Greg has three posts up on Hayek and Social Security (here, here, and here). He's quoting from the same chapter that I was.
Unfortunately he seems to be deleting comments, so I'm not sure how far you'll get. I emailed him about it and asked him to continue the conversation, but no response so far. I'm not sure what I've said that offended him.
In case he deletes your comments too, think of this as a forum to discuss the material he presented in those posts. My interpretation is the same as it was (it ought to be - I read those exact passages just a couple days ago when writing my post!). Hayek supports social insurance. He has a lot of problems with Social Security, Medicare, and unemployment insurance and does not think that they at all meet the standards of social insurance he would find acceptable. As Levine and Zernike suggest, Hayek spends most of the chapter (after setting up what sort of program he would approve of) denouncing the programs that exist. So Greg Ransom is presenting that very first part - the discussion of acceptable social insurance in a liberal society.
This isn't exactly Hayek's Pure Theory of Capital. It's a fairly straightforward chapter. I wish Greg would tell me what he thinks is wrong with my read of it, but he doesn't seem interested.