That is one of the ways economics has moved past Hayek. And really this is a way Smith showed more understanding than Hayek. Really I suspect despite that quote, Hayek would agree with what I said here.
As Smith showed the economy does best when the experts, ie individuals, families and firms make the choices. That is when the baker seeks his own self interest. It is not a matter of whether the planners are good or bad. The planners just don’t have the information that thousands or hundreds of thousands or millions of individual decision makers have.
You can see sort of the same thing on the First 48 on the A&E Network. Though usually not the case, the murderer may be smarter than each individual cop on the case as the planner may be smarter than every other individual in society. But all it takes is two or three investigators looking at the murderers story before holes start croppng up in it. Similarly as I said above, no matter how smart the planner, they do not have the expertise of the millions of experts on their family, their tastes, their firms.
My point in that paraphrase of Hayek was to impugn the motives and rationale of the planners.
They really aren’t in it for the good of the individual,
they’re in it for the CONTROL of the individual; to force others to conform to their will.