RSS 2.0 FeedThe Heroes Of Capitalism
by Doug MataconisIn an article that appeared in yesterday’s Wall Street Journal, but only became available for free access today, Philosopher David Kelley marks the 50th anniversary of the publication of Atlas Shrugged by noting the novel’s central accomplishment, celebrating as heroes men and women who even today are still considered villains by a large part of society:
Businessmen are favorite villains in popular media, routinely featured as polluters, crooks and murderers in network TV dramas and first-run movies, not to mention novels. Oil company CEOs are hauled before congressional committees whenever fuel prices rise, to be harangued and publicly shamed for the sin of high profits. Genuine cases of wrongdoing like Enron set off witch hunts that drag in prominent achievers like Frank Quattrone and Martha Stewart.
By contrast, the heroes in “Atlas Shrugged” are businessmen — and women. Rand imbues them with heroic, larger-than-life stature in the Romantic mold, for their courage, integrity and ability to create wealth. They are not the exploiters but the exploited: victims of parasites and predators who want to wrap the producers in regulatory chains and expropriate their wealth.
Rand’s perspective is a welcome relief to people who more often see themselves portrayed as the bad guys, and so it is no wonder it has such enthusiastic fans in the upper echelons of business as Ed Snider (Comcast Spectacor, Philadelphia Flyers and 76ers), Fred Smith (Federal Express), John Mackey (Whole Foods), John A. Allison (BB&T), and Kevin O’Connor (DoubleClick) — not to mention thousands of others who pursue careers at every level in the private sector.
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Economists have known for a long time that profits are an external measure of the value created by business enterprise. Rand portrayed the process of creating value from the inside, in the heroes’ vision and courage, their rational exuberance in meeting the challenges of production. Her point was stated by one of the minor characters of “Atlas,” a musical composer: “Whether it’s a symphony or a coal mine, all work is an act of creating and comes from the same source: from an inviolate capacity to see through one’s own eyes. . . . That shining vision which they talk about as belonging to the authors of symphonies and novels — what do they think is the driving faculty of men who discovered how to use oil, how to run a mine, how to build an electric motor?”
As for the charge, from egalitarian left and religious right alike, that the profit motive is selfish, Rand agreed. She was notorious as the advocate of “the virtue of selfishness,” as she titled a later work. Her moral defense of the pursuit of self-interest, and her critique of self-sacrifice as a moral standard, is at the heart of the novel. At the same time, she provides a scathing portrait of what she calls “the aristocracy of pull”: businessmen who scheme, lie and bribe to win favors from government.
Economists have also known for a long time that trade is a positive sum game, yet most defenders of capitalism still wrestle with the “paradox” posed in the 18th century by Adam Ferguson and Adam Smith: how private vice can produce public good, how the pursuit of self-interest yields benefits for all. Rand cut that Gordian knot in the novel by denying that the pursuit of self-interest is a vice. Precisely because trade is not a zero-sum game, Rand challenges the age-old moral view that one must be either a giver or a taker.
And that, as I’ve noted elsewhere is the singular accomplishment that Ayn Rand should be remembered for. While the moral principles she wrote about had been part of the academic literature of Western Civilization for some time, they had never been popularized before in the way that Ayn Rand did. Because of that, it’s fair to say that there’s an entire generation of libertarians, and businessmen, whose first encounter with the idea that there isn’t anything wrong with profit, and that success isn’t a dirty word, came from a woman named Ayn Rand, and a book called Atlas Shrugged.
Hold on here. Selfishness is NOT a virtue. The schoolyard bully who beats up the kid to take his lunch money is NOT virtuous because he does it out of selfishness. His selfishness is, in this case, unquestionably a vice.
What’s important here is the Invisible Hand — that’s the device (the marketplace) that diverts selfishness — usually a vice — in a productive direction. Adam Smith wasn’t puzzled by the basic concept: he enunciated it 150 years before Ayn Rand came along. So let’s not lionize selfishness. Selfishness is not good. It often leads to results that are bad for everybody else. But capitalism and the marketplace are able to harness that selfishness and make it useful. So let’s raise a glass to capitalism — not selfishness.
In the same way, I see no reason to lionize people merely because they are rich or powerful. How do we know they got their wealth or power by contributing to society? There are some cases in which we know it to be true: entertainers and sports figures, for example, earn their wealth directly due to their talents. But was the CEO of Enron wealthy because he was productive or because he was a thief? I know lots of people who are wealthy, and some definitely earned it, and some did not.
I’ll give you one good example: Bill Gates, the richest man in America (but not the world). He’s rich because he owns lots of stock in the company he founded, which ended up with almost a monopoly on PC operating systems. But, if you know the history of all this, you’ll realize that Gary Kildall should, by all rights, have gotten what Bill Gates got. So, did Bill Gates earn his wealth? And did he get it by selling the best product, or by monopolistic practices? I can say with certainty that the Microsoft products have at all stages in its history been inferior to competing products. But in every case, their size gave them a marketing advantage that overcame their products’ deficiencies. I believe that, had Microsoft never come along, the world of PC software would probably be further advanced that it is today. So, is Bill Gates a hero to be lionized or a villain to be cursed?
My take is that wealthy people should not be lionized because of their wealth. We don’t know if they earned their wealth or stole it. So we have to judge each person on his own merits. There are lots of people who’ve made huge contributions to society. Some are wealthy, some are not. Wealth is not a good measure of contribution to society.
Comment by Chepe Noyon — October 11, 2007 @ 10:16 pmChepe,
I think you are unfamiliar with the word as it relates to the central themes of her writings. Howard Roark was the embodiment of the selfish man, yet he never harmed anyone. To be selfish is to never deviate from one’s principles.
Comment by Brian T. Traylor — October 11, 2007 @ 11:00 pmIf she really meant “principled”, why did she use “selfish”? Both words have well-defined meanings. Why would she misuse the latter word so badly?
Comment by Chepe Noyon — October 12, 2007 @ 12:39 amAyn Rand did not mean principled. For the best explanation of what she meant, and why she used the word, I’ll quote a few passages from the Introduction of “The Virtue of Selfishness”:
What Ayn Rand really advocated was “rational self-interest” – a rational, principled life motivated by one’s own selfish desires.
It is frequently presumed that selfish motivation in and of itself is somehow wrong. (As you say above, “…selfishness – usually a vice…”). Ms. Rand was trying to oppose that presumption with the idea that selfishness is, first and foremost, a valid motivator of men, and that just because some evil men are selfish, it does not mean that all selfish men are evil.
As you also say above, “So we have to judge each person on his own merits.”. And I say exactly! Judge people on their merits, instead of assuming that selfishness or wealth automatically equate with evil.
s.s.
Comment by Steve S. — October 13, 2007 @ 2:04 pm