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REASON: Do you find that your work is known, for instance, in Salzburg and students seek you out?
HAYEK: It wasn't when I arrived. And even now there is not a great deal of interest outside of the few who have come to my classes.
REASON: You still seem to prefer it in Europe–am I correct about that? Do you prefer living here? You've been in Freiburg and you've been in Salzburg for several years!
HAYEK: That is very largely for purely practical reasons. I think if I were completely free to choose I would live in England in spite of present political differences.
REASON: In general, I am curious as to how you see the prospects of liberty in our times or in the future?
HAYEK: What I expect is that inflation will drive all the Western countries into a planned economy via price controls. Nobody will dare to stop inflation in an ordinary manner because as things are at present, to discontinue inflation will inevitably cause extensive unemployment. So assuming inflation stops it will quickly be resumed. People will find they can't live with constantly rising prices and will try to control it by price controls and that of course is the end of the market system and the end of the free political order. So I think it will be via the attempt to regress the effects of a continued inflation that the free market and free institutions will disappear. It may still take ten years, but it doesn't matter much for me because in ten years I hope I shall be dead.
REASON: It matters a lot for me and for most of our readers, I can tell you. Is it likely that in America there would develop social revolution as a result of all this? I don't think that all the various factions of the American society can be brought together into a submissive totalitarian hold that would be required for a massive social planning. Do you find that to be a reasonable idea?
HAYEK: Yes. But what will happen I cannot really imagine because it will be constant pulling one way and pulling the other for the reason that inflation will be regarded as intolerable. The only way really to stop it will produce unemployment which would be regarded as equally intolerable and people will resort to price controls without knowing that this leads into worse matters. When they recognize it they will scrap the price controls and we'll again be at the beginning of the same affair. I don't know how many times we can go through the same cycle and certainly it will mean an increasing disappointment with governments. The governments will be unable to give the people what they clamor for and it will certainly be a time of constant political disruptions. My wish is that people would have courage to face a period of substantial though not necessarily very prolonged unemployment, with all provisions for the unemployed, and restore the price mechanism. But I think the chance that this will happen which to me seems to be the only way out for free system, is very small indeed.
REASON: That's what I'm afraid of. But it's not going to be the first time that people have chosen a pathvery different from freedom. Dr. Hayek, thank you very much for allowing us to visit and talk to you. We wish you good health and thank you again.