim Scott, among many others (you can see how everyone in the Senate voted on it here). Instead of putting their efforts towards recruiting candidates who actually align with libertarian values and want to shrink government and end the wars, they’ve spent money on candidates like those I mentioned who want bigger government almost as much as the Democrats do.

The Koch brothers have done a lot of good for libertarianism by funding institutes and organizations that promote the idea of liberty. Rand Paul declared “The Koch brothers’ investment in freedom-loving think tanks will carry on for generations”, this is true and while libertarians should be grateful for their contributions in that regard, their involvement in the American election process and candidates they’ve thrown their support behind could be so much better for the cause of liberty, but we’ll see what’s more effective long-term in making our country freer.


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