Political Entrepreneurs

The Economic Engine of Political Change

January 2013

The Antigua Forum 2013

January 30th, 2013 by Wayne Leighton

This past weekend (January 24-27, 2013) marked the second annual gathering of the Antigua Forum.  Over 30 reformers from around the world gathered in Antigua, Guatemala to focus on one key theme: how to make market-liberal reform a reality in their countries. The participants at this year’s event included experienced reformers (e.g., former high-ranking officials), current reformers (those who are “in the trenches”), innovators working outside of the traditional political process (e.g., private education in…
Read more»

Students for Liberty Reviews Madmen

January 26th, 2013 by Edward Lopez

Matthew Needham, a senior politics major at Michigan State University and Executive Board member at Students for Liberty, has enthusiastically reviewed Madmen . An astute reader and conversant (I had the good fortune of meeting him last weekend in Toronto), Matthew concisely summarizes our framework for understanding political change, and then he draws attention to its implications–namely the theme of Chapter 7, “Assembling the Wisdom: What is to be done?” While their model emphasizes the role of academics and…
Read more»

Light blogging of late

January 25th, 2013 by Edward Lopez

Sorry for the light blogging of late. After last week’s Cato Book Forum , Wayne flew south to Guatemala to direct the annual Antigua Forum conference — a gathering of several dozen reformers (i.e., political entrepreneurs) from around the world. As for me, I flew north to the University of Toronto for a one-day seminar on Madmen sponsored by the Institute for Liberal Studies, and I’ve been putting in long hours organizing the 50th anniversary conference of the Public Choice Society. So, although Wayne and…
Read more»

Video of Cato Book Forum on Madmen

January 18th, 2013 by Edward Lopez

We had a thoroughly good experience presenting the substance of Madmen at yesterday’s Cato Book Forum. For those of you who didn’t catch the live webcast, the video is now available. Follow the link below. I think it’s particularly interesting to hear Ian Vasquez’s opening remarks and then to skip to the 34:30 mark and watch/listen to the comments by Fred Smith (until recently, the President of the Competitive Enterprise Institute).  There was robust discussion during…
Read more»

Rediscovering Buchanan’s Rediscovery

January 14th, 2013 by Edward Lopez

As I claimed in  a post last Thursday , the recent flurry of commentary about Jim Buchanan is most welcome and impressive, but it fails to capture his deepest contribution and the breadth of its relevance. In this post I will try to convey in plain language what I think those are. This is a long post, long enough to try the patience of most readers. So, for your convenience, let me first summarize: While Buchanan is best known…
Read more»

Entitlement Reform and Public Employees: Interesting Battles, Important Experiments

January 13th, 2013 by Wayne Leighton

In December the U.S. Government Accountability Office (GAO)  released a report on retiree health benefits and the liabilities of the U.S. Postal System. Sounds pretty esoteric, right? We’re talking about one entry on the balance sheet of a government agency that is not particularly innovative or popular. Yawn. And yet, this issue points directly to questions that will drive any future discussion of fiscal reform in the United States. It’s best to pay attention. For example,…
Read more»

James McGill Buchanan, Jr.: The Family’s Obituary

January 12th, 2013 by Edward Lopez

This is the obituary released by the family. It is published in today’s Roanoke Times. Memorial services have yet to be announced. Information about charitable contributions is listed at the bottom below. Notes to the family should be directed to Jo Ann Burgess at the Buchanan House — address below. Nobel prize-winning economist Dr. James M. Buchanan died Wednesday, January 9, 2013, in Blacksburg, Virginia. He was 93. Buchanan, a 1940 graduate of Middle Tennessee…
Read more»

Financial Services Regulation: The New Ability-to-Repay Rule

January 11th, 2013 by Wayne Leighton

On January 10, 2013 the Consumer Financial Protection Bureau released new proposed rules related to mortgage lending standards. In effect, the agency will implement an “Ability to Repay Rule” to govern those who engage in mortgage lending. Here’s the agency’s announcement , which offers few details. This news report from the Wash Post’s business section is more informative. The new rules will apply to “qualified mortgages” and are designed to keep lenders from issuing loans to borrowers who…
Read more»

James M. Buchanan: A Compendium of Remembrances

January 10th, 2013 by Edward Lopez

Donald Boudreaux and Alex Tabarrok have already provided very useful lists of commentary about the passing of Jim Buchanan. Here, I add my own perspectives, admittedly with some overlap. The New York Times obituary  is an excellent place to start and a solid overview of Buchanan’s life and work: A similar article at Bloomberg fills in additional interesting details. Also an excellent introduction to Buchanan’s life and work, George Mason University produced this video , “Daring to be Different,” in 2009. One of…
Read more»

James M. Buchanan: Complete Scholar

January 10th, 2013 by Edward Lopez

Here are five observations to illustrate the breadth and depth of Jim Buchanan’s work. 1. The philosophical depth and political idealism of James M. Buchanan, from the early pages of The Calculus of Consent: Logical Foundations of Constitutional Democracy (1962), which he authored with Gordon Tullock: The Scholastic philosophers looked upon the tradesman, the merchant, and the moneylender in much the same way that many modern intellectuals look upon the political pressure group. Adam Smith and…
Read more»

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.189, ch.7)

The most successful entrepreneurs know what they do well, they know the market and the opportunities within it, and they choose those activities that create the most value. This is true in economic as well as political markets.

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.178, ch.7)

[W]hen the right elements come together at the right time and place and overwhelm the status quo, it is because special people make it happen. We call them political entrepreneurs.

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.176. ch.7)

While we started this book with Danny Biasone saving basketball, we end it with Norman Borlaug saving a billion lives. These stories are not that different. Both faced vested interests, which were reinforced by popular beliefs that things should be a certain way—that is, until a better idea came along.

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.174, ch.6)

Because there was a general belief that homeownership was a good thing, politicians found the public with open arms.... Everybody was winning—except Alfred Marshall, whose supply and demand curves were difficult to see through the haze of excitement at the time, and except Friedrich Hayek, whose competition as a discovery procedure was befuddled... In short, once politicians started getting credit for homeownership rates, the housing market was doomed.

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.166, ch.6)

Everyone responded rationally to the incentives before them. In short, the rules that guided homeownership changed over time, which in turn changed the incentives of these actors. And bad things happened.

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.153, ch.6)

They understood the economics. The ideas had already won in ... the regulatory agency itself. All that remained to be overcome were some vested interests and a handful of madmen in authority.

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.146, ch.6)

If the idea for auctions of spectrum use rights had been part of the public debate since at least 1959, why didn’t the relevant institutions change sooner? What interests stood in the way?

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.121, ch.5)

When an academic scribbler comes up with a new idea, it has to resonate well with widely shared beliefs, which in turn must overcome the vested interests at the table. Many forces come together to explain political change, even though it may seem like coincidence of time and place.

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.120, ch.5)

It’s the rules of the political game that deserve our focus, not politicians’ personalities or party affiliations.

From the Pages of Madmen, Intellectuals, and Academic Scribblers (p.119, ch.5)

In short, ideas are a type of higher-order capital in society. Like a society that is poor in capital and therefore produces little consumer value, a society that is poor in ideas and institutions will have bad incentives and therefore few of the desirable outcomes that people want.

©2017 Wayne A Leighton & Edward López • Web Design by Barrel Strength