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‘Buchanan’s Theory Supplanted an Ideology — the Faith in Government as Omniscient and Benevolent’



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That sentence is from George Will’s most recent column in the Washington Postin which he makes the case for a balanced-budget amendment based on the pioneer work of George Mason University’s James Buchanan. Buchanan is the father, along with Gordon Tullock, of public-choice economics. As Will explains:

This Nobel laureate economist, who died last month at 93, pioneered the “public choice” school of analysis, the premise of which is in the title of his 1979 essay “Politics Without Romance.” Public choice theory applies economic analysis — essentially, the study of how incentives influence behavior — to politics.

Public choice analysis began in the 1960s, when Washington’s social engineers were busy as beavers building a Great Society and confidence in government reached an apogee that prudent people hope will never be matched. Public choice theory demystified politics by puncturing the grand illusion that nourishes government growth. It is the fiction that elected politicians and government administrators are more nobly motivated, unselfish and disinterested than are persons acting in the private sector.

Buchanan extended the idea of the profit motive to the behavior of politicians and bureaucrats, two groups seeking to maximize power the way many people in the private sector maximize monetary profits. Public-sector actors often do this by transactions with rent-seekers — private factions trying to maximize their welfare by getting government to give them benefits, such as appropriations, tax preferences and other subsidies.

Critics have often called Buchanan an ideologue for pointing out that government officials are not benevolent, but rather, like all humans, are self-interested. Will explains why clinging to the idea of benevolent lawmakers despite evidence of the contrary is ideology too. He also provides recent evidence of Buchanan’s theory:

Six days after Buchanan died, House Republicans provided dismal (and redundant) validation of public choice theory. Rep. Mick Mulvaney (R-S.C.), supported by Majority Leader Eric Cantor and Budget Committee Chairman Paul Ryan, proposed offsetting just $17 billion of the $60 billion aid for victims of Superstorm Sandy and doing so by cutting just 1.63 percent from discretionary government spending. Rep. Hal Rogers (R-Ky.), chairman of the Appropriations Committee, said this would “slash and burn” important programs, and the measure failed because 71 Republicans opposed it.

The political class is incorrigible because it is composed of — let us say the worst — human beings. They respond to incentives of self-interest. Their acquisitiveness is not for money but for the currency of power, which they act to retain and enlarge. This class can be constrained, if at all, not by exhorting them to become disinterested but by binding them with a constitutional amendment.

(h/t to Adam Thierer)



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