MR. BUCHANAN: SOME EPISODES FROM THE LIFE OF A UNIVERSITY OF VIRGINIA GRADUATE STUDENT IN THE EARLY 1960s
Charles R. Plott
California Institute of Technology
At the University of Virginia in the 1960s Public Finance was an upper level course taught by Mr. Buchanan. Everyone was referred to as "Mr." at the University of Virginia and the daily-required dress for classes was coat and tie. No student would have imagined calling Mr. Buchanan "Jim." I recall how the class was conducted. His style was to assign either papers or a topic for reading and students were required to produce written documents of no more than a page or two on each assignment. This ritual began the first week.
The first assignment was to produce a "positive case for tax reform." I think it was broad tax reform related to a paper that had been assigned for reading. The paper contained many opinions and value judgements and Mr. Buchanan had made it clear that preaching did not particularly impress him – and he equated preaching to the implicit use of value judgements in papers that were supposed to be based on facts. Of course, none of the students knew Mr. Buchanan beyond his formidable reputation, the reputation that had attracted me to the University of Virginia the preceding year. His classroom presence made it clear that assignments were to be taken seriously and that production of paper by the students was definitely expected.
I could see many approaches to the assigned problem. The paper we were using as a background could be ridiculed. One could use the opportunity to express personal opinions about various and sundry governmental tax policies. I could search for inconsistencies in either the tax code, general tax policies or in the implicit value judgements in the assigned paper. However, the assignment used the word "positive" and none of the approaches I could imagine seemed to be responsive to the challenge that Mr. Buchanan had given to us. He had given no hints on how one might proceed.
My mind could produce only one conclusion. The assignment was impossible. It was based on a confused view about areas in which positive analysis could be applied. I could not see how a matter of active policy analysis promoting a change in policy could be approached without some sort of value judgement. On the one hand, I knew that Mr. Buchanan must know how to solve the problem or he would not have given the assignment. On the other hand, my mind could produce no answer other than the assignment could not be done. Faced with the fact that a paper must be produced I began to write.
Almost certain that my days at the University of Virginia were numbered, due to the fact that I was going to tell an established professor that he did not know what he was talking about, I nevertheless tried to make my case. Perhaps in the process of getting the boot I would learn something important. In many clumsy ways my essay said that value judgements were inherent in any such task. Listing every approach I could imagine, I tried to identify the point at which a value judgement was inescapable. My first and last sentences said that the task was impossible. As I prepared the paper I figured that a Ph.D. career for me was simply not in the cards.
I do not remember if we turned in the papers and then discussed them or discussed them and then turned them in. I do remember that the first reaction a student received from Mr. Buchanan was in the public forum of the classroom after ideas were exposed to the class and to Mr. Buchanan. Since this was the first part of the semester and the class had not yet experienced how Mr. Buchanan expressed displeasure, I did not know the form of execution that I would experience.
In a million years I would have never guessed what happened. Mr. Buchanan was ecstatic with my ideas and my work. He read my paper to the class saying that I was precisely right. He went over the other papers, exposing his own curiosity and the difficulty he was having dealing with this sort of question. With each student he pondered how the student might be able to get around my position. It was clear that mine was not an answer that he wanted and he felt that other alternatives must exist but, in fact, he shared my opinion. His grading practice was to assign either a minus or a plus to a paper as opposed to letter grades and I think that I received two of the latter. I was shocked and relieved but, more importantly, I was excited about the intellectual honesty that I was privileged to be a part of.
To me the lesson was profound and the lessons that I continued to get from the class were similarly profound. The lessons were not necessarily about public finance, although we learned that as well. Mr. Buchanan was instructing us in a process of discovery, by either posing a question because of its intrinsic interest, or as an attempt to extend the ideas of others after critical review. In fact, most of the assignments were to "criticize" and so ingrained became this process of criticism that for years later it was difficult to even read a paper without putting it down in disgust and listing objections.
Nevertheless, in this atmosphere of critical review, the ideas of others were held with respect. More importantly, the students learned that their ideas were treated just as seriously as those of the author of the paper in review. Mr. Buchanan readily admitted when he did not know something and was quick to acknowledge when a student’s ideas were better than his own. This lesson was about the irreverent and dispassionate nature of research, with the arbitrator being logic and nature itself, and it influenced us all. No argument was won by appeal to authority. The ground rules for discussion resided only in facts and logic.
We all enjoyed the occasions when Mr. Buchanan assigned one of his own papers for review. The students would chew these up just as readily as any others without even bothering to be polite with the use of language. Mr. Buchanan would take the abuse with a smile and be particularly excited when someone could prove him wrong. The tougher the criticism the greater the praise. The training in the course was to take no prisoners - not even the professor!
It is interesting to contrast the class of Mr. Buchanan with the classes in the business school that were held jointly with law school students. I recall one discussion in particular when one of the economics graduate students, Admiral George Brown, was questioning the arguments advanced in the case the class was studying. "It is a clear example of collusion," argued a law student. "That does not follow from the facts and pattern of data," claimed Brown. "I don't care," replied the law student, "it is still an example of collusion." "Says who?" asked Brown in a tone of disbelief. The discussion was ended by the law student's appeal to authority: "Judge X, that's who!" In Mr. Buchanan's class the discussion would have never ended like that.
He demonstrated that intellectual activity is a process of discovery and all of us are part of it. He did not pretend to have the answers to all questions. He never hesitated to admit that he did not know. He was urging us to ask deep questions and to not avoid the philosophical. His own deep seated hope seemed to be that policy/political analysis without values is possible and that the problem just needed better elaboration. We would bump against this complex issue from time to time but the lesson seemed to be to skip problems that we could not solve and go to the next one. Get the ideas out. Push rather than repeat.
This free-for-all of ideas did not go unnoticed by the students. Several were upset because we were not using a famous book by Musgrave. Basically, they thought that we should be learning to repeat what others said. Of course, that was not to be.
The formality of the Thomas Jefferson Center at the University of Virginia was shattered by the presence of Betty Tillman. All graduate students were (and remain) her "boys and girls." Mr. Buchanan, Mr. Coase, Mr. Nutter, Mr. Tullock and Mr. Yeager were all "Mister" but Betty Tillman was "Betty." Her office was stationed between the offices of Mr. Buchanan and Mr. Tullock but her fingerprints were everywhere. Most importantly, she was the heart of a sense of community that certainly integrated the students but also linked the students with the faculty.
Ideas, it seems, are frequently suggested by the posing of questions. At several points Mr. Buchanan posed questions that substantially influenced my research career and in this experience I know that I am not alone. I suspect that some of these questions were posed to me because I was recognized as one of the more technically inclined students, who was called upon when graphs and intuition about the logic began to fail.
Public Finance was the background specialty but Mr. Buchanan was interested in both the finance aspects of the public sector as well as the demand side. He recognized the great absence of theory about the efficiency of public decisions, or even a methodology for asking the questions. This recognition motivated many questions about the implementation of various mechanisms, such as voting, lotteries, games, contests or anything else that might apply to the assessment of the demand for public goods. Those questions lead naturally to the supply side and whether or not classical administrative and bureaucratic responded efficiently.
Mr. Buchanan was curious about a world which contained only public goods. He recognized that the classical Samuelson conditions required at least one private good and he was stumped about what might be the conditions used to describe efficient allocations when no private goods existed. Or, what were the conditions on equilibrium if unanimity is used in a world of private goods. In my second year as a graduate student he asked me what the conditions might be and in seeking an answer to that question I posed related questions that occupied the first years of my research career. The search for an answer took me through the early theory of linear inequalities and into the theory of convex cones and much of the theory of linear and nonlinear programming. As it turns out, the answer to Mr. Buchanan's question had been posed and answered much earlier by R. Frisch but, by the time I discovered Frisch, I had answered the question independently and was asking about majority rule equilibrium under the same conditions. I was also interested in how a group might find a proposal that all could agree to among a large set of options. Both of these extensions of Mr. Buchanan's question turned into important publications for me.
The work on equilibrium conditions in a world of public goods occupied my time well into my third year and I thought that they could be used as a dissertation. I raised the issue with Mr. Buchanan, who was by this time my advisor. He considered the time of year, which was early the first semester of my third year. He also reflected on the fact that I was on an Irwin Foundation fellowship and wondered what I would do for the rest of the year. He did not mention it but the fact was that he had been working on housing policies. The conclusion was that I should shift my effort to a new and different topic, the problem of grants-in-aid. I am not sure that I had a lot of input in that particular discussion. Anyway, my dissertation topic became urban renewal. Suspecting that time left on my fellowship might have more to do with when I graduated from the University of Virginia than the questions I was posing for research, I continued to work on questions related to the federal urban renewal program until it was time to graduate. By this time Mr. Buchanan was a sounding board for ideas and his excitement was infectious and a constant source of encouragement. The (second) dissertation resulted in a good publication.
Mr. Buchanan could see the tracks of public goods in places that had been obscured to others and his questions were constantly leading to discoveries about where the basic theory could be applied. The joint cost problem was recognized as having public goods aspects. Peak loads could be interpreted as involving public goods. Aspects of quality and location were put in the same category. One day he asked me how one determines where to put a fire station, a question that still challenges aspects of theory. To this he added issues about decision-making processes and new concepts of game theory. I recall his sharing his correspondence with Bob Aumann about cooperative games without side payments with a continuum of players. These questions continued to shape my thinking for years.
One of my most interesting experiences was when he handed me a first draft of his theory of clubs. I formalized the model and demonstrated that his major conclusions could be deduced as an immediate consequence of the problem formulation. To me the problem was trivial and I reported as much to him. Nevertheless, in spite of my criticism, the paper continued to circulate backed by his high opinion of it. Clearly, this was an important lesson for me. The lesson did not register with me at the time but when the paper became recognized as the seminal work for a new branch of theory my attention and re-evaluation was evoked. The lesson was one that Mr. Buchanan had taught me many times through demonstration (but never through a lecture). It is the interpretation of the model and not necessarily the complexity of the mathematics of the model that makes it an important contribution.
Students were encouraged to get their ideas into print. I recall that John Gurley, who was editor of the American Economic Review in the early 1960s, claimed that he received more papers from Jim Buchanan students than the students of anyone else in the profession.
I think that this activity of U.Va. students was derived in large part by the confidence placed in them by the faculty. From my perspective the best example is the first meeting of what was subsequently called the Public Choice Society. The meeting was held in the fall of 1963 at the Faulkner House at the University of Virginia. I think that Mr. Buchanan managed to get funding for the project through Howard Hines of NSF and had put together what can now be seen as an impressive list of participants, including Duncan Black, James Coleman, Anthony Downs, John Harsanyi, Jerry Kramer, Eleanor Ostrom, Vince Ostrom, John Rawles and Bill Riker. The subsequent fame of the scholars on this list, as well as the others who were there, says something about the ability of the person who compiled it.
Mr. Buchanan asked me to prepare a reading list, a sort of bibliography, to define this emerging area. The interesting thing is that I was left alone to include what I thought was important and to ignore what I thought was not important. This was a major meeting for the faculty of the University of Virginia and to give a graduate student the responsibility for contributing to the definition of a new field really demonstrated the confidence he placed in his students. I felt this confidence, as did the other graduate students, and there is little doubt in my mind that it contributed to the success of the careers that Mr. Buchanan has touched.
I recall a bit of philosophy he gave me and I pass it along to my students. "From time to time in your career you will find yourself at odds with everyone else in the profession. Everyone might think that you are wrong. When that happens, study your arguments very carefully because they could be right. Then, if after careful review you can prove yourself right, stick with your position. It is one of your most creative moments." Of all of the things that Mr. Buchanan taught me this perspective is one of the most important.
July 16, 1999