Published in March 1996 issue of Prospect Magazine
There has always been a tendency for people on the centre and left of politics to belittle the achievements of Friedrich Hayek, the great Austrian-British economist. He is usually regarded as a right wing ideologue. This is a pity, because his work is rich in insight, and has a lot to teach those who do not share his preconceptions.
His reputation as an ideologue was established almost as soon as he arrived in England to take up a chair in economics at the LSE in 1931. Lionel Robbins recruited him to help counter the influence of Keynes. He did cross swords academically with Keynes and Sraffa over monetary theory, but surprisingly made no public response to the publication of Keynes’s General Theory of Employment, Interest, and Money, the book which launched the Keynesian revolution. Hayek later said he he was reluctant to spend time criticising Keynes when Keynes changed his mind so often.
During the war, he began work on the book that became The Road to Serfdom. Published in 1944, when Hayek was 45, it made a huge impact as a radical attack on the new social democratic consensus. Its success gave him a public prominence which enabled him to spend the rest of his life actively reviving and restating the principles of classical liberalism.
He faded from attention in the 1950s and 1960s, but several strands of the new right acknowledged Hayek as their inspiration in the 1970s and 1980s. Thatcher made him a Companion of Honour. He continued to be vilified, however, by many social and political theorists for his argument that even the mildest measures of state intervention risked pushing a society towards totalitar…