… is from pages 320-321 of Vol. 19 of The Collected Works of James M. Buchanan: Ideas, Persons, and Events; specifically, it’s from Jim’s 1986 article “Ideas, Institutions, and Political Economy: A Plea for Disestablishment”:
A genuine revolution in the thinking of economists had occurred. Keynes had provided a framework with which the whole economy, not just the actors within it, could be analyzed. Economists were duped into thinking that they could “understand” the operation of a complex economic interaction process by the use of hydraulic-like models that embodied the interdependencies among a relatively small number of macroeconomic variables, with macroeconomic equilibrium being defined independent of that which described incentive-compatible states in the behavior of participating actors.