Sex appeal versus philosophical depth, the ultimate libertarian showdown. In order to be fair, let’s have a sample of both Hayeks at their best:

VERSUS

“It would be impossible to assert that a free society will always and necessarily develop values of which we would approve, or even, as we shall see, that it will maintain values which are compatible with the preserva­tion of freedom. All that we can say is that the values we hold are the product of freedom, that in particular the Christian values had to assert themselves through men who successfully resisted coercion by government, and that it is to the desire to be able to follow one’s own moral convictions that we owe the modern safe­guards of individual freedom. Per­haps we can add to this that only societies which hold moral values essentially similar to our own have survived as free societies, while in others freedom has perished.”

— Friederich Hayek, The Moral Element in Free Enterprise, 1962

and the winner is?

Friedrich Hayek and Ludwig von Mises

Jeffrey Tucker points out that the Austrian economists Hayek and von Mises explained long ago in the 1930s why the Keynesian policies of credit expansion being used today to try to bring about recovery would not be effective in restoring prosperity then or now.

Did you ever have the feeling that we’ve been through this before?

Think of it. Those in charge have only recently sworn — yet again! — that if we keep interest rates at zero, keep battling the symptoms of recession and unemployment with spending and jobs programs, clobber the speculators with regulations, and otherwise keep trying to revive moribund industries, all will be well. Just don’t cut government spending or let interest rates rise!

So where have we heard it all before? It was the 1930s, when the battle between F.A. Hayek and J.M. Keynes raged in the English-speaking world, not only in the academic journals but in the newspapers in London and the United States.

Hayek gave a series of lectures based on his previous works in German that tried to explain that the ruling elite and their theoretical apparatus had it all wrong.

In a thousand different ways he said the same thing: “To combat the depression by a forced credit expansion is to attempt to cure the evil by the very means which brought it about.”

Further, “because we are suffering from a misdirection of production, we want to create further misdirection — a procedure that can only lead to a much more severe crisis as soon as the credit expansion comes to an end.”…

Ludwig von Mises wrote in 1931:

Credit expansion cannot increase the supply of real goods. It merely brings about a rearrangement. It diverts capital investment away from the course prescribed by the state of economic wealth and market conditions. It causes production to pursue paths which it would not follow unless the economy were to acquire an increase in material goods. As a result, the upswing lacks a solid base. It is not real prosperity. It is illusory prosperity. It did not develop from an increase in economic wealth. Rather, it arose because the credit expansion created the illusion of such an increase. Sooner or later it must become apparent that this economic situation is built on sand.

Too bad the fight was fixed.

Glenn Reynolds reports that, for some strange reason, sales of books like Ayn Rand’s Atlas Shrugged and Friedrich Hayek’s Road to Serfdom are soaring.

The amused cynic contends:

(W)hat is happening is that through the “economic emergency,” Obama is trying to implement Rand’s fictitious “Directive 10-289,” which is what the the combination of “stimulus package,” unsupervised TARP bailouts, “Cap and Trade,” and “Health Care Reform” equal when they are rammed down your throats without discussion (or even the reading of the details) by your supposed “representatives” in the national government.

He quotes none other than Michelle Obama herself, telling an audience at UCLA last year:

Barack, as Oprah said, is one of the most brilliant men you will meet in our lifetime.

Barack is more than ready. He’ll be ready today, he’ll be ready on day one, he’ll be ready in a year from now, five years from now – he is ready.

That is not the question. The question is: What are we ready for?

Wait, wait, wait – because we say we’re ready for change, we say we’re ready for change, butcha see, change is HARD.

Change will always be hard, and it doesn’t happen from the top down.

We do not get universal health care, we don’t get better schools because somebody else is in the White House. We get change because folks from the grass roots up decide they are sick and tired of other people telling them how their lives will be – when they decide to roll up their sleeves and work.

And Barack Obama will require you to work.

He is going to demand that you shed your cynicism, that you put down your division, that you come out of your isolation, that you move out of your comfort zones, that you push yourselves to be better, and that you engage.

Barack will never allow you to go back to your lives as usual – uninvolved, uninformed…

Who knows? Like the Khmer Rouge, he may decide to march urban populations out of energy consuming cities for resettlement at collective farm settlements in the countryside, too.

Friederich August Hayek

Jesse Larner, writing in Dissent, makes a valiant attempt to dismiss Hayek from a post-Soviet-collapse, “we’re only advocating voluntary collectivism,” progressive perspective. Hayek overlooked “spontaneous collectivism” you see.

Ilya Somin, at Volokh Conspiracy, offers an intelligent critique of Larner.