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POV: Have Gun, Will Nudge
by Ayn Rand | March 1962
It's Not the Unions — It's the Labor Laws
by Doug Altner | March 19, 2014
Regulatory Strangulation
by Steve Simpson | March 13, 2014
Obamacare creates a new class of free riders
by Rituparna Basu | January 23, 2014
Obamacare Is Suffocating An Already Sick Health Insurance Patient
by Rituparna Basu | January 22, 2014
The Broken State of American Health Insurance Prior to the Affordable Care Act: A Market Rife with Government Distortion
by Rituparna Basu | January 21, 2014
Obamacare is Really, Really Bad for You, Especially If You're Young
by Rituparna Basu | August 21, 2013
Justice Department should let US Airways & American Airlines merger proceed
by Tom Bowden | August 16, 2013
Why Is Apple Inc. On Trial? For Good Behavior, It Turns Out
by Tom Bowden | June 20, 2013
The Forgotten Man of the Minimum-Wage Debate
by Doug Altner | June 19, 2013
Why Delivering Beer Isn’t Easy
by Doug Altner | June 11, 2013
What Explains GM’s Problems With The UAW?
by Doug Altner | May 20, 2013
What Are The Search Results When You Google ‘Antitrust’?
by Tom Bowden | April 18, 2013
To Protect the Defenseless, We Must Abolish the Minimum Wage
by Don Watkins | March 27, 2013
I’ll Buy My Own Contraception, Thanks
by Rituparna Basu | November 13, 2012
Why The Glass-Steagall Myth Persists
by Yaron Brook | November 12, 2012
Why Ayn Rand’s Absence From Last Thursday’s Debate Benefits Big Government
by Yaron Brook | October 15, 2012
Changing the Debate: How to Move from an Entitlement State to a Free Market
by Don Watkins | July 02, 2012
3 Things Everyone Needs to Know About the Apple Antitrust Case
by Don Watkins | April 10, 2012
What's Really Wrong with Entitlements
by Don Watkins | February 21, 2012
The Entitlement State Is Morally Bankrupt
by Don Watkins | September 13, 2011
How Important Is the Obamacare Litigation?
by Tom Bowden | August 12, 2011
Atlas Shrugged: With America on the Brink, Should You “Go Galt” and Strike?
by Onkar Ghate | April 29, 2011
The Road to Socialized Medicine Is Paved With Pre-existing Conditions (Part 3)
by Yaron Brook | April 06, 2011
The Road to Socialized Medicine Is Paved with Pre-existing Conditions (Part 2)
by Yaron Brook | March 10, 2011
In Defense of Finance
by Yaron Brook | February 15, 2011
The Road to Socialized Medicine Is Paved with Pre-existing Conditions
by Yaron Brook | February 10, 2011
The Avastin Travesty
by Tom Bowden | December 12, 2010
Apple Now Targeted for Success Like Microsoft Was in the 1990s
by Tom Bowden | October 04, 2010
The Un-American Dream
by Don Watkins | August 27, 2010
What About Private Health Emergencies?
by Tom Bowden | April 08, 2010
What’s Really Driving the Toyota Controversy?
by Don Watkins | March 26, 2010
Anti-Smoking Paternalism: A Cancer on American Liberty
by Don Watkins | March 06, 2010
Apple vs. GM: Ayn Rand Knew the Difference. Do You?
by Don Watkins | March 02, 2010
Smash the Labor Monopolies!
by Tom Bowden | September 15, 2009
America’s Unfree Market
by Yaron Brook | May 2009
Atlas Shrugged and the Housing Crisis that Government Built
by Yaron Brook | March 2009
The Green Energy Fantasy
by Keith Lockitch | February 25, 2009
Stop Blaming Capitalism for Government Failures
by Yaron Brook | November 13, 2008
The Resurgence of Big Government
by Yaron Brook | Fall 2008
The Government Did It
by Yaron Brook | July 18, 2008
From Flat World To Free World
by Yaron Brook | June 26, 2008
How Government Makes Disasters More Disastrous
by Tom Bowden | April 29, 2008
Life And Taxes
by Yaron Brook | April 17, 2008
War On Free Political Speech
by Yaron Brook | March 21, 2008
To Stimulate The Economy, Liberate It
by Yaron Brook | February 14, 2008
Exploiters vs. Victims in the Grocery Strike
by Elan Journo | January 30, 2004
Prescription Drug Benefits Violate the Rights of Drug Companies
by Onkar Ghate | July 24, 2002
Drop the Antitrust Case Against Microsoft
by Onkar Ghate | March 17, 2002

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Atlas Shrugged and the Housing Crisis that Government Built

by Yaron Brook | March 2009

Ayn Rand once said that the purpose of her novel Atlas Shrugged — which tells the story of a U.S. economy crumbling under the weight of increasing government control — was “to keep itself from becoming prophetic.” She may not have succeeded. As a number of commentators have noted, the parallels between today’s events and those dramatized in Rand’s 1957 novel are striking.

In a recent Wall Street Journal column, for instance, Stephen Moore observed that “our current politicians are committing the very acts of economic lunacy” that Atlas Shruggeddepicted 52 years ago. In the novel, he points out, politicians respond to crises “that in most cases they created themselves” with more controls and regulations. These, in turn “generate more havoc and poverty,” which spawn more controls, “until the productive sectors of the economy collapse under the collective weight of taxes and other burdens imposed in the name of fairness, equality and do-goodism.”

This certainly seems like an apt description of, say, the housing crisis. For decades, Washington promoted homeownership by people who couldn’t afford it: think Fannie Mae and Freddie Mac, the Community Reinvestment Act, tax incentives to buy homes, housing subsidies for the needy, among other programs. And when people started to default on their mortgages by the truckload? The government didn’t scrap its controls, but instead promised to bail out delinquent homeowners and irresponsible bankers and impose more regulations on all lenders (responsible or not).

But what commentators miss is that Rand’s novel provides the explanation for why this is happening — and the cause is not some inexplicable “lunacy” on the part of politicians. The cause is our very conception of fairness, equality, and the good. “Why,” states the hero ofAtlas Shrugged to the people of a crumbling world, “do you shrink in horror from the sight of the world around you? That world is not the product of your sins, it is the product and the image of your virtues.”

In Rand’s novel, government puts the needs of the meek and less fortunate first. For instance, the Anti-dog-eat-dog Rule is passed to protect some long established, less-efficient railroads from better-run competitors. Why? Because it was deemed that those “established railroad systems were essential to the public welfare.” What about the superior railroad destroyed in the process? Its owner needs to be less selfish and more selfless. The Rule fails to stem the crisis, and the country sinks deeper into depression. But, wedded to the ideal that each must be his brother’s keeper, government imposes more burdens and regulatory shackles on productive companies in the name of bailing out the struggling ones — only to drive the country further toward disaster.

Sound familiar? These are the same slogans invoked and implemented today. We must be “unified in service to the greater good,” President Obama tells a cheering nation. We must heed the “call to sacrifice” and “reaffirm that fundamental belief — I am my brother’s keeper, I am my sister’s keeper. . .”

In 2002, pushing for extensive new government programs to “expand home ownership,” President Bush reminded us of our selfless “responsibility . . . to promote something greater than ourselves.”

To implement this goal, Washington allowed Fannie and Freddie to pile up dangerous levels of debt. It used the Community Reinvestment Act to coerce banks into relaxing their lending standards. It used our tax dollars to dole out housing subsidies to otherwise unqualified borrowers. And when it turned out that home buyers who couldn’t afford homes without government help, also couldn’t afford them with government help, we still do not abandon these failed policies. Clinging to the notion that we are our brother’s keeper, everyone today proposes new policies to bail out the “unfortunate.”

While the details of these policies have been debated, no one challenges their goal. No one questions whether it is morally right to be selfless and to sacrifice to “promote something greater than ourselves.”

This is what Atlas Shrugged challenges. Why, it asks, is it morally right to regard some individuals as servants of those in need, rather than as independent beings with their own lives and goals? What is noble about a morality that turns men into beggars and victims — the bailed out and the bailers out?

Atlas Shrugged presents instead a new conception of morality that upholds the right of the individual to exist for his own sake. This, Rand tells us, is the only possible basis for a free country. It’s freedom or service — the pursuit of happiness or of the “public good” — the Declaration of Independence or the endless crises of the welfare state — self-interest or self-sacrifice.

It’s still not too late to make the right choice.

About The Author

Yaron Brook

Chairman of the Board, Ayn Rand Institute