The Latest from Cafe Hayek

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My latest column for AIER is the first of a two-part series looking back on the publication, five years ago this month, of a notably disgraceful example of so-called ‘scholarship.’ A slice:

Five years ago there appeared the most appalling instance of academic malpractice that I’ve ever personally engaged with. In her book Democracy in Chains: The Deep History of the Radical Right’s Stealth Plan for America, published in June 2017, Duke University “historian” Nancy MacLean purports to reveal that my late Nobel-laureate economist colleague, James Buchanan, was a white supremacist who throughout his long tenure in the academy aimed to undermine democracy and to oppress the poor and working classes, and who eventually became a willing tool of rapacious oligarchs.

No one who knew Jim Buchanan personally, or who even just read relevant parts of his vast scholarly output, recognizes the fictional “Buchanan” who appears in MacLean’s book. Thus in the previous paragraph I put the descriptor “historian” in quotation marks to reveal up front my low assessment of the quality of MacLean’s historical research and reporting on Buchanan’s work. Her book is a screed of fiction passed off as a work of fact.

Long-time readers of my blog, Café Hayek, know that I spent a great deal of time and energy during the Summer and Fall of 2017 exposing some of the countless fallacies and grotesque misimpressions that constitute the substance of MacLean’s book. My efforts are surely less thorough and effective than are those of more talented scholars, including AIER’s own Phil Magness, who joined in the effort to set the record straight against MacLean’s fabrications about Buchanan, and about the school of public-choice research that Buchanan co-founded with his brilliant long-time colleague and co-author Gordon Tullock. (Disclosure: I was, for many years at George Mason University, a colleague also of Gordon Tullock.)

I share here – as I will in my next column – some of my many efforts to expose the errors that run throughout MacLean’s book, as well as throughout some of the attempts by others to defend her fictional tale.

First is this (slightly amended) June 28, 2017, letter to New Republic News Editor Alex Shephard:

Mr. Shephard:

In the introduction to your interview of Democracy in Chains author Nancy MacLean, you write that my late Nobel laureate colleague James Buchanan insisted “that democracy and liberty – defined as free market capitalism – were incompatible and that it was necessary to limit participatory democracy to protect the property rights of the extremely wealthy. Though he did no empirical work, he was remarkably influential in the field of public choice theory, which essentially argued that markets could never fail and governments always did.”

Your characterization of Buchanan verges on libelous. For starters, Buchanan did not believe that “markets could never fail.” Here’s just one of many quotations from Buchanan’s published works that disprove your accusation: “Markets fail; governments fail.” (This quotation is from page 130 of Jim’s 1976 paper “Methods and Morals in Economics” as this paper is reprinted in volume 19 of The Collected Works of James M. Buchanan.) Much of Buchanan’s work is a careful comparison of what he always insisted are the imperfect outcomes of markets with the imperfect outcomes of politics. It’s true that Buchanan’s comparisons of politics with markets led him to conclude that imperfect markets outperform imperfect politics more often than most people suppose. But it is emphatically untrue that he believed that “markets could never fail and governments always did.”

Worse is your assertion that Buchanan believed that democracy and liberty are incompatible. Although Buchanan – like every other serious person who’s pondered the matter – opposed unlimited majority rule, throughout his life he sought ways to ensure that each and every adult has an equal voice in the political arena. Jim understood that a key benefit of such political equality is the maximum possible protection of individual liberty.

Finally, even if we ignore Buchanan’s proposal for confiscatory inheritance taxation, it is grotesque of you to suggest that Buchanan wished to protect the private property rights only of “the extremely wealthy.” Jim advocated strong and equal protection of everyone’s private property rights. So I challenge you (or Prof. MacLean, or anyone else) to put your money where your mouth is: search for passages in Buchanan’s writings showing that he wished to protect only the property rights of the rich, and that he was hostile, or even indifferent, to the property rights of the non-rich. For each such passage you find I’ll pay you $1,000. But if you’re unable to find any such passage you pay to me $100. Deal?

Sincerely,

Donald J. Boudreaux

Shephard did not respond to the above letter.

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… is from page 119 of the late Michael Novak’s 1981 essay “In Praise of Bourgeois Virtues,” as this essay is reprinted in the 1999 collection of some of Novak’s pieces, On Cultivating Liberty: Reflections on Moral Ecology (Brian C. Anderson, ed.):

Human offspring require some twenty years of nurture. Three thousand years of civilization must be passed on to children during those years; without that, progress would halt.

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Here’s a letter to the Wall Street Journal:

Editor:

Andy Kessler eloquently exposes as nonsense the assertions by many of today’s intellectuals that reality is whatever our words say it is – that, for example, bees are fish, puddles are navigable waters, and violent rioting is “mostly peaceful” (“Bees Are Fish and Other Fake Narratives,” June 20). Such intellectual chicanery, alas, is not new. In 1776 Adam Smith observed that “[t]here is nothing so absurd, says Cicero, which has not sometimes been asserted by some philosophers.”*

Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030

* Adam Smith, An Inquiry Into the Nature and Causes of the Wealth of Nations (Indianapolis: Liberty Fund, 1981 [1776], page 876.

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… is from page 11 of Edwin Cannan’s superb November 13th, 1931, Sidney Ball Lecture – a lecture titled “Balance of Trade Delusions“:

So firmly rooted was the belief that it was better to give to the foreigner than to receive from him that even ardent free traders would defend imports not on the ground that it is a happy thing to receive goods and services and the less you pay for them the better, but because, as they put it, “if you don’t import you won’t be able to export!” As if to send out goods and services and get back as little as possible was the ideal.

DBx: Brilliant!

Cannan (1861-1935), who taught at the London School of Economics, was one of the early 20th century’s greatest expositors of basic economic reasoning. In the speech from which this quotation is drawn, Cannan intellectually destroys the notion that a nation that runs a so-called ‘negative’ balance of trade – that is, a trade deficit – is necessarily (as most protectionists still in ignorance insist today) “losing” at trade.

I thank my GMU Econ colleague Dan Klein for alerting me to this lecture by Cannan.

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Chris Freiman is correct: “Socialism doesn’t liberate workers from domination.”

James Harrigan celebrates Juneteenth.

Juliette Sellgren talks with Walter Olson about election fraud.

GMU Econ alum Gabby Beaumont-Smith, writing at Reason, explains that “Congress and Biden probably just made the shipping problem worse.” A slice:

As the supply chain fell into disarray, the market adjusted and prices increased, including shipping prices. These price increases were the result of simple economics, not price gouging by greedy shipping companies. Ocean carriers raised prices in response to high demand for goods with a limited supply of shipping as ships and containers were stuck in congested ports. Ocean carriers increased prices in an attempt to temper demand for shipping. As evidence that prices rose because of supply and demand, not greed, consider that shipping prices have recently fallen as supply chain woes have started to abate: Spot rates for 20-foot containers from Asia to the United States dropped almost 33 percent since peaking in September 2021.

Here’s wisdom and insight from the always-wise and always-insightful Bruce Yandle.

Pierre Lemieux isn’t surprised by Biden’s economic myopia.

Liz Wolfe reports on more absurdity from the CDC.

“Brutal lockdown proves final straw for the middle classes fleeing Shanghai” – so reports the Telegraph.

Covid is not a leading cause of death in children.

In this long read, Michael Betrus details how the media fueled unwarranted covid hysteria and the consequent lockdowns.

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… is from page 230 of Robert Higgs’s September 1986 Freeman essay, “To Deal With A Crisis: Governmental Program or Free Market?” as this essay is reprinted and slightly revised in the superb 2004 collection of some of Bob’s essays, Against Leviathan (original emphasis):

Emergency government programs, then, offer exceptional opportunities for those who would substitute their own values for those ordinarily guiding the allocation of resources in the market. When the cry of “Emergency!” goes up, the public’s resistance to government takeovers comes down. Hence, aspiring redistributors of income, collectivist planners, and do-gooders at other people’s expense rush in to exploit the unusual opportunity for replacing market processes with government controls. Whatever one may think about the immediate desirability of an emergency government program, however, one must recognize that the program is almost certainly only a beginning; and what follows in its train may be far less desirable.