Something Troubling in James Buchanan’s Theory

Just when I first read Buchanan’s The Limits of Liberty (1975) 30 years ago, I find the following intriguing or troubling:

In the model incorporated here … I allow quite explicitly for personal inequality in the natural equilibrium, the anarchistic base from which primal disarmament contracts are conceptually negotiated. … [T]he establishment of positive claims to stocks of goods or endowments may not be possible until and unless some unilateral transfers are made. This potential for transfer allows us to introduce an additional dimension of adjustment which may possibly facilitate the reaching of agreement among parties in contract. …
[C]ertain “exchanges” of resources endowments of goods and behavioral constraints may be necessary before clearly acknowledged ownership imputations are possible. (pp. 92-3)

The Santa Barbara Killings

A few hours before Jews were slaughtered in Belgium, a young madman was shooting and knifing people of his age in California. Besides the fact that the two killings happened in a gun-free zone, there seem to be few similarities between the two criminal acts.

The Santa Barbara killer was a very disturbed young man, as obvious from his troubling video. But civilization and morals used to teach a man to control himself, not to yield to all instincts, desires or frustrations, wherever he sat on the continuum between normal and mad. (The killer had been diagnosed with “high functioning Asperger’s” as a child.) Obviously, this constraint has been much softened—a thesis I defended in my post on “The Rise of the Young Mass Killer.”

And we must recall that in places like California (and Belgium), ordinary citizens cannot easily carry handguns to protect themselves.

The result of all this is that anybody who puts his feet into a BMW and his hands on a gun or knife is a possible threat.

The reaction of the very authorities responsible for social-engineering such a society will probably be to try and further restrict the right of the innocent to defend themselves. And watch the backlash against people deemed to be mentally disturbed or different, and guilty of pre-crimes.

Anarchy and the Limited State

One can argue for total anarchy if it is the only stable equilibrium that is acceptable on the continuum from total anarchy to the total state. Note that both total state and total anarchy are stylized concepts, which can only be approximated in reality. Note also that stability has a time dimension. During history, neither near-total state nor near-total anarchy has been stable for more than a few centuries. One could venture the claim that total anarchy would be stable, but it does not seem more a stretch of the imagination to make the same claim for a classical liberal, limited state.

Urban Legends about Mathematics and Keynes

Many urban legends circulate about the use of mathematics in economics.

For example, many people think (they have heard that…they know somebody who knew somebody who knew…) that John Maynard Keynes loved and used mathematics. In his 1936 magnum opus, The General Theory of Employment, Interest and Money, Keynes seldom used math. He even attacked economists for using them too much. One can find this by simply reading the General Theory:

It is a great fault of symbolic pseudo-mathematical methods of formalizing a system of economic analysis… Continue reading

The State Must Have Something to Hide

Any terrorist who does not believe that we are living in a free society but under a disguised tyranny (the sort he would like to establish under a different mantle) would have assumed that, at the very least, his phone calls could be logged and his emails read. The only people not to believe so were honest citizens who thought they were living in a free society. So remind me what are the reasons for hiding the Surveillance State? Why do you hide your surveillance programs if you have nothing to hide?

US Government Is Already Broke

Published in the Financial Post (, January 25, 2013

In Tuesday’s Financial Times, well-known columnist Martin Wolf argues that “America’s fiscal policy is not in crisis.” “The federal government,” he writes,“is not on the verge of bankruptcy.” “This,” Wolf admits, “is a highly controversial statement.”

Indeed, many analysts believe that the U.S. federal government is bankrupt. They include, among others, economists Jeffrey Hummel of San Jose State University and Laurence Kotlikoff of Boston University. As early as 2006, Kotlikoff wrote an article in the journal of the Federal Reserve Bank of St. Louis, asking the question “Is the United States Bankrupt,” to which he answered affirmatively. Continue reading

Obama’s Inaugural Address: the Citizens’ Citizens

Presidential inaugurations are, at best, similar to royal marriages in England, where simple people dream of the Prince Charming; at worst, they resemble nationalist orgies where people proclaim their faith in, and submission to, their dear leader. There was both in Barack Obama’s inauguration today. Continue reading

James Buchanan (1919-2013)

Published in the Financial Post (, January 10, 2013 [Note that the copy editor mistakenly removed the quote marks around "politics without romance," which is an Buchanan's expression.]

If one expression can capture the work of James Buchanan, who died yesterday aged 93, it is “politics without romance.” His approach generated a whole school of economic analysis called “Public Choice.” Closely associated to Buchanan were Gordon Tullock, Richard Wagner, Geoffrey Brennan, and other economists working mainly at the Virginia Polytechnic Institute and, later, George Mason University.

For his work in this field, Buchanan won the 1986 Nobel Prize in Economic Sciences.

Buchanan’s starting point was so simple enough that it now seems rather obvious. Continue reading