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March 31, 2009
Why Ayn Rand Persists in Business
Russian-born novelist Ayn Rand died over a quarter century ago, yet her books and her Objectivist philosophy are debated in business circles regularly, particularly in tumultuous economies.
Reviled by some people and glorified by others, Ayn Rand's 1957 novel Atlas Shrugged has been growing in popularity, with annual sales reaching all-time highs 50 years after publication.
According to the Ayn Rand Institute, sales of the book almost tripled over the first seven weeks of this year compared with sales for the same period last year, continuing a strong trend after bookstore sales reached an all-time annual high in 2008.
Why is this half-a-century-old book — not to mention its Russian-born author's entire philosophy — considered as timely today as ever before?
Rand is considered the mother of Objectivism, a philosophy that claims:
- Reality exists as an objective absolute; facts trump man's feelings, wishes, hopes and fears.
- Reason is the only way to perceive reality and the sole knowledge source — it is man's only guide to action and means of survival.
- Every man exists for his own sake. Pursuit of his own rational self-interest and his own happiness is his life's moral purpose.
- The ideal political-economic system is laissez-faire capitalism. In Rand's own words, "It is a system where men deal with one another, not as victims and executioners, nor as masters and slaves, but as traders, by free, voluntary exchange to mutual benefit."
Objectivism regards capitalism as a beneficent system in which the innovations of the most creative benefit everyone else in the society (although this is not its justification).
With Atlas Shrugged, according to a 2007 feature in the New York Times, Rand said she "set out to show how desperately the world needs prime movers and how viciously it treats them" and to portray "what happens to a world without them."
"No politico-economic system in history has ever proved its value so eloquently or has benefited mankind so greatly as capitalism — and none has ever been attacked so savagely, viciously and blindly," Rand wrote in her introduction to Capitalism: The Unknown Ideal.
Atlas Shrugged begins in a time of recession, telling the story of the United States economy "crumbling under the weight of crushing government intervention and regulation," as Dr. Yaron Brook, president and executive director of the Ayn Rand Institute, recently explained in the Wall Street Journal. "Meanwhile, blaming greed and the free market, Washington responds with more controls that only deepen the crisis."
To save the economy, the book's hero John Galt calls for a strike against government interference. Factories, farms and shops shut down, and riots break out as food becomes scarce.
Rather than simply argue that government control destroys entrepreneurialism, Rand took it further by claiming that men are in fact morally obligated to fight for these freedoms.
Atlas Shrugged glorified the right of individuals to live entirely for their own interest. The author's idea of the "virtue of selfishness" did not necessarily encourage exploiting others, but rather, as Brook wrote of Rand's philosophy: "Selfishness — that is, concern with one's genuine, long-range interest — required a man to think, to produce, and to prosper by trading with others voluntarily to mutual benefit." (Source: The Wall Street Journal)
Upon its initial release, the reviews for Atlas Shrugged were generally very negative. Rand's radical philosophy had become explicit in this novel of embattled capitalism, and the reviewers reacted accordingly, mocking with extreme opposition and attacking with vitriol. "Both conservatives and liberals were unstinting in disparaging the book; the right saw promotion of godlessness, and the left saw a message of 'greed is good,'" said the New York Times.
Nonetheless, over time Rand's books and philosophy both have accumulated a who's who of devout followers. Today's business leaders who have cited Rand's books as influential include: Cypress Semiconductor CEO T.J. Rodgers; Whole Foods CEO John Mackey; Dallas Mavericks owner Mark Cuban; and James M. Kilts, who led turnarounds at Gillette, Nabisco and Kraft.
"When they read the book, often as college students, they now say, it gave form and substance to their inchoate thoughts, showing there is no conflict between private ambition and public benefit," the Times explained of the novel's coterie of fans.
One of Rand's most famous acolytes was former Federal Reserve Chairman Alan Greenspan, who met Rand when he was 25 and working as an economic forecaster. (She was already renowned as the author of The Fountainhead, a novel that wove Objectivist beliefs into the speeches of the book's hero, Howard Roark, an architect true to his principles.) Soon after, the young Greenspan joined Rand's exclusive Collective, a group that evangelized Rand's writings and, in Greenspan's case, politicized them.
But even Greenspan, testifying before a congressional committee last October, admitted to a "flaw" in free-market ideology, specifically "in the model" of securitization.
Although 2008 and 2009 have so far seen Rand's brand of unbridled capitalism take some blows — as government intervention continues full tilt following the unfolding of the largest bailout in government history late last year — many business executives are rediscovering a certain comfort in Rand's heroes today, finding reassurance that self-interest makes the most sense both economically and morally.
The Economist recently pointed out data from TitleZ, a firm that tracks bestseller rankings on Amazon.com, showing recent sales spikes of the book coinciding with major political events, such as the passing of the economic stimulus plan. The spikes, The Economist surmised, happen when people notice the eerie similarities between real-life events and the scenarios Rand described in her book — including slowing international trade, riots in Europe, sea pirate attacks on cargo ships and politicians castigating corporate chiefs.
Whenever governments intervene in the market, it seems a safe bet readers will rush to buy Rand's novel. Last week, not long after its praising on Comedy Central's The Colbert Report, the book ranked No. 1 on Amazon.com's bestseller list in the U.S. Literature and Fiction category.
Resources
Is Rand Relevant?
by Yaron Brook
The Wall Street Journal, March 14, 2009
Atlas Felt a Sense of Déjà Vu
The Economist, Feb. 26, 2009
Ayn Rand's Literature of Capitalism
by Harriet Rubin
The New York Times, Sept. 15, 2007
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8 CommentsGreat review! Thanks.
March 31, 2009 3:20 PMAnother review I read recently: http://www.reason.com/news/show/36527.html
I think this summation is the best I've read for explaining why Rand's work achieved the success it did. It talks about the parts of her philosophy that are still relevant today while grafting it onto (or grafting other parts onto Objectivism) to deal with our experiences in the real world.
March 31, 2009 4:50 PMAgain, as usual, the media distorts. Greenspan, at one time was a Rand "follower" -even that word galls me to no end. He left her ideology and the practices of Objectivism LONG before he made his "oops" statements, and objectivists (myself included) find the mis-representation that he is one of us a blatant twisting of facts. For an objectivist of ANY stripe to accept the position in the Federal Reserve is the equivalent of being Benedict Arnold. His ideas and actions were long ago separated from the Objectivist philosophy.
It also is NOT her ideas of philosophy currently taking the 'hits' in today's situation, as the people responsible for the mortgage collapse as well as the INSANE governmental intervention are NOT the Capitalists that she wrote about in any stretch of the word. The banks as well as the mortgage sub-prime fiasco were 100% looters. They produced nothing other than scraps of electronic paper which were traded by these same people to generate "no-risk" profits.
A Capitalist PRODUCES, and nothing in today's crisis resembles production, but we continually see the distortion lumping these utter fools in with the people in Industry.
Her book makes this crystal clear. Her non-fiction essays and books on the Objectivist Philosophy make this clear.
In many of the articles popping up today, we see the same vitriol, fear and hatred of what she had to say, and what is most humorous (if not scary) is that most of the attacks SOUND EXACTLY LIKE THE governmental officials and looting business people in the pages of that book.
Like Marx's Communist Manifeso, Rand's 'Atlas Shrugged' has left a permanent stain on society. Look at the ruthless capitalist apostles who say it changed their lives. Greenspan? This man bears the biggest responsibility for our current mess. Objectivism is all well and good, but any simplistic black and white world view cannot be good for workers OR capitalists. Humans, when left to their own devices tend to be too greedy for their own good.
March 31, 2009 6:15 PMThe invention of the motor which Ayn Rand envisioned in Her novel Atlas Shrugged; ie) one which is compatible with Her Philosophy For Living On Earth, marks a new phase in Her Philosophical Movement. So...
"By the rules and terms of my code one owes a rational statement to those whom it does concern and who're making an effort to know." - ThisIsJohnGaltSpeaking\AtlasShrugged\AynRand
There is some cause for uncertainty for "those whom it does concern..." and it happens 'after'-"going JohnGalt" and it's --- "What now?"
To this I can make a significant and reassuring contribution to this commentary section, through a citation of what the fictional John Galt says to all potential strikers in the novel as well as in answer to the castaway Dagny Taggart's question:
"What did you tell them to make them abandon everything?"
"I told them that they were right." ... he said - "that it is a moral crisis and it has to run for once it's undisguised course."
You see folks, John Galt and his motor are no longer just fiction as the missing piece of the puzzle has been actualized and the motor that Miss Rand envisioned in the novel, as well as "The Gulch" are now real entities.
We meet every year during the month of June. Any of your readers that have "withdrawn their moral sanction" and/or feel compelled to "withdraw their support" for the 'looter/moocher's code', can now do so with the intention of actually getting toward an Object.
Details and information for 'Getting To Atlantis' you can e-mail:
Inaissance@gmail.com
*this is good news for Objectivists and Ayn Rand admirers - like the fulfilling of a prophecy, only more exact*
"We found that we liked to meet - in order to be reminded that human beings still existed. So we came to set aside one month of the year...to rest, to live in a rational world, to bring our real work out of hiding, to trade our achievements - here, where achievements meant payment, not expropriation. ...- for one month out of twelve. It made the eleven easier to bear."
- JohnGalt:DagnyTaggart@GatecrashersDinner\AtlasShrugged\AynRand -
And I mean it.
A $ A
April 1, 2009 3:38 AMI read Ayn Rand's books, all of them, when I was in my teens. I am now over 60 years old. I have learned that the flaw in Ayn Rand's thinking is the same flaw that is taught in Economics 101 - that participants in business are pursuing their objective, enlightened, long-term self-interest.
The fact is, most economic actors are irrational, most economic decisions are made on incomplete evaluation of known existing facts (not to mention the unknowns), and much of the public discourse about economics and politics is short-sighted, narrow-minded, and abysmally ignorant. Most decisions are made politically, that is, based on how people will feel about them, rather than objectively, that is, based on the actual physical consequences, costs and benefits.
It remains true that we do live, not in our minds, but in our bodies, which are trapped in a real world which does not care about our feelings, but only about food, water, shelter, air, disease, and the effort required to meet biological human needs with respect to them. It is also true that most of us are not aware of this and that few of us act accordingly.
April 1, 2009 10:17 PMRand was a seminal (no comment) thinker, whose works were indeed transformative. Coming as they did when much of American intellectual thought was englamored with the socialist ideal, her works were a source of inspiration to many of us.
She was far from perfect herself -- but who among us is perfect?
Cancel my newsletter subscription. Your organization is obviously infected with Communist liberal hacks who are allowed to publish their garbage on what I had hoped was one of a few remaining channels for the truth.
April 2, 2009 3:42 PM
