The growth of government intervention over the last century was built on the back of a handful of myths. A generation ago, the dominant myth was that free markets had caused the Great Depression, a falsehood ultimately debunked by economists like Milton Friedman. Today, the key myth is that financial deregulation caused the 2008 financial crisis.

What deregulation? There aren’t many possibilities. Despite what we hear, regulation of the financial industry substantially increased over the last thirty years. Government spending on financial regulations, to take one measure, ballooned from $725 million in 1980 to $2.07 billion in 2007 (in 2000 dollars). Anyone looking to blame deregulation for the crisis faces slim pickings.

By far, the single most cited example of this financial “deregulation” is the Gramm-Leach-Bliley Act (GLB), which partially repealed the Glass-Steagall Act thirteen years ago today. Regulatory evangelists including Nobel Prize economist Joseph Stiglitz and recent senatorial candidate Elizabeth Warren, not to mention the Occupy Wall Street protesters, have named the overthrow of Glass-Steagall as public enemy number one.

Stiglitz, for instance, in a lengthy piece for Vanity Fair,could only muster two examples of the deregulation he thinks bears primary responsibility for the crisis: the repeal of Glass-Steagall and the SEC’s 2004 decision to raise banks’ debt-to-capital ratio from 12:1 to 30:1. The latter, of course was not deregulation, but re-regulation. For the regulatory evangelists, the repeal of Glass-Steagall is all they’ve got — and what they’ve got ain’t much.

Glass-Steagall was enacted in 1933 to create a firewall between commercial and investment banks: commercial banks could not underwrite or deal in securities, and investment banks could not accept deposits. The Act also restricted commercial banks from being affiliated with any company that underwrote or dealt in securities.

But by the 1990s, the affiliation provision was widely viewed as unnecessary and even harmful to financial institutions. In 1999, President Clinton signed GLB into law. Although it left the bulk of Glass-Steagall in place, it ended the affiliation restrictions, freeing up holding companies to own both commercial and investment banks.

There is zero evidence this change unleashed the financial crisis. If you tally the institutions that ran into severe problems in 2008–09, the list includes Bear Stearns, Lehman Brothers, Merrill Lynch, AIG, and Fannie Mae and Freddie Mac, none of which would have come under Glass-Steagall’s restrictions. Even President Obama has recently acknowledged that “there is not evidence that having Glass-Steagall in place would somehow change the dynamic.”

As for the FDIC-insured commercial banks that ran into trouble, the record is also clear: what got them into trouble were not activities restricted by Glass-Steagall. Their problems arose from investments in residential mortgages and residential mortgage-backed securities — investments they had always been free to engage in.

GLB didn’t cause the financial crisis — and, when push comes to shove, the regulatory evangelists must admit as much. Stiglitz, in the same Vanity Fair article, concedes that Glass-Steagall did nothing to “directly” cause the crisis. Warren, meanwhile, confessed to New York Times reporter Andrew Ross Sorkin that Glass-Steagall would probably not have stopped the financial crisis, but that she was pushing to reinstate it because, in Sorkin’s words, “it is an easy issue for the public to understand and ‘you can build public attention behind.’”

The reason deregulation is blamed for the crisis is not because there’s proof that GLB was responsible. It’s because people like Stiglitz and Warren have an ideologically based suspicion of markets and the self-interest they unleash.

You can think of it as the “greed” explanation: bankers and financiers are not selfless “public servants,” but “greedy” profit-seekers out for themselves. Unless carefully controlled and limited by government regulators, the story goes, this “greed” is inevitably a destructive force that will foster short-range and often predatory decisions.

Is it any wonder that those who held this view did not feel the need to investigate what led to the financial crisis, but “just knew” the answer had to be a lack of government control? “Wall Street has betrayed us,” John McCain declared just one day after Lehman’s collapse. “This is a result of excess and greed and corruption. . . . And we got [sic] to fix it and we’ve got to update our regulatory system.”

If one understood that the pursuit of profit in a free market does not favor a short-term, cut-every-corner mentality, one’s approach would be very different. One would consider real the possibility that government interference with market forces led to the irrationality and value-destruction of the financial crisis. Indeed, that’s precisely what a growing body of literature suggests.

The definitive history of the financial crisis remains to be written. But one thing is for sure: it shouldn’t be written by those who have a quasi-religious conviction that the freedom to pursue profits is the cause of all the world’s problems, and that government regulation is the unfailing elixir.

About The Authors

Yaron Brook

Chairman of the Board, Ayn Rand Institute

Don Watkins

Former Fellow (2006-2017), Ayn Rand Institute

It’s no secret that the right is awash in Ayn Rand. Tea Partiers carry signs like “Who is John Galt?” and, astonishing for a novel published 55 years ago, sales of Atlas Shrugged topped 445,000 last year.

All of this has prompted researchers like Yale historian Beverly Gage to wonder, “Why is there no liberal Ayn Rand?” Good question. Liberals today, Gage observes, have no long-term goals or vision, no big ideas, no canon.

Here’s a radical thought. Instead of liberals dismissing Rand’s appeal to the American spirit of individualism and independence, as President Obama recently did in his Rolling Stone interview, why don’t liberals make Rand part of a new canon? Why let conservatives monopolize her?

Rand herself I suspect would have welcomed this. In a talk in Boston in 1961, she lamented the fact that both liberals and conservatives were ideologically bankrupt, with too many liberals turning sympathetically to unlimited government and too many conservatives turning back to the Middle Ages. She was seeking to address, she said, “the ‘non-totalitarian liberals’ and the ‘non-traditional conservatives'” in the audience.

Her message that night was the need for a principled, uncompromising fight for a moral ideal she thought long abandoned by both sides, the rights of the individual. This means life, liberty, property and the pursuit of happiness: your moral right to follow your own reasoned judgment in earning your way in the world and achieving your happiness.

Religious conservatives like Paul Ryan have to distance themselves from Rand’s philosophy. Theirs is an inconsistent position. Ryan, for instance, wants to be seen as an advocate of individual rights while simultaneously making a mockery of a woman’s right to the pursuit of happiness by proposing to force her to bring a pregnancy to term even in the case of rape.

Rand rejects such medievalism. Precisely because raising a child is a personal and immense undertaking, a woman must have the freedom to judge whether and when to have children. To equate an embryo with a human being, a potential with the actual, and then to declare the willful ending of a pregnancy murder, is to abandon reason and science in favor of mystical Church dogmas. No government, Rand argued, should have the power to dictate to a woman in such matters; it’s her life and her decision.

The same principle — the individual’s moral right to his own life — put Rand on the side of other supposedly liberal causes: she was a staunch defender of free speech and immigration and a staunch opponent of racism. But this very principle led Rand to reject what too many liberal-leaning people seemingly dare not even question: the modern regulatory-welfare state.

What in the end is the regulatory-welfare state but a massive and growing attempt to override our reasoned choices and decisions: to dictate to us whose permission we must obtain to drive a taxi or serve alcohol in a restaurant, what questions we’re allowed to ask in a job interview, whose health care we must pay for and in what way, how much we must “save” for retirement (which the government then proceeds to spend), and on and on and on.

Take the case of but one regulatory agency, the FDA. The FDA wasn’t created to outlaw fraud, which was already illegal. It exists to tell us which drugs we can buy, companies which drugs they can sell, how those drugs must be tested and how manufactured. What if people rationally disagree with the government’s dictates? What if a company thinks it has developed a better way of testing for efficacy or an unconventional but superior manufacturing process? What if a patient is willing to risk known and even unknown side effects because of the unusual severity of his disease? If the decision about abortion should be left to a woman (in consultation with her doctor), why shouldn’t these important decisions be solely between the individuals involved? Because they are economic in nature, and therefore subject to majority vote?

This is precisely one issue on which Rand challenges modern liberals: whether it’s consistent to advocate an individual’s intellectual and personal liberty while denying him economic liberty.

It wasn’t always so. Liberals in the nineteenth century were champions of science and at the forefront of abolishing slavery and securing a woman’s individual rights. But they were also champions of private property, free trade and economic liberty. It is this combination that produced the individual’s unprecedented progress in that century. Modern liberals, however, abandoned the right to private property in favor of various socialistic visions, which have since faded with awareness of what socialism and communism actually wrought. The result is what Gage notes: modern liberals bereft of an ideal.

Any liberal-leaning person today who seeks long-term goals and a new vision, but will not touch the political right because of conservatives’ anti-evolution, anti-immigration, anti-abortion platforms, would do well to remember nineteenth-century liberalism. Perhaps the two alternatives confronting us, a government with virtually unlimited power to dictate our personal lives or our economic lives, are both defective.

For anyone willing to explore this possibility, I can think of no better place to start than with Ayn Rand.

About The Author

Onkar Ghate

Chief Philosophy Officer and Senior Fellow, Ayn Rand Institute

What is Barack Obama’s vision for America? Here’s one telling clue. In a new interview with Rolling Stone, the president declares that the individualist credo of novelist-philosopher Ayn Rand misses “what’s best in America.”

Really?

Rand, who immigrated to America from Soviet Russia when she was 21, praised this country as “the greatest, the noblest and, in its original founding principles, the only moral country in the history of the world.”

America’s greatness, in Rand’s judgment, lay in the fact that it was the first nation in history to treat government as the individual’s servant rather than his master. As she put it, “All previous systems had held that man’s life belongs to society, that society can dispose of him in any way it pleases, and that any freedom he enjoys is his only by favor, by the permission of society, which may be revoked at any time. The United States held that man’s life is his by right . . . that a right is the property of an individual, that society as such has no rights, and that the only moral purpose of a government is the protection of individual rights.”

In America, the government’s only job was to protect the individual’s right to life, liberty, property, and the pursuit of happiness from violation by physical force or fraud. In this atmosphere of freedom, individuals flourished. From the founding through the beginning of the twentieth century, government kept Americans free to create, innovate, and compete, to keep the results if they succeeded, and to try again if they failed.

It was during this era that immigrants flocked here by the millions and America became known as “the land of opportunity” — not the land of handouts (there was no welfare state in America during this time) or of guaranteed success, but of freedom to make your own way without obstruction. Today the supporters of Big Government are fond of telling us that “a hungry man is not free.” Those who immigrated to America during the nineteenth and early twentieth centuries knew otherwise. They arrived poor — even famished — but ambitious.

The results are a matter of historical record. Untold numbers went from rags to riches, while the great majority of individuals were able to live better than their parents and grandparents had. Average wages for workers, for instance, more than tripled during the nineteenth century while working hours declined by nearly a third.

Obama mocks this as a society where “you’re on your own.” But Americans during this era were not “on their own” in the lone-wolf, asocial sense he insinuates. Free Americans developed complex webs of association based on voluntary agreement. As Tocqueville famously observed at the time, “Americans of all ages, all stations of life and all types of disposition are forever forming associations. There are not only commercial and industrial associations in which all take part, but others of a thousand types.” There were businesses, charities, social clubs, private insurance agencies to protect against disease and injury, and a whole lot more. By limiting government, Americans unleashed voluntary association.

In a sense, however, Americans were “on their own.” Limited government meant that other people’s wants and needs were not your unchosen responsibility. The corollary was that you and you alone were responsible for securing your own wants and needs. You were responsible for developing the knowledge, skills, and traits of character you needed to earn a living. You were responsible for saving to meet life’s unexpected twists and turns. You were responsible for educating your children. You could ask for help from other people during hard times — but you could not demand it as a right. You were on your own.

That was not a bug but a feature: it meant that the bad choices of your neighbor didn’t constitute a claim on your time and wealth: you could go right ahead and focus on making something of your life, rather than be dragged down in the muck of his.

This is the America that Rand upheld and fought for. But Obama thinks this is not “what’s best in America.” Then what is? Basically, it’s everything that’s not distinctively American: entitlement schemes, rampant economic controls and regulations, and government infrastructure projects copied from other countries. For Obama, caring about others doesn’t mean respecting their freedom or helping them voluntarily when they hit tough times — it means enacting collectivist policies that restrict economic freedom and redistribute earned wealth.

In short, what’s best in America according to Obama is everything that came after the era when government’s power was limited by the principles of the Declaration of Independence.

That, not Rand’s individualism, is what’s truly un-American.

About The Authors

Don Watkins

Former Fellow (2006-2017), Ayn Rand Institute

Yaron Brook

Chairman of the Board, Ayn Rand Institute

If not now, when? Ayn Rand is being hailed for her uncanny ability to project societal trends, as

our limping economy and mushrooming government begin to look more and more like the decaying

America her novel depicted more than a half-century ago. Her influence on today’s political debates

is indisputable — even though Paul Ryan, who gave her books to his staff and says she inspired his

political career, now actively distances himself from her philosophy. And the second installment of

the Atlas Shrugged movie opens October 12, promising to draw even more attention to Rand and her

ideas.

Not surprisingly, with all the attention, the culture is suddenly full of pundits and instant Rand experts

eager to describe her ideas in a nutshell. And it’s natural to consider all this commentary in deciding

whether Rand’s novels and essays are worth reading for yourself.

But be careful; unfortunately, much of the commentary on Rand gets her badly wrong.

It’s common, for instance, to hear that Rand’s is a plutocratic philosophy — “of the wealthy, by the

wealthy, for the wealthy,” says Paul Krugman — one that favors “the rich” against “the poor.” Yet

she rejects such categorization. The real distinction she draws in Atlas Shrugged is between thinking,

productive individuals at all income levels versus the irrational and unproductive, among whom she

includes worthless, political-pull-peddling CEOs.

Others claim that Rand’s open advocacy of egoism — she even wrote a book called “The Virtue of

Selfishness” — is proof that she blithely endorsed cruel predation against poor and weak people.

Except that Rand explicitly rejected this account of selfishness, offering in its place a revolutionary

morality that rejects sacrifice of any kind — sacrifice of self to others, but also of others to self. Rand’s

new concept of “selfishness” — in which “every living human being is an end in himself, not the means

to the ends or the welfare of others” — holds that one cannot achieve personal happiness by treating

others as masters to be served or as victims to be exploited. The irony is that she is accused, by

commentators who miss her central point, of endorsing precisely the form of vicious “selfishness” she

so meticulously exposed and rejected.

Strangest of all are the sneering attacks that Rand is unreadable. This despite legions of fans who

found Atlas a riveting page-turner. You probably know someone who couldn’t put the book down —

who dropped everything else for three days to race through its thousand pages toward resolution

of the plot’s intriguing mysteries. What’s more, people in all walks of life — from CEOs to office

assistants — describe reading Atlas Shrugged as a life-changing experience. This is why sales of

the novel have continued to increase, decade by decade, and why, as October 10 marks its 55th

publication anniversary, it’s still flying off the shelves like a just-issued bestseller — more than 445,000

copies in 2011 alone.

So if you’re not familiar with Rand’s work, be wary of taking at face value anything you see or hear

about her ideas. (This very article emphatically included. Don’t take my word for it. If what I say

intrigues you, read her firsthand and then judge for yourself.)

Regrettably, this applies also to the Atlas Shrugged movies — both to Part 1, released in April 2011,

and to Part 2 (which I caught at a pre-opening screening in Hollywood). If you were hoping to skip

the book and just catch the films, I’m sorry to say that they’re not even close to the real thing. I don’t

envy anyone the challenge of trying to condense Rand’s complex story into a movie, but the first two

installments leave out the drama and richness of her tightly integrated plot, the complexity of her

characters, and the depth of her philosophical ideas.

You’d do better to make some popcorn at home and curl up with the actual book. If you want

to understand the ideas of one of today’s most important thinkers — and enjoy a moving literary

experience — there’s no better time to read Atlas Shrugged than right now.

About The Author

Keith Lockitch

Vice President of Education and Senior Fellow, Ayn Rand Institute

The murders of American diplomatic and military personnel in Libya underscore the consequences of America’s longstanding failure to uphold the rights of Americans to live and speak their minds in the face of the Islamist threat.

For decades, U.S. policymakers have refused to recognize the religious character and goals of the Islamist movement. That movement — which encompasses Tehran’s mullahs, al Qaeda, Hamas, Hezbollah, the Muslim Brotherhood, and many others — is a political ideology that seeks to subjugate all the world’s peoples, by physical force, under the supreme governing authority of Islamic religious law, in every area of life and thought.

America has for decades failed to see how that audacious long-term plan of conquest — however grandiose and fanciful it might seem — in fact actuates the Islamist cause. Whether the Libyan murderers and the mobs in Cairo and in Sanaa were truly incensed by a YouTube film or merely using that as a pretext, the Islamist goal remains to enforce submission in body and mind — on pain of death. The West’s long history of religious wars attests to the fact that until religion has been defanged and marginalized by reason, it is deadly.Our failure to understand this has crippled our policymaking.

The pattern is stark.

Rewind three decades to a watershed crisis. The 1979 raid on the U.S. Embassy in Tehran and ensuing captivity of American diplomats were acts of war blessed by Iran’s jihadist regime. Did Washington assert itself, declare that American lives are untouchable, and vow to retaliate with all necessary force unless the hostages were freed?

If only.

The Carter administration disavowed serious military action, eventually imposed some limp sanctions, and agonized over how best to accommodate Tehran’s demands (for money, legal immunity, a face-saving resolution). We caved. The ayatollahs correctly drew an ominous lesson that when attacked, America will not do a damn thing.

What followed was a spate of attacks that Tehran and its jihadist allies spearheaded. Perhaps the most audacious were the 1983 bombings of the U.S. Embassy in Lebanon and the barracks of U.S. Marines, killing 241 Americans. Reagan’s response? Loud but empty rhetoric about retaliation, followed by meek capitulation.

Raid an embassy, take Americans hostage, murder Americans — and get away with it. That was a bright green light inviting more aggression, from an America apparently willing to surrender its self-respect.

It was against this backdrop that Ayatollah Khomeini decided he could now tell Americans what we can think and say, issuing a death-sentence fatwa on Salman Rushdie, author of “The Satanic Verses,” and his American publisher, for having offended Mohammad and Islam. In the face of this religious endorsement of totalitarian thought control, did the George H. W. Bush administration declare that an American’s freedom of speech is inviolable? Did it vow to end the regime in Iran if anyone, anywhere dared to act on Khomeini’s death decree?

No. On the contrary, even as U.S. booksellers were flooded with death threats, even as two bookstores were firebombed, even as employees of American publishers trembled in fear of an assassin’s bullet — the administration was passive. Effectively, that non-response sold out the principle of freedom of speech, in deference to a blood-lusting Islamist cleric.

The attacks of September 11, 2001, were the climax, up until then, of a mounting series of jihadist attacks. Bush quickly assured us that the attacks had nothing to do with religion. The subsequent U.S. military response in Iraq and Afghanistan, far from seeking to defeat Islamists, in fact brought many to power through Bush’s crusade for elections. Despite the large-scale military deployment, our policy remained one of conciliation (let the Afghans and Iraqis define their own constitutions) and active appeasement (trying to bribe Tehran to stop its aggression).

This policy failed to dissuade jihadists from viewing America as (in bin Laden’s favored phrase) a paper tiger. A case in point was the 2006 Muslim riots over Danish cartoons lampooning Mohammad. The raging of mobs, the burning of flags, the firebombing of embassies — all this was meant to coerce the nations of Europe and North America to bow down before Islamic religious law. Practically all of them did. In unison. With a perfunctory nod to the right of free speech, George W. Bush’s administration betrayed that principle by indicating that perhaps the cartoons were better left unpublished, while the State Department criticized their publication as “offensive to the beliefs of Muslims.”

The cycle is clear. Islamists attack, expecting a non-response. We, unable or unwilling to tackle the issue of religion, submit, conciliate, appease — inviting them to ramp up their aggression.

Is it any wonder that our embassies in the Middle East are besieged, breached, bombed?

The cycle persists, because without connecting the dots to see the big picture,without grasping the uniting religious goal of the Islamist movement, we cannot take the steps necessary to stop it. Until we end America’s policy of passivity, inaction and appeasement, we can only expect more Islamist aggression.

About The Author

Elan Journo

Senior Fellow and Vice President, Content and Advanced Training, Ayn Rand Institute

A CEO stands in front of his crumbling, century-old factory and speaks to his employees. “I promise that no matter what, I will never renovate this place. No matter how many worn-out items break, no matter how much our out-of-date machinery slows us down, no matter how many people tease us for clinging to fax machines over email, I will keep this factory going as-is. It’s time to embrace the inefficient.”

How long do you think a company operated in such a fashion would last? How long do you think its employees would have jobs? 

Everyone understands that in a competitive economy, businesses face an ultimatum: maximize efficiency or die. But although few today would demand that a CEO tolerate an unproductive factory, the notion that a CEO has a duty to maintain unproductive jobs is sacrosanct.

“You’re fired.” Two words that were unpleasant even before they were associated with Donald Trump. Losing your job can be incredibly painful, particularly in today’s economy, where Washington’s Byzantine regulatory regime has kept unemployment near double digits. 

But keeping employees who are hurting a company’s bottom line isn’t good for anyone — not even the employee whose unproductive job is (temporarily) allowed to weigh down the enterprise.

It’s a lesson that is clearly needed in the wake of recent attacks on private equity firms, which profit by making other companies profitable. Mitt Romney has been excoriated because his firm, Bain Capital, sometimes acquired companies that could only be made attractive to lenders and buyers by laying off significant numbers of employees.

Why is this even controversial? Because we have a weird double standard. When an employee leaves a company for greener pastures — maybe higher pay, maybe more satisfying work, maybe a more pleasant commute — nobody complains. Of course he should do what’s best for him. 

But when a business does the same thing? When it judges that some jobs are draining profits and need to be cut? Then it’s as if some nefarious sin has been committed.

Well, if Bain thought shedding those jobs would foster its bottom line, then why shouldn’t it have done so? A business exists to make a profit for its owners. That’s why owners and lenders risk their wealth investing in companies to begin with. No profit motive, no businesses — and no jobs.

A productive employee adds value to the company over and above what it costs to retain him. A good salesman may get paid a hundred grand a year. But if he brings in two million dollars in business? Small price to pay.

When it comes to the employee who costs more than he brings in, though, laying him off is as necessary as replacing out-of-date machinery. It doesn’t necessarily mean the employee is incompetent — often it’s the job itself that is not productive. Perhaps you’re the greatest C++ programmer around, but if your company’s customers start demanding programs written in Java, then from an economic standpoint, your role at the organization is no longer productive. You’re hurting your company’s profitability, not helping it.

Small comfort to the guy who finds himself out of work, though, right? Actually, it should be something of a comfort. Think about it. You work for an employer because you think it’s a good deal for you: would you really want to stay if you thought it was a bad deal for him? If you thought all your hard work contributed nothing to the bottom line? A business relationship should be win-win — profit-profit — for both parties. Anything else is charity.

Losing your job is never fun, but it’s worth keeping in mind the big picture. We all benefit from living in an economy where there is a relentless push for efficiency — even more so if you happen to be out of work. Think of how much worse it would be to lose your job in a world where you couldn’t take advantage of Walmart’s low prices. 

And in a dynamic economy the more ability, skills, and work virtues you develop, the more companies can’t afford not to hire you. Besides, if no one appreciates your talents, you are always free to start your own business. 

The problem today is not that companies are laying off employees in pursuit of profits. It’s that the government has hamstrung everybody’s ability to pursue profits, leading to the sort of widespread, prolonged unemployment that wouldn’t exist in a genuinely free market. In an economy where the government gets out of the way and unleashes the profit motive, layoffs can be, dare we say, a good thing for everyone involved.

About The Authors

Yaron Brook

Chairman of the Board, Ayn Rand Institute

Don Watkins

Former Fellow (2006-2017), Ayn Rand Institute

Vice presidential candidate Paul Ryan has credited
philosopher Ayn Rand with inspiring him to enter politics — and made her
1,000-plus-page opus, Atlas Shrugged,
required reading for his staff. “The reason I got
involved in public service, by and large, if I had to credit one thinker, one
person, it would be Ayn Rand,” he said in 2005 at a gathering of Rand fans. “The fight we are in
here, make no mistake about it, is a fight of individualism versus
collectivism.” It is a theme that pervades Rand’s corpus.

Given the Wisconsin congressman’s interest in Rand’s
writings, Ryan’s addition to the GOP ticket has naturally unleashed a flash-mob
of analysts parsing his speeches, articles, and signature proposals for evidence
of her influence. On domestic policy, the impact of Rand’s
ideas
on Ryan’s outlook
is marked, though uneven and sometimes overstated. Religion, in particular, has
driven a wedge between Ryan, who would enact Catholic dogma into law,
and Rand, an atheist, who championed the separation of church and state. But
what has received far less attention is Ryan’s outlook on foreign policy — and
whether it bears the mark of Rand’s thought.

Ayn Rand’s foreign policy, if we can construct one from her
writings, would be grounded in her view of man’s
rights and the nature
of government. In Capitalism: The Unknown Ideal, Rand argues that the ideal
government is the servant, not the master, of the individual. In her view, it
is a vital institution strictly limited to one function: to safeguard
individual rights. By “rights,” Rand means
freedom to take “all the actions required by the nature of a rational
being for the support, the furtherance, the fulfillment and the enjoyment of
his own life.” Critically, the protection of an individual’s rights “does
not mean that others must provide him
with the necessities of life.”

Domestically, this outlook entails a truly free market with
absolute legal protection of private property, and without regulations,
bailouts, corporate handouts, or entitlement programs like Social Security,
Medicaid, and Medicare. (Ryan breaks with Rand by attempting to save, rather
than end these programs.) In Rand’s political philosophy, however, there is no
gulf between economic rights and personal and intellectual ones: for instance,
she wrote passionately of the crucial importance (contra Ryan) of the right to abortion, and
regarded freedom
of speech as sacrosanct.

Like her views on domestic policy, a Randian foreign policy
would be guided exclusively by the goal of protecting the individual rights of
Americans, and only Americans. Accordingly, the U.S. government shouldn’t issue
handouts to other countries (through foreign aid or international welfare
schemes), nor treat its citizens as cannon fodder (through a military draft). Indeed,
Rand was scathing in her analyses of the Vietnam War, arguing that it did not
serve America’s national interest. “[I]t is a pure instance of blind, senseless
altruistic self-sacrificial slaughter,” she wrote in Capitalism: The Unknown Ideal.

Of course, there are times when government is obligated to
go to war, according to Rand. The crucial standard here is whether the lives
and property of Americans are imperiled. The only morally justifiable purpose
for war, she wrote, is self-defense. This rules out so-called humanitarian missions,
like the tragic Clinton-era mission in Somalia, and the notion that the United
States is somehow obliged to serve as the world’s policeman. The primary
function of the military, in Rand’s eyes, should be to deter, and when necessary,
defeat foreign aggressors.

Although some of Rand’s political ideas have informed the
libertarian movement, she regarded any form of pacifism (including
Ron Paul-esque passivity) as destructive to national defense. And undoubtedly
she would have supported a strong military response to the 9/11 attacks
(though, as I have argued in my book,
she would have rejected George W. Bush’s conception of the enemy and his entire
prosecution of the war).

Rand viewed deterrence as an especially important — and
effective — method of defending American freedom. In her view, the power of a
morally confident, assertive United States was considerable, though largely
unappreciated. For instance, she believed that if the West had truly stood up
to the Soviet bloc by withdrawing its moral sanction, ending the flow of aid,
and imposing an airtight boycott, the Soviet threat would have imploded many
years before it actually did, without the need for war.

Perhaps most importantly, Rand argued in favor of genuine
free trade — without trade barriers, protective tariffs, or special
privileges. In her words:
“the opening of the world’s trade routes to free international trade and
competition among the private citizens of all countries dealing directly with
one another.” In the 19th century, she argued, free trade liberated the world
by “undercutting and wrecking the remnants of feudalism and the statist tyranny
of absolute monarchies.” Not coincidentally, she observed, this era
enjoyed the longest period of general peace in human history (roughly from 1815
to 1914).

Taken together, Rand’s approach implies a re-thinking of the
moral values that should inform foreign policy. The result is a
foreign policy based on pure, “rational
self-interest” — defined as the aggregated ability of individual Americans
to enjoy life, liberty, and property unmolested by foreign aggressors.
Crucially, it rejects the duty selflessly to serve others, whether they
are next door or overseas. So how, then, does Paul Ryan’s foreign policy
measure up?

Reading Ryan’s most substantive speech
on foreign policy, delivered at the Hamilton Society in 2011, you can certainly
hear the reverberation of Rand’s ideas. “[I]f you believe these rights are
universal human rights, then that clearly forms the basis of your views on
foreign policy,” he said, partially echoing the Randian conviction that
regimes are moral to the degree that they respect individual rights. For Ryan, as
for Rand, championing rights
leads “you to reject moral relativism. It causes you to recoil at the idea
of persistent moral indifference toward any nation that stifles and denies
liberty.” Moreover, Ryan falls in line with Rand in his thoughtful
promotion of free
trade. In his Hamilton Society speech, for instance, he argued in favor of
an “expanding community of nations that shares our economic values as well as
our political values” in order to “ensure a more prosperous world.”

But if these similarities are meaningful, Ryan nevertheless seems
to fundamentally part ways with Rand. In particular, he speaks of the need to
“renew our commitment to the idea that America is the greatest force for
human freedom the world has ever seen,” and sees in the Arab Spring the
“long-repressed populations give voice to the fundamental desire for
liberty.” Further, Ryan claims that it is “always in the interest of
the United States to promote these principles in other nations.” Like
President George W. Bush, whose wars he supported, Ryan appears to subscribe to
the quasi-religious view that freedom
is written into the soul of mankind, and that it is somehow the moral duty of
America, the freest and wealthiest of nations, to go forth and wage wars to
unchain the world’s oppressed. In all this, he could not be less Randian.

Rand certainly believed that the United States benefits from
a freer world. Thus, she held, America should speak up for dissidents
everywhere who seek greater freedom. But Rand would only ever consider deploying
the military where the rights of Americans hang in the balance — when, in
other words, it becomes an issue of self-defense. This critical distinction may
well be lost on Ryan, if the media’s parsing of his neoconservative leanings
has been fair.

Perhaps as he gears up for the October vice-presidential
debate, Ryan will consider re-reading Rand’s work. Anyone seeking to inject
more rational and more distinctively American ideas into our nation’s chaotic
foreign policy ought to seriously consider Ayn Rand’s refreshingly clear-eyed
perspective.

About The Author

Elan Journo

Senior Fellow and Vice President, Content and Advanced Training, Ayn Rand Institute

Paul Ryan is Romney’s pick for Vice President and now Ayn Rand’s name is on everyone’s lips.

Many on the left are pillorying Ryan as an unrealistic “ideologue” because of his Rand connection. Many on the right accede, quickly trying to set aside Ryan’s admiration for Atlas Shrugged as youthful indiscretion. “Every young conservative has a fascination with Ayn Rand at some point,” Romney’s strategist Eric Fehrnstrom says dismissively.

But hold on. If we actually consider the essence of what Rand advocates, the idea that her philosophy is childish over-simplification stands as condemnation not of her position but of the many adults from whom this accusation stems.

The key to Rand’s enduring popularity is that she appeals not to the immaturity but to the idealism of youth. This is why more than 29,000 students submitted entries this year to essay contests on her novels and, in the past five years alone, high school teachers have requested over 1.5 million copies of The Fountainhead, We the Living, Anthem and Atlas Shrugged to use in their classrooms. They know that students respond to her stories and heroes as to few other books.

“There is a fundamental conviction which some people never acquire,” Rand wrote in 1969, “some hold only in their youth, and a few hold to the end of their days — the conviction that ideas matter.” The nature of this conviction? “That ideas matter means that knowledge matters, that truth matters, that one’s mind matters. And the radiance of that certainty, in the process of growing up, is the best aspect of youth.”

If Ryan is a man who takes ideas seriously, as numerous supporters and detractors claim, this is an attitude he would have encountered on every page of Rand’s writings.

But how as an adult do you sustain the conviction that the truth matters, in the face of constant calls to compromise your views and give in?

You need to achieve, Rand argues, a radical independence of mind. Independence does not mean doing whatever you feel like doing but rather forging principles and using them to choose your actions rationally, carefully, scientifically. Independence means refusal to subordinate your ideas or values to the “public interest,” as too many secularists demand, or to the “glory of God,” as too many religionists demand. It means refusal to grant obedience to any authority.

The independent mind instead embraces reason as an absolute. “The noblest act you have ever performed,” declares the hero of Atlas Shrugged, “is the act of your mind in the process of grasping that two and two make four.” Rand meant it.

On Rand’s view, to take the truth of your own ideas seriously is a remarkable achievement: it represents a profound dedication to self. Crucially, this dedication requires that you not passively absorb your society’s moral views, however well-entrenched, but instead question and study the entire field of good and evil. This is precisely what Atlas Shrugged — with its critique of the regulatory-welfare state and the moral ideas that spawned it, alongside its presentation of a new moral code of rational self-interest — challenges us to do.

Most of us are passionate about morality only when young. As we grow older and discover the impractical, even self-destructive nature of the moral slogans we were taught to bandy about, we abandon the field. After all, we tell ourselves, “we’ve got to live.”

But this split between the moral and the practical poisons the soul. “To take ideas seriously,” Rand writes, “means that you intend to live by, to practice, any idea you accept as true,” that you recognize “that truth and knowledge are of crucial, personal, selfish importance to you and to your own life.”

Her approach here is the opposite of the view that ideals transcend this world, one’s interests and human comprehension — that idealism is, according to a former president whose words are echoed by virtually every leader today, “to serve in a cause larger than your wants, larger than yourself.”

In a world that equates idealism with otherworldliness and denial of self, while simultaneously reminding us that, as one conservative commentator puts it, “perfection in the life of man on earth” is impossible — Rand stands alone. She argues that perfection on earth is possible, if only we’re ready to work for it.

Hold your own life as your highest value, follow reason, bow to no authority, pursue unwaveringly the true and the good, create a life of productive achievement and personal joy — enact these demanding values and virtues, Rand argues in Atlas Shrugged, preserve “the hero in your soul,” and an ideal world, here on earth, is “real, it’s possible — it’s yours.”

Does an adult world that decries this philosophy as “simplistic” not convict itself?

Instead of criticizing Ryan’s Rand connection, perhaps the question we should be asking is why her ideas have not had a much greater impact on his worldview.

About The Author

Onkar Ghate

Chief Philosophy Officer and Senior Fellow, Ayn Rand Institute

It’s not often that an American election sparks debate about a philosopher. But ever since Mitt Romney announced his selection of Paul Ryan as his vice presidential candidate, talk has turned to the ideas of novelist-philosopher Ayn Rand.

Ryan is on record as being a fan of Rand’s, and although he has taken pains to distance himself from her entire philosophy, he continues to stress that her novel Atlas Shrugged “is a great novel.” Ryan is far from the only one who thinks so. Since the financial meltdown of 2008, Rand’s 1957 novel has sold more than 1.5 million copies.

But here’s something interesting: virtually all of those sales took place in the US. Why are so many Americans, from students to politicians, talking about Rand’s novel — and why are her books comparatively unknown in Europe?

The answer to both questions is the same: Atlas Shrugged is a hymn to the American spirit.

The American spirit is characterized by independence, individualism, political and economic freedom, and productive ambition. It’s the sense of life best summed up in the American Revolutionary motto “Don’t tread on Me.” It was this spirit that led so many Americans to rebel against the post 2008 expansion of state power. They didn’t just see big government as a threat to the economy: it was an affront to their whole conception of what America is about. After eight years of Bush and eight minutes of Obama, they were fed up with being tread upon.

Atlas speaks to this spirit. Set in a world eerily similar to ours — a world where the economy is crumbling, where government intervention is growing, and where productive individuals are denounced and drained for the sake of the unproductive — it tells the story of men and women who decide to stop being tread upon.

But the dramatic story contains a powerful intellectual punch: Atlas gives the American spirit a philosophic defense it has never had. The American spirit often has been attacked as atomistic, cruel, and materialistic. Atlas blasts any such notion. It shows that capitalism is a win-win system where all individuals are free to pursue their happiness. It shows that it is right for individuals to be concerned with their own happiness. And it shows that those who seek to “tread on you” — to control your life, redistribute your wealth, and mortgage your future — are morally wrong. 

It’s no accident, then, that Ayn Rand’s immense popularity in America has not crossed over to Europe. It’s for the same reason that Europeans largely embraced the government’s post-financial crisis interventionist policies — from bailouts to stimulus spending sprees to vast new regulatory powers — while Americans rebelled. Whatever motto best captures the European attitude toward life, “Don’t tread on me” is not it.

Ayn Rand wrote Atlas, in part, as a warning to Americans. She believed that, as early as 1890, America had veered from its free-market roots and was descending into statism. (She would have regarded as absurd the widely-held notion that America in the years before the financial crisis had anything resembling a free market.) To reverse that trend, Americans would have to translate their individualistic spirit into an explicit ideological program: one that upheld individualism and laissez-faire capitalism as moral and political ideals.

To succeed in this task, Rand argued, Americans would need to question and reject the alien idea of altruism. Altruism is the Old World doctrine that it’s your duty to live for others and renounce your own self-interest. In one form or another, this moral doctrine has been the justification for every welfare program. Other people need money for their retirement or healthcare, it’s claimed, and therefore they’re entitled to that money from you. The individual’s pursuit of his own happiness versus altruism — this is the choice facing America.

Although Rand was primarily speaking to Americans, she was not only speaking to Americans. The spirit of America, she held, is open to any individual willing to think. Today, as Europe is doubling down on the welfare state, that spirit, and the ideas of Atlas Shrugged, are needed more than ever.

About The Author

Don Watkins

Former Fellow (2006-2017), Ayn Rand Institute

Whether he likes it or not, Paul Ryan’s worldview is going to be defined in large part by its distance from philosopher Ayn Rand’s. Ryan is on record as praising Rand’s novel “Atlas Shrugged” and her moral defense of capitalism. He’s also on record as rejecting Rand’s philosophy, Objectivism.

So, where does Ryan sit in relation to Rand?

There are signs that Rand influenced Ryan’s views on individual rights. “If one wishes to advocate a free society — that is, capitalism,” Rand wrote half a century ago, “one must realize that its indispensable foundation is the principle of individual rights. If one wishes to uphold individual rights, one must realize that capitalism is the only system that can uphold and protect them. And if one wishes to gauge the relationship of freedom to the goals of today’s intellectuals, one may gauge it by the fact that the concept of individual rights is evaded, distorted, perverted and seldom discussed, most conspicuously seldom by the so-called ‘conservatives.’”

Paul Ryan is one of the few conservatives who does speak regularly — and meaningfully — about individual rights. In a speech delivered in June, Ryan said that this election would come down to a choice between two views of rights, and their differing implications for the welfare state: the view that rights “come to us naturally before government, they are ours automatically — or this new idea, the progressive theory of government-granted rights. … It’s an opportunity society versus welfare state.”

But don’t be too quick to leap from these broad proclamations to the conclusion that Ryan is an avowed Randian on rights. Even if we leave aside Ryan’s Catholic dogma about souls and embryos, which Rand completely rejected, and focus only on the economic issues for which Ryan is most known, the differences remain stark.

According to Rand, rights are moral principles that are designed to restrain society from interfering with an individual’s moral action. Morality helps an individual decide what he ought to do — rights tell society not to stop him from doing what he ought to do. Since morality, in Rand’s egoistic conception, tells an individual he should support his own life, act on his own independent judgment, produce the wealth he needs to survive, and seek out his own happiness, then a political system should enshrine the individual’s inalienable rights to life, liberty, property, and the pursuit of happiness.

These rights, Rand stressed, are rights to action — not to a physical object. Individuals have a right to earn property and use it as they see fit. If a thief (or an IRS agent) takes their money, their right to property has been violated. But no one can have a right to be provided with property at someone else’s expense. “If some men are entitled by right to the products of the work of others, it means that those others are deprived of rights and condemned to slave labor.”
Think of what this implies for the entitlement state, a subject near to Ryan’s heart.

Rand saw entitlements as a violation of individual rights on a massive scale. This is why she opposed Social Security when FDR enacted it in the 1930s, why she rejected Medicare when Johnson proposed it in the 1960s and why she held that the whole entitlement state should be phased out and ultimately abolished.

For Rand, the great achievement of America’s founding was to create a society based on rights, in which peaceful, voluntary coexistence among men was possible. People were free to deal with one another on mutually agreeable terms, or else go their own way. The entitlement state blasted that peaceful coexistence, turning politics into a mad scramble by warring pressure groups for other people’s money.

Ryan’s goal, by contrast, is not to end the entitlement state but to save it. His budget reflects that view: it preserves Medicare, albeit in a less costly form, and it actually increases Social Security spending, from 4.75 percent of GDP to 6 percent, according to the CBO. Although Ryan regularly invokes individual rights, he does not stand by them consistently. Not even on economic issues, where he is best.

For anyone who believes in limited government, it is a positive sign that a leading politician talks seriously about individual rights, and this clearly is due in part to Rand’s influence. But to take rights seriously, as Rand advised? That will require a much more principled agenda.

About The Author

Don Watkins

Former Fellow (2006-2017), Ayn Rand Institute