Why maintain a preference for free markets when the economy lacks manly vigor?
Entering this debate is treading the finest of lines between what divided Keynes and Hayek in their postwar economic policy models and ideas. Always the optimist about liberal democracy, Keynes’ pessimism proved nowhere more pesky than in his fear of letting markets do the dirty work of rooting out failing businesses and unsustainable employment policies. Hayek, on the other hand, never rose to the ocassion of Keynesian optimism. Instead, he dealt with the personal concerns channelled by Hitler’s national socialism by elucidating the dangers of market internventions as opposed to market failure– not two sides of the same coin, as the former creates and solidifies new political and economic power bases closely tied to those of the ruling regimes while the latter often unleashes competing political and economic power bases. I’ve always appreciated Hayek’s work much more than I appreciated Keynes’, partly because Hayek acknowledged towards the second half of his life that economic histor
