Did the Libertarian Party Cost Donald Trump the Election?

No, but it might have cost him Georgia’s electoral votes.

My friend and fellow economist Walter Block has an op/ed in the Wall Street Journal (November 8 and November 9 print edition) titled “Libertarians Spoil the Election.”

Here’s his argument:

Did the Libertarian Party throw the election to Joe Biden? Maybe. At this writing nominee Jo Jorgensen’s vote total exceeds Mr. Biden’s margin over President Trump in Arizona, Georgia, Nevada and Pennsylvania, enough to change the outcome.

First, he’s wrong about Pennsylvania and Nevada. Jorgenson’s vote doesn’t cover the spread.

He has a better case for Arizona and Georgia.

But even there, here’s the problem: Walter is assuming implicitly that the vast majority of votes that went to Jo Jorgenson would have gone to Trump. I think that’s wrong for two reasons.

First, I would bet that about 20 percent of the people who voted for Jorgenson would not have bothered voting had they not been offered that alternative. (What’s my evidence? I admit that it’s gut feel.)

Second, consider the remaining 80 percent. I would bet that at most 2/3 of this remaining 80 percent would have voted for Trump had Jorgenson not run. Why as much as 2/3? Because what I have observed is that young libertarianish people would have preferred Biden over Trump and older libertarianish people would have preferred Trump over Biden, and a much higher percent of older people than of younger people vote.

If I’m right, that means that we would have to take the difference between 2/3 of 80% and 1/3 of 80%, which is, of course 1/3 of 80% and apply that to the Jorgenson totals in each state.

Do that and Walter’s point might work for Arizona and Georgia but it’s not a slam dunk.

Arizona: Biden gets 1,645,277 votes, Trump gets 1,629,845 votes, and Jorgenson gets 50, 121 votes.

80% of the Jorgenson vote = 40,097 votes.

1/3 of that = 13,366 votes.

Biden minus Trump = 15,432.

So even there, not clear that Trump would have won Arizona.

Georgia: Biden gets 2,467,870 votes, Trump gets 2,456,275 votes, and Jorgenson gets 61,951 votes.

80% of the Jorgenson vote = 49,561 votes.

1/3 of that = 16,520 votes.

Biden minus Trump = 11,595 votes.

So there there’s a much better shot at Walter’s point.

In his op/ed, Walter makes a strong case for Trump over Biden, most of which I agree with. Walter is critical of Trump on protectionism, as he should be. But he does leave out a major issue, one on which Biden is head and shoulders above Trump: immigration.




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Voting and Margins

I used to teach my students, before I was allowed to vote in this country (I became a U.S. citizen in 1986) that even in swing states, their vote for President would not be determinative.

When I finally got to vote (I think it was in the June 1986 California primaries), I voted and experienced the truth of my statements.

My vote for U.S. president makes no difference on the margin and neither does yours. (That’s why I always vote for the person closest to my views, no matter how slim his or her odds.)

Which, of course, doesn’t mean that politicians running for office should think that votes don’t matter. They’re dealing with much thicker margins.

My favorite example I liked to give in class after 2000 was the Bush/Gore election for President because all my students had followed it, at least somewhat. One of the big issues in Florida was that, on April 22, 2000, Bill Clinton’s administration had used guns to rip away Elian Gonzalez from his relatives in Florida and send him back to Cuba.

That was a big upset to a large number of Florida voters from Cuba or whose parents left Cuba. Gore, of course, was part of the Clinton administration. So what was he to do? I followed it pretty carefully and my recall is that Gore lamely criticized Bill Clinton for one news cycle and then let it drop.

Then I asked my students: What if Al Gore had lambasted Clinton for it over, say, 3 days? Is it conceivable that he would have shifted, say, 0.2 percent of the Florida Cuban vote? If so, we would be referring to President Gore.

Or, I pointed out, George W. Bush was an effective campaigner. What if, instead of thinking he had Florida in the bag, partly because his brother was governor, he hadn’t gone home to Texas to do a premature victory lap? Then we might have avoided the legal nightmare of Bush v. Gore.


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From Democracy to Populist Rallies

In his 1945 book On Power, Bertrand de Jouvenel wrote:

Democracy, then, in the centralizing, pattern-making, absolutist shape which we have given to it is, it is clear, the time of tyranny’s incubation.

Sometimes, democracy in America looks a bit like the South American version.

In general, democracy as we know it works differently than what Christopher Achen and Larry Bartels call its “folk theory” version. In their book Democracy for Realists, they describe the folk conception of democracy:

In the conventional view, democracy begins with the voters. Ordinary people have references about what their government should do. They choose leaders who will do those things, or they enact their preferences directly in referendums. In either case, what the majority wants becomes government policy. … Democracy makes the people the rulers, and legitimacy derives from their consent.

That nothing like this happens in the real world should be obvious by observing the current electoral campaign in America, reading the political advertisements, and listening to the presidential candidates of the two main political parties. Public choice theory explains many failures of folk democracy.

There is much to disagree with in the alternative proposed by Achen and Bartels, which is an elitist democracy based on group identities. But the populist solution does not produce better democracy. It is more an extreme form of “folk theory” democracy that worsens democratic failures.

What is said and done in President Trump’s rallies is more entertainment than information on a political program. These rallies are liturgical spectacles of fusion between the great leader and “the people.” Extreme illustrations were given when the president danced as the crowd was chanting “YMCA” (videos are available on YouTube).

This sort of show is not new in contemporary populism. In his book Populisms: A Quick Immersion (which I review in the forthcoming issue of Regulation), Carlos de la Torre, a professor of sociology at the University of Kentucky, observes that “[p]opulism blurs the line between politics and entertainment.” Of Rafael Correa, the populist president of Ecuador from 2007 to 2017, Torre writes:

Rafael Correa’s campaign strategy in 2006 was also based on mass rallies, where common people were in close proximity to the candidate and sang along with him to revolutionary music of the 1960s and 1970s. Even though this music was retro, Correa’s political rhetoric was innovative. Unlike the long and boring speeches of his rivals, Correa blended music and dance with speech-making. He spoke briefly, presenting a simple idea, music was played, and Correa and the crowd sang along the campaign tunes and dance.


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Do Most Countries Elect Their Government Leader by Majority Rule?


Prime Minister Scheer?


Co-blogger Scott Sumner, over at his own blog, themoneyillusion, writes:

Other countries generally elect their president by majority vote (although a few “ceremonial” presidents are picked by an EC, as in India).

He might be correct if he literally means “president.” But Scott seems to be comparing the United States electoral college to how the rest of the democratic world elects its governments’ main leaders, whether they’re called President, Prime Minister, or something else.

The other governments I know best–Canada, where I grew up, eh?, the United Kingdom, Australia, and New Zealand–don’t elect their Prime Minister by majority vote. They have a Parliamentary system and the party with the most seats gets to form the government. In a way, that’s like the Electoral College.

Indeed, although in Canada’s 2019 national election no party won a majority of the vote, the party that won the plurality was the Conservative Party. Scheer’s Conservative Party won 34.34 percent of the vote and Prime Minister Justin Trudeau’s Liberal Party won 33.12 percent. If it had been the party with the most votes that determines the Prime Minister, we would be referring to Prime Minister Andrew Scheer.



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Parties become popular by taking unpopular stands

This Matt Yglesias tweet caught my eye:

While that sounds plausible, I believe Yglesias is mistaken about how politics works. There’s more to politics than public opinion polling on this or that issue; the intensity of support also matters. Here’s a simply numerical example:

Suppose that the GOP contained 50% of the public, and the Democrats were also 50% of the public. (I’m ignoring independents just to make a point.) Also assume:

1. Roughly 25% of the public is religious conservatives. Assume their policy views are endorsed by only 35% of the electorate. In other words, their views are unpopular.

2. Roughly 25% of the public is economic conservatives who oppose high taxes on the rich, higher minimum wages, etc. Again, let’s say only 35% of the public agrees with them.

It looks like it would be a mistake for the GOP to adopt conservative positions on religious questions and economic policy. These positions don’t poll well.

But that view ignores the intensity of beliefs. Many of the religious conservatives may not agree with economic conservatives on tax issues, but it’s the moral issues that really motivate their voting. Vice versa for the economic conservatives. You could add in a few other issues where GOP voters might have passionate beliefs, such as opposition to restrictions on gun ownership, or favoring a ban on marijuana. Even if the positions don’t poll well, they may offer an opportunity for the GOP to add small but highly motivated voters to their “big tent” coalition.

The Democrats do the same. Recent polls in (left-leaning) California suggest that the affirmative action proposition on the ballot is not very popular, but the issue may be important in motivating a significant portion of the Democratic “base”.

I think of the GOP as the party of people that resent progressive views on a wide range of unrelated policy questions.  They have “conservative” views on everything from economics to traditional religious values to foreign affairs to criminal justice.”  There are no “rank and file conservatives”.

To some extent all parties include “strange bedfellows”, but that seems truer of the GOP than the Dems, and much more true of the GOP than the Libertarians or Socialists.  This tendency might be less pronounced in a multiparty parliamentary system with proportional representation.  But when there’s a two party system, at least one party (maybe both) must include lots of people with little in common.

There’s a name for political parties that only adopt highly popular positions: “Losers”

PS.  Here’s a general rule of thumb.  Be skeptical when a pundit (including me) says that a political party needs to fix its problems by adopting positions closer to their own view on the issues.  I almost never recall a pundit saying to a losing party, “Your mistake is that you agree with me on this issue; you need to start opposing my view on this issue.”


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Competition in Indiana Politics Leads to Reduced Regulation

Me: I want to go to there.

INDIANAPOLIS (AP) — Most of Indiana’s coronavirus restrictions on businesses and crowd sizes will be lifted this weekend, but people will still be required to wear masks in public for another three weeks, Gov. Eric Holcomb said Wednesday.

Holcomb, a Republican running for reelection, has faced discontent from some conservatives over coronavirus restrictions. He said he would lift statewide capacity limits for restaurants and bars and crowd limits for social events beginning Saturday because he says the state has made progress in recent weeks in slowing the spread of COVID-19. The mask requirement will be extended until Oct. 17.

This is from Tom Davies, “Indiana governor keeps mask order, drops other virus limits,” Associated Press, September 23, 2020.

Why Holcomb’s sudden change of heart?

Davies writes:

The mask order first took effect July 27 and has drawn ire among conservatives who believe his executive orders in response to the pandemic have gone too far. That has complicated his reelection campaign against Democratic challenger Woody Myers, with some saying they would support Libertarian candidate Donald Rainwater.

So Holcomb appears to be losing support to the Libertarian Party candidate, who, I assume has criticized the lockdowns.







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Drissel on the Normative Core

I received the following email from Bill Drissel about my “Public Choice: The Normative Core.”  Reprinted with his permission.

Dr. Caplan

The data you seek for your “normative core” is readily available in one arena: public transportation.  I follow the Anti-Planner, Randal O’Toole.  The planned benefit is number of riders.  The planned cost is usually available in dollars(of a given vintage).  The subsequent cost-overruns and consequent ridership are also available.  So every cost/benefit ratio could easily be adjusted by a “normative core adjustment”.

For example, if extensive research shows that, for public transportation, actual costs / planned costs average 2.1 and actual ridership / planned ridership average 0.40, then the normative core adjustment factor for public transportation = 5.25.  So for back-envelope calculations, the planned cost/benefit should be multiplied by 5 or so.

I have considerable acquaintance with software estimates including many that ended up in proposals and contracts.  I don’t know of a single case of software under-run (costs less than planned).  I would guess the typical over-run for routine software development at 2:1.  For difficult stuff: 5:1.  Really hard stuff like voice, face, fingerprint recognition: much higher than 5.  Development of a capable word processor with fonts and embedded images like MS Word, a single lifetime wouldn’t be enough.

I had a one-man consulting business for 45 years.  Whenever I asked a client about his over-run experience, I got a mournful story.  If I suggested he apply an experience-based multiplier, the response was always, “If we did that, we’d never get any business!”  I guess that’s the equivalent of, “Junior Professor: By that standard, government should never do anything.”

I admire the work that you and Don Boudreaux do.  I’m 87 but if I had encountered the public choice body of knowledge while I was much younger, I might have given up engineering for economics.


Warmest regards,

Bill Drissel


The Colony, TX


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Friends in high places

A number of experts on technology have expressed concern about the national security implications of allowing Chinese companies/products like Huawei, TikTok and WeChat to have access to the US market. I’ve been skeptical of their arguments, although I concede that I am not well informed on technology issues. On the other hand, I wonder if tech experts have sufficient awareness of the “public choice” aspects of giving the government the power to run an industrial policy.

Previously I noted that the US government’s original intention to protect US consumers from possible spying by Huawei has morphed into a crusade to destroy the Chinese company. Political considerations also seem to be showing up in the TikTok case. Oracle has offered to purchase a portion of TikTok and insure that user data is safe, but some Trump administration officials remain unconvinced:

Several people said such a plan could satisfy career officials at Cfius. But some cautioned that the situation was not analogous to any previous case.

“We have a president who is running a campaign against China and any indication of giving in to Beijing over TikTok will be seen as weakness,” said a person involved in the negotiations, who was concerned about the deal receiving approval from the Trump administration. . . .

A veteran Cfius lawyer said any deal with ByteDance that let the Chinese company retain a majority ownership of the app in the US would be hard for the Trump administration to swallow.

I get worried whenever I see news reports of economic policymakers wanting to avoid perceptions of “weakness”, or outcomes being “hard to swallow”.  Does this address national security issues, or doesn’t it?

In the end, I expect the deal will likely go through, but I am not entirely reassured by the reasons why:

Oracle was originally brought into the negotiations to provide an alternative to Microsoft Corp., MSFT +1.69% a rival bidder with Walmart as a partner, said one person familiar with the talks. The U.S. investment firms Sequoia Capital and General Atlantic, which are existing investors in ByteDance, went in search of a tech company with close ties to the administration and settled on Oracle, the person said.

Oracle co-founder Larry Ellison hosted a fundraiser for Mr. Trump this year at his house, and Chief Executive Safra Catz also worked on the executive committee for the Trump transition team in 2016.

It seems that the Chinese believe that US economic policy decisions are made based on personal connections with the administration.  I’m not sure if that’s true, but the perception is enough to distort the market.  Would a takeover attempt led by a Trump critic have had an equal chance of success?  I have my doubts.

However you feel about this specific issue, it’s important to recognize that we are a long way from national security decisions being made by philosopher kings.  Once you grant the government the power to enact an industrial policy, don’t expect the decisions to be free of political/personal considerations.  On balance, I trust the market more than I trust any government.

PS.  My wife traveled to China last week and I’ve started using WeChat.  I’m willing to accept the risk that the Chinese government is spying on my calls.  For years I’ve assumed that the NSA knows whatever they want to know about my digital communications.


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Public Choice: The Normative Core

The economic analysis of politics goes by many names: political economy, rational choice theory, formal political theory, social choice, economics of governance, endogenous policy theory, and public choice.  Each of these labels picks out a subtly different intellectual tradition.  Each tradition expands our understanding of the world.  My favorite, though, remains public choice.

As a GMU professor, you may attribute this to home-team favoritism.  Yet before I was a professor at GMU, I was a student at UC Berkeley and Princeton, and neither school fostered the love of public choice… to say the least.  The main reason I prefer public choice, rather, is for its normative core.  All economists who study politics do cost-benefit analysis, but the public choice approach is wiser.  And heretical.

What exactly is this “normative core” of public choice?  Simple: After doing standard microeconomic analysis of government policy, public choice adamantly states:

That’s an upper-bound on how well government intervention can work.  In the real world, government intervention usually works much more poorly.  Before we claim government intervention passes a cost-benefit test, we can, should, and must use past government performance to predict future government performance.

The upshot: Public choice economists end up opposing many government interventions blessed by textbook and policy wonk alike.

Example: Most economists – even economists who study politics – are fans of Pigovian taxation to address externalities problems.  What public choice reminds us, though, is that Pigovian taxation is the best that governments can accomplish.  In the real world, however, governments are worse in dozens of ways.   Before you advocate a regime where government sets Pigovian taxes to address externalities, then, you should estimate what real-world governments will actually do when you give them that kind of power.

Another case: When I was a grad student TAing Industrial Organization, I often argued with the junior professor teaching the class.  He knew a lot of theory, but almost no economic history, so I told him about quite a few famously anti-competitive antitrust decisions.  After a while, I recall a little exchange that went roughly like this:

Junior Professor: Bryan, I don’t care about what government did in the past; I care about what government is going to do in the future.

Me: Shouldn’t we use the past behavior of government to predict the likely future behavior of government?

Junior Professor: By that standard, government should never do anything.

Me: [double-take] Not really, but OK!

For Junior Professor, the normative core of public choice was practically a reductio ad absurdum.  But that’s only because he started with a firm pro-government conclusion, and rejected even ironclad premises that undermined it.  When I applied the normative core of public choice, he saw a big bias against government.

This so-called “bias,” however, is simply well-justified pessimism.  If actual governments abuse the power to tax, subsidize, and regulate, then it makes cost-benefit sense to put the officials who set tax, subsidy, and regulatory policies in a few chains.  Or a lot of chains.  Or a solid block of concrete.

Mainstream economists tend to scoff at this mentality.  Frankly, that’s because they’re fifty years behind the research frontier.  Although textbook demonstrations that well-crafted government policies can make the world better are fun homework problems, they end up being an intellectual smokescreen for demagoguery.  The normative core of public choice shows that laissez-faire is undervalued: Even when good government is plainly able to make things better, past experience teaches us to be deeply skeptical that government will do so in practice.  Until economists judgmentally study government in action, they have no business recommending that government do much of anything.


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One Thing Rationally Ignorant Voters Don’t Know

A Twitter follower of mine just praised president Trump for saving money by donating his salary back to government departments (I didn’t bother to add  the many justified “sic”):

“He takes a ZERO salary from the american people. How much did americans paid for Obama, Biden, Pelosi, Schumer, etc?”

Is this a significant saving for “the American people,” that is, American taxpayers? To check that, the voter must do some simple calculations. But even among those voters who can easily find the data sources and do the calculations, “rational ignorance” (as public choice economists say) will prevent most from doing it. Rational ignorance is the fact that the voter remains rationally ignorant of politics because he or she, individually, has no impact. It’s not as when he buys a car: he pays the money and gets the car he ordered. Politics and voting are very different: Why take the trouble and cost of finding information when your vote is not going to change the result of the election anyway? You’ll get the same political car anyway. Add partisanship to the mixture, and a perfect anti-Enlightenment storm is forming.

So let’s calculate if we should be grateful to the president for being so thrifty with public money. The annual salary of the president is $400,000—which means at most $300,000 after tax. This corresponds to 1/16,000,00o (one sixteen-millionth) of the annual expenditures of the federal government, which were roughly $4.8 trillion ($4,800,000,000,000) in 2019, before the pandemic struck. It can be easily calculated that in 2019 (note again: before the pandemic), the amount by which Trump increased the annual expenditures of the federal government was a bit more than $600 billion ($600,000,000,000) compared to the last year of Obama’s presidency (see https://fred.stlouisfed.org/graph/?g=vzfE).

Thus, by foregoing his presidential salary, Trump saved the American taxpayer $300,000 a year and, by the end of 2019, was spending $600,000,000,000 more of their money on an annual basis. This means that what Trump saved the taxpayers is 1/2,000,000 (one two-millionth) of what he ended up spending over and above what Obama spent during his last year. (It is of course much worse since the beginning of 2020.)

Many taxpayers, if they knew, would have preferred that Trump ran with his $300,000 and showed frugality with the trillions of dollars of federal expenditures. According to USA Today, two previous presidents, also very wealthy, John Kennedy and Herbert Hoover, also donated their salaries. But they did not increase annual federal expenditures by half a trillion dollars.

PS: Thanks to Jon Murphy for his comments on a draft of this post.


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