Despite the greatness of Hayek, he was not as great a systematic thinker as Mises. In The Constitution of Liberty, for example, Hayek claims that, so long as it is making general rules (i.e., not legislating for the particular advantage of any one group), the government can perform certain services in competition with private companies, or when no private company does the job. Most Austrian economists, Mises included, would argue that the government ought not compete in the marketplace, and that if no private entrepreneur can do something for a profit, that is precisely the reason why government ought not to do it: it is a waste of resources. Perhaps this is what Goldberg is getting at by his reference to Hayekâs “pragmatism.” If so, it should be noted that Hayek does not view his own acceptance of occasional market interventions as a “pragmatic” compromise of laissez-faire principles. Instead, Hayek maintains that the government must be careful not to intervene in the wrong way and for the wrong reasons.
