by Don Watkins

Supporters of laissez-faire capitalism are often asked, “€œIf the government doesn’€™t build the roads, who will?” Having lived in traffic-infested Northern Virginia and Southern California, I have always said that private roads are the best argument for capitalism, not the thorniest objection. In yesterday’s Wall Street Journal, historians Larry Schweikart and Burton Folsom note that history is on my side:

Henry Ford and dozens of other auto makers put a car in almost every garage decades before the National Interstate and Defense Highways Act in 1956. The success of the car created a demand for roads. The government didn’€™t build highways, and then Ford decided to create the Model T. Instead, the highways came as a byproduct of the entrepreneurial genius of Ford and others.

Moreover, the makers of autos, tires and headlights began building roads privately long before any state or the federal government got involved. The Lincoln Highway, the first transcontinental highway for cars, pieced together from new and existing roads in 1913, was conceived and partly built by entrepreneurs—Henry Joy of Packard Motor Car Co., Frank Seiberling of Goodyear and Carl Fisher, a maker of headlights and founder of the Indy 500.

What is economic power? It is the power to produce and to trade what one has produced. In a free economy, where no man or group of men can use physical coercion against anyone, economic power can be achieved only by voluntary means: by the voluntary choice and agreement of all those who participate in the process of production and trade. In a free market, all prices, wages, and profits are determined—not by the arbitrary whim of the rich or of the poor, not by anyone’s “greed” or by anyone’s need—but by the law of supply and demand. The mechanism of a free market reflects and sums up all the economic choices and decisions made by all the participants. Men trade their goods or services by mutual consent to mutual advantage, according to their own independent, uncoerced judgment. A man can grow rich only if he is able to offer better values—better products or services, at a lower price—than others are able to offer.
Ayn Rand
Capitalism demands the best of every man—his rationality—and rewards him accordingly. It leaves every man free to choose the work he likes, to specialize in it, to trade his product for the products of others, and to go as far on the road of achievement as his ability and ambition will carry him. His success depends on the objective value of his work and on the rationality of those who recognize that value. When men are free to trade, with reason and reality as their only arbiter, when no man may use physical force to extort the consent of another, it is the best product and the best judgment that win in every field of human endeavor, and raise the standard of living—and of thought—ever higher for all those who take part in mankind’s productive activity.
Ayn Rand

The arguments for gun control or gun confiscation basically boil down to this: “If guns were illegal, they would not be available. If they weren’t available, people like that crazy killer in Connecticut would not be able to use them.”

This assumes that a crazy psychopathic killer, hell-bent on murder, would let an obstacle like finding a gun legally stop him. This is absurd. A crazy psychopathic killer, by definition, has decided that he must do his evil deed, and indeed is even entitled to do it. There will be an underground “market” for guns, if they are outlawed, just as presently there is an underground “black market” for marijuana, heroin and cocaine.

The people who claim that violence can be controlled by outlawing guns show how little they understand about the nature of criminals and criminal psychology. They assume — they must assume, to take the position they do — that these killers are for the most part semi-reasonable, although troubled souls who rush out to the gun equivalent of a convenience store, mostly on impulse, to purchase their gun. If this purchase were made more difficult or impossible, the implied reasoning goes, this poor troubled soul would refrain from his violent actions.

I suppose this is why the self-same people who favor gun confiscation are the very same ones who plead for all manner of excuses for criminal behavior. They tend to be the same type of people who feel that everything and everyone is responsible for criminal behavior, other than the criminal himself.

They can’t understand, or perhaps don’t want to understand or come to grips with, the psychology of evil. It’s admittedly disturbing to try and do so. But this is no excuse for eliminating the right of the nonviolent, noncriminal majority to protect themselves from violence by making it harder or impossible for them to purchase weapons for self-defense.

Look at it this way. Do you want to live in a world where a violent criminal knows that all the nonviolent, noncriminals out there are disarmed? Do you think this will actually alleviate crime or contribute to its rise — especially as economic conditions continue to worsen in a society where government now acts mostly as an economic wrecking ball?

Of course, the people who want guns outlawed for the peaceful, nonviolent majority are usually the same ones who think that government is capable of literally anything. Too much sugar in sodas? There ought to be a law. Some people unable or unwilling to buy health insurance? There ought to be a law. Mind you, not just a law affecting those individuals; a law imposed on everyone, a one-size-fits-all “solution” to a problem guaranteed only to make the problem worse.

Back in the days of Prohibition, people who wanted to drink got their alcohol. Outlawing alcohol didn’t do a thing to change society, other than make society more dangerous and give the government more to do. Similarly, the “war on drugs” has done nothing to eliminate or even reduce addiction to heroin, cocaine or marijuana. It turns people who enjoy these drugs into criminals, but it doesn’t change their behavior one bit. We could decriminalize their behavior tomorrow and that would end the dangerous black market for drugs, as well as give the government much less to do, allowing it to focus on really important things like — oh, I don’t know, capturing terrorists. And decriminalizing that behavior would not do a thing to change the nature or extent of all the substance addiction problems out there. Those would go on just as before, no more or no less — perhaps a bit less, if anything.

It’s the same with gun ownership. Those who support gun control view gun ownership as something akin to, if not worse than, abuse of heroin and cocaine. They think that if the government outlawed guns tomorrow, and took them away from peaceful people, that criminals would somehow be pressured or even shamed into not killing. It’s beyond ridiculous. I guarantee that if guns are outlawed in the near future, you’re going to see lots of changes in the lives of the peaceful, but not a bit of change in the minds and behaviors of the violent. In fact, violence will grow, if anything, because the violent will now know the peaceful are disarmed, with only an unaccountable or unavailable police force to aid them.

Worst of all, it’s the intellectually superior and self-congratulating who are the most in favor of gun control. It’s taken as ignorant and mentally unsophisticated to have any other position on the subject. You would think the intellectually superior and sophisticated would at least have some remote grasp of how a criminal mindset works. “Criminal” by definition refers to someone who considers himself outside and above the law, and entitled to do whatever he pleases in life, even if it means initiating force against another.

These are the sort of people who will sleep better at night if we pass restrictive or confiscatory gun laws. And it’s the supposedly intellectually superior among us who are hell-bent on protecting the nonviolent by making life more comfortable for the violent.

I decided to change my WordPress username and blog from An Objectivist Blog to The Capitalist Revolution. I felt it was better to me. While I love having an Objectivist blog title, I already have one here on tumblr. I felt like I could reach more people with The Capitalist Revolution while also advocating Objectivism through it. It seemed more in your face.


Vice-presidential candidate Paul Ryan has reportedly had favorable things to say about Ayn Rand, author of “Atlas Shrugged” and the philosophy of Objectivism, which stresses the absolutism of reason, reality and individual rights (including laissez-faire capitalism).

The New Yorker magazine reports the following on 8/11/12:

Rand’s works were an early and important influence on him, shaping his thinking as far back as high school. Later, as a Congressman, Ryan not only tried to get all of the interns in his congressional office to read Rand’s writing, he also gave copies of her novel “Atlas Shrugged” to his staff as Christmas presents, as he told the Weekly Standard in 2003.

Two years later, in 2005, Ryan paid fealty to Rand in a speech he gave to the Atlas Society, the Washington-based think tank devoted to keeping Rand’s “objectivist” philosophy alive. He credited her with inspiring his interest in public service, saying, “[T]he reason I got involved in public service, by and large, if I had to credit one thinker, one person, it would be Ayn Rand. And the fight we are in here, make no mistake about it, is a fight of individualism versus collectivism.”

Three years ago, as Tim Mak reports today at Politico, Ryan described America’s political challenge as coming straight out of Rand’s work—saying, “what’s unique about what’s happening today in government, in the world, in America, is that it’s as if we’re living in an Ayn Rand novel right now. I think Ayn Rand did the best job of anybody to build a moral case of capitalism, and that morality of capitalism is under assault.”

More recently, however, Ryan has distanced himself from Rand and Objectivism:

“I reject her philosophy. It’s an atheist philosophy. It reduces human interactions down to mere contracts and it is antithetical to my worldview. If somebody is going to try to paste a person’s view on epistemology to me, then give me Thomas Aquinas…Don’t give me Ayn Rand.”

This conflict within Paul Ryan is a good case study in the whole problem with “conservatism” as we know it.

Ultimately, conservatism is, like leftism, based on fear. Leftists are afraid of personal responsibility, sometimes for themselves and always for people in general. Conservatives are afraid of being punished by God, and all religions (including Paul Ryan’s Catholicism) teach sacrifice of the self to the deity.

My question for Paul Ryan and others is: How do you justify a society based on individualism and individual rights by starting with an epistemology of supernaturalism?

If man’s ultimate purpose is to serve God, then it seems to me that the role of government would be to foster, if not outright require, individuals to sacrifice for one another. This is precisely what leftism does, and what the Obama Administration in particular has been all about. If you’re a devout Christian who believes in turning the other cheek on your enemies (even the nuclear-armed ones), and replacing the ethics of individual fulfillment and self-responsibility with selfless charity as Jesus advocated, then the defense-cutting, tax-increasing, massive domestic spending Obama should be your guy.

Differences about religion aside, it’s hard to believe that Paul Ryan actually understood Atlas Shrugged when he read it, if he seriously believes that Rand’s ethics boils down to “mere contracts.” In Atlas Shrugged and elsewhere, she made it very clear that her philosophy was about the supremacy of reason, and the primacy of objective reality over consciousness. She likewise maintained that objectivity and rationality are the basis for the interaction between mind and reality. (Her student Leonard Peikoff’s book on Objectivism did a beautiful job integrating these points.)

Rand ultimately concluded that laissez-faire capitalism was the only context for a moral society in which the rational individual could be free and self-responsible. By the way, if everyone is left free, this includes the greatest geniuses, producers and innovators in both science and industry—meaning that the entire well-being of the society is lifted as a result. Atlas Shrugged illustrated this quite well, as did the history of America for its first two-hundred years.

It’s true that the enforcement of “mere contracts” is one of the few proper functions of government in a free society, along with protecting individuals from force. The key philosophical point here is that contracts are voluntarily entered into by willing parties. There are no “social contracts” as leftists and conservatives insist. As Rand asserted, rational individuals do not deal with one another via force. Does Ryan mean to imply that human beings have obligations to one another just because the government (or Church) says so, and whether they want to honor those externally chosen “obligations” or not? Such as wealth transfers, participation in government programs against one’s will, and the like?

As a Catholic, Ryan undoubtedly thinks we are all each other’s keepers. Yet as a former advocate of Ayn Rand, he must have at least seriously questioned this idea.

The whole point is: The justification for freedom has to come from somewhere. If it’s Jesus and Church, then there’s no reason to topple Obama from power. If the basis for freedom is reason and self-preservation, as Ayn Rand maintained, then the case for individual rights is secure.

Which is it? Reason or faith? Freedom or enslavement? Paul Ryan hasn’t quite made up his mind, it seems. Sooner or later, Americans will have to choose. Atlas Shrugged illustrated this dilemma in fiction, and contemporary America is showing us the real-life version.

by Harry Binswanger

Ayn Rand publicly recommended the works of Mises but not of Hayek. Today, when Hayek is much better known than Mises, it’s worth seeing why.

I came to the full realization of what’s wrong with Hayek’s approach while re-reading Atlas Shrugged. No, not in Galt’s speech, but surprisingly in the section describing the Minnesota harvest disaster, when trains were diverted to harvest the (spoiled) soybean crop of Kip’s Ma.

There was not much that remained in her mind of the last twenty hours, only disconnected bits, held together by the single constant that had made them possible—by the soft, loose faces of men who fought to hide from themselves that they knew the answers to the questions she asked.

. . . Then came the faces of the assistants in the Car Service Department, who would neither confirm the report nor deny it, but kept showing her papers, orders, forms, file cards that bore words in the English language, but no connection to intelligible facts. Were the freight cars sent to Minnesota?Form 357W is filled out in every particular, as required by the office of the Co-ordinator in conformance with the instructions of the comptroller and by Directive 11-493. Were the freight cars sent to Minnesota? The entries for the months of August and September have been processed by— Were the freight cars sent to Minnesota? My files indicate the locations of freight cars by state, date, classification and— Do you know whether the cars were sent to Minnesota? As to the interstate motion of freight cars I would have to refer you to the files of Mr. Benson and of—

This is the answer to Hayek’s basic argument in defense of capitalism. (I should say that I know of Hayek’s arguments only from the comments of writers who agree with him, but I’m pretty sure I’ve got it right; if not, I hope someone will correct me.)

Hayek’s argument, as I understand it, is that no government planners can substitute for the knowledge embodied in market prices. The price-system, he correctly observes, sums up the evaluative judgments of all the millions of people buying, selling, and refraining from doing so, on the market. Freely arrived at prices contain information; the planners’s knowledge cannot remotely equal that.

In a way, this is an argument from ignorance: the planners can’t know enough to issue the right decrees. In its simpler form, it’s the argument that you can’t force a person to do what’s best for him because only he can know what’s best for him, which is an argument one often hears from conservatives.

The Objectivist argument is quite different: you can’t achieve anyone’s good by force, because values are objective—which means they exist as values only if they are rationally judged by the acting party to be beneficial to him. And no one can be forced to make a rational judgment. The only effect of the force is the destruction of the alleged beneficiary (and everyone else).

A value which one is forced to accept at the price of surrendering one’s mind, is not a value to anyone; the forcibly mindless can neither judge nor choose nor value. An attempt to achieve the good by force is like an attempt to provide a man with a picture gallery at the price of cutting out his eyes. Values cannot exist (cannot be valued) outside the full context of a man’s life, needs, goals, and knowledge. (What Is Capitalism? in Capitalism: The Unknown Ideal)

The Objectivist politics rests on Ayn Rand’s identifications: 1. Man’s mind is his basic means of survival, and 2. Force is anti-mind. Conclusion: force is anti-life. (Individual rights are the principle that recognizes and implements this.)

This is light-years away from (and deeper than) Hayek’s argument from ignorance. He holds, in effect, that the few can’t know as much as the many. But, in fact, they often do. The history of man is replete with examples of one man who was right against the mob. Just read the beginning of Roark’s speech. I realize that Hayek is speaking of economic knowledge, knowledge of how to coordinate production and exchange under a vast division of labor, which is indeed something no single mind or small set of minds can deal with. But his argument stems from a wider, skeptical outlook. And, at any rate, it is completely on the wrong track.

Back to Atlas Shrugged. The point is that the statist system, under Directive 10-289, produces men who fought to hide from themselves that they knew the answers. The substitution of force for market freedom produces not ignorance but evasion. The issue, then, doesn’t concern anyone’s quantity of knowledge but whether thinking, problem-solving, decisive action are rewarded or punished. It’s all about preserving the connection of the mind to life: a system either lets rationality reap its rewards or penalizes rationality.

I have written about the economic selection (like natural selection) that operates under capitalism: success creates the means of its own enlargement and failure is self-eliminating. That is what underlies the social objectivity, as Ayn Rand called it, of market phenomena. The reign of force sabotages this economic selection and turns it into its opposite, an unnatural selection in which success is punished and failure bailed-out.

Under capitalism, it pays men to think; under statism, it pays men to fight against knowledge and to concentrate on avoiding blame.

Interestingly, there is a lot of material in Part III of Atlas about the distinction between the metaphysically given and the man-made. Avoiding blame means trying to guess a potential blamer’s emotions not working to identify the facts of an independent reality. For instance, in the same sequence about Minnesota, there’s this:

The men in Washington were last to be reached by the panic. They watched, not the news from Minnesota, but the precarious balance of their friendships and commitments; they weighed, not the fate of the harvest, but the unknowable result of unpredictable emotions in unthinking men of unlimited power.

And, a little earlier:

You could save us now, you could find a way to make things work—if you wanted to!

She burst out laughing.

There, she thought, was the ultimate goal of all that loose academic prattle which businessmen had ignored for years, the goal of all the slipshod definitions, the sloppy generalities, the soupy abstractions, all claiming that obedience to objective reality is the same as obedience to the State, that there is no difference between a law of nature and a bureaucrat’s directive, that a hungry man is not free, that man must be released from the tyranny of food, shelter and clothing—all of it, for years, that the day might come when Nat Taggart, the realist, would be asked to consider the will of Cuffy Meigs as a fact of nature, irrevocable and absolute like steel, rails and gravitation, to accept the Meigs-made world as an objective, unchangeable reality—then to continue producing abundance in that world.

Ayn Rand’s thought moves on a plane never even glimpsed by most of those who consider themselves intellectuals—including, unfortunately, some who are taken to be the strongest advocates of capitalism.

If one upholds freedom, one must uphold man’s individual rights; if one upholds man’s individual rights, one must uphold his right to his own life, to his own liberty, to the pursuit of his own happiness—which means: one must uphold a political system that guarantees and protects these rights—which means: the politico-economic system of capitalism.
Ayn Rand

May 3rd, 2012 Don Watkins

David Frum laments the fact that more and more people on the right are starting to follow Ayn Rand in calling for a moral defense of capitalism. “It reminds me,” he says, “of the dying phase of socialism.”

According to Frum, early socialists championed its economic efficiency over capitalism and only turned to a moral defense of socialism when the efficiency argument fell apart in the 1970s and 80s. “In economics,” Frum concludes, “you only mount a ‘moral defense’ when you feel you are losing.”

Frum needs to check his history. It’s definitely true that early socialists touted the economic superiority of socialism, but it was moral idealism that fueled their crusade for collectivism, and it was deeply-held moral notions that led people to accept the socialists’ economic claims.

Read, for instance, of the moral hatred of capitalism that drove Karl Marx, or about America’s “Red Decade” and why so many found the “Soviet Experiment” attractive. Even during socialism’s heyday (roughly the late 19thcentury through WWII), the collectivists harped endlessly about capitalism as a system ruled by “immoral” self-interest, the profit motive, “greed,” individualism, and materialism—and they touted socialism for promoting community, brotherhood, and service to the group.

One of the points I stress when I talk about entitlements is that poverty is a production problem. What brings a person out of poverty is more wealth. If you want to see poverty end—and who doesn’t?—then your main concern is to discover how poor individuals can produce more wealth for themselves.

But many people today treat poverty as a political problem to be solved by transferring wealth from people who have produced it to people who haven’t.

Michael Katz is one of the leading authorities on the history of poverty and government anti-poverty efforts in America. The other day I started reading his book The Underserving Poor and quickly ran into this line: “But poverty, after all, is about distribution; it results because some people receive a great deal less than others.”

Poverty is all about distribution? Were cavemen poor because animal skins and arrowheads were not evenly distributed?