The Dangers of Randian Economics

May 11, 2011
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Imagine for one second that you are a great, innovative mind. You as this great innovative mind are a lynchpin upon which society relies to survive and thrive. Because you are this lynchpin you do anything within your power to improve yourself because the better, happier, and more content you are the more society relies upon you because it is a parasitic social construct. If you cannot hold up society on your own you deserve to be brutally crushed under it just like all the homeless people you walk past on your way to your hyper-competitive job in which you are constant getting your co-workers fired for their incompetence and inability to keep up with your overwhelming power.

You’re currently imagining the most selfish person in the world. Someone who does not care if everyone got the same initial opportunities they did. In fact in most cases this person did not have to stress for a thing in their entire lives. They were born into money, went to college on their parents’ dime, and then graduated right into a high level job due to connections. They have never had to go without health care, they have never been discriminated against because they come from a rich, white, protestant family. They believe that because they are some all powerful lynchpin that society rests on society owes them; instead of the other way around.

This is the social aspect of Ayn Rand’s Objectivism that many groups, such as Paul Ryan’s Republican and Libertarian supporters, attempt to apply to economics. When applied to economics there is intense deregulation, no policing of industrial activities, tax cuts for the rich, and a complete lack of welfare or similar plans for the less fortunate citizens that cannot help themselves. The United States of America has seen the negative effects of Randian Economic Theory with the actions of Alan Greenspan, which burst three markets and caused the current recession we are just barely recovering from.

Greenspan was a reactive Chairman of the Federal Reserve, every time a market situation looked bad he would wait until after it got to it’s worst stage before implementing any countermeasures. In 2000 Greenspan sat and did nothing until after the dot com bubble burst, at which point he raised interest rates in a hope to clean up the mess. Between 2001 and 2004 due to 9/11 and multiple corporate scandals he lowered interest rates to around 1% and according to his critics, such as Steve Forbes, caused massive inflation. These policies within the years ending his term and the years directly after his term led to the collapse of the faulty delivery market, the collapse of the housing bubble, and the crash of the highly unregulated credit industry. Greenspan was one of Ayn Rand’s most loyal acolytes.

Randian Economics is a dangerous economic theory, which allows blatant exploitation of the less fortunate citizens and in the long run only helps the already rich. Under Randian Economics the Lorenz Curve of the United States of America grew to show an unprecedented level of economic disparity between the classes for a developed nation. The Lorenz Curve of the USA has at its worse under this policy resembled that of aristocratic or oligarchic societies. Deregulated industries do not regulate themselves, instead they cause a danger to the citizens of the nation and exploit them viciously.

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Treefiddy said...
May 27, 2011 at 6:31 am
Laissez-faire capitalism is the only justifiable economic system. Under such a system, the government exists for the sole purpose of protecting the unalienable rights of the citizenry. Government may make no sanction of violence, but exists to provide a police force, a military, a judiciary, and a prison system. Government exists as a response to force, ensuring that no man sanctions violence against another. A judiciary is needed to handle disputes between labor, to force contracts, and to prot... (more »)
DAlexander replied...
May 27, 2011 at 9:10 am

I've actually read all three of Rand's major pieces. 

Every single country you've mentioned has an atrocious standard of living except for Hong Kong which had an okay standard of living for a while. Japan initially had horrible standard of living when it industrialized and actually now has a very regulated system that isn't very laissez-faire at all. That supports my point of the economic practice being socially and morally bankrupt.

And yes the housing boom and bust had ot... (more »)

DAlexander replied...
May 27, 2011 at 9:12 am
Err...sorry for some reason it tried to double my comment?
Treefiddy said...
May 27, 2011 at 6:30 am
All wealth which has ever been created on this Earth, is the product of man's mind. Man's faculties for interpreting his surroundings, including that he lives by a rational code of morality and objective set of ethics are the only means by which man may survive. Wealth will not be created by arbitrary whims, appeals to emotion, or the appeals to need. The world exists independant of consciousness, and man's judgement ultimately determines the nature of his existance in relationship to this Earth... (more »)
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