Political Entrepreneurs

The Economic Engine of Political Change

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 State University and a Rutherford County, Tennessee, native, received the 1986 Alfred Nobel Memorial Prize in Economic Sciences for his leadership in developing the public choice theory of economics. Dr. Buchanan also received the National Humanities Medal in 2006.

Of receiving the prestigious Nobel award, Dr. Buchanan once wrote: “If Jim Buchanan can get a Nobel Prize, anyone can. Recognition and acceptance of this simple truth are very important.”

A stridently independent thinker, Dr. Buchanan earned the Nobel for “his development of the contractual and constitutional bases for the theory of economic and political decision-making.” That this would lead, on the one hand, to the development of general political theory in constitutional political economy and, on the other, to public choice theory, which brings the tools of economic analysis to the study of public decision-making.

His book, The Calculus of Consent: Logical Foundations of Constitutional Democracy, which he co-authored with Gordon Tullock, is considered a classic work on public choice theory.

After he was awarded the Nobel prize, Dr. Buchanan continued to write and lecture on his interests around the world into his 94th year. He lived in Blacksburg, Virginia, and was married to the late Anne Bakke Buchanan, who died in 2005.

In 2007, Dr. Buchanan retired from his position as Advisory General Director, Center for Study of Public Choice, George Mason University, Fairfax, Virginia, having previously achieved emeritus status in 1999 as Distinguished Professor Emeritus of Economics from George Mason University and University Distinguished Professor Emeritus of Economics and Philosophy from Virginia Polytechnic Institute and State University, Blacksburg, Virginia. Professor Buchanan received his B.A. from Middle Tennessee State Teachers College in 1940; his M.S. from the University of Tennessee-Knoxville in 1941; and his Ph.D. from the University of Chicago in 1948.

The following is a short list of his most well-known major works: The Collected Works of James M. Buchanan (20 vols., 1999–2002, 2004)—most of the following titles are also published in the Collected Works— Better than Plowing: And Other Personal Essays (1992); The Economics and the Ethics of Constitutional Order (1991); Liberty, Market and State: Political Economy in the 1980s (1986); The Reason of Rules: Constitutional Political Economy (with Geoffrey Brennan, 1985); The Power to Tax: Analytical Foundations of a Fiscal Constitution (with Geoffrey Brennan, 1980); Freedom in Constitutional Contract: Perspectives of a Political Economist (1978); Democracy in Deficit: The Political Legacy of Lord Keynes (with Richard E. Wagner, 1977); The Limits of Liberty: Between Anarchy and Leviathan (1975); The Calculus of Consent (with Gordon Tullock, 1962).

The latest additions to his long list of distinguished publications are Why I, Too, Am Not a Conservative: The Normative Vision of Classical Liberalism (Cheltenham: Edward Elgar, 2005) and Economics from the Outside In: Better than Plowing and Beyond (College Station: Texas A&M University Press, 2007.)

The grandson of Tennessee Governor John P. Buchanan, James McGill Buchanan, Jr., was born on October 3, 1919, and grew up on a Depression-era farm in the Gum community of Rutherford County just outside Murfreesboro, Tennessee. He attended Buchanan School, which was named as such because it was built on land once part of the Buchanan family farm.

In his book of personal essays, Better Than Plowing, the down-to-earth Buchanan points out that his family’s humble roots instilled within him a strong work ethic—he earned money for college books and fees by milking cows—that set the stage for his distinguished career.

Buchanan graduated in 1940 from what was then Middle Tennessee State Teachers College with majors in mathematics, English literature, and social science. He went on to a graduate fellowship at the University of Tennessee-Knoxville and an economics fellowship at Columbia University.

Duty to country then called during World War II, with Buchanan entering officer training in the U.S. Navy ROTC program, eventually serving on the staff of Adm. Chester W. Nimitz in Hawaii.

Following his Naval service in the Pacific, Buchanan earned his doctorate from the University of Chicago. The prolific scholar and author would serve later as the advisory general director of the Center for Study of Public Choice at George Mason University in Fairfax, Virginia, where he also served as a distinguished professor emeritus.

Buchanan is survived by two sisters, Lila Graue of Fayetteville, Arkansas, and Elizabeth Bradley of Pearland, Texas, as well as three nephews, Doug Graue, Jim Whorley and Jeff Whorley.

Announcements regarding memorial services will be made at a later date. Charitable contributions in Dr. Buchanan’s memory may be made to either the Center for Study of Public Choice Foundation―Buchanan House Fund, Center for Study of Public Choice, Buchanan House MSN 1E6, 4400 University Drive, Fairfax, VA 22030 or the MTSU Foundation―Dr. James Buchanan Fund, Wood-Stegall Center, P.O. Box 109 Murfreesboro, TN 39132.

Madmen, Intellectuals, & Academic Scribblers

The Economic Engine of Political Change

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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.

Madmen, Intellectuals, & Academic Scribblers

The Economic Engine of Political Change

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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.

Madmen, Intellectuals, & Academic Scribblers

The Economic Engine of Political Change

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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.

Madmen, Intellectuals, & Academic Scribblers

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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.

Madmen, Intellectuals, & Academic Scribblers

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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.

Madmen, Intellectuals, & Academic Scribblers

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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.

Madmen, Intellectuals, & Academic Scribblers

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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?

Madmen, Intellectuals, & Academic Scribblers

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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.

Madmen, Intellectuals, & Academic Scribblers

The Economic Engine of Political Change

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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.

Madmen, Intellectuals, & Academic Scribblers

The Economic Engine of Political Change

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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.

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