Public Choice

Better Than Plowing, and Other Personal Essays.
by James M. Buchanan.
University of Chicago Press. 194 pp. $23.95.

In much economic theory, politicians and government bureaucrats are exempted from the general rule that humans seek to maximize their own interests; instead, government is assumed to be a sort of benignly neutral referee, capable of acting in the broad public interest. But James M. Buchanan, winner of the 1986 Nobel Prize in economics, has long disputed this assumption. Since the early 1960’s, he has led a small but growing band of academics in the development of “public-choice” theory, a school of thought that applies economic analysis to the behavior of governments. In particular, public-choice theorists have stripped away the idealized conception of the state that many economists have tended to present as a real alternative to market practices, and have focused instead on the limitations of government action.

The dust jacket of Better Than Plowing, a collection of autobiographical essays, describes Buchanan’s work as “the theoretical inspiration for much of the Reagan era’s economic philosophy.” This is an overstatement. In fact, public choice was but one of several intellectual schools that influenced U.S. economic policy in the 1980’s, along with supply-side theory and monetarism. True, the perspective offered by public-choice analysis was compatible with the Reagan administration’s efforts to scale back the government’s role in the economy. But the implications of public-choice theory are that achieving such a goal would require institutional change, as opposed to mere policy adjustments.

Thus, although the Reagan administration provided tax and regulatory relief, and constrained the growth of public expenditure, the mechanisms of economic policy-making remained much the same in 1988 as they had been in 1980. There had been little change in the budgetary process, or in other institutional arrangements conducive to the expansion of government. The way was thus clear for a swift reversal of Reagan’s economic policies during the succeeding administration, which is indeed what happened.

It is unfortunate that public-choice theory did not make a greater impact on the Reagan era. Yet interest in institutional reform appears to have grown stronger during the past several years, as evidenced by efforts to impose term limits on Congress and to mandate a balanced federal budget. Although not every proposal for institutional change can be traced directly to public-choice theory, this school of thought does appear to be congruent with a current mood. In academic circles, meanwhile, public choice continues slowly but steadily to gain acceptance.



Now in his seventies, Buchanan looks back on a long and contentious career. In a manner that is consistent with his self-conscious status as an intellectual outsider, Better Than Plowing is an unorthodox book, its twelve chapters shifting frequently among times and places and mixing autobiography, intellectual history, and social commentary. Although Buchanan occasionally veers into the jargon of the social scientist, in general he treats both personal and intellectual matters with lucidity, interweaving a persuasive argument for the public-choice perspective with thought-provoking observations of his life and times.

The book’s title is borrowed from the economist Frank H. Knight, one of Buchanan’s intellectual mentors, who used the phrase to describe his own attitude toward his academic career. It has special resonance for Buchanan, who grew up in poverty in the 1920’s and 1930’s in rural Tennessee. In Better Than Plowing he describes years of hard work on the farm and an education at rural schools and a local teachers’ college. An early suspicion of established institutions was nurtured by reading about the late-19th-century career of his grandfather, John P. Buchanan, a populist politician and one-term governor of Tennessee. This mistrust was magnified by the younger Buchanan’s experience in the Navy during World War II, in which he encountered discrimination favoring Ivy League graduates in the distribution of assignments.

When he arrived at the University of Chicago to pursue graduate studies after the war, Buchanan was, by his own later description, a “libertarian socialist.” But his socialism did not survive a course in price theory taught by Frank Knight, and his thinking was further shaped by reading the work of Knut Wicksell, a relatively obscure theorist who advised economists to set aside assumptions of government benevolence when offering policy advice. Questions about the functioning of the state preoccupied Buchanan as he set out on his academic career. During a year spent in Italy on a Fulbright grant in the mid-1950’s, he was influenced by the emphasis placed by Italian theorists of public finance on the political institutions in which policy-makers operate.

At the University of Virginia, where he was then teaching, Buchanan’s output of books and papers began to rise rapidly. In 1962, he and his chief collaborator, Gordon Tullock, published The Calculus of Consent, a book that marked the emergence of public-choice theory as a definable subdiscipline within economics. Soon Buchanan and others began to apply their analytical perspective to a growing range of economic and political phenomena. Before long, however, he ran afoul of the University of Virginia’s administration, which conducted an investigation into the ideological attitudes of the public-choice theorists on its faculty. This experience led Buchanan, exercising what he refers to as the “academic-exit” option, to relocate to the University of California at Los Angeles; but then, repelled by the turmoil of UCLA’s campus in 1968, he exited yet again, this time to Virginia Polytechnic Institute.



The unrest of the 1960’s, combined with the rapid expansion of the U.S. government during that decade, inspired Buchanan to direct his attention to more fundamental questions of political philosophy than had been addressed in the early years of public-choice theory. This new line of research led to his 1975 book, The Limits of Liberty, which offers a defense of limited government against the twin alternatives of statism and anarchism.

Buchanan remained at Virginia Polytechnic Institute until 1983, subsequently moving to George Mason University, where he currently directs the Center for the Study of Public Choice. He also spends time on a remote tract he owns in the mountains of southwestern Virginia; this property, a 90-acre, nonproducing farm, figures prominently in his essays as a place of refuge from the turbulence of his academic career and from some of the less welcome consequences of the recognition that has come with the winning of the Nobel Prize.

Such inconveniences, however, are overshadowed by Buchanan’s success. From unlikely origins, he emerged to change the nature of economic theory, and to exert an as-yet-unconsummated influence on public policy.

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