is that CATO appears more willing to stand by the less palatable political consequences of their policy proposals.

This is very basic, but in this case, they for instance acknowledge that the goal of liberalisation is not lower prices, as has been said by so many politicians trying to sell these reforms. (They don't go all the way to stating explicitly that full market prices for electricity means denying electricity to some based on purchasing capacity - i.e. the poor; but maybe that's obvious to them.)

Your wider point is noted and worth repeating.

In the long run, we're all dead. John Maynard Keynes

The fact that Rothbard was an important figure is, indeed, a red flag to me, as Rothbard was both economically incompetent and psychologically out-to-lunch.

George Mason University, however, enjoys one of the few largely-libertarian economics departments that I've actually found to be decent.  I'm a big fan of Tyler Cowen, who, unlike most libertarian economists, is quite modest and fair-minded, in my experience -- taking issues like Keynesian/Monetarist intervention, for example.  Alex Tabarrok, Cowen's partner-in-crime over at Marginal Revolution, isn't bad either.  (I should note, in the interest of full disclosure, that my uncle wrote the foreword to Tabarrok's book.  They're friends, so I'm biased on your-friends-are-my-friends grounds here, although I do genuinely enjoy Tabarrok's blogging.)  I'd submit, though, that Mason is a fairly open-minded school.  If I had kids, I wouldn't get my knickers in a twist over their attending it.

The big-dog professors at Mason don't tend publish on the big topics (business cycles and the related macroeconomic issues), though, so they tend to serve me more as entertainment than education.

The Auburn University crowd is the one to keep an eye on, even though the Mises Institute has technically been purged as an official arm of the school.  They're simply insane (racist, xenophobic, incapable of divorcing themselves from the thoroughly-discredited theories of the 1910s), as I can say after dealing with some of their disciples at Florida State.

Not everyone at Cato is a true believer, so far as I can tell, and I've been reading Cato publications (along with Brookings, going back to my undergraduate public policy classes) for the better part of the last five years.  Their Social Security scheme was a joke, but mainly because of the outright lies about the state of the current system.  The actual policy was, in my opinion, mediocre, but it would've deserved to die even if it were spectacular because of the fact that they attempted to sell it with obvious falsehoods.

(That is, for the record, the main reason for why I'm not all about John Edwards's candidacy, like some here.  I can take a certain amount of lying and arrogance from politicians, but Edwards's refusal to speak to how he plans to pay for all of his proposals is incredibly offensive to me, bordering on Bush-caliber horseshit.  He could accomplish all of those things, and without a lot of pain, but he needs to tell people the truth.)

I disagree about funding sources automatically discrediting people.  Policies should be examined for what they are.  Funding sources should simply provide for a greater degree of skepticism, where appropriate.  If that's the bar each of our interest groups have to clear, everything is going to be discredited, because we're going to find that dirty money influences just about everything in the policymaking sector.  It's always been that way, and it will, unfortunately, always be that way.

All that said, I think Brookings and the NBER are the only two think-tanks worth reading, so long as one avoids those two clowns who work on Iraq at the former.

Be nice to America. Or we'll bring democracy to your country.