Economist Ronald Coase Was Chased Out of UVA in 1964 for Supporting Market Solutions.

The Twitter feed of academic Siva Vaidhyanathan points to this story about how recently deceased economist Ronald Coase was chased out of the University of Virginia in the early 1960s.

The heinous crime of Coase, who would go on to win the 1991 Nobel Prize in economics? He stood against the rising tide of belief in an economy managed by experts and regulators.

"He introduced this whole notion," says [UVA law prof George] Cohen, "that people through private negotiation can reach an efficient solution."

What Coase and his colleagues were challenging, Cohen says, was the widespread belief that the only way to protect scarce resources— such as air, water, or habitat— was via taxation. Unfortunately, as Coase and Center co-founder James M. Buchanan would learn, using markets to achieve efficient and beneficent goals would run afoul of the university administration intent on a more "modern" outlook.

In 1994, Coase told this reporter how one of his UVA colleagues accidentally received a copy of a secret dossier compiled by then Dean of the Faculty Robert Harris in which Harris outlined a plan to change the economics faculty. Under then President Edgar Shannon, Harris allegedly used non-promotion and non-offer-matching to force Jefferson Center scholars to disperse. Coase left UVA for Chicago in 1964; Buchanan departed four years later.

"I think [the report] was very damning because it makes quite clear what their attitude was and there was actually a policy to get rid of us," Coase said....

Buchanan and Coase got the last laugh, as each would win the Nobel Prize for Economics, Buchanan in 1986 and Coase in 1991.

"The secret report became known in a very peculiar way," Coase told me. "What happened was that Warren Nutter, who was chairman of the department, asked for some file, and when he got it, there it was.

"The University of Virginia was not interested in retaining me," continued Coase. "It was a political thing. They had decided that my views, which they never understood— they never tried to ascertain my views actually."

Read the whole thing - a truly disturbing example of ideological prejudice - here.

And read Reason's 1997 interview with Coase (conducted by economist Thomas W. Hazlett, now at George Mason University, the eventual home of James Buchanan and Gordon Tullock, who was also chased out of UVA for ideological reasons). Coase elaborates on what it was like at UVA in the late 1950s and early '60s:

Reason: You began teaching at the University of Virginia in the late 1950s, and by the early 1960s the administration there was not impressed with the work being done by yourself, Warren Nutter, James Buchanan, Gordon Tullock- four of the most famous and influential economists in the post-war era, two of whom [Coase and Buchanan] went on to win Nobel prizes. Yet the University of Virginia was not happy with what was happening in their economics department.

Coase: They thought the work we were doing was disreputable. They thought of us as right- wing extremists. My wife was at a cocktail party and heard me described as someone to the right of the John Birch Society. There was a great antagonism in the '50s and '60s to anyone who saw any advantage in a market system or in a nonregulated or relatively economically free system.

 Whole thing here.

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  • robc||

    What Coase and his colleagues were challenging, Cohen says, was the widespread belief that the only way to protect scarce resources— such as air, water, or habitat— was via taxation.

    Hey Nick, how about sending this story on to Bailey. He hasnt figured it out yet.

  • John||

    +1000 Bailey loves taxation. And he pretends that if we just tax something, we won't be poorer for it. Bailey seems to think that if the market adjusts to higher prices, there is no real cost to the higher prices.

    Bailey is really confused on a few issues. His love of carbon taxes being the most notable.

  • Libertymike||

    Second that.

  • Irish||

    Is Bailey seriously in favor of carbon taxes? I don't even read his articles anymore because they always get spammed by Tony who will scream DEEEEENIIIIIIEEEEEERSSSSSSS! whenever anybody makes an argument against Tony's preferred solutions.

  • John||

    Yes he is. He honestly seems to think that making energy more expensive will not make us poorer if only the market is allowed to adjust for it. It is a frankly bizarre understanding of how markets work.

  • fish||

    DEEEEENIIIIIIEEEEEERSSSSSSS!

    I thought that this is what he screamed when one of his young, firm, energetic composition 101 students ejaculated in his rectum?

  • ||

    Damnit fish, now I have to go scrub my brain.

  • fish||

    Sorry.

    Might I suggest using the steel wool!

  • Irish||

    In 1994, Coase told this reporter how one of his UVA colleagues accidentally received a copy of a secret dossier compiled by then Dean of the Faculty Robert Harris in which Harris outlined a plan to change the economics faculty. Under then President Edgar Shannon, Harris allegedly used non-promotion and non-offer-matching to force Jefferson Center scholars to disperse. Coase left UVA for Chicago in 1964; Buchanan departed four years later.

    So the University of Virginia had two men who would end up becoming two of the most important economists of the last 50 years, and they got rid of both of them. It's amazing how progressive ideology results in people acting against their own self-interest and destroying everything they touch.

    We could be talking about the Virginia School of Economics if their deans weren't so fucking stupid.

  • John||

    They ran off a Nobel Prize winner. Sometimes justice is served.

  • Irish||

    They ran off TWO.

  • Libertymike||

    Well, don't you want to run off another one? The affirmative action Nobel winner?

  • Irish||

    Yeah, but he won a peace prize. That's not like a real Nobel that they give you for actual accomplishments.

    I mean, the European Union won the 2012 Nobel Peace Prize for "over six decades contributed to the advancement of peace and reconciliation, democracy and human rights in Europe." Yeah, it's not like the reason for European peace is American military hegemony. It's because of your precious little EU.

  • Auric Demonocles||

    So can the US get the 2 prizes for over 14 decades contributed to the advancement of peace and reconciliation, democracy, and human rights in America?

  • Libertymike||

    Would you agree that "precious little" is not how you would characterize the EU's efforts to piss on the individual liberty of Europeans?

  • fish||

    They ran off a Nobel Prize winner. Sometimes justice is served.

    Sometimes running of winners of prizes issued by a central bank is a good thing.

    See: Krugman, Paul

  • fish||

    Running "OFF" ghodammit! It's "off"!

  • Irish||

    If I were a university I would want Krugman there. That's the thing. From the university's perspective, any talented economist who can bring in grant money and churn out articles in peer reviewed papers is a good thing to have. It raises your esteem profoundly. Look at what happened at the University of Chicago during the height of the Chicago School of Economics.

    It's in your best interest to have high quality professors, even if you disagree with their political views. The fact that leftists run off high quality conservative and libertarian professors is proof positive that liberalism is a cult that causes people to willingly destroy themselves over petty horseshit.

  • fish||

    If I were a university I would want Krugman there.

    Really? In what field of study?

  • Irish||

    Do you really think Princeton is worse off with Paul Krugman on their staff? Just because I don't like him and vehemently disagree with him doesn't change the fact that there's a hell of a lot of cache in having a Nobel Prize winner on staff.

  • fish||

    Nahh...I'm mainly being a dick...but I do think think any claim that Krugman makes to still being an economist is tenuous at best.

    You can refer refer to his obsession over debt during the Bush the Lessers 8 years versus debt during Barack the Magnificents tenure if you are so inclined. There are many other examples of political positions trumping his adherence to any cogent position of the discipline.

  • Ornithorhynchus||

    'In what field of study?'

    Janitor in the Veterinary School, where he can shovel all the bullshit he wants.

  • sarcasmic||

    They're just being tolerant, you know. Tolerant people don't have to tolerate intolerance.

    Since any political disagreement with the left is born of intolerance, running off people with political differences is an act of tolerance.

  • fish||

    Now now Sarc.....we talked about this! You get all spun up and dizzy when you enter the "Circle of Tolerance"!

  • MJGreen||

    And this was after both men published their most important works while at UVA. Coase's Social Cost was published in 1960, Buchanan and Tullock's Calculus of Consent in 1964.

    It's like firing a prospector after he finds you a gold vein and an oil field.

  • MJGreen||

    My wife was at a cocktail party

    Well his wife knew how the game was played.

    Can't be said enough: a truly great economist and, from all accounts, all around good guy and tireless intellectual.

  • ||

    Yeah, I laughed at that one, too.

  • CE||

    Yet most people have never heard of him, and Krugman gets a daily column to spread ignorance.

  • DJF||

    Burn The Witch!!!!!

  • The Late P Brooks||

    But the American university system is the pinnacle of unfettered intellectual exploration and unending curiosity, right?

    RIGHT?

  • Auric Demonocles||

    It's a good thing we have the tenure system so stuff like this doesn't happen.

  • The Late P Brooks||

    They thought of us as right- wing extremists. My wife was at a cocktail party and heard me described as someone to the right of the John Birch Society. There was a great antagonism in the '50s and '60s to anyone who saw any advantage in a market system or in a nonregulated or relatively economically free system.

    Let's be fair. In England, at the time, Labour governments were rebuilding their war-ravaged nation at a pace which was the envy of the world and irrefutably proving the effectiveness of a prudently managed economy.

  • sarcasmic||

    I recall someone saying that the reason Europe and Japan passed the US economically after WWII was that their manufacturing base had been destroyed, and they rebuilt with modern technology. Meanwhile textile mills in the states are using century old machinery.

  • ||

    Well, as Hazlitt pointed out in response to this, there's nothing stopping us from bombing our own industrial base into prosperity.

  • CE||

    Don't give McCain any ideas.

  • Auric Demonocles||

    But then we won't get millions and millions of dollars from foreign governments to rebuild it!

  • ||

    I've heard about the Wirtschaftswunder and the Japanese post-war economic miracle, but frankly, I don't particularly recall anything about the UK's postwar boom.

  • ant1sthenes||

    I thought he was being sarcastic.

  • Goldwin Smith||

    Let's be fair. In England, at the time, Labour governments were rebuilding their war-ravaged nation at a pace which was the envy of the world and irrefutably proving the effectiveness of a prudently managed economy.

    Sarcasm? Labour was out of power from 1951-1964 and I don't recall Attlee or Wilson being known for their boom economy. Hell Attlee was well known for keeping the WWII economic controls in place long after the war was over.

  • ||

    People who bring up the John Birch Society when attempting to malign someone always reveal far more about themselves than the person they're attempting to actually malign.

  • khm001||

    This doesn't bother me that an employer would force someone out because he didn't like the employees attitude. In fact, I'm fine with that. The actual problem with higher education is that it's run primarily using tax dollars. That is the only real scandal about higher education.

  • SForza||

    As an alumnus of UVA, when they ask for donations, I always say NOPE: Not One Penny Ever. Oddly, they haven't hit me up in a while.

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