Public Choice Tests Government Against the Politicians Who Wield Its Power

Mike Munger defines liberalism through two commitments: humility, the assumption that “I may not be right,” and tolerance, the assumption that “you may not be wrong.” Neither comes naturally. In practice, he says, liberalism requires people to forbear from acting as if they know they are right and their opponents are wrong. That restraint does not mean abandoning conviction. It means persuading others rather than forcing them, and listening because they may have something to teach.

Munger presents public choice as an offshoot of this liberal tradition. James Buchanan called it “politics without romance”: an approach that asks how political decisions are actually made, rather than treating government as a unified, benevolent actor. The phrase does not mean public action is always misguided. It means resisting the assumption that government will identify and pursue the common good simply because it is government.

The restraint Munger describes depends partly on norms that laws cannot supply. Russ Roberts connects this to Lord Moulton’s idea of “obedience to the unenforceable”: limits people accept even when no legal penalty compels them. Some things are wrong without being illegal. Roberts suggests that if people treat legality as the boundary of morality, the informal restraints that make open debate possible can disappear.

Munger agrees that liberal societies need this middle ground between law and private choice. A parliament could impose a strict speaking limit and vote to silence anyone who exceeded it. But a norm allowing someone to continue speaking may be better: listeners might learn something or change their minds. The point is not that rules are never useful. It is that not every worthwhile restraint should be enforced as a rule.

Munger notes that Patrick Deneen has argued liberalism is failing because it has come to treat whatever is legal as moral. Munger disagrees with that as a definition of liberalism, but says he is uncomfortably close to agreeing that the danger is real. The fact that an action is permitted does not settle whether it is right; the “middle nation” Moulton described depends on people accepting limits the law does not impose.

The term liberalism itself complicates the argument. Munger says that outside the United States it generally refers to individual rights and the freedom of individuals to act as they see fit. In the United States, he argues, the word came to be associated more with progressivism: a view that individuals operate within forces too large for them to manage alone, and that government should help counterbalance those forces. What Americans call classical liberalism, he suggests, is closer to what much of the world simply calls liberalism: limited government, individual rights, responsibility, and reliance on norms that emerge rather than being imposed.

He presents this as a broad characterization, not a definition beyond dispute. In his account, classical liberalism draws on the Scottish Enlightenment and Edmund Burke, combining concern for individual rights and limited government with individual responsibility. He describes it as a kind of civic republicanism in which people create meaning for themselves, rather than relying on government to create communities of meaning for them.

The “romance” in Munger’s account is the impulse to carry the moral expectations of close relationships into institutions involving strangers. He draws on Friedrich Hayek’s distinction between the small, intimate order and the extended order. Family life can depend on affection, detailed personal knowledge, and discretionary judgments about what each person needs. Hayek’s warning, as Munger presents it, is that those practices cannot simply be extended to a whole society; nor should the impersonal rules of a large-scale order govern every intimate relationship.

Russ Roberts makes the distinction concrete with family decisions. Parents know their children’s preferences, circumstances, and struggles in ways that a distant official does not. They may distribute resources unequally because they judge one child to need more that day. Roberts describes this as a form of family “dictatorship”: a parent substitutes a judgment about what is good for a child for an abstract rule of equal shares. When a governor sent him a note urging him to vaccinate one of his children, Roberts says he felt the state was implying that he did not know or care for his child adequately.

The reverse mistake would be to apply the impersonal rules of commerce to family life. Charging children rent or giving a spouse a retail gift card on the grounds that it offers greater choice might make sense under a narrow account of consumer welfare. It could still violate the meanings and expectations that make family relationships work.

Munger’s example is a Best Buy gift card for a spouse’s birthday. He can construct an economic argument that the gift card is at least as good as choosing a present himself: the recipient can select something they want more. He jokes that he could demonstrate this with indifference curves and a budget set. But the gesture might still be received badly. A line of reasoning that makes sense in a commercial setting does not settle what is appropriate in a personal one.

The distinction is not that families are fair while markets are not, or that one order is morally superior. Roberts describes parents as making judgments about what is good for their children, rather than applying an abstract rule of fairness. Munger’s point is that this kind of discretion rests on a particular relationship. A spouse’s gift, similarly, has meaning beyond the recipient’s opportunity to choose a product.

Hayek’s broader point is that societies contain different kinds of relationships, each with its own rules. Solidarity and altruism can help people cooperate in families and small groups, but they cannot by themselves organize a large society. Conversely, applying the impersonal rules of a wider commercial order to intimate relationships can crush them. The challenge is to live in both orders without confusing them.

Mike Munger’s “two eyes” for assessing institutions are information and incentives. Any proposal to have one institution correct another’s failures has to ask what information the decision-makers possess and what incentives shape their choices. Munger names four familiar conditions associated with market failure: asymmetric information, externalities, public goods, and natural monopolies. These are real conditions, he says, in which markets may produce outcomes that appear improvable. His objection is to assuming that government can correct them without facing its own informational and incentive problems.

Munger links the information problem to Austrian economics, which questions what government can know when it does not use prices to coordinate dispersed information. Public choice focuses on incentives: the people who operate government have interests and constraints of their own. Munger’s test is to replace “government” in a proposal with the name of a politician the speaker distrusts. If someone says the state should decide what people may say online, he asks them to substitute Donald Trump—or, as Roberts notes, Nancy Pelosi. If the proposal becomes unacceptable, the abstraction may be doing too much work.

The test is not a partisan claim about any particular politician. Its purpose is to make the decision-maker visible. Munger argues that saying “the government wants” or “the government will do” can make a collection of people and offices sound like a single organism. Government exists, but what it does emerges through institutions, rules, and individual choices. The people within those institutions may face different incentives from people in businesses, but they do not become a different species.

This is the point of behavioral symmetry, which Munger says might more precisely be called motivational symmetry. People respond differently to different incentives; the claim is not that a politician behaves exactly like a business executive in every situation. It is that the same assumptions about human motivation should apply in both settings. A corporate executive who becomes a senator does not receive a new soul. Nor does a consumer become an expert in foreign policy when entering a voting booth.

The argument does not require assuming that people are narrowly selfish. Munger distinguishes self-interest from selfishness: self-interest can include concern for others and a desire to participate in groups. Methodological individualism means that individuals are the ones who experience outcomes; it does not mean people care only about themselves. Roberts illustrates the distinction with a group lunch: if everyone says they had a good time, that is shorthand for the experiences of the individuals. If one person had an allergic reaction and went to the hospital, it would be strange to say without qualification that the group had a good time.

Munger adds that methodological individualism is not ethical individualism. Ethical individualism, as he describes it, would mean treating one person’s good experience as sufficient to declare the group’s experience good. People can care about other members of a club, team, or voluntary association, and talk about the quality of an experience shared with them. They form groups and pursue common aims without making the group a single mind or erasing differences among its members.

Munger uses lunch to illustrate politics as exchange. A group wants to eat together, but each person may prefer a different restaurant. They make arguments about distance, price, and waiting times, and may reach a compromise. Someone who dislikes the choice can leave and get takeout. They might also defer to the person who knows a cuisine best, or agree to share dishes. The group decides where to eat, while individuals may choose what to order.

Roberts points out that the diners may care about one another and know each other’s needs, while people in a large political community may be strangers who dislike one another. Munger agrees: the information and incentives that support cooperation in a small group generally do not scale. The lunch example illustrates collective choice, but does not supply a model for how a large political community will work.

Once decisions are made through government, “the will of the people” can disguise the difficulty of aggregation. Russ Roberts stresses that citizens want different things. A political outcome is produced by institutions, norms, and the incentives of people working within them; it is not a direct expression of one shared preference. That does not mean government intervention is necessarily bad, or that markets always produce the right result. It means that neither democratic procedure nor the label “public servant” removes the need to examine how decisions are made.

Munger’s analysis emphasizes the information voters have and the incentives politicians face. He says most people cannot name even one senator and treats that lack of information as a rational response to incentives: a single person’s vote is unlikely to determine an election, so there is little reason for that voter to master every policy issue. The same lack of attention does not apply to all participants. Organized interests may have stronger reasons to focus on particular decisions.

Roberts supplies the sugar example to show how those differences can affect policy. Producers who benefit from restrictions on imported sugar have a strong reason to focus on them. Consumers, each of whom may pay somewhat more for products containing sugar, have less reason to notice or organize against the cost. Roberts’s point is that a policy benefiting a small group while imposing smaller costs across many people should not simply be described as the will of the people.

For politicians, reelection is a central constraint. Munger compares that constraint with competition in business. A company faces customers and rivals; a senator faces voters and the process of winning another term. In Munger’s account, organized interests can matter disproportionately when the wider electorate is inattentive. Electoral incentives do not guarantee that representatives will enact what most citizens would prefer if they were fully informed and organized.

Munger also argues that political attention varies across stages of elections. He puts participation in primaries at roughly 15 or 20 percent of the population and says those who turn out may be more ideological and, in his view, often poorly informed. A candidate has to win the primary and then the general election. Munger’s claim is that a politician who takes a principled position may risk losing a primary before facing the wider electorate.

The exchange over Edmund Burke exposes the tension between personal judgment and political accountability. In his speech to the Bristol electors, Burke argued that a representative owes voters his judgment, not simple compliance with their wishes. If he believes the right course differs from what voters want, he should follow his judgment. Munger notes that Burke lost the election. The example complicates the idea that an elected official can simply rise above political pressure: voters can punish a representative for exercising judgment against their wishes.

Munger says elected officials may be less free to act on their judgment than the romantic picture of public service suggests. A senator must seek reelection and work through other offices and veto points. Even a representative with a good idea may not be able to enact it. Munger does not claim every legislator is cynical or that no public-spirited person enters politics. He argues that political incentives can make it difficult for legislators to act as they believe they should.

Roberts challenges the bleakness of that account. He does not accept that all political outcomes are a “cesspool of failure,” and sees no reason public choice must rule out public-spirited politicians or effective government. He also questions whether politicians are simply exploiting voters’ lack of information. Munger replies that his point is not necessarily that they exploit it, but that they face the fact that voters cannot easily overcome it.

Munger points to what he describes as a period of little legislation in Congress and increasing reliance on executive orders under successive administrations. He attributes this, in part, to incentives that make it hard for legislators to take positions that could cost them a primary. Some politicians who are principled, he says, become frustrated by their inability to act. His more specific judgment is that, under current conditions, those who remain in office for a long time may be more interested in power than in effectiveness.

Roberts’s counterargument is that incentives are important without being the only determinant of conduct. People can choose not to follow them, and norms—both legal rules and unenforceable expectations—shape behavior in business and politics alike. The speakers reject the simple contrast between virtuous public servants and greedy businesspeople, as well as its mirror image. The relevant questions are what people know, what they have reason to do, and what norms help them act well.

Munger explicitly qualifies the reach of public choice: it does not rule out the possibility that the state can make good choices and improve things. That is different, he says, from his judgment about current conditions in the United States. Roberts’s presumption of liberty is a default, not a claim that every public intervention fails; Munger’s criticism is that the current incentives make effective and principled action unusually difficult.

Political attachment can be a source of pleasure and belonging. Russ Roberts describes sports fandom as a largely harmless form of romance: a fan may say “we won” even though the team played without him, or believe a favored athlete could do no wrong. When the illusion breaks, the disappointment can be real; the attachment can also add richness to life.

Mike Munger agrees that teams can be a healthy outlet for the desire to belong. He suggests that people are inclined to feel embedded in something larger than themselves, and invokes the Dunbar number—the approximate size of a group in which people can keep track of reputations—to describe the importance of small communities. He says gossip helps people keep track of others’ conduct. His point is not that attachment is inherently harmful, but that its consequences differ when it attaches to a political state.

Roberts connects that risk to Hayek’s warning about carrying the instincts of the small group into the wider order. People may trust their parents not to hurt them, or assume a favored athlete would be a good person. Munger argues that it is different to imagine the state as an organism whose leaders naturally represent the people as a whole. In that case, attachment can make the interests and choices of actual people within government less visible.

Munger associates this organic conception with romantic traditions, including Hegel’s account of the state as an ethical substance with a rational structure above individual wills. He also notes that Edmund Burke shared elements of this view. In the account Munger gives, the state is understood not as a set of offices held by individuals with particular interests, but as the embodiment of a people’s shared ethical life.

Roberts offers Joseph Roth’s The Radetzky March as a literary example of emotional entanglement between people and the state. The novel follows a family whose members are connected to the Austro-Hungarian empire through military and bureaucratic roles. Roberts sees the book as a portrait of the loss of romance when the illusions sustaining that attachment are shaken.

The danger Munger draws from this is not that people should give up political commitments, but that they should not assume power is safe because their own side holds it. Roberts recalls Munger’s image of a sword one would not want an opponent to wield after the next election. Munger uses it to warn against removing constitutional limits because a leader is believed to be good or aligned with one’s aims. Political control can change hands; the restraints one rejects for an opponent may be the restraints one needs later.

The speakers’ disagreement is not over whether government should be trusted without scrutiny. Both reject that. It is over how pessimistic to be about the current political system—and why ideas of limited government and individual liberty have lost ground.

Russ Roberts describes himself as less dismissive of political outcomes than he once was. He sees a presumption of liberty as a sound starting point, but not as a reason to rule out public action. People should generally be free to make their own choices, including giving to charity or forming nonprofits to address problems they care about. Mike Munger agrees that public choice does not, by itself, prescribe a minimal state. He is more pessimistic about the present United States: in his view, current political conditions make it unusually difficult for candidates committed to humility, tolerance, and limited government to prevail.

Munger connects this shift to what he sees as a failure among advocates of classical liberalism, including academics such as himself. They emphasized material consequences—such as the prospect that markets would make people richer—without making the moral case for liberalism or addressing the desire for meaning and belonging. The collapse of the Berlin Wall, he says, encouraged a triumphalist belief that liberal democracy had won. Advocates of liberty did not do enough to explain what kind of life their political arrangements made possible.

His diagnosis is not that material prosperity is unimportant. It is that a case for liberty made only in terms of better products or rising wealth may not answer people’s desire to belong to something larger than themselves. Munger argues that public-choice and classical-liberal thinkers neglected that moral dimension, leaving room for political movements that offered a more affirmative account of collective purpose. He says Deneen has partly diagnosed this problem, even though Munger disagrees with Deneen’s definition of liberalism.

Munger says he has become more worried after speaking with younger conservatives. He describes a change in the way some of them talk about the Constitution. The young conservatives he once encountered carried a pocket edition of the U.S. Constitution and saw conservatism as the defense of a liberal tradition. Now, he says, some argue that the Constitution is a “dead letter,” that its restrictions leave their side fighting with one hand behind its back, and that power should be centralized in a president who can impose preferred policies.

For Munger, that is a change in how political power is understood. A constitutional limit may frustrate a leader who wants to enact policies he regards as good, but it can also prevent opponents from using the same power later. People who assume their side will always prevail may be mistaking the beliefs of their political circle for the views of everyone else.

Munger uses Thomas Sowell’s phrase “a constrained vision” for the alternative. A person may want to do good, but must accept that some desirable actions will be blocked to reduce the chance of future abuses. What counts as good is disputed, including by people who share a political community. For Munger, accepting limits means recognizing that one’s own assessment is not the only one that can shape public policy. The response to disagreement should be persuasion and accommodation, not simply a stronger capacity to win.

Roberts’s response is more measured. He says limited-government ideas have struggled for much of his lifetime, even if their prominence has ebbed and flowed. He also suggests that the issues animating voters have changed: questions about economic policy and regulation that once occupied much of the political debate no longer seem to motivate voters in the same way. He asks whether the electorate has moved away from freedom and toward more government control. Munger’s answer focuses less on a simple movement leftward than on a renewed form of political romanticism, including on the right.

The unresolved tension is between Roberts’s qualified optimism—that public-spirited people and useful government action remain possible—and Munger’s judgment that current incentives and political attitudes make the prospects for limited government especially poor. Munger does not attribute that pessimism to public choice as a doctrine. He attributes it to the present political environment and to a failure to offer a compelling moral account of liberty. He warns that a politics organized around winning, without restraint or accommodation, may leave either side vulnerable when power changes hands.