Two days ago I wrote that “Communism’s failure to recognize human selfishness was the number one reason for its collapse.” Similarly, if Ayn Rand’s objectivism was ever fully implemented, her failure to recognize the depths of human selfishness will be the number one reason for its collapse.
But, that might have already happened! As you will see, some argue that the world’s present economic meltdown is precisely because her policies have been implemented!
Enter Alan Greenspan.
As I mentioned previously, Greenspan found Rand to be “a stabilizing force” and said that “It hadn’t taken long for us to have a meeting of the minds—mostly my mind meeting hers.”1 And as of 2007 he said he found her “broader philosophy of unfettered market competition compelling, as I do to this day.”2 In other words, he is, or at least was, a fan.
Well, Alan Greenspan was the Chairman of the Federal Reserve Board from 1987 to 2006 and as chairman he worked to implement the Randian ideal of deregulation.
A New York Times article, entitled “Greenspan Concedes Error on Regulation,” related the following exchange of Greenspan’s testimony to Congress:
“You had the authority to prevent irresponsible lending practices that led to the subprime mortgage crisis. You were advised to do so by many others,” said Representative Henry A. Waxman of California, chairman of the committee. “Do you feel that your ideology pushed you to make decisions that you wish you had not made?”
Mr. Greenspan conceded: “Yes, I’ve found a flaw. I don’t know how significant or permanent it is. But I’ve been very distressed by that fact.”3
Now to be clear, I’m not an economist and so I’m not qualified to opine regarding the extent of Greenspan’s responsibility for our present economic crisis. However, others do blame him. As the liberal Mother Jones put it:
While Greenspan did defend his various decisions, he admitted that his faith in the ability of free and loosely-regulated markets to produce the best outcomes had been shaken: “I made a mistake in presuming that the self-interests of organizations, specifically banks and others, were such as that they were best capable of protecting their own shareholders and their equity in the firms.” In other words, whoops—there goes decades of Ayn Rand down the drain.4
Even a Forbes writer blamed Greenspan and Rand:
Alan Greenspan’s testimony before congress earlier this week should be looked at as a moment where the way we talk about politics and the economy fundamentally changed. Greenspan, protégé of Ayn Rand and the driving mind behind the notion that risk can be contained by having ever growing numbers of market players taking pieces of that risk, has now admitted that “Those of us who have looked to the self-interest of lending institutions to protect shareholder’s equity (myself especially) are in a state of shocked disbelief.”5
Of course, Randian diehards disagree. For example, Libertarian Harry Binswanger disdains Greenspan as “a man who betrays Ayn Rand, and who wrecks the economy of the U.S. in carrying out that betrayal, then succeeds in shifting the blame onto Ayn Rand and capitalism.”6 In other words, the economy is in trouble because Greenspan compromised Rand’s principles. Curiously, though, some on both the left and the right agree that Greenspan is culpable for our present economic mess!
Wherever the blame is ultimately placed, as a Christian apologist I can say this with confidence: if you let people do whatever they want, they will! We’ve seen that again and again. Business leaders from Bernie Madoff to the Enron honchos (and who knows how many others) have irreparably injured countless people’s financial futures. The bottom line is that human’s need accountability (not just to the consumer, but to the law) because without accountability, we will only keep reliving Lord Acton’s maxim: “Power corrupts and absolute power corrupts absolutely.”
The reason we have three branches of government is our founding fathers realized that selfish people need “checks and balances.” Surely, there must be a better way than on the basis of Rand’s ideas to preserve economic and political liberty and to encourage people and businesses to be responsible?
Romans 3:10: “There is no one righteous, not even one.”
Amen.
- From Alan Greenspan’s book, The Age of Turbulence (New York: Penguin, 2007), 51. Read more at: http://www.noblesoul.com/orc/bio/turbulence.html, accessed 7 April 2011. [↩]
- Ibid., 52. [↩]
- Edmund L. Andrews, “Greenspan Concedes Error on Regulation,” The New York Times, http://www.nytimes.com/2008/10/24/business/economy/24panel.html. Accessed 11 April 2011. [↩]
- David Corn, “Alan Shrugged,” Mother Jones, http://motherjones.com/politics/2008/10/alan-shrugged. Accessed 11 April 2010. See also Barrett Sheridan, “Who Is to Blame,” Newsweek: http://www.newsweek.com/2008/12/09/who-is-to-blame.html. Accessed 11 April, 2011. [↩]
- Michael Maiello, “Greenspan Testifies: Our Political Language Just Changed” Forbes.com, 24 October 2008, http://blogs.forbes.com/beltway/2008/10/24/greenspan-testifies-our-political-language-just-changed/. Accessed 11-April, 2011. [↩]
- Harry Binswanger, Capitalism Magazine, “Alan Greenspan vs. Ayn Rand and Freedom,” http://www.capitalismmagazine.com/markets/alan-greenspan/5353-alan-greenspan-vs-ayn-rand-and-freedom.html. Accessed 11 April 2011. [↩]
Good observations and reiteration of basic problem with Rand’s philosophy and the application in today’s world IMO. Key issue: Rom. 3:10.
Rand forever lost me with many of the statements of her main character, Kira, in We the Living. I hope you might explore some of those statements peppered throughout her works; it does give some disturbing insights into the founder of Objectivism (one of the principle arguments for why Rand should not be such a role model by any American in my humble and honest opinion).
Follow her at your own peril — that’s my rather uneducated take.
Thank for writing this, I found this from my link on FB by the Christian Research Journal. I have read Atlas Shrugged about once a year for 10 years only because of the news paper I read called Investors Business Daily. As a Christian I was repulsed by the ideals and the selfishness presented but each year after reading it I would sit and ponder her mind set. As more and more Christians I knew were coming to embrace the philosophy’s of Ayn Rand. I also saw the dangers of self-esteem movement totally destroying our culture. You have presented the ideas in a very concise way and I have used your blog now twice to my college kids and my kids in high school.
I just wanted to say thank you so much for your research.
I have bookmarked this and I look forward to reading more of your writings.
Your blog post regarding Ayn Rand is well thought out and a great read. Let me preface my response by stating up from that I am politically libertarian. I could not be such, however, without being a Christian. While the examples of bad behavior listed above may be the result of following Ayn Rand’s libertarianism, I would distinguish it from being Libertarian. The excesses of self-esteem in America are a result of its emphasis within the government-run public school system. You don’t find much of that in schools that are private. Abortion, that massive pockmark on the United States, would have limited effects were it not for governmental funding of Planned Parenthood. The effects of the sub-prime mortgage crisis would have been diminished had it not been for a series of federal legislative bungles over supposed “fair housing” starting with the Carter administration. Combine that with Federal Reserve, a quasi-government agency whose monetary policies are more akin to subsidized gambling than laissez-faire economics, and its no wonder there is a banking crisis. When our policymakers reject “rule of law” in favor of implementing the “philosophe du jour” we can expect things to go horribly wrong.
Thanks for the post. I first became aware of this connection and the root of the financial crisis while watching PBS Frontline episode ‘The Warning’ http://www.pbs.org/wgbh/pages/frontline/warning/. A tragic example of the consequences of a bad philosophy worked out. And it didn’t very take long.
Typo. … didn’t take very long.
Excellent analysis in all of your blog postings regarding the author of this work! I have talked or presented that when one really studies the Founding Fathers and Framers of our Constitutional Republic one see that they understood the depravity of man according to the Scriptures. This is not only noted in their individual writings but clearly noted in the Federalist Papers. As one studies the source documents and gains insight to the writings of Algernon Sydney, Locke, Montesquieu and even Bastiat it is clear that God established continuity in governance and that the selfishness/sinful nature of mankind must be held in check for a society not to devour itself. The depth of the personal writings of the many key players in the development of the United States knew how this basic premise of the nature of man affected every aspect of society, business and government. It was clear to the majority of them that for sustainable self-governance we would need to be a “moral and virtuous people” that adhered to Biblical principles. Yet, over the last century, the ‘isms’ including Rand’s philosophy have captivated the nature of man such that your conclusions echo the trouble our nation is in. Only a new “Great Awakening” can effect the social and political environment; but the body of Yahshua has lost its bearing to the truths that the Founders of America understood.
I always go back to Charles Finney as he analyzed what was happening to the US and the Churches in the late 1800 and his conclusion that: “THE PULPIT IS RESPONSIBLE: Brethren, our preaching will bear its legitimate fruits. If immorality prevails in the land, the fault is ours in a great degree. If there is a decay of conscience, the pulpit is responsible for it. If the public press lacks moral discrimination, the pulpit is responsible for it. If the church is degenerate and worldly, the pulpit is responsible for it. If the world loses its interest in religion, the pulpit is responsible for it. If Satan rules in our halls of legislation, the pulpit is responsible for it. If our politics become so corrupt that the very foundations of our government are ready to fall away, the pulpit is responsible for it. Let us not ignore this fact, my dear brethren; but let us lay it to heart, and be thoroughly awake to our responsibility in respect to the morals of this nation. –Charles G. Finney, December 4, 1873
I think that your analysis of Ayn Rand is incomplete. Rand’s view of altruism is a mixed bag and worth looking at more closely. While it is true that she was a rabid atheist and officially denied the doctrine of original sin, she could not help but admit to it in her critique of altruism. Rand rejected altruism because she conflated true altruism with state sponsored “altruism.” True altruism is when a person gives of his own resources to another who has no claims upon those resources without any outer compulsion. A Christian view would suggest that believers are motivated to give because they have received so much from God through Jesus Christ. Christ’s love births in them a desire to share with others and the work of the Spirit continues to develop that desire into action. Christians are motivated by an inner compulsion that is called love. Thus, the attitudes and actions of altruism are looked upon as admirable and praiseworthy. This is evidenced by the great number of charities and voluntary organizations that work to benefit needy people all through the voluntary generosity of others.
On the other hand, state sponsored “altruism” is when the government takes the resources of one person and gives it to another who has no claim upon it. This is accomplished by force of law and punishment (this is called “redistribution of wealth”). The motivation to “give” is fear of punishment, not love or generosity and this is certainly not praiseworthy or admirable. In no way can it be said to be true charity, because it is not motivated by compassion or love but by the threat of force and punishment.
Rand saw that people manipulated government to take for themselves what they had not earned from those who had earned it. It is clear that she viewed this as corrupt and evil. In one sense, Rand was oblivious to evil at the individual level (the greed of private corporations and individuals which she called self-interest, as well as personal morality), but she saw and named evil in corrupt government laws, regulations, practices, and politicians.
How could Christians value Rand’s ideas? Carefully.
Certainly, Christians can agree with Rand that people should be able to keep what they produce. That government can through burdensome regulation, legislation, and a corrupt political system become a source of pain and suffering on people which it is supposedly there to protect. We may also join her in affirming that state sponsored “altruism” is not a sign that we are a generous people, but merely that we fear the threat of punishment. That law can be used and manipulated by malicious design to turn ordinary citizens into criminals by merely changing regulations and policies. That individual freedom can be trampled down by the government money addicted mob who proclaim that it is for the good of society.
What Ms. Rand never understood is that capitalism that is not informed by Christian values inevitably degenerates into organized crime. She never grasped the fundamental importance of Trust. Egoism leads to a miserable existence, no matter how romantically she portrayed the same in her novels, and I cite the life of Ayn Rand as a case in point! Her cult-like inner circle was creepy, and a far cry from the rational ‘objectivism’ that she claimed to champion! Newsflash: Talk is cheap!
You’re not just taking on Rand here. You are taking on every free-market economist from Adam Smith, to Von Mises, Freidman, Hayek and probably Sowell. To assert that there is something inherently unchristian about free market economics shows a complete lack of understanding. I believe that the Lord Himself places a great deal of emphasis on free will. No one can honestly look at the U.S. economy and say that we have been practicing free-market capitalism for the last 100 years. I would much rather spend my time contemplating the far more egregious consequences of socialism and her various sisters.
“Wherever the blame is ultimately placed, as a Christian apologist I can say this with confidence: if you let people do whatever they want, they will! ”
Careful, This is a very dangerous statement. You may not intend to take this to it’s logical conclusion, as many tyrants have.
Hi Ned,
The only thing I suggested in my blog is that there must be at least some government oversight to prevent people from taking advantage of others. Of course we have to allow a free market but that doesn’t mean that there is no government oversight at all, does it? Are you suggesting there should be zero oversight? None? Nada?
Clay