Friedrich von Hayek, along with Ludwig von Mises, were among a number of Jewish-Austrian intellectuals to flee Vienna during the 1930s and the encroaching threat of Nazi Germany. This concise 170 paged book by Eamonn Butler, who was Director of the Adam Smith Institute in Britain, attempts to convey the essentials of Hayekian thought that grew out of the economic thought of over 25 books.
After a single paged preface and a 14 paged introduction "Hayek's life and work" are 6 chapters and an Epilogue: Chapter 1) Understanding how society works; Chapter 2) The market process; Chapter 3) Hayek's critique of socialism; Chapter 4) The criticism of social justice; Chapter 5) The institutions of a liberal order; Chaper 6) The constitution of a liberal state; Epilogue) Sense and sorcery in the social sciences. These chapters and epilogue are followed by notes, a select bibliography, and an index.
Some interesting tidbits are that "Hayek's 1941 work, "The Pure Theory of Capital", continues the same theme of looking under the surface of the averages and aggregates which economists like to talk about" and this same "theme was taken up again in "The Counter-Revolution of Science". Butler says that the "problem for any planner is that the 'facts' he must deal with are not concrete things, but are the relationships and behaviour [sic] of individuals themselves, something which nobody can predict in advance" (pp8-9). I suppose somebody forgot to pass Butler's insight along to the American advertising and marketing sector, because they spend 100 billion a year attempting to do what Butler maintains cannot be done - predict the behavior of consumers.
Another interesting aside is the story of Antony Fisher, who founded the Institute of Economic Affairs in London, England, at the suggestion of Hayek who "advised him to avoid politics, and do what he could in the field of ideas"(p12). Unwittingly, these free marketeers provided the camouflage for state corporatism that was appropriated by the Tories in both major parties. See Richard Cockett's "Thinking the Unthinkable".
Hayek is not just an economist, he is also a sociologist: "If we are to understand how society works, we must attempt to define the general nature and range of our ignorance concerning it" he wrote in "The Constitution of Liberty" on page 23(p13). Hayek came up with a sociological term he dubbed "constructivism": "man's mind is itself a product of the civilisation in which he has grown up and . . . it is unaware of much of the experience which has shaped it - experience that assists it by being embodied in the habits, conventions, language and moral beliefs which are part of its makeup"(p152). He adds that "we can only know the world as it is filtered through past experience"(p153). Hayek's recognition of cultural programming stands in contradiction of his earlier view that the actions of consumers cannot be predicted. Butler adds "Note the crucial distinction between Hayek's liberalism [of Scottish influence] and the 'laissez-faire' caricature"(p155).
Hayek is properly critical of socialism, but remains silent on corporate statism. He ignores the fact that corporations are creatures of the state and that in a free market there are no corporations. His silence is strange because he reviewed George Orwell's "1984", which told of Orwell's 1944 days at the BBC doing war propaganda for the British state in the guise of a futuristic novel. Hayek also wrote a nice piece on "The Confusion of Language in Political Thought" in "New Studies" that indicated he was familiar with the attempts of statists to camouflage their activities with the rhetoric of the free market.
In short, Hayek is no Murray Rothbard who understood that government is the problem, not the solution. Hayek, on the other hand, believes some government is necessary. Hayek does not address Robert Nozick's warning that government is similar to a cudgel where parties and individuals compete in order to wield it over others - the larger the cudgel, the more damage it can do. Witness the state terrorism being waged by Bush, Blair and their cronies by wielding the enormous cudgels in the form of U.S. and British governments. The result is American-powered British Empire in contradiction to every value that George Washington and the other Founding Fathers fought for when they fought 'against' the British, not for them as Bush does today. Hayek would be alarmed at today's growing collectivism.