James M. Buchanan wrote the following in The Limits of Liberty (1975):
Dissatisfaction with the institutional structure, and most notably with the observed performance of government at all levels, remains widespread, but there is no effective means through which this shared attitude can be translated into positive results. Reactions against the excesses of bureaucracy provide the source for bureaucratic expansion. Frustrations with the status quo are noted by politicians and by actual and would-be self-serving “public servants.” Proposals come forward for resolving “social problems,” almost on an assembly-line schedule, proposals that necessarily require expansion rather than contraction in elements of structure that generate the evils. The infinite regress involved in what has been called the “public utility attitude” goes on. If something is wrong, have government regulate it. If the regulators fail, regulate them, and so on down the line. In part this is the inevitable result of public failure to understand the simple principle of laissez-faire, the principle that results which emerge from the interactions of persons left alone may be, and often are, superior to those results that emerge from overt political interference. There has been a loss of wisdom in this respect, a loss from eighteenth-century levels, and the message of Adam Smith requires reiteration with each generation. Modern economics must stand condemned in its failure to accomplish this simple task, the performance of which is, at base, the discipline’s primary reason for claiming public support.
There is more to it than this, however, and some miraculous rediscovery of eighteenth-century political wisdom would scarcely get us out of the woods. The surface paradox between observed frustrations with governmental processes and the resulting expansion in these same processes is itself based on a deeper and more complex phenomenon, one that itself involves a more permanent paradox.
What has changed if anything with regard to (a) this general paradox, and (b) the condemnation of modern economics?