Dear American Billionaire,

Bill Gates and Warren Buffett have asked you to publicly pledge to give away at least half of your wealth to philanthropic causes. So far forty of the wealthiest Americans have signed the Giving Pledge, as it’s known. As people who have an enormous respect for those, like you, who create enormous wealth, we urge you not to join them.

At the beginning of your career, you set out to pursue your passion. Like your peers, you took immense risks, worked grueling hours, tackled complex problems, and experienced your share of bad luck and failure — but you persevered. Maybe you created unrivaled efficiencies that allowed you to charge unbeatable prices, like Richard Schulze of Best Buy . Maybe you found a way to make life and business incredibly more convenient, like FedEx founder Fred Smith. Maybe you helped create a new industry, like Intel’s Gordon Moore. Whatever the details, you became one of the world’s most productive individuals.

But while you may have received financial rewards, satisfaction, and the respect of your peers, the one thing you haven’t gotten for your achievement is moral credit.

The premise underlying the Giving Pledge is that so long as you were pursuing your own goals and well-being, what you were doing wasn’t moral. Only by making the good of others your primary aim and sacrificing your wealth to meet their needs do your actions acquire ethical significance.

Virtually everyone today shares that view — but what if it’s wrong? What if your greatest moral achievement consists, not in giving away your wealth, but in having produced it? What if morality is really about guiding you in making the most of your own life — not commanding you to serve the needs of others? What if the most virtuous thing you can do in life is to pursue your own happiness?

This conception of morality has a long and noble history, stretching back to ancient Greece. Greek philosophers conceived of ethics as a guide to living — to acquiring the virtues necessary to shape your life into the most enjoyable, most successful life it can be. That is also how the Greeks’ modern heir, Ayn Rand, viewed morality. And since creating material wealth is a central requirement of a human life, Rand argued, productive achievement is a profoundly moral activity.

You have produced on a grand scale. Now you have a tremendous amount of wealth at your disposal — more than you could possibly spend on your personal consumption. If the achievement of your own happiness is your goal, then perhaps you will choose to keep your wealth invested in business endeavors. Perhaps you will pass it on to loved ones. Perhaps you will use the money to promote capitalism — the economic system that made your success (and the success of every industrialized nation) possible.

Or perhaps you will donate your money to a charitable cause that matters to you. Like many of the businessmen targeted by the Giving Pledge, you may already fund educational programs in your home town, or medical research to fight an illness you’ve faced. You give to charity out of a benevolent desire to help those worthy of help. That’s perfectly consistent with your pursuit of happiness.

But according to the Giving Pledge, what makes you happy shouldn’t be your primary concern.

It is no accident that the Giving Pledge is not a call for charity but a public pledge to give. As Matthew Bishop and Michael Green observe, “Richesse oblige is part of American culture. The peer pressure to give is great (for donors large and small) . . . The Giving Pledge has upped that peer pressure . . .” The Pledge treats your wealth, not as a justly earned reward, but as a gift from society — one that came with plenty of strings attached. The message is: Fulfill the obligation that came with your riches, give your wealth away — or hide your face in shame.

But your wealth was not an undeserved gift. Every dollar in your bank account came from some individual who voluntarily gave it to you — who gave it to you in exchange for a product he judged to be more valuable than his dollar. You have no moral obligation to “give back,” because you didn’t take anything in the first place.

Your productive achievement and the rewards that go along with it are something you should be proud of, and they are something others should admire. Don’t let anyone treat them as a sin.

Don Watkins

Yaron Brook

About The Authors

Don Watkins

Former Fellow (2006-2017), Ayn Rand Institute

Yaron Brook

Chairman of the Board, Ayn Rand Institute

Human progress requires good ideas.

Consider how just two fundamental ideas have ushered in the modern world. Rewind a scant 600 years, and modern science doesn’t yet exist.

Men and women live and die in squalor and filth, largely ignorant of the germs that ravage their bodies and of the natural laws that govern the universe, instead imploring an alleged supernatural force to help them navigate this vale of tears.

But thanks to minds such as Galileo, Sir Isaac Newton, Louis Pasteur and Charles Darwin, this is not how we face the world today. They taught us our method of knowing: careful, mathematically precise observation, step-by-step inference and generalization, and systematic, evidence-based theory building.

They had the courage to challenge entrenched authority, toss aside superstition and defy popes. As others followed the trail the first scientists blazed, human knowledge advanced dramatically.

Thanks to a second idea, this explosion of knowledge broke the confines of the laboratory and ivory tower. Another daring group of thinkers challenged political authoritarianism.

Kings and aristocrats were swept aside to make way for the rights of man. This idea gave birth to a new nation, our beloved America, in which the individual was free to think and pursue his own happiness. A new person arose: the industrialist.

Slandered as robber barons, what these individuals actually did was earn fortunes by studying the discoveries of science and commercializing them.

A mind-boggling array of inventions and products ensued: automobiles, oil, radios, antibiotics, refrigeration, electricity, washing machines, air conditioning, indoor plumbing, airplanes and on and on, to our present world of personal computers and cell phones.

Try to imagine life without all of this. It’s not easy.

But as far as we’ve come because of these two ideas, human progress demands implementation of a third idea to complete the scientific and political revolutions. We’re still beholden to the past in ethics.

Although few of us would turn to the Old Testament or the Quran to determine the age of the Earth, too many of us still turn obediently to these books (or their secular copies) as authorities about morality. We learn therein the moral superiority of faith to reason and collective sacrifice to personal profit.

But the more seriously we take these old ethical ideas, the more suspect become the modern ideas responsible for human progress. The scientists in their laboratories did not demonstrate the superiority of faith. Thomas Jefferson in his Declaration did not proclaim the superiority of collective sacrifice. Why should we think these ideas are the path to moral enlightenment?

Perhaps, of all the damage these antiquated moral ideas do to human progress, the most significant is how they distort our conception of moral ideals.

Ask someone on the street to name a moral hero; if he isn’t at a loss, he’ll likely name someone like Jesus Christ or Mother Teresa. Why? Because they’re regarded as people of faith who shunned personal profit for the collective good. No one would dream of naming Galileo, Darwin, Thomas Edison or John D. Rockefeller.

Yet we should. It is they, not the Mother Teresas of the world, that we should strive to be like and teach our kids the same.

If morality is judgment to discern the truth and courage to act on it and make something of and for your own life, then these individuals, in their capacity as great creators, are moral exemplars. Put another way, if morality is a guide in the quest to achieve your own happiness by creating the values of mind and body that make a successful life, then morality is about personal profit, not its renunciation.

Monetary profit is just one of the values you have to achieve in life. But it is an eloquent representative of the whole issue, because at its most demanding, as exhibited by a Bill Gates or a Steve Jobs, making money requires a profound dedication to material production.

The fact that earning money is ignored by most moralists, or condemned as the root of evil, is telling of the distance we must travel.

In effect, we need to turn the Billionaire’s Pledge on its head.

The world grants, at best, no moral recognition to Gates and Buffett for the personal fortunes they’ve created, but it awards them a standing ovation for giving their profits away. But the standing ovation belongs to the act of creation, the profit they brought into their own lives and anyone who traded with them.

If morality is about the pursuit of your own success and happiness, then giving money away to strangers is, in comparison, not a morally significant act. (And it’s outright wrong if done on the premise that renunciation is moral.)

Science, freedom and the pursuit of personal profit — if we can learn to embrace these three ideas as ideals, an unlimited future awaits.

About The Authors

Yaron Brook

Chairman of the Board, Ayn Rand Institute

Onkar Ghate

Chief Philosophy Officer and Senior Fellow, Ayn Rand Institute

An enterprising manager walks into Steve Jobs’s office and lays out his plan for Apple‘s future. “It’s simple,” he says. “Step one, stop giving employees bonuses. Step two, save money by doing away with our Quality Assurance process. Step three, pad our earnings in order to drive up our stock price. What do you think?”

Talk about an indecent proposal. In reality, that kind of plan would get a manager fired. But believe it or not, this reflects the conventional view of how profit-seeking businessmen think.

Health insurance companies make money by denying patients needed tests. Doctors make money by giving them unnecessary ones. Speculators make money by recklessly bidding up the price of stupid investments. Short sellers make money by driving down the price of sound ones. Lie, cheat, steal, roll the dice and cut corners: People think that’s the easy path to business success.

In his pitch for Dodd-Frank, President Obama complained that in “the absence of sound oversight, responsible businesses are forced to compete against unscrupulous and underhanded businesses, who are unencumbered by any restriction on activities that . . . take advantage of middle-class families, or, as we’ve seen, threaten to bring down the entire financial system.” In Obama’s view — a view many Americans share — being “unscrupulous and underhanded” is a competitive advantage.

Is it any wonder, then, that laws and regulations shackling businessmen are increasing by the day? If lying, cheating and stealing really are the road to riches, then businessmen can’t be trusted and economic freedom can’t be tolerated.

But it’s not true. In a truly free market, the fly-by-night shysters who try to make a killing get killed — by the government, which outlaws force and fraud, and by the market, which shuns any company that fails to create genuine value.

Just take a look at WorldCom. CEO Bernard Ebbers had spent nearly twenty years growing WorldCom into a telecom leader. But when the company ran into financial difficulties in the early ’00s, Ebbers hid its troubles through fraudulent accounting. After the $11 billion fraud was exposed, Ebbers was sentenced to twenty-five years in prison and WorldCom went belly-up.

Think about your own line of work. Think of the time, energy and money your organization pours into research and development, quality control, motivating employees and searching for innovative ways to meet its customers’ needs. Can you succeed via dishonesty and corner-cutting? We’ve spoken to businessmen all over the world and they all say the same thing: “Oh, you couldn’t get very far in my industry that way. But those other industries . . .”

They’re wrong. The only way to profit in a free market over the long run is via production and mutually beneficial trade. Henry Ford grew rich by building us cars. Walt Disney grew rich by bringing us delight. Robert Noyce grew rich by inventing the integrated circuit and making modern computers possible. Sam Walton grew rich by selling us virtually everything dirt cheap. The profit motive doesn’t drive people to cut corners but to create value.

And it is with the long run that most profit-seekers are concerned. In 1982, when children in Chicago started dying from Tylenol that had been deliberately tainted with cyanide, Johnson & Johnson immediately pulled over thirty million bottles from stores. Short term, the recall was costly, but the profit motive led Johnson & Johnson to ignore the short-term costs and make a decision that ultimately saved the Tylenol brand. This is the norm under capitalism — the Madoffs are a rare and fleeting exception.

In today’s semi-capitalist, mixed economy, however, Obama is right that a lot of charlatans are lining their pockets. But he’s wrong that government’s the solution: it’s the problem.

Take housing. Thirty years ago, when the housing market was much freer, lenders knew they couldn’t make money doling out bad loans. So they meticulously examined the credit history of potential borrowers and asked for substantial down payments.

Government intervention in the market changed all that. Thanks to Washington’s affordable housing crusade, unscrupulous mortgage bankers could make easy money by lending to anyone with a pulse and selling worthless paper to government-backed behemoths Fannie Mae and Freddie Mac.

But in a truly free market, profit-seekers have no more motive to resort to chicanery and crime than do teachers or doctors. The path to profit isn’t plunder — it’s productivity.

About The Authors

Don Watkins

Former Fellow (2006-2017), Ayn Rand Institute

Yaron Brook

Chairman of the Board, Ayn Rand Institute

When the housing boom went bust and mortgage giants Fannie Mae andFreddie Mac failed, forcing taxpayers to cough up $150 billion and counting, Washington should have reconsidered its policy of promoting homeownership. It hasn’t.

Last Tuesday, Tim Geithner led a summit to determine the future of Fannie and Freddie. According to Geithner, “We will not support returning Fannie and Freddie to the role they played before conservatorship.”

We should hope not. But Geithner hastened to add that Washington would still play an important role in housing. “I believe there is a strong case to be made for a carefully designed guarantee in a reformed system, with the objective of providing stability in access to mortgages, even in future downturns.” HUD secretary Shaun Donovan put it this way: “The government’s footprint in housing finance needs to be much smaller than it is today.” Smaller? At a time when government backs 97% of new mortgages, it would be hard to make its footprint any larger.

For nearly a century it has been the policy of the U.S. government to increase American homeownership. Its efforts include (but aren’t limited to) bouts of easy money from the Fed, the mortgage-interest deduction, the exclusion of capital gains on primary residence sales, direct and indirect subsidies from the Department of Housing and Urban Development, and artificial liquidity pumped into the mortgage market via government sponsored entities Fannie and Freddie.

Policymakers assure us that the next generation of government housing programs will be “carefully designed” (bring on the next five-year plan, Comrade!). But the real question is why the government should be doing anything to promote homeownership.

“I do believe in the American Dream,” said President Bush in 2002. “Owning a home is a part of that dream, it just is. Right here in America, if you own your own home, you’re realizing the American dream.” Bush was echoing a theme that reaches back at least to Herbert Hoover: When the government encourages homeownership, the story goes, it strengthens individuals and communities and thereby fosters the American Dream.

They’re wrong. A government crusade to promote homeownership is un-American.

America’s distinction is that it was the first nation founded on the principle that you have a right to pursue your own happiness without government interference. But the government’s homeownership crusade means it gets to decide how you should live, and stick-and-carrot you into living that way.

Take the mortgage interest deduction. It so happens that Yaron has a mortgage and Don rents. Both of us have good reasons for our respective choices, but because the government has decided everyone should buy a home, for each dollar Yaron pays on his mortgage, he saves a few pennies on taxes, while Don does not. Instead of playing the role of impartial umpire, the government is playing the role of paternalistic master: “To keep more of your money, do what I want.”

And if that weren’t enough, the government also uses your money to get your neighbors to do what it wants. Welcome to the wild world of subsidies, where the government effectively robs Peter to house Paul. Typically these subsidies were indirect, as in the case of Fannie and Freddie. Their implicit government guarantee meant that you (and your kids) were forced to cosign on Fannie’s and Freddie’s debt in order to lower the cost of mortgages. This was supposed to benefit the people who did their duty and took out home loans, although it turned out to be a bad deal for everyone. Now, however, a number of policymakers, including the former patron saint of Fannie and Freddie, Barney Frank, are calling for direct subsidies to home buyers.

Here’s the real lesson: The American Dream is not some government-subsidized house foisted on you by George W. Bush or Barney Frank. It’s the undiluted freedom to decide how you want to live–and, if you want to own a home, it’s the freedom to work, save, establish credit, and earn one. In America, the government’s job is to protect our freedom to pursue our values, not to dictate what our values are. Its homeownership policy should be the same as its toaster oven policy: laissez-faire.

Government intervention in housing runs deep, and it can’t be eliminated overnight. But the government should make its long-term goal to fully extricate itself from the housing market. It can then start gradually dismantling Fannie, Freddie, tax preferences for homeowners, and every other government housing program.

Some say we can’t begin to accomplish this in the era of Obama. Our response: Yes, we can.

About The Authors

Don Watkins

Former Fellow (2006-2017), Ayn Rand Institute

Yaron Brook

Chairman of the Board, Ayn Rand Institute

Ever since business groups such as the Chamber of Commerce and the Business Roundtable started attacking the president’s policies for throttling their ability to produce, political commentators have been asking: “Is Obama anti-business?”

That might seem about as debatable as heliocentrism. Why, then, have Obama’s critics found it so hard to make their case?

They call Obama a socialist–his defenders say he resisted calls to nationalize the banks and socialize health care. They say Obama has grown government “too much”–his defenders say he’s merely trying to cope with an economic emergency and provide markets with some “sound oversight.” Sure, they concede, the president’s rhetoric has sometimes crossed the line, but at the end of the day, he’s a pro-business guy.

All of which raises the question: What does it mean to be pro-business anyway?

One place to look for an answer is Ayn Rand’s 1957 novel Atlas Shrugged, a perennial favorite among American entrepreneurs, and a pro-business work if there ever was one.

From an executive who runs a transcontinental railroad to an industrialist who creates a metal stronger and lighter than steel, the heroes of Atlas are producers–individuals who use their intelligence to create vast amounts of wealth. Whereas many people think of business as a humdrum affair of paper-shuffling and pencil-pushing, Rand’s work dramatizes the incredible ingenuity, discipline and risk-taking that business requires.

Today “pro-business” often gets equated with assuaging the desires of the business lobby. But Atlas excoriates those “businessmen” who spend their time liquoring up politicians to coax favors or crush competitors. What it celebrates is the activity of business–the process of production and trade that has taken us from mud huts to Manhattan. The true producer Rand shows, makes just one demand of Washington: “Get the hell out of my way!”

Atlas shows that what business requires from politicians is not favors but freedom. To the extent producers are free to act on their judgment, they generate the kind of wealth that has lifted the West (and much of the East) out of poverty. To the extent they are forced to take orders from bureaucrats, the result is stagnation.

The economic system fully geared to the life of producers is complete, unregulated, laissez-faire capitalism–a total separation of state and economics, where the government protects each individual’s inalienable rights, including his rights to property and to freedom of contract and trade, and otherwise “gets the hell out of the way.” That’s what it means to be pro-business.

By this standard, Barack “At a Certain Point You’ve Made Enough Money” Obama is obviously anti-business. But many people are under the impression that Obama’s critics are pro-business. Nothing could be further from the truth.

One of the myths that arose following the financial crisis was that America pre-Obama was something close to a free market. According to this narrative, anyone who supports the status quo circa 2007 is a champion of capitalism.

But by 2007 the number of federal agencies and commissions riding roughshod over a businessman’s rights had already mushroomed to more than 100, including the IRS, SEC, EPA, FTC, FDA, FCC, USDA, FDIC, OHSA. These agencies were enforcing an unprecedented 73,000 pages of regulations, and their budgets had swelled to record levels. This included 2002′s draconian Sarbanes-Oxley, passed by the Senate 99-0 and signed into law by the supposedly pro-capitalist President Bush.

This vast government control of production and trade is the opposite of capitalism. Yet how many of these anti-business laws and regulations have Obama’s critics vowed to repeal? None of any consequence.

What’s more, despite an avalanche of evidence that the prime culprits in the financial crisis were the Fed’s low interest rates, government housing policy, and too-big-to-fail, Republicans have joined Democrats in blaming America’s “free market,” and vow, in Mitch McConnell’s words, to “rein in Wall Street to prevent another crisis.”

While Republicans often express admiration for Ayn Rand, the one thing they refuse to rein in is today’s massive regulatory-welfare state. To the extent they oppose Obama, it’s not on the grounds that businessmen have a right to function free from government coercion, but on the grounds that the amount of coercion Obama advocates goes a little too far.

None of this is to deny that in the short term, the threat Obama poses to business vastly outstrips the threat posed by most of his critics. But if Americans are looking for a pro-business alternative–one that defends America’s original capitalist system–they won’t find it in today’s political establishment.

About The Authors

Don Watkins

Former Fellow (2006-2017), Ayn Rand Institute

Yaron Brook

Chairman of the Board, Ayn Rand Institute

In the years leading up to 2008 – 09’s financial meltdown, government control over mortgages, interest rates and America’s banking system was at an all-time high.

And yet when crisis struck, free enterprise took the blame.

The cure, therefore, was to give government even wider powers. Washington can now bail out any company, fire CEOs, override contracts and print billions of dollars to “stimulate” the economy — all in the name of the public interest. The result? Our deficits and debt continue to mount, and there’s a real possibility of a future like Greece’s.

This is the state of our world today. It’s remarkably similar to the state of the world in Ayn Rand’s Atlas Shrugged, a mystery story about a future America whose economy is disintegrating and whose government is accumulating power faster than anyone thought possible. This parallel is a big reason a record 500,000 people bought Atlas Shrugged last year.

So what can we learn from a book that foresaw in 1957 what few believed possible in 2007? We can learn a lesson the heroes of the novel learn: the cause of the government’s greater, destructive control of business. And we can learn how to oppose it.

Many of the heroes in Atlas Shrugged are the kind of men and women who built, and continue to build, America into the economic power that it is — inventors such as Edison, industrialists in the mold of Rockefeller and Carnegie, business visionaries reminiscent of Bill Gates and Steve Jobs.

In logic and justice, the heroes of Atlas Shrugged should be admired and appreciated for their efforts; instead, they’re demonized and shackled.

Man of Steel

Take the case of Hank Rearden, the leading industrialist in Atlas Shrugged and inventor of Rearden Metal, an alloy superior to steel. Rearden is denounced and forced to surrender his iron and coal businesses because the Equalization of Opportunity Bill demands he create business “opportunities” for struggling competitors.

His production of Rearden Metal is capped by the Preservation of Livelihood Law designed to keep other steel makers afloat. Key businesses can’t buy enough Rearden Metal because Rearden’s forced to give every customer an equal portion under the Fair Share Law.

Each new government scheme to control Rearden’s industry brings a new crisis, and each new crisis brings a new scheme.

The result is the accelerating collapse of Rearden’s business empire — and of all the other productive enterprises that depend on Rearden’s enormous productivity. The only beneficiaries of this orgy of government authority are power-lusting politicians and the pseudo-businessmen who lobby for and profiteer from these laws.

This scenario from Atlas Shrugged is an incredibly destructive one — and yet it is all too reminiscent of recent bailouts and power grabs in Washington.

Why? Why does government control over the economy only grow? Part of the answer in Atlas Shrugged is that those seeking power over business triumph because they claim, unchallenged, the moral upper hand.

Bankers and hedge funds today, like Rearden and the other industrialists in Atlas Shrugged, are denounced as selfish, greedy profit seekers.

And everyone knows that selfishness and profit seeking are evil, right?

Further, the justification of every new government scheme in our world, as in the world of Atlas Shrugged, is that it places “the public interest” above private profit.

When the government created Fannie Mae and Freddie Mac, authorizing them to guarantee trillions of dollars in mortgages, what was the justification? It’s in “the public interest” to promote homeownership for countless Americans.

When the housing bubble collapsed, what was the justification for bailing out failing institutions? “The public interest” demands the preservation of illiquid and insolvent banks. The justification for bailing out GM? It’s in “the public interest” to keep GM workers employed.

And who, after all, dares question the morality of pursuing the public interest?

So when government controls inevitably create an economic crisis, there exists a ready-made explanation and scapegoat: The evil profit seekers must be responsible and so must be further reined in, and the good, public-spirited officials charged with reining them in must have had too little power, which must therefore be increased. Which means: more shackles for productive American businessmen and more power for government.

And so America moves, step by step, in the direction of the economic shambles of a banana republic or a Soviet Russia.

How to reverse course? Challenge these moral ideas.

“The public interest” is an immoral idea.

As Rand puts it elsewhere: “Since there is no such entity as ‘the public,’ since the public is merely a number of individuals, the idea that ‘the public interest’ supersedes private interests and rights can have but one meaning: that the interests and rights of some individuals take precedence over the interests and rights of others.”

This is precisely what we witness in Atlas Shrugged as Rearden’s business is torn apart in the name of the public interest: His money, property and life are sacrificed to anyone and everyone who can gain the title of “the public.” Rearden has no right to his money and metal, because he’s selfishly produced them; sundry other people have a right to both, because in their selflessness they have produced neither, which entitles them to be regarded as “the public.”

This is precisely what we see all around us today, as failing banks are bailed out by healthy banks and taxpayers (are they any less the public?), unprofitable GM is saved at the expense of profitable businesses and their employees (are they any less the public?), and homeowners who cannot pay their mortgages are bailed out by prudent people who didn’t even buy a house (are they any less the public?).

The lesson? Anytime anyone calls for economic policies to promote “the public interest,” he’s calling for evil — the sacrifice of individuals who’ve earned something to those who haven’t.

What’s the alternative to the tyranny of “the public interest”? Each individual’s pursuit of his private interests — in Jefferson’s words, the pursuit of happiness.

The result is a nonsacrificial society, in which government is stripped of the power to concoct schemes to promote “the public interest” and is solely focused on protecting each individual’s rights, including his property rights.

Doing What’s Right

But such a society, Atlas Shrugged shows us, can exist only if we regard making (and enjoying) a profit as an unmitigated, life-sustaining virtue. Rearden comes to realize this — and the importance of speaking up morally. He declares publicly what no Rockefeller, Carnegie or Gates would ever dare declare:

I work for nothing but my own profit — which I make by selling a product they need to men who are willing and able to buy it. . . . I do not sacrifice my interests to them nor do they sacrifice theirs to me; we deal as equals by mutual consent to mutual advantage — and I am proud of every penny that I have earned in this manner. . . . I refuse to apologize for my ability — I refuse to apologize for my success — I refuse to apologize for my money.

Rearden takes this moral stand because he’s realized, in the words of a friend, that:

If you ask me to name the proudest distinction of Americans, I would choose — because it contains all the others — the fact that they were the people who created the phrase “to make money.” . . . Men had always thought of wealth as a static quantity — to be seized, begged, inherited, shared, looted or obtained as a favor. Americans were the first to understand that wealth has to be created. The words “to make money” hold the essence of human morality.

Unless we recapture this quintessentially American spirit, this independent, individualistic ethic — and discover the words fully to name it, to understand it, to defend it and to implement it — we’ve no right to expect the freedom and progress that earlier Americans achieved.

This is one of timeless themes of Atlas Shrugged.

About The Author

Yaron Brook

Chairman of the Board, Ayn Rand Institute

After clearing the Senate Judiciary Committee today, Elena Kagan must now win the support of the full Senate.

Assuming that the Senate confirms Ms. Kagan to be the next justice for the Supreme Court, she must swear to “support and defend the Constitution of the United States.” But does she understand the document she’s supposed to uphold?

Alarmingly, Kagan’s testimony before the Senate Judiciary Committee shows that she rejects the Founders’ view of the Constitution as a charter of liberty whose purpose is to protect individual rights. Instead, she adheres to the modern view that it’s a mechanism for establishing unlimited majority rule over the individual.

As a matter of historical fact, the Founding Fathers wrote the Constitution for a certain purpose. They wanted a government that would respect and protect the individual’s rights to life, liberty, property, and the pursuit of happiness. Aside from certain contradictions (the worst of which, toleration of slavery, required a bloody civil war to expunge), the Constitution is dedicated to protecting the individual from society by means of a limited government. The Supreme Court cannot objectively interpret the document’s language apart from this essential purpose.

Regrettably, however, too many of today’s judges reject this approach to constitutional interpretation.

The Holmes model: sneering at natural rights

Instead, they follow the path marked out by Justice Oliver Wendell Holmes, Jr., who sat on the Supreme Court from 1902 to 1932. “All my life I have sneered at the natural rights of man,” Holmes wrote, reflecting his view that the individual rights venerated by the Founders have no objective validity and therefore no role in discerning the Constitution’s meaning.

Judges may harbor personal opinions on man’s rights, Holmes conceded, but such notions have “nothing to do with the right of a majority to embody their opinions in law.” Holmes’s view directly contradicts that of James Madison, the Father of the Constitution, who reviled unlimited democracy as “incompatible with personal security or the rights of property.”

Kagan, during her recent hearings, declared her allegiance to the Holmesian orthodoxy. Under questioning from Sen. Tom Coburn (R) of Oklahoma, Kagan said a judge’s understanding of inalienable rights is “outside the Constitution and the laws,” and therefore “you should not want me to act in any way on the basis of such a belief.”

In a written follow-up, Kagan named Holmes as the last century’s most influential Supreme Court justice, stating: “His opinions . . . set forth the basic rationale for judicial deference to legislative policy decisions.” Having discarded the Constitution’s actual purpose as irrelevant to judging, Kagan is left with Holmes’s concept of the Constitution as a mechanism for implementing unlimited majority rule.

How might a different judge proceed — one who regards it as her duty to interpret each clause in relation to the individual rights to life, liberty, property, and the pursuit of happiness?

Different ideas about the Commerce Clause

Suppose she were asked to interpret the oft-disputed provision that grants Congress authority to “regulate Commerce . . . among the several States.” Such a judge would recognize that the Commerce Clause empowered Congress to protect the rights of traders, by preventing states from imposing tariffs and other restrictions on the free movement of goods across state lines.

Such a judge, applying the Commerce Clause to current cases, would ask whether any proposed government action itself violates an individual’s rights. And such a judge would stand ready to strike down laws that exceed the government’s granted authority.

Kagan, by contrast, would see the Commerce Clause as authorizing nearly total control by the majority over the way every individual earns a living, spends money, and trades with others — his rights be damned. She would have no trouble finding, for example, that the majority, through its elected representatives in Congress, is authorized to mandate the individual purchase of health insurance, as Obamacare attempts to do. After all, insurance is part of commerce, isn’t it?

Nor would she fail to find authority for the government to bully banks into joining bailout schemes, launch massive “stimulus” spending of taxpayer money, and cap carbon emissions. If it’s commerce, the majority can control it. During her testimony, Kagan even lectured Sen. Coburn on the majority’s constitutional right to (hypothetically) require that each individual eat three vegetables a day — allowing herself only an inconsequential personal opinion that such a dictatorial law would be “dumb.”

This is the judicial philosophy that has enabled government to expand at an accelerating pace for more than a century — without judicial impediment, and without any end in sight.

If the Senate confirms her nomination, Elena Kagan will surely recite the words of her oath accurately, but her testimony shows she has no intention of supporting and defending the true Constitution.

About The Author

Tom Bowden

Analyst and Outreach Liaison, Ayn Rand Institute

Capitalism is under siege. The social-economic system that made America the land of opportunity, freedom and explosive growth is under attack. Many blame the greed and self-interest of Capitalists for today’s economic morass. Others wonder how and why the events in Ayn Rand’s novel, <em>Atlas Shrugged</em>, could so closely parallel today’s events.

In this talk, Yaron Brook provides evidence that today’s crisis is a failure of the un-free market. Massive government intervention, from Washington’s affordable-housing crusade to the Federal Reserve’s easy-money policies, laid the groundwork for the crisis which culminated in TARP and the various stimulus packages. Likewise, Medicare and Medicaid laid the groundwork for the government’s most recent massive takeover of health care. Dr. Brook evaluates the government’s latest actions and suggest alternatives.

Dr. Brook also explains why the free market has taken the blame for a crisis caused by government intervention, and why it is that self-interest and the profit motive are the reasons that capitalism is the only moral social-economic system. His talk provides some hints of why Ayn Rand’s provocative philosophy is the only explanation that makes sense of today’s events. (Recorded June 9, 2010.)

About The Author

Yaron Brook

Chairman of the Board, Ayn Rand Institute

Despite overwhelming evidence that government intervention wrecks health care, government control over American medicine keeps growing. Why?

Because, Yaron Brook argues, virtually everyone today believes that a person’s need morally entitles him to have it fulfilled at others’ expense. This morality of need is at the root of every government health care entitlement, from Medicaid to ObamaCare .

In this provocative talk, Dr. Brook attacks the morality of need, and proposes a revolutionary alternative: the moral right of each individual to live for his own sake, taking responsibility for his own life and needs — including his health care needs — on a free market. (Recorded May 11, 2010.)

About The Author

Yaron Brook

Chairman of the Board, Ayn Rand Institute

Just when swine flu was expected to peak, it has mysteriously faded from view. Now that Americans are no longer queuing up for vaccine, some 71 million doses (part of a $1.6 billion tax-funded program) are likely to be trashed upon expiration. While baffled health experts investigate causes, it’s worth looking back at some important but little-known decisions that the Food and Drug Administration took amidst last fall’s crisis atmosphere.

Afraid of being held accountable for widespread sickness and death due to swine flu or H1N1 virus, the FDA elected to bypass its labyrinthine, virtually interminable approval process so that doctors could immediately employ promising remedies (other than vaccines) to combat the disease. In sweeping aside regulatory obstacles, the FDA was using authority granted by Congress back in 2004 — to be used only in the event of a “public health emergency.”

Of course, Congress was implicitly conceding what the FDA’s critics have known for decades — that people die unnecessarily (millions, by some reckonings) when denied access to drugs the agency has not yet condescended to approve. Once H1N1 was deemed a “public health emergency,” the FDA issued a series of so-called Emergency Use Authorizations (EUAs) providing exemptions for three antiviral drugs (Peramivir, Tamiflu, and Relenza), two “flu panels” (diagnostic tests), and a respirator.

Congress’s rationale for permitting such EUAs was to remove the FDA roadblock when unapproved drugs (or approved drugs used in unapproved ways) might enhance national security in the face of a chemical or biological threat to “public health.” But wait a minute: Why does preserving “public health” justify bypassing the FDA approval process, while private health doesn’t? Why should drug companies be able to offer life-saving drugs to large numbers of sick people — but not to small numbers, or even to single individuals?

There is no rational answer to such questions, because there is no rational distinction between public and private health in this context. Every life-threatening disease presents a health emergency to the individual patient. Morally, you have the right to seek the best treatment you can find. Yet our legal system denies you that right when it comes to private health emergencies.

In 2008 the Supreme Court refused to hear the appeal in Abigail Alliance for Better Access to Developmental Drugs v. von Eschenbach, leaving in place a lower court decision that a lone individual has no constitutional right to escape the government approval process, even if his life is at stake. The plaintiff in that case was a nonprofit named for Abigail Burroughs, a 21-year-old woman who died of cancer in 2001 after a desperate, but futile, quest for federal permission to take an experimental cancer-fighting drug her doctor recommended.

The answer to such injustices is not for Congress to tinker with the standards by which EUAs can be issued. Instead, we need to challenge the idea that private parties striving to preserve human life against dread diseases should ever have to ask government permission before acting.

Pharmaceutical products such as antivirals are the private property of their manufacturers. Drug companies should be free to offer those products for sale on an open market, on terms they deem proper. If a doctor views a particular drug as his patient’s best option, then he should be free to prescribe it. And if a patient decides it’s his best chance for health, he has a right to authorize the treatment — indeed, his unalienable right to life is meaningless in that situation without such freedom.

Of course, government must always stand at the ready, with power to redress such objective legal wrongs as fraud, negligence, and breach of contract. But otherwise the government should remain entirely out of the loop when drug companies, doctors, and patients are making the all-important decision to treat a life-threatening disease with a promising drug.

Whether the recent EUAs freed up remedies that actually saved people from succumbing to swine flu is an open question. But there is no doubt that individuals afflicted by other diseases continue to die because their rights are trampled by FDA control over pharmaceuticals.

Drug companies should never have to look toward Washington, D.C., bowing and begging for bureaucratic permission to save lives — a million lives, or just one.

About The Author

Tom Bowden

Analyst and Outreach Liaison, Ayn Rand Institute