… is from page 45 of my colleague Richard Wagner’s excellent new intellectual biography of Jim Buchanan, James M. Buchanan and Liberal Political Economy  (2017); here, Dick is discussing Buchanan’s very first published article, “The Pure Theory of Public Finance: A Suggested Approach ,” which appeared in the December 1949 issue of the Journal of Political Economy:
The central objective in Buchanan’s 1949 paper was to set forth the possibility of an alternative to treating fiscal phenomena as products of some despot, whether that despot is real or imagined. With this formulation, Buchanan took the first step in shifting public finance from a despotic to a democratic institutional framework. Buchanan’s reference to an individualistic theory of the state does not imply some embrace of a social philosophy of rugged individualism. It means only that governments are comprised of individuals who rule themselves in some fashion, in contrast to people being ruled by monarchs or despots. Therefore, any explanation of what governments do must be traced to those individuals who in ruling themselves act in the name of government. Just how those individuals might rule themselves depends on their preferences, values, and ideologies. They might operate in the name of liberalist or collectivist ideologies, or any other ideological formulation one might imagine. Whatever the ideology, however, governmental action is action that is initiated by some set of individuals.
DBx: Dick Wagner here explains nicely the introduction by Buchanan of methodological individualism into the theory of public finance (that is, the theory of government taxation, borrowing, and spending) in English-speaking countries. (Buchanan was inspired to follow a methodological-individualist approach by his close study of Italian fiscal theorists, who were pioneers in the methodological-individualist approach to the analysis of fiscal phenomena.) The point of methodological individualism is that any credible explanation of social phenomena must start with an understanding of the preferences, constraints, and opportunities faced by individuals who have, or who potentially have, some capacity to act in ways that affect the phenomena to be explained. Groups of people – for example, “the state,” “the market,” “consumers,” “the rich” – do not as such act or think or feel or choose or evaluate. Only individuals think, feel, learn, evaluate, ponder, choose, and act. The observed outcomes of markets or states are the outcomes of the combined actions of each of the many individuals whose individual choices and actions give rise to these observed outcomes.
One may object, on methodological grounds, to methodological individualism. But what one may not legitimately portray a scientific plea for all social science to be based on methodological individualism as being either a denial that collective action and outcomes are very real, or an ideological call to ignore the reality of others, the interests of others, or the connectedness of each of us to others and of them to us. And yet by using the following quotation by Pierre Lemieux at the start of her book Democracy in Chains, Nancy MacLean seems to think that she’s serving up some ‘smoking-gun’-like quotation showing both the blindness to the true nature of society of those of us who find value in public-choice theory and our anti-social wish to dissolve society into independent, atomistic individuals:
The public choice revolution rings the death knell of the political “we.”
– Pierre Lemieux, “The Public Choice Revolution ” Regulation, Fall 2004.
I urge you to read Pierre’s essay and judge for yourself its meaning. You will, I’m confident, conclude that Pierre here refers to the insistence by Buchanan and other public-choice scholars on the use of methodological individualism. It is not – contrary to what appears to be MacLean’s supposition – a dastardly call for each of us to disassociate ourselves from each other politically or to do political science as if collective institutions, such as the government, are non-existent or even necessarily inferior to markets. It is a recognition of the centrality of methodological individualism to public-choice scholarship – a centrality that was placed there in Jim Buchanan’s first publication.
One has no business writing a book about topic X if one is unwilling to spend the time required to learn topic X. Nancy MacLean – in writing a book that purports to be about Jim Buchanan and public-choice scholarship – never bothered to learn enough to know that central to public-choice scholarship is the methodological tenet of methodological individualism. As a result, MacLean unintentionally gives those of us who are better informed than she is reason to laugh at her mistaken use of Pierre’s quotation.
And if MacLean retorts by insisting that she fully understands the meaning and importance of Pierre’s quotation, the spark for laughter would only intensify. The reason is that in her footnote to her quotation of Pierre, she writes: “Lemieux was writing for one Koch-funded organization, the Cato Institute, as a fellow of another, the Independent Institute.” Never mind the pointless description of Cato and the Independent Institute as “Koch-funded”; as Mike Munger points out, Nancy MacLean’s employer, Duke University, is also Koch-funded . Instead, reflect on the absurdity of MacLean supposing that the funding sources of a publication and one of its authors are relevant to a point about scientific method.