Yaron and I have a new piece over at the London School of Economics and Political Science blog on Ayn Rand’s moral defense of capitalism.
Ayn Rand has been one of the greatest salesmen of capitalism in history, with total sales of her books approaching 30 million copies. What makes her so powerful? To put it simply: she knows how to tell the story of capitalism. Since capitalism arose during the nineteenth century, its critics have weaved a compelling story shaping the way we think about free enterprise. Capitalism, according to this story, is inherently immoral because the needy many receive no help from society, while the greedy few are allowed to exploit society. Well, if so then the solution is obvious: to limit and ideally eliminate capitalism.
You can see that story at work today. The financial crisis, we’re told, was the product of greedy bankers profiting at the expense of society. The solution? Regulate the greedy profit-seekers and redistribute their ill-gotten gains to those in need.
How have capitalism’s alleged champions responded to this story? By and large, they haveconceded that capitalism is an inherently immoral system. Their story consists of the claim that it is a necessary evil. “You’re right,” they’ve told the critics, “capitalism does exploit the needy and reward the greedy. But unfortunately it works and socialism doesn’t, so while we need to limit capitalism, we mustn’t go too far.”
But if you concede that your position is a necessary evil, then in any specific battle, who is going to have the advantage? The person who is defending the necessary evil or the person who says, in this case the evil is unnecessary? Who will be seen as the noble idealists and who will be seen as cynical and self-serving? If capitalism is a necessary evil, then the critics are right: our goal should be to minimize it and ultimately put something superior in its place.
Ayn Rand argues that capitalism is a necessary good: It is the only social system in which human beings can survive, prosper, and enjoy their lives. The key to Rand’s approach is that she doesn’t jump right away to the question of what political policies we should adopt. As a philosopher, she starts by looking at what kinds of actions individual human beings have to take in order to flourish.
Whole thing here.