… is from pages 1-2 of Christopher Achen’s and Larry Bartels’s important 2016 Princeton University Press book, Democracy for Realists (footnote deleted):

In Abraham Lincoln’s stirring words from the Gettysburg Address, democratic government is “of the people, by the people, and for the people.” That way of thinking about democracy has passed into everyday wisdom, not just in the United States but in a great many other countries around the globe. It constitutes a kind of “folk theory” of democracy, a set of accessible, appealing ideas assuring people that they live under an ethically defensible form of government that has their interests at heart.

Unfortunately, while the folk theory of democracy has flourished as an ideal, its credibility has been severely undercut by a growing body of scientific evidence presenting a different and considerably darker view of democratic politics.  That evidence demonstrates that the great majority of citizens pay little attention to politics.  At election time, they are swayed by how they feel about “the nature of the times,” especially the current state of the economy, and by political loyalties acquired early in childhood.  Those loyalties, not the facts of political life and government policy, are the primary drivers of political behavior.  Election outcomes turn out to be largely random events from the viewpoint of contemporary democratic theory.  That is, elections are well determined by political forces, but those forces are not the ones that current theories of democracy believe should determine how elections come out.

DBx: Achen and Bartels (much like the pages of my colleague Bryan Caplan’s 2007 volume) report on a vast ocean of scientific studies the results of which are impossible to square with the popular belief that the winning majority of voters in any election are thoughtful about what they do as voters.  Not only are most voters in any country prone to support policies that are not in the best general interest of the people of that country, most voters are often prone to support policies that aren’t even in these voters’ own best interests (especially if those interests are reckoned over the long-run).

Critics of public choice such as Nancy MacLean – apparently unable to digest research of the sort that is reported in Achen’s and Bartels’s book – cling, like unimaginative schoolchildren who excel at memorizing passages from grade-school textbooks, to the popular notion of vox populi, vox dei.  And when such critics encounter sober theory and research that cast doubt on popular accounts of the workings of majoritarian democracy, they accuse those researchers of being enemies of the People and stooges of oligarchs.  ‘If you say that majoritarian democracy is flawed – if you seek to cause me to doubt what I learned in fourth grade about the splendors and perfections of democracy – then you are a bad, bad, bad person!’ – that seems to be the intellectual reaction to the work of public-choice scholars and others who examine collective decision-making realistically rather than romantically.

An irony today is that of all the famous scholars who have toiled to examine collective decision-making realistically rather than romantically, James Buchanan is among those who clung to as much romance about democracy as any realistic person possibly could.  Buchanan struggled (I think with little success, but nevertheless brilliantly) to describe feasible political institutions that gave to as many people as possible as much voice as possible in political affairs.  If you rank, from most optimistic to least optimistic, all of the serious scholars who have worked in public choice, broadly conceived, according to their expressed beliefs that democratic decision-making is a foundational value of western civilization and one that can be made to work well if we get the right kinds of constitutional rules, Buchanan would be among the most optimistic.

I myself believe that Buchanan was too optimistic about the possibility of devising actual, real-world constitutional rules to make democracy work well.  I believe that Buchanan’s cherished social-contract theory is deeply flawed.  I believe that Buchanan had too much confidence in even the best possible real-world state.  Yet I believe – I know in my marrow – that Buchanan was among history’s greatest economists and social philosophers.  He thought deeply and creatively about political arrangements and social institutions.  He hated the fact that, in reality, some people “play god” (as he often put it) with the lives of other people.  And he hated this reality regardless of the identities and wealth of those who are playing god and those who are played with by those who are playing god.

So not only has Nancy MacLean revealed herself to be shockingly uninformed about the current state of scholarship and research into democratic decision-making, she has, in her book Democracy in Chains, utterly misunderstood – and, hence, falsely portrayed in a narrative with all the sophistication of a Saturday-morning cartoon – one of the most illustrious political economists of all time.  She should be ashamed of herself.  And so, too, should any who fall for her cartoon-tale be ashamed.

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… is from chapter 12 of John Stuart Mill’s 1861 Considerations on Representative Government:

[T]he very principle of constitutional government requires it to be assumed, that political power will be abused to promote the particular purposes of the holder; not because it always is so, but because such is the natural tendency of things, to guard against which is the especial use of free institutions.  However wrong, therefore, or however foolish, we may think it in the electors to convert their representative into a delegate, that stretch of the electoral privilege being a natural and not improbable one, the same precautions ought to be taken as if it were certain.  We may hope that the electors will not act on this notion of the use of the suffrage; but a representative government needs to be so framed that even if they do, they shall not be able to effect what ought not to be in the power of any body of persons – class legislation for their own benefit.

DBx: John Stuart Mill (1806-1873) must have been the stooge of some mid-19th-century oligarch!  What more evidence for this conclusion is necessary beyond this quotation?  After all, in this quotation Mill calls for constitutional limitations on what democratic majorities may do.

The quality of the inferences strewn throughout Nancy MacLean’s Democracy in Chains are in most cases no less foolish and fabricated than is the quality of the inference that, because J.S. Mill opposed unlimited majoritarianism, he too – as MacLean hallucinates James Buchanan was – a lackey for evil oligarchs intent on crushing the masses beneath the solid-diamond heels of the oligarchs’ boots.

The plain meaning of Mill’s words, and the plain meaning of Buchanan’s words, make clear that both scholars called for constitutional constraints on majoritarianism to reduce to a minimum the likelihood that government power will be abused to create private benefits at the public expense – expense both in terms of money and, worse, diminished liberties.  The fact that Nancy MacLean and her “Progressive” fans see in this call for constitutional restraints only an obstacle to the efforts of the masses to secure what is rightfully theirs reveals both the extraordinary naiveté that she and her fans have about real-world political power, and the deep ignorance that she and her fans bring to any assessment of the workings of an economy.

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Tom Woods talks with David Hart about Frederic Bastiat.

Jeff Jacoby observes that Obamacare has already failed.

As he does so well, Jeff Miron reveals an ill unintended consequence – in this case, the promotion of violence – of the so-called “war on drugs.

Shikha Dalmia is correct: today’s GOP hates immigrants more than it hates big government.

An American in Paris.

Marian Tupy decries the totalitarian instincts of many environmentalists.

From 1987: David Henderson on James M. Buchanan.

Here’s Steve Horwitz’s full-length review of Nancy Maclean’s fictional tract, Democracy in Chains.  A slice:

It is clear throughout the book that MacLean simply does not have the intellectual background and tools to understand the ideas she is dealing with. She is not familiar enough with the economic and political theory, nor the social science more broadly, to understand the contexts and questions that motivate Buchanan’s research and that of public choice theorists in general. Buchanan’s intellectual context is not the South, either in the form of the Southern Agrarians … or the slavery-defending Calhoun. The real context, made clear with a quick look at any of his major works, was figuring out how people choose in groups, and especially how choices can be made through the political process in ways that ensure that all voices get heard. Central to Buchanan’s thought was the importance of consent in politics. One way to view his project is that it was an attempt to explain how non-market decision-making processes might also be made “mutually beneficial” in the way that market exchanges are. That is, how can we make it such that decisions made outside the market are ones that benefit all parties?

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On page 120 of her fictional tale, Democracy in Chains, Nancy MacLean – in the course of explaining my late colleague Jim Buchanan’s role in the 1970s in trying to secure funding for academic programs to promote Virginia Political Economy – gives her readers what she regards to be a helpful reminder about Buchanan:

Remember, to him, venal self-interest was at the core of human motivation; the trick was to establish new providers.

I’m amused by MacLean’s “to him.”  MacLean wants her readers not to forget that Buchanan believed that people are motivated overwhelmingly by narrow material self-interest – and that, with this belief, Buchanan was seriously out of touch with reality.

I’ll here overlook MacLean’s failure to understand the use by public-choice scholars (and by non-public-choice scholars!) of the analytical device of homo economicus.  I’ll overlook also MacLean’s failure – as evidenced by the above quotation – to acknowledge Jim Buchanan’s own expressed reservations about, and qualifications on, the use of homo economicus.  Instead, I note the irony of MacLean criticizing Buchanan and other public-choice scholars for what she believes to be their incessant and mistaken belief that “venal self-interest was at the core of human motivation.”  After all, central to MacLean’s world view is the belief that anyone – anyone from a scholar such as Buchanan to a businessperson-philantropist such as Charles Koch – who supports free markets, private property, and the limitations on government necessary to preserve these institutions is motivated to do so by venal self-interest.  MacLean refuses to acknowledge that someone can sincerely believe that the social institutions that best serve all, even the poorest amongst us, include free markets, private property, and the constitutional limitations on government necessary to preserve free markets and the security of private property.

For MacLean, anyone who wishes to constrain the state’s power to tax, to spend, and to regulate reveals by that very wish that he or she is motivated by venal self-interest rather than by a sincere regard for the well-being of humanity.  I’m not here arguing that those of us who wish to severely limit the powers of government are correct in our positive analyses of the likely consequences of such limitations.  But I do here proclaim that we are genuinely sincere in our beliefs.

Nancy MacLean is not only ungenerous but also hypocritical to criticize free-market advocates, such as Buchanan, for allegedly believing that the only, or the overriding, human motivation is venal self-interest while she herself refuses to acknowledge any motivation other than venal self-interest as driving Buchanan, the Kochs, and many others to support liberty and constitutionally limited government.

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… is from pages 26-27 of Vol. 19 (Ideas, Persons, and Events [2001]) of The Collected Works of James M. Buchanan; specifically, it’s from Jim’s 1992 autobiographical essay ”From the Inside Looking Out”:

I resist, and resist strongly, any and all efforts to pull me toward positions of advising on this or that policy or cause.  I sign no petitions, join no political organizations, advise no party, serve no lobbying effort.  Yet the public’s image of me, and especially as developed through the media after the Nobel Prize in 1986, is that of a right-wing libertarian zealot who is anti-democratic, anti-egalitarian, and anti-scientific.  I am, of course, none of these and am, indeed, the opposites.  Properly understood, my position is both democratic and egalitarian, and I am as much a scientist as any of my peers in economics.  But I am passionately individualistic, and my emphasis on individual liberty does set me apart from many of my academic colleagues whose mind-sets are mildly elitist and, hence, collectivist.  And to these colleagues, I can never be forgiven for having contributed to the development of a sub discipline, public choice, that has exposed the operation of collective political institutions to serious scrutiny for the first time in well over a century.

DBx: Of course, someone such as Nancy MacLean can assert that Buchanan’s description of himself is inaccurate.  Indeed, much of MacLean’s Democracy in Chains is effectively one long such assertion.  But as pointed out by many people who knew Buchanan – and who know his work (and the contexts of his work) far better than MacLean does – MacLean supplies no credible evidence to support her case.  Her book isn’t history; it’s a wild and reckless mash-up of words – a mash-up concocted by someone who appears to have been already set on the meal she’d cook and who then went looking for bits and pieces of evidence, nearly all of it out of context and much of it simply over her head, that she could stir into a stew that would be tasty only to those hungering for an ideologically intoxicating, if poisonous, intellectual meal.

MacLean, for example, misunderstands the meaning that Buchanan and all economists attach to many of the terms used by professional economists (such as “allocation”) – misunderstandings that often result in unintentionally hilarious misinterpretations of Buchanan’s meaning.  She also, having gained access to some of Buchanan’s unpublished private papers, pulls from these memos and other materials this phrase and that word – those passages and these ruminations – that, out of context, help to persuade a credulous public that Buchanan was a racist, unscientific, and anti-democratic ideologue who played a major role in a “stealth” conspiracy to make the world safe only for evil oligarchs.  Evidence contrary to MacLean’s tale is ignored (or misunderstood and, hence, misrepresented).  And any lack of evidence is simply filled in by MacLean’s hallucinations.

Many people have written to me over the past few weeks to upbraid me for not calling MacLean a fraud and a liar.  But I have no hard evidence that she is such (although the facts surrounding her book would indeed support a strong case for that accusation).  Perhaps naively, I continue to believe that MacLean is no liar but, instead, a woman whose combination of dense ideological blinkers and deep intellectual deficiencies lead her sincerely to believe all that she has written about Buchanan and the “stealth” scheme that is purely the product of her hallucinations.

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On page 290 of Democracy in Chains, Nancy MacLean writes that in 1998

[Tyler] Cowen had published a new book, In Praise of Commercial Culture, which elaborated on old shibboleths from Ludwig von Mises.

The good people at Harvard University Press, publisher of Tyler’s 1998 book, must be distraught to learn from MacLean that Tyler’s book merely “elaborated on old shibboleths” from a long-dead Austrian economist.

Fortunately, the Harvard University Press crowd can breathe easily, for MacLean’s description of Tyler’s book is wholly inaccurate: Nowhere in his book does Tyler mention Mises.

Why not?  There’s no doubt that Tyler has closely studied Mises’s works.  And there’s no doubt that Mises wrote about the connection between commerce and art.  And yet Tyler doesn’t mention Mises.  Perhaps Tyler absorbed Mises so deeply that he, Tyler, simply channeled Mises unawares.  Or perhaps Tyler simply forgot to mention the scholar on this point who MacLean asserts (with no real evidence, by the way) is the source of the views on commerce and art that Tyler develops in his 1998 book.  Or maybe Tyler intentionally failed to mention Mises, perhaps hoping to steal the glory that comes with being thought to be an original thinker!

No one who knows Tyler would believe either of these last two possibilities.  And MacLean offers no evidence that points to either of these explanations being valid.  Indeed, MacLean doesn’t even mention that Tyler doesn’t even mention Mises in the 1998 book.  So it’s an open question where she got the notion that Tyler’s 1998 book is just an ‘elaboration’ of Mises’s views on the subject.  (I have my suspicions about where MacLean got this notion, but I’ll keep these suspicions to myself.  Unlike the careless MacLean, I don’t report my suspicions as if they are facts.)

In the same footnote from which the above quotation is drawn, MacLean references Mises’s 1956 monograph, The Anti-capitalistic Mentality, but she offers neither explanation nor even page references.  In this short Mises tract there is a chapter (#3) titled “Literature Under Capitalism.”  This chapter and a section (“Materialism”) in chapter 4 are the only parts of this book that I can find that touch on the topic of Tyler’s 1998 book.  Here, Mises does say some things that overlap with the broad theme of Tyler’s book – namely, contrary to the claims and worries of critics such as John Ruskin, in commercial societies fine and high art continues to flourish even though a great deal of contemptible and even trashy ‘art’ is also produced.  But Mises doesn’t develop the thesis in any depth.  All of 19 short pages are devoted to this topic.

More fundamentally, Mises’s attitude is distinctly different from Tyler’s.  Unlike Mises, Tyler regards a great deal of popular literature, music, painting, architecture, and other expressions of human creativity to be genuinely good, and sometimes great, works of art.  While Mises recognized that the increasing prosperity of ordinary people prompt them often to improve their tastes and buy what Mises regarded to be genuinely good works of art (including in its industrial manifestations, such as in the design of furniture), Mises was far less willing that is Tyler to expand his opinion of what does indeed count as truly worthwhile works of art.  For example, here’s Mises [p. 31]:

Capitalism could render the masses so prosperous that they buy books and magazines.  But it could not imbue them with the discernment of Maecenas or Con Grande della Scala.  It is not the fault of capitalism that the common man does not appreciate uncommon books.

Tyler would not so much deny the truth of what Mises says here as he would – and does! – argue that the new, innovative forms of artistic expression made possible by commercial society give rise to a great deal of new art forms that, if not recognized immediately as excellent, truly are excellent and will typically one day be recognized as such.  Tyler would also deny that ordinary people must somehow become graced with the discernment of famous artists and art critics in order for ordinary people, through their purchases in commercial markets, to support the production and distribution of genuinely excellent art.  Consider this passage from pages 6-7 of Tyler’s book [emphasis original to Welles]; Tyler’s mention of Welles is favorable:

Orson Welles argued for the supremacy of consumer opinion in judging aesthetic value.  He once said: “We must not forget the audience.  The audience votes by buying tickets.  An audience is more intelligent than the individuals who create their entertainment.  I can think of nothing that an audience won’t understand.  The only problem is to interest them.  Once they are interested, they understand anything in the world.

The sources of inspiration that Tyler mentions in his 1998 book [on pages 12-13] include Samuel Johnson, Charles Perrault, Baldassare Castiglione, Condorcet, and, more recently, Camille Paglia, Herbert Gans, and the economist William Grampp.  I do not think that a mention of Mises would have been out of place here, but nor was any such mention called for.  Again, Mises’s discussion of these matters isn’t all that deep (which is not to say that it is mistaken) and Mises’s ideas about what is and isn’t good art were indeed very different from those of Tyler.  There is, in short, no reason to believe that Tyler was elaborating on a theme set by Mises and every reason to understand that Tyler’s exploration of the connections between commerce and art go vastly further than any such exploration that might be prompted even by the most generous reading of Mises’s words on this topic.

One thing is clear to a reader of Tyler’s 1998 book: it is a remarkably innovative, and deeply informed, application of the economic way of thinking to a wide variety of questions about the connections between commerce and art.  Most assuredly it is much, much more than a mere ‘elaboration’ on Mises’s, or anyone else’s, comments on this topic.  Tyler’s 1998 book is, in my opinion, his best.  For Nancy MacLean to ridicule it as she does borders on libelous.

I’ve featured some quotations from Tyler’s 1998 book here at Cafe Hayek.  For example, here’s one found on page 197:

By placing conservative culture at the top of their political agenda, the neo-conservatives risk losing their skepticism about big government.

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On page 290 of Democracy in Chains, Nancy MacLean writes the following:

[Tyler] Cowen’s first book, The Theory of Market Failure: A Critical Examination, was a collection of essays copublished by the Cato Institute and designed to refute the key argument for government intervention: that markets often fail. Offering tribute to public choice economics, it showcased nonscholars on the payrolls of three different Koch-funded nonprofits.

Wow!  Seems as though this book is filled with hack works by hack writers.  It must be a book devoted, in good part, to ‘showcasing’ nonscholars doing dirty work for evil oligarchs.

Let’s take a look at the “nonscholars” whose papers are collected in this book (listed below in order of appearance in the book) and where their papers originally appeared:

  • Tyler Cowen (at the time an assistant professor of economics at U.C.-Irvine) [publication original to this volume]
  • Paul Samuelson (professor of economics, MIT; first American to win the Nobel Prize in Economic Science) [Review of Economics and Statistics]
  • Francis Bator (professor of political economy at Harvard’s Kennedy School) [Quarterly Journal of Economics]
  • Kenneth Goldin (professor of economics, Cal.-State at Fullerton) [Public Choice]
  • Earl Brubaker (professor of economics, Naval Postgraduate School) [Journal of Law & Economics]
  • Harold Demsetz (professor of economics, UCLA) [Journal of Law & Economic]
  • Andrew Schotter (associate professor of economics, NYU) [from Schotter’s 1981 Cambridge University Press book, The Economic Theory of Social Institutions]
  • Charles Tiebout (professor of economics till his 1969 death, University of Washington) [Journal of Political Economy]
  • James M. Buchanan (professor of economics, George Mason University; 1986 Nobel laureate) [Economica]
  • Carl Dahlman (economist, U.S. Dep’t. of Health and Human Services) [Journal of Law & Economics]
  • Robert Axelrod (professor of political science and public policy, University of Michigan) [from his highly regarded 1984 book, The Evolution of Cooperation]
  • Ronald Coase (professor of law, University of Chicago; 1991 Nobel laureate) [Journal of Law & Economics]
  • Steven N.S. Cheung (professor of economics, University of Hong Kong) [Journal of Law & Economics]
  • Robert Poole (president of the Reason Foundation) [from the 1980 book Cutting Back City Hall]
  • Robert J. Smith (Competitive Enterprise Institute) [publication original to this volume]
  • Jack High (professor of economics, George Mason University) and Jerome Ellig (Citizens for a Sound Economy) [publication original to this volume]

Looks like a pretty scholarly group to me.  This list plainly belies MacLean’s description of the 1993 Cowen-edited volume as one that “showcased nonscholars.”  Anyone who knows anything about the market-failure literature knows that most of these contributors are very well-known and highly respected scholars.

Of course, not all contributors are as well-known as Buchanan, Coase, and Samuelson.  And, indeed, the least well-known of the group (Poole, Smith, and Ellig) are the ones connected to “Koch-funded nonprofits.”  But this fact does not mean that these three men are “nonscholars.”  (I don’t know about Bob Poole or Robert Smith, but I know that Jerry Ellig has a PhD in economics, from GMU, and has written several scholarly journal articles [one with me, long ago, in the Journal of Air Law & Commerce]).  Moreover, anyone who reads their contributions to this volume will see clearly that these are papers written by genuine scholars.  And does the placement of the papers by Poole, Smith, and Ellig suggest that Tyler “showcased” these papers?  Does the array of contributors, and their order of appearance in this collection, justify MacLean’s description of the book as one that “showcased nonscholars”?  I think the answer is no, but you, dear reader, judge for yourself.

(I believe that the “Koch-funded nonprofits” that MacLean has in mind are Citizens for a Sound Economy, the Competitive Enterprise Institute, and the Reason Foundation.  Authors associated with these nonprofits are responsible for three of the 16 papers in this collection.  I know too little about the now-defunct Citizens for a Sound Economy to pronounce on it.  But I’m quite certain that, while both the Competitive Enterprise Institute and the Reason Foundation likely did – and perhaps still do – receive some contributions from one or both of the Koch brothers, those contributions did not, and do not, come close to being the principal source of funding for either organization.  So MacLean’s manner of referring to these organizations as “Koch-funded” is misleading given that this reference – especially in the context of what MacLean would describe as the “totality” of her book – seems to suggest that these organizations are puppets of the Kochs.)

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David Hart just reminded me that, soon after Jim Buchanan died in January of 2013, Liberty Fund’s on-line “Liberty Matters” series for March 2013 was devoted to the life’s work of Buchanan.  I’m surprised and chagrined that I did not link to this symposium when it first went on-line.

The lead essay in this symposium is written by Buchanan’s frequent co-author Geoff Brennan.  Other contributors to this on-line symposium are Pete Boettke, Steve Horwitz, Loren Lomasky, Ed Stringham, and Viktor Varberg.  The whole thing is worth reading.  (Nancy MacLean – who recently wrote what is alleged to be an “intellectual biography” of Buchanan – doesn’t cite this symposium in her book and, judging from her book’s contents, apparently did not read what these collaborators and students of Buchanan said about him.  Too bad, for had she read this symposium she would have encountered several reasons to revise – and in many cases to reverse – her portrayal of Buchanan.)  Here’s a slice from Geoff’s excellent lead essay:

Of course, he saw markets as the primary institution for the mobilization of exchange possibilities. But his version of the “economic analysis of the study of political processes” (or “Public Choice theory,” as it came to be called) was distinctive in Public Choice circles for its emphasis on “politics as exchange” – a phrase he repeated many times. (As an aside, we should note that for many libertarians/classical liberals it might be more natural to think in terms of politics as coercion – and though Buchanan certainly did not deny the possibility of coercion in politics, he equally certainly denied that all government action is intrinsically coercive.) He believed that exchange via political action is possible and that the role of the economist is to uncover those exchange possibilities. In this, he followed Knut Wicksell (unquestionably one of Buchanan’s intellectual heroes) and Wicksell’s other interpreter, Erik Lindahl – and in this sense was a participant along with Musgrave and Samuelson in the analysis of public goods and associated market failure that dominated the welfare economics/public economics of the 1950s and early 1960s.

That is, Buchanan fully accepted the public-goods argument that markets sometimes fail to exploit all the mutual benefits that are on offer in human society. And he also accepted the (Wicksellian) proposition that collective action could in principle appropriate such “gains from exchange” in public-goods supply. In other words, he thought that there is (in principle) a role for the “productive state” as well as the “protective state” – to use a distinction he developed explicitly in the Limits of Liberty (1975).

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Yet Another Nancy MacLean Error

by Don Boudreaux on July 23, 2017

in Myths and Fallacies

Among the most-recent of the late Jim Buchanan’s writings are his essays on what he called “parentalism”: the desire of many people to have others take some responsibility for their lives.  (Many of these essays are gathered in this 2005 collection.  I reviewed this collection here.)

True to form, Nancy MacLean recklessly uses quotations from these later writings of Buchanan in ways that give the appearance that Buchanan held views that he certainly did not hold.  James Taylor uncovers one such careless use by MacLean of a Buchanan quotation.

Nancy MacLean seems to possess extraordinarily poor reading comprehension.  She is either incapable of understanding what she reads, or she reads so spottily from the materials that she uses in her research that she misses the meaning of these materials.  Perhaps both.

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… is from pages 34-35 of Christopher Snowdon’s excellent 2015 monograph, Selfishness, Greed and Capitalism: Debunking Myths about the Free Market (link added):

An ill-informed decision at the ballot box has practically no private cost to the individual.  Even in the extremely unlikely event of his vote being decisive, the costs of electing a fool or a knave will be dispersed over a large population.  In short, voters can afford to indulge their irrational impulses at virtually zero cost every few years.

This is very different from being irrational with one’s own money in the market.  A poor decision in the marketplace will cost us our hard-earned money.  A mistake at work might cost us our job.  It is because the private costs of making a bad choice are so much greater when our own money is at stake that we are incentivised to gather information and choose carefully when making a purchase in the marketplace….  In politics, unless you are a journalist, politician or lobbyist, it is rational to ignore the whole circus and spend one’s time more productively.  ‘Voting is not a slight variation on shopping,’ says [Bryan] Caplan (2007: 140-41).  ‘Shoppers have incentives to be rational.  Voters do not.’  There is, therefore, no contradiction between being a rational actor in the market and an irrational participant (or abstainer) in a democracy.

DBx: The above quotation is a nice summary of a deep insight from Kenneth Arrow and Gordon Tullock (quoted here yesterday).  This insight has been further developed and extended by Geoff Brennan, Loren Lomasky, and my colleague Bryan Caplan.

People more interested in emoting than in thinking often react to this (and other) realistic assessments of the real-world features of democracy by accusing those who offer these assessments of various trumped-up offenses: ‘Opponent of giving ordinary people a say in their own governance!’ ‘Enemy of the People!’ ‘Friend of oligarchs!’  Emoting, of course, feels good, and to indulge in it requires far less effort than does serious thinking.  (Those who know the work of Brennan, Lomasky, and Caplan will recognize the irony here.)  But regardless of your system of ultimate values, if you’re a genuinely well-meaning person you do not dismiss as evil those who point out inconvenient real-world features of your preferred social institutions.  Instead, you listen carefully to such people and, if you judge their insights to be valuable, incorporate these into your own analysis and world-view.

An enthusiast for unlimited majoritarian rule might find the insight quoted above to be mistaken, but surely this insight has enough logical coherence and connection to real-world experience to justify being taken seriously.  This insight ought not be dismissed merely because, if it is taken seriously, it dampens your enthusiasm for unlimited majority rule, or at least causes you to consider reducing the range of human activities over which you wish to have majority decisions reign as sovereign.  Anyone who would dismiss this insight is obliged to do more than scream ‘It’s undemocratic and those who offer it or who endorse it are enemies of democracy and, therefore, enemies of all that is good and noble!’

Note that the political left is full of people who view individuals acting in markets as being gullible and irrational.  So if we grant that people on the political left are friends of humanity, it’s not true that merely to point out that there are some institutional settings in which it can be argued that individuals regularly act irrationally or unwisely is to reveal a hatred of humanity.  The challenge is to compare how ordinary men and women are likely to act under different institutional settings – namely, on one hand, in collective decision-making settings (such as majoritarian democratic settings) and, on the other hand, in private-property settings (such as commercial markets).

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