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In his recent interview [2] with George Mason University Nobel Laureate James Buchanan, Aaron Steelman asked Buchanan about the exciting work being done by our young GMU colleague Bryan Caplan. Bryan is extending the important insight that motivated the 1993 book by Geoffrey Brennan & Loren Lomasky, Democracy and Decision [3].
In a nutshell, this insight is that expressing ill-conceived or irresponsible or “irrational” opinions is rational if the expression of such opinions gives the person satisfaction and if no personal consequences befall the person as a direct result of his expression of those opinions.
Because voting is a decision-making institution in which each voter gets to express his opinions costlessly (that is, without direct, personal consequence), voters likely are rationally irrational.
Here’s Buchanan’s take:
I don’t know Caplan’s work very well. But I think there is something to what he is trying to argue. For instance, I think there is the following bifurcation in the choice process: We may want to do things collectively that we are not willing to sustain privately. It may be true that the welfare state represents what people actually want. They may want the government to take care of everybody and so they vote for candidates who run on such a platform, including the higher tax rates needed to pay for it. At the same time, given those high levels of taxation, they may decide to quit working, like the Swedes, and spend time at their summer home. So even though they voted for the whole program — on both the spending and taxation sides — they are not willing to support it through their private actions.
My take on this matter is that the word “want” is ambiguous. You know what I mean if I say “I want to own an S-class Mercedes automobile.” In fact, I do want such a car – in a way. I want such a car if I don’t have to pay for it. Because I cannot actually own such a car unless I, personally, fork over more money than I’m willing to fork over for it, I in fact (on another meaning of the verb “to want”) do not want an S-class Mercedes.
When Buchanan says that Swedes “may want the government to take care of everybody,” what does it mean? That the typical Swede is really willing to fork over a lot of money to achieve this end? Or that having the government take care of everybody is an aspiration that happens to become an actual goal of public policy because of the peculiarities of majority-rule voting?