Quote of the week...please share your favourite line from Ayn Rand's writings

“Happiness is that state of consciousness which proceeds from the achievement of one's values.”

Tuesday, February 23, 2010

Hazards of environmentalism: climate change

Lately, the debate over climate change has heated up, and it has also raised questions about the nature of the environmental movement. Ayn Rand had said the following on the underlying philosophy of the green movement,
"Ecology as a social principle condemns cities, culture, industry, technology, the intellect, and advocates men’s return to “nature,” to the state of grunting subanimals digging the soil with their bare hands." (The Ayn Rand Letter)

The immediate goal is obvious: the destruction of the remnants of capitalism in today’s mixed economy, and the establishment of a global dictatorship. This goal does not have to be inferred—many speeches and books on the subject state explicitly that the ecological crusade is a means to that end. (The Return of the Primitive)
In an article titled "India should support a toothless IPCC", published in the Wall Street Journal Asia, on Feb 9, 2010, I had looked at the politics of climate change, and wrote that,
The IPCC was created as a way to make the world, particularly the poor, fall in line and support expensive climate-change initiatives by overwhelming them with the apparent authority of the world’s leading technical body on the subject, backed by alleged scientific consensus. This attempt was doomed to fail, primarily because scientific inquiry does not respect consensus, and orthodoxy is anathema to scientific progress. So the fall of IPCC was inevitable, and that seed was laid at the time of its conception, in the very nature in which IPCC was sought to be built... ... ...

The IPCC has been checkmated, as have so many other U.N. institutions before it. This is the inevitable consequence of the desire for global government under the misguided belief that ordinary people may not know what is in their own interest and for their own future. With the deepening of democratic ideals, people power can no longer be overturned so easily. The failure of the IPCC shows that sovereignty still lies with the people, not with the aspirants for global government.
Liberty Institute is co-hosting a discussion on the challenging climate post Copenhagen summit, at the India International Centre, New Delhi, on February 23, 2010, from 5.30 pm to 8 pm. The two key speakers are Dr S Fred Singer and Dr Benny Peiser. Dr Singer is an eminent scientist from the US, who coordinated a group of international scientists and prepared a report on the science of climate change. Dr Peiser is an astro-physicist who has a minor planet named after him, and now heads a new organisation dedicated to climate policies in UK.

All are welcome to this event. For more information please visit the Challenging Climate blog - http://challengingclimate.blogspot.com

Thursday, February 18, 2010

Atlas Shrugged Of The Left?

The movie Avatar by James Cameron is very hyped-even in libertarian circles. Austro-libertarians like Stephan Kinsella opine that the movie is very good and libertarian.Objectivists like Peter Suderman and Nick Rizzuto find the movie collectivistic. Rizzuto called it “The Atlas Shrugged of the Left”. “Atlas Shrugged”, writes Rizzuto, “is a story of the triumph of the individual over the collective, while Avatar is an amalgamation of Hollywood and the liberal left’s collectivist political fetishes.”What is the truth of the matter? The truth is somewhere in the middle. I won’t say that the movie is great. I found it unspeakably boring. The special effects were awesome. But, that’s about it. The movie is on Na’vi’s on Pandora defending their private property rights against humans. A human soldier, Jack Sully helps the Na’vi’s in the endeavor.

What struck me is the similarities Avatar have with a Malayalam movie “Vietnam Colony”. In
that movie, a private company tries to forcefully evacuate people from a slum sort of place.
They send the protagonist to trick people into accepting the deal. Later in the movie, like
Jack Sully, the protagonist Mohan Lal joins the people and fights the company. It all depends on how you look at it. We shouldn’t forget that Capitalism is a politico-economic system based on private property rights. What unites capitalists is their respect for the sanctity of private property. So, obviously the movie has a libertarian theme in that sense. As Kinsella wrote:“The plot is about property rights. In particular, the property rights of the Na'vi, in an established tree-city that they have clearly homesteaded. The "Corporation" here is basically a mini-state, or an arm of a state--it has an army going around killing and destroying”. But, I won’t go to the other extent and assert that it is a full-fledged libertarian movie. It is not. It is obvious that the people behind the movie didn’t intend that. Their collectivist, anti-capitalist mindset is apparent.

Nick Rizzuto noted that the primitive protagonists find virtue in their collective identity and lack of individuality. Rizzuto says that “The theme is the classic condemnation of capitalism; that wealth created not through innovation as Ayn Rand seems to suggest, but rather through exploitation”. Now, it is true that wealth is created through innovation and exploitation. But, to say this is far from proving that some people acquire wealth through wrong means. Obviously, some people do-And the movie is on some such people.

Atlas Meet in Delhi - "The Fountainhead" Special

The next monthly Atlas Meet in Delhi will take place on Friday, 19 February, 2010. This time (on the suggestion of Mayank Sharma, a new participant), the Meet will focus on discussions of Ayn Rand's exhilarating novel - "The Fountainhead".

'The Fountainhead' probably has a special place for most fans of Ayn Rand's works. On this blog, more than two-thirds of the respondents list it as the first book of Miss Rand's that they read in answer to "Tell us about your journey: Share your experience...". Nobody can remain unmoved after reading this epic drama of the individual vs. the collective!

It is always a great joy to revisit the wonderful world of Ayn Rand, to soak in the spirit of her characters and see the world as it ought to be. We'll begin by watching short video excerpts from the movie version of The Fountainhead, including Roark's speech in defense of his dynamiting Courtland.

To make the evening more enjoyable for everyone, participants are encouraged to choose their favorite characters from the novel (from both the heroes and villians) and come with a quote from each character. We can then talk about how events in the novel relate to our own lives today and to the world around us.

19th February 2010

5.30 pm - 7.45 pm

The Agenda

Session I (Savor and Study)
5.30 pm - 6.45 pm: Watch trailer of "The Fountainhead", followed by a video excerpt of Roark's speech from the movie. Share favorite characters and quotes. Discuss relevance to our lives and the world today.

6.45 pm - 7.15 pm: Tea and snacks break.
[Those interested in coming in only for one session, could arrive or depart during this time.]

Session II (Spread and Sustain)
7.15 pm - 7.45 pm: Discussions on ways to spread Ayn Rand's ideas amongst students -
i) continuation of discussions on ideas mooted in previous meetings (Organizing talks in schools through personal contacts).
ii) other ideas for promoting the same.

*New* : You can also participate in the discussions live over the internet via audio/video conferencing. All you need is a web-browser and audio capabilities on your computer. If you have a webcam, then you can see us and be seen as well. If you are interested, you must send an email to vbajaj@aynrand.in at least one day in advance to receive the link and instructions.

The Venue
inlingua International School of Languages,
N-12, first floor,
South Extension - Part I

It is an open meeting - anyone interested in Ayn Rand's ideas is welcome. You may call Vikram on 9810028900 for directions. If you're planning to attend, it would be helpful if you let us know by leaving a comment below or by sending an email to vbajaj@aynrand.in .

Friday, February 12, 2010

An Enemy Of Capitalism

Alan Greenspan, the former chairman of the Federal Reserve, was often considered as one of the most powerful men on earth. Interestingly, he was once an acolyte of the novelist-philosopher Ayn Rand, and a proponent of the Gold Standard. It is indeed an irony that he later renounced his views on Gold Standard and headed the very institution he attacked-The Federal Reserve.

As advocates of a free market economy know, enemies of capitalism blame the evils of interventionism on the free market. It is, they say, the “laissez faire” policies of Alan Greenspan, which caused the present economic crisis. They conveniently forget that Greenspan gave up his views on Capitalism long ago. It is also forgotten that the existence of the Federal Reserve is incompatible with a free market economy. How is Government manipulation of money and credit a free market policy? Isn’t it a form of central planning? Isn’t it ridiculous to blame the present mess on Capitalism when Capitalism never existed in the first place?

My introduction the concept of gold standard was through an article-“Gold And Economic Freedom” he wrote for Ayn Rand’s “Capitalism-The Unknown Ideal”. In the article, Greenspan made a strong case for free banking, the Gold Standard and a free economy. It is safe to assume that he renounced his free market views for the Chairmanship of the Fed. He is no longer an Objectivist or a Capitalist. He might be considered as a traitor to Objectivism and Capitalism. He wrote in his autobiography about Objectivism that "as contradictions inherent in my new notions began to emerge the fervor receded”.

When Greenspan was asked whether Ayn Rand would have been a fan of the Federal Reserve, he answered that they never discussed the issue in particular. This is certainly a dishonest statement. In his 1966 article for the Objectivist Newsletter, Greenspan himself wrote these words: "Under the gold standard, a free banking system stands as the protector of an economy's stability and balanced growth." And More: “A free banking system would have been compelled, by economic necessity, to put the brakes on this process of runaway speculation. Credit and investment, in such a case, would be drastically curtailed; the banks which made unprofitable investments, the enterprises which proved unproductive, and those who dealt with them, would suffer—but that would be all; the country as a whole would not be dragged down. However, the "anarchy" of a free banking system had been abandoned—in favor of "enlightened" government planning.” However, when Greenspan was made the Chairman of the Fed, he didn’t even make a move to institute the Gold Standard.

In his Biography, Greenspan wrote that he has always harbored nostalgia for the Gold Standard which guaranteed price stability. Further, he wrote that he doesn’t see the likelihood of its return in the near future and it is a necessary cost for the existence of the welfare state. What is this statement intended to mean? It is certainly that the Federal Reserve creates money out of thin air to fund the welfare state. Moreover, Greenspan got it all wrong. Price stability is both unachievable and undesirable. As Friedrich Hayek had once written, the "impossibility of achieving in practice an absolute stabilization of the level of prices in a dynamic economy has been proven time and again."

When he was asked in an interview some time back whether he was wrong, he replied-"Well, partly." "’A critical pillar to market competition and free markets did break down,’ Greenspan said. ‘I still do not understand why it happened.’" “Those of us who have looked to the self-interest of lending institutions to protect shareholders’ equity, myself included, are in a state of shocked disbelief.” Was this the man who wrote this about the 1929 Crash that “The excess credit which the Fed pumped into the economy spilled over into the stock market--triggering a fantastic speculative boom.”? He blamed the fraud of Enron, WorldCom and Global Crossing on “infectious greed”. Wasn’t it Greenspan who wrote for the Objectivist Newsletter that "it is precisely the 'greed' of the businessman or, more appropriately, his profit-seeking, which is the unexcelled protector of the consumer?"

The greatest crime that Greenspan had done was not his inflationary policies during his term. It was that he “admitted” that his belief in enlightened self interest was wrong! Greenspan was just passing the blame to the market. Surely, this man is a hypocrite!

Tuesday, February 9, 2010

Price Fixing Means Chaos

The Indian Government appointed panel headed by Kirit Parikh has recommended a hike in fuel prices. The media hails the recommendations as a deregulation of the fuel prices. Ayn Rand fans would remember Wesley Mouch (In “Atlas Shrugged”) explaining his plan to Rearden: "Under this plan, we will grant the industry a five per cent increase in the price of steel." Tinky Holloway adds: "A certain increase in prices will have to be granted to the producers of iron ore—oh, three per cent at most—in view of the added hardships which some of them will now encounter.” We hear Rearden speak “I rebelled against the looters' attempt to set the price and value of my steel”. In the same novel, Dagny Taggart wants to raise the prices before price controls are being imposed. Boyle and Mouch opposes her. But, Dagny wins in the end by providing information to Mouch for blackmailing Rearden. When the economy breaks down, Wesley Mouch calls a secret meet of special interest groups. He puts forward Directive Number 10-289, which contains eight policy changes. Point Seven imposes universal price controls.

Jennifer Burns tells us in “Goddess of the Market”, how Ayn Rand vehemently opposed the pamphlet of Friedman and Stigler against Rent Control (which is a form of price controls), as the authors didn’t oppose Rent Controls on moral grounds. She wrote to Mullendore, “Not one word about the inalienable right of landlords and property owners. Not one word about any kind of principles-Just expediency and humanitarian concern for those who can find no houses.”

The economic argument against price fixing by the Government carries much weight. It creates shortages or unsaleable surpluses depending on the case. It leads to black-markets, long queues, wasted time, poor quality products, expensive methods of production, and in the long run, higher prices. But, the primary argument is moral. The Government has no moral right to interfere in deals based on voluntary consent for mutual benefit. Such government interference makes both parties worse off. The argument against price controls hold even if customers benefit (which obviously isn’t the case) from price controls. The consumers don’t have a moral right to buy goods at a price lower than the producers would have set. Price controls are an outright infringement of individual rights. The benefits to tax payers (when subsidies to fuel producers are eliminated) and the cut in the fiscal deficit are only side benefits. Markets aren’t rational when the players don’t have the valuable signals coming from market prices. The market price system left unhampered would lead to more rational behavior on both the sides.

Sunday, February 7, 2010

“Atlas Shrugged” Sets a New Record!

Irvine, CA--Ayn Rand’s “Atlas Shrugged” sold more than 500,000 copies in 2009, more than double the previous record set in 2008, reports Penguin USA, publisher of the four American editions. For the first time, combined annual sales of Ayn Rand’s four novels totaled more than 1,000,000 copies.

“The explosion in sales of ‘Atlas Shrugged’ more than a half century after its initial publication is truly remarkable,” said Dr. Yaron Brook, president of the Ayn Rand Institute. “Annual sales of ‘Atlas Shrugged’ have been increasing for decades to a level never seen in Ayn Rand’s lifetime.

“People are discovering the prescience of Ayn Rand’s writing. They’re seeing the policies of ‘Atlas Shrugged’ villains Wesley Mouch and Cuffy Meigs acted out by our government officials today. They’re looking for answers on how to stop government intrusion in our lives. ‘Atlas Shrugged’ provides those answers, and many more.”

First published in 1957, “Atlas Shrugged” continues to draw media attention, including a recent episode of “Stossel” on Fox Business Network dedicated to the novel. More than 7,000,000 copies of “Atlas Shrugged” have been sold since it was first published.

Saturday, February 6, 2010

Ayn Rand's Troubled Economics?

Mark Skousen is an economist I respect a lot. He is inclined towards Capitalism, and is a consistent critic of Keynesian economics. However, in his article “THE TROUBLED ECONOMICS OF AYN RAND”, he proves that he has grossly misunderstood Ayn Rand’s philosophy and the concept of consumer sovereignty. Howard Roark, Skousen writes, denies a basic tenet of sound economics–the principle of consumer sovereignty, when he says. “I don’t intend to build in order to serve or help anyone. I don’t intend to build in order to have clients. I intend to have clients in order to build.”

The principle of consumer sovereignty was (and is) espoused by many sound economists, including Ludwig Von Mises and W H Hutt. They are right in saying that in a free market, people are urged to produce goods which are demanded by the consumers. But, this is far from proving that the consumer is “sovereign”. It was one of the greatest achievements of Ayn Rand to prove the fallacy of consumer sovereignty, a notion which has misled even great economists. As she put it, “There are the economists who proclaim that the essence and the moral justification of capitalism is "service to others—to the consumers," that the consumers' wishes are the absolute edicts ruling the free market, etc. What all such theorists fail to mention is the fact that capitalism grants economic recognition to only one kind of consumer: the producer.” Even Ludwig Von Mises would have agreed that people pursue their monetary interest “only to the extent that other things are equal.” The consumer is not sovereign. He hasn’t’ (and shouldn’t have) the right to compel producers to produce goods he desire.

Sovereignty is in fact, a political concept, as expressed in statements such as “The King is sovereign”. It doesn’t apply to economics. As an economist wrote, “Sovereignty” is the quality of ultimate political power; it is the power resting on the use of violence. In a purely free society, each individual is sovereign over his own person and property, and it is therefore this self-sovereignty which obtains on the free market. No one is “sovereign” over anyone else’s actions or exchanges. Since the consumers do not have the power to coerce producers into various occupations and work, the former are not “sovereign” over the latter.”

Mark Skousen is off the mark when he says “Randian selfishness ignores the interest of others.” I wonder whether he has carefully studied Ayn rand’s philosophy. There is no clash between legitimate interests of people. One doesn’t ignore the interests of others when pursuing ones selfish interests. One, in fact, aids it.

Friday, February 5, 2010

Atlas Shrugged Essay Contest - A Finalist from India and Cash Prizes by Liberty Institute!

More good news! Not only do we have a semi-finalist from India in last year's Atlas Shrugged Essay Contest (Jaidev Deshpande - see post below), we also have a finalist - Surabhi Mohta!  

On behalf of the "Ayn Rand in India" initiative, Liberty Institute has awarded a special prize of Rs.2000 each to both the participants for having distinguished themselves in this prestigious international competition. Congratulations to Surabhi and Jaidev!  

Surabhi is in her 3rd year for a bachelor's degree in commerce from St. Xavier's College, Kolkata, and is an aspiring entrepreneur. She discovered Ayn Rand's works in her father's library just over two years ago. For the contest, she chose the theme "The Producers versus The Plunderers: Man versus Beast", on which she wrote the following essay:

In Atlas Shrugged, Rand incisively defines and contrasts the heroes and the villains by their adversative views of money. She shows how the very essence of their characters can be unearthed from the way they feel about wealth. 

 The heroes want to make money by their ability and hard work. They use their resourcefulness to produce and trade amongst themselves. Thus Dagny Taggart runs a transcontinental railroad; Henry Rearden manufactures steel; Dwight Sanders builds airplanes. The villains on the other hand want unearned wealth. They know that they cannot produce as much as they would like to consume; hence they resort to the vilest means possible in order to gain affluence. They force the producers to give them their hard earned wealth by spreading communist propaganda, preaching altruism, lobbying for innumerable subsidies and passing legislatives that allow them to muscle in on the profits of their superior competitors. The difference between the heroes’ view and the villains’ view of money runs analogous with the difference between a prolific manufacturer and a destroyer filled with hatred, a businessman and a con artist, an inventor and a lobbyist and John Galt and James Taggart.

The means that the two sides use to obtain wealth also give an insight