James Buchanan Exit or Way Out

James Buchanan, Exit or Way Out?

Unless some dramatic action is taken, Buchanan believes the spectre of the Hobbesian jungle will become concrete very shortly. He rejects any piecemeal approach for that is largely how we raised the ghost. His valuable insight into the punishment dilemma indicates that greater enforcement will not be sufficient. But this is not the crucial issue, as state violations of the constitutional contract are the fundamental cause of the problems. Buchanan's solution is a 'constitutional revolution' in which individuals engage in a major reassessment of their constitutional rights and freedoms (Buchanan and de Pierro, 1969). But being a methodological individualist he is unable to predict the outcome of such a renegotiation of the constitutional contract; certainly he expects a rolling-back of state intervention. This is not the bugle call for the return of laissez-faire doctrines and their implied support of the status quo because he also expects that the question of income distribution to be on the agenda. But in the cases of 'market failure' and 'externalities' Buchanan forsees the emergence of new institutional arrange­ments rather than state intervention.

However, Buchanan's constitutional revolution can only come about if the contractarian perspective is adopted by citizens, legislators, the judiciary, social philosophers and economics professors. The intellectual climate appears conducive to such a conversion given the confidence of the 'radical right' and the growing ascendancy of monetarism. But the problem remains of constructing a political machine whose function is to dismantle and modify the state apparatus without itself being corrupted. Further, those who currently benefit from the existing machine will resist any changes whilst changes in technology (e.g. the coming 'chip'-based-information society) and in the international economic order (e.g. increasing dominance of the global corporation) may induce an increased desire for state intervention. The growing ground swell of tax payers' revolts, the success of California's Proposition 13 (which surfaced in a fairly unusual constitutional setting) and the general dissatisfaction with government, testify to the possibility of a renegotiation and the importance of public choice. Buchanan gloomily sees the alternatives as either an intensification of the social dilemma of being governed or violent revolution.

Buchanan's analysis of the emergence of law; of constitutions as a process; of the pervasiveness of contracts; and of the problems of the day, are not exactly historically descriptive. They provide a framework for discussion and study and one that is at variance with many more popular perspectives. Within the framework the focus of attention is the state which is deemed to have failed. His economics of politics examines head-on an apparatus that impinges on everyone's life, apparently without limit. Of course Buchanan attracts many detractors who can criticise his rejection of an organic state, class, the public interest and his view that economics is about markets not allocation. But ultimately all criticisms can be reduced to an attack on Buchanan's methodology which embodies his beliefs. Thus, finally there is only one question: do Buchanan's beliefs offer us an exit from our current problems - or are they just too way out ?