The union of political liberalism with Hayek’s economic liberalism – laissez faire– has proven to be an unhappy marriage. It is no surprise that some of those who have fared worse during the last quarter century of right wing resurgence are attracted to xenophobic nationalism and intolerance. In the early 21st century it is not ‘big government’ that is the threat to liberal values. Ask yourself: where are they key liberal ideas of tolerance, the rule of law, and defense of the weak against the strong more secure today: the Nordic countries (where governments comprise half of the economy) or the U.S, where Hayek’s political vision has been widely embraced?
Hayek rightly insisted that the question of how best to organize society could not be answered in abstract terms but required instead historical and empirical comparison. I wonder if he might today – on empirical grounds – reconsider his view that a larger government role in the economy is a threat to liberal values?