—Barney Frank, interviewed by Jason Zengerle
You were talking about the Republicans and not being able to work with them. But isn’t your ultimate beef with the voters, since it’s the voters who reward that behavior?
I’m glad you said that, you’re very smart. These days, in developed countries, everybody says you need a private sector to create wealth, you need a public sector to create rules by which wealth is created. Sensible people understand that. The tension between left and right has been where you draw that line, but it’s been a contest between people who see maybe a 20 percent overlap. Let me read this to you. [Picks up copy of Friedrich von Hayek’s The Road to Serfdom.] “In no system that could be rationally defended would the state just do nothing.” [Closes book.]
Do you read Hayek a lot?
For these purposes. For the first time in American history, we have people in power now who reject that idea. If they knew it was Hayek, they might think, Well, maybe.But they reject the public sector. That’s why we can’t work together.
... I liked this part at the end:
some people in the media act like Washington is some autonomous entity that’s operating with no connection to the public. I had a woman stop me the other day, she said, “I’m very angry about Congress. What are you guys doing?” I said, “Who’s your congressman?” “Oh, I don’t know,” she said. “Well, see, I vote for me,” I said. “I’m happy with me. Why are you blaming me for the people you vote for?”That always drives me crazy: numbskulls who complain about being tyrannized by Congress as if "Congress" were some Martian overlord who descended in a giant Neoclassical marble spaceship.
To create conditions in which competition will be as effective as possible, to supplement it where it cannot be made effective, to provide the services which, in the words of Adam Smith, "though they may be in the highest degree advantageous to a great society, are, however, of such a nature, that the profit could never repay the expense to any individual or small number of individuals"—these tasks provide, indeed, a wide and unquestioned field for state activity. In no system that could be rationally defended would the state just do nothing. An effective competitive system needs an intelligently designed and continuously adjusted legal framework as much as any other. Even the most essential prerequisite of its proper functioning, the prevention of fraud and deception (including exploitation of ignorance), provides a great and by no means yet fully accomplished object of legislative activity.I hadn't ever thought that LBJ's "Great Society" got its name from Smith. Richard Goodwin gets the credit, but I daresay he'd read Smith (or Hayek)—the context of Smith's sentence is too relevant for coincidence.
... Btw that last parenthetical sets Hayek apart from contemporary libertarians, who argue that the ignorant are pretty much there to be exploited.