All Commentary
Saturday, February 1, 1997

Book Review: Government: Servant or Master? Edited by Gerard Radnitzky and Hardy Bouillon

Can the Coming of a Euro-Leviathan Be Halted?

Rodopi • 1993 • 322 pages • $50.00

Dr. Prychitko teaches economics at the State University of New York, Oswego.

Years ago James Buchanan wrote The Limits of Liberty: Between Anarchy and Leviathan in which he argued that the constitutional and coercive authority of the state is necessary to maximize our liberty, but the state has broken its contractually sanctioned bounds. Once broken of its chains, the modern nation-state tends, willy-nilly, toward the monstrous leviathan that threatens, rather than enforces, people’s basic liberties. That book’s weaknesses lay in providing an overly abstract neoclassical model of constitutional choice that is difficult for those untrained in economics or political science to follow, and in failing to provide sustained empirical or historical examples that clearly shed light on the substantive growth of the state.

Although they aren’t intentionally following Buchanan’s lead, Gerard Radnitzky and Hardy Bouillon offer a solid set of philosophical, economic, and empirical arguments which, taken together, make for a fine complement to Buchanan’s earlier study. Government: Servant or Master? draws primarily upon European classical liberal scholars, and focuses on the present expansion (and chaos) of European nation-states. Of particular concern are the goals of the European Community. As Radnitzky states in his introduction, Their aim will be the expansion of Leviathan from [the] national to European level, to an Euro-Leviathan (the Maastricht Monster), among other things conceived as an institutional taxing cartel that enables the member states to maximize the spoliation of citizens (p. XLI). Can Leviathan (let alone a burgeoning Euro-Leviathan) be tamed?

Part I of the book consists of five theoretical chapters: Arthur Seldon’s Politicians for and Against the People is a study of the dire, politically alienating effects of the professionalization of politics. Gerard Radnitzky’s Private Rights Against Public Power explores the classical liberal claims that political freedom can only be a consequence of fundamental economic freedom. Anthony de Jasay’s Is Limited Government Possible? argues yes, limited government is possible, but only if constitutional commitments override the narrow interests of utility-maximizing individuals and special interest groups. Hardy Bouillon’s Mastering the Growth of Government is quite pessimistic, building upon de Jasay’s arguments that James Buchanan’s earlier analysis really doesn’t show how people, in forming a binding constitutional contract, will be able to overcome their own selfish interests and foster impartial agreements over rules. Finally, this section ends with another de Jasay chapter, Ownership, Agency, and Socialism, which employs principal-agent problems to state or social ownership.

Part II focuses upon several illuminating case studies: Peter Bernholz discusses the problems of hyperinflation and the need for credible institutional reforms—specifically rules that restrict the discretionary power of the state—to fundamentally curtail inflationary potential, while Gerhard Schwarz and Hans Otto Lenel discuss Switzerland’s current economic floundering and the interventionist social market economy of post- World War II Germany, respectively. Antony Flew criticizes the state-monopoly system of education in the United Kingdom, while Jacob Sundberg turns the book’s attention to the crippling Swedish tax system and its present crisis. Steve Pejovich focuses on the economic, political, and ethnic crisis of the former Yugoslavia, supplying his classic property rights analysis to explain its explosive rates of inflation and problems of merely reforming socialist categories of ownership, rather than fundamentally attempting to generate private, marketable ownership claims.

The book is rounded off, in Part III, by Peter Bernholz’s keen discussion of totalitarianism as the limiting case of the state, the institutional antipode to a free society.

This book is mixed reading. The authors’ styles range from the philosophically analytical (if not overly italicized) of Radnitzky to the clearly written (but overly romantic) of Arthur Seldon; in one sense the collection as a whole seems a bit unwieldy to be read seriatim: readers will probably tend to read two or three chapters that fit their interests or academic backgrounds rather than devour the entire book. In light of this, and the publisher’s series, most will find Government: Servant or Master? suitable to add to college or research libraries rather than their own personal collections.

The topics in this book suggest that Buchanan’s pessimism of the 1970s is shared by many classical liberals of the 1990s, even though this age has produced, in the name of greater freedom, tremendous constitutional upheaval in the former Yugoslavia, Soviet Union, and other socialist countries in Eastern Europe. And when we witness the rise of individual nation-states agglomerating into a larger inter-nation constitutional matrix, such as the European Community, one wonders whether Buchanan’s public-choice model of rational individuals agreeing to general rules, as if under a veil of ignorance, can help thwart the coming of a possible Euro-Leviathan. After reading this book, I myself have become a bit more skeptical.

  • David Prychitko is professor of economics at Northern Michigan University, where his teaching interests include microeconomics, macroeconomics, and comparative political economy.