The Story of the Virginia School.

• Author: Carden, Art

Towards an Economics of Natural Equals: A Documentary History of the Early Virginia School

By David M. Levy and Sandra J. Peart

308 pp.; Cambridge University Press, 2020

C.S. Lewis's "Screwtape Proposes a Toast" is one of my favorite pieces of literature. In it, we learn about the cunning subtlety with which societies can be undone by the mere redefining of words. Lewis illustrates this with "democratic," which becomes corrosive when the demos resents difference and sanctifies envy. In our age, applying "undemocratic" to Jeff Bezos or Bill Gates (or the success of the enterprises they started) is this kind of corrosion.

An anodyne definition of democracy simply sees it as a set of decision-making institutions involving majority rule. The Virginia school of political economy's definition--"government by discussion"--follows their intellectual lodestar, University of Chicago economist Frank Knight, and is a valuable complement.

In Towards an Economics of Natural Equals, David Levy and Sandra Peart explore the roots of Virginia political economy and the radical egalitarianism of James M. Buchanan and his contemporaries. The book is a thought-provoking treatment of 20th century economic thought or even of "neoliberalism," and economists and intellectual historians interested in how we got here would do well to add it to their bookshelves.

Ford Foundation rejection / Towards an Economics of Natural Equals is an extension of Levy and Peart's broader project on the history of economic thought. It is a natural companion to their 2017 book Escape from Democracy: The Role of Experts and the Public in Economic Policy. (See "The Discontented Animal," Summer 2017.)

The authors dive into the history of Buchanan's ill-fated effort to secure funding from the Ford Foundation to support his Thomas Jefferson Center for Studies in Political Economy at the University of Virginia. The outcome was depressing: the foundation (and administrators at the University of Virginia) seemed to think that Buchanan, Warren Nutter, Ronald Coase, and others in the Virginia and Chicago schools were reactionary right-wing zealots rather than scholars and economic scientists. The irony, Levy and Peart point out, is that by denying the grant request and hindering the Jefferson Center, the Ford Foundation made economics more monolithic rather than less.

One of the significant differences between more conventional economic approaches and the Chicago and Virginia approaches emerges...