What is the broader relevance of Ayn Rand for society?
In the last of his three-part series, Lars Seier Christensen focuses on the broader relevance of Ayn Rand in society today after the practical example covered in part two. You can read part two here and part one here.
First and foremost, Ayn Rand remains among the few that recognises with crystal clarity, that we will not win the battle through just proving that freedom and capitalism works. It has already been proven beyond discussion. Nevertheless, we are still facing new attacks on freedom every day.
One of the biggest mistakes we can make is to assume that rationality will prevail, that just through superior economic performance, freedom will capture enough peoples' hearts in a democracy to win the day. This creates a major problem for those of us that like to argue rationally, rather than emotionally.
It creates a major opportunity for politicians that intuitively know that in a rational world, there would be little demand for their services. Only in an irrational, emotional universe, where opportunists can gain access to media and visibility to express “feelings” and try to take the moral high ground, no matter how unfounded in reality it is — only in such an environment can you survive without having to produce practical, productive results, and instead prosper and benefit from empty talk and third-rate acting performances.
This tendency, unfortunately, has only strengthened during the recent crisis. There is often a complete disconnect between the reality and the words used to describe it, the actions pretending to deal with it. In particular, this is very noticeable in the Eurozone these days.
Secondly, Ayn Rand has gained renewed relevance and attention, because her predictions have been fulfilled in many different areas. This of course pleases and reconfirms long-standing admirers, but also bring many new supporters to the scene, looking for answers to the crisis we are in.
To name but a few predictions, clearly the dynamics of democracy and interfering politicians are very well described in Atlas Shrugged, where constant intrusive corrective attempts to fix a given problem leads to new, unforeseen problems that need additional correction. This triggers an endless series of correcting moves, where only two things are certain.
First, the politicians assign ever greater powers to themselves, as they manage to convince the citizens of the need for even more interference, although the problems are created by interference in the first place.
There are endless examples of this in both the US and the Eurozone, where one mistake invariably leads to call for even more powers, leading to new mistakes. The EU's standard answer to any of its own failures is that had it just had even greater powers, things would have been much better. The real question to ask here is not why it claims this, what else could it really do, if the only alternative is to admit incompetence and failure?
The European Union is a prime example of politicians enjoying too much power. Photo: Shutterstock.com
The real question is how do voters persist in managing to ignore the reality and believe in their politicians, rather than themselves?
Second, freedom and capitalism, the only real answer to the current crisis, gets ever more restricted and prevented from working efficiently, meaning that the underlying strength of human ingenuity and creativity is stopped from working and becomes increasingly powerless to pull us out of the morass we are in.
Another of Rand's predictions of business people using government favours in return for giving up their independence, has sadly been confirmed better than anywhere else in my own industry. It is embarrassing to see the extent the banking industry has relied on support from governments, and how ruthlessly it is currently exploiting the offers of cheap money available from the central banks.
Very little of the bailouts filter down to the real economy, as it is easier to hold onto safe returns in a variety of government paper, cementing the unhealthy relationship between banks buying government securities and in return being propped up by the same governments to secure them as an outlet for these very securities and their printing machines.
At the same time, banks are now in the firing line all over the world, helpless to resist an endless row of enquiries, fines, regulatory tightening and excessive compliance costs pushed onto their p/l sheets, hurting earnings, and making them ever more dependent on the state for support. It is a vicious circle for an industry if I ever saw one, and I fear that we are approaching the end of banking as a private industry. But once we have a government-controlled banking industry, our problems will really begin.
Pick-a-winner, corporate social responsibility, employment rules, affirmative action, the creation of fictional jobs and plain political popularity and obedience will then rule who prospers and survives in all industries, not just banking. Beware of this development, it is poison to capitalism, growth and to prosperity for all of you. The new central bank regulator, and the banking union, ultimately draining the sound banks for money to support the failing ones, could be the nail in the coffin coming from the EU to a bank near you soon.
In fact, the undemocratic, power-grabbing, emotional, populistic Washington that takes over in Atlas Shrugged is today most closely resembled by the EU and the Eurozone in the real world.
It is quite frightening how much of the rhetoric in Bruxelles and some of the Eurozone countries resembles Ayn Rand's universe. Constant talk of solidarity, of progress under difficult circumstances and the need for more central power is almost taken directly from Atlas Shrugged. There is absolutely no connection with reality and no humility whatsoever in the face of near total failure. Absolutely no wish to face the public or give it a say in any of the major new initiatives and blunt direct intervention in national governments.
Arrogance in the extreme frequently manifests itself against deviating views of Europe such as those displayed by even a meek David Cameron. This organisation is failing big time, and its only response is to gather ever more power in the hands of Bruxelles, clearly against the will of the populations of Europe that are beginning to see that in fact, the euro may be the practical equivalent of Project X in Atlas Shrugged.
In France, we now have a President that by his own admission, hates the rich. So much so that he is trying to circumvent his own constitution to introduce punitive taxes on them, although illegal. And it is so much so that he drives relentlessly forward with proposals for a financial transaction tax that has been shot down by pretty much every historical experience and most economists as a massive own goal, damaging the very countries that deploy it.
Well, it seems that the rich also hate their president, judging by the number of them leaving — famously spearheaded by Gerard Depardieu — for places like Belgium, that amazingly actually acts as a tax haven for the French in spite of all the EU rhetoric, or Switzerland, where inflows of new immigration requests are, according to my sources, at record highs, particularly from Scandinavia, UK and France. Depardieu, of course, chose Russia, which speaks volumes as to the deep trouble Western Europe is in.
This leads to a very interesting question, a question full of hope. Is there indeed also a solution to the problem, such as the one Ayn Rand foresaw with the flight to Galts Gulch? It will be difficult to find a place entirely outside of the reach of aggressive governments eager for tax dollars, as Switzerland has learned to its misfortune. But is there a possibility for creating an area, so attractive and so successful that it will attract enough good and productive people to become a good example for other nations to follow? Unfortunately, not much points in that direction as most countries pursuing such strategies lack sorely in that other commodity, personal freedom and security from governmental abuse.
And the few places that try to provide both, such as Switzerland seem to also be contracting the malaise. I chose Switzerland as my country of residence a few years back, and I have not regretted it for a second.
With its effective tax competition between cantons, and very direct democracy, it has many features aimed at keeping the state under control. But I have been disturbed to see recent attempts at reducing this tax competition, introducing death taxes, and most recently, the infamous 12-1 proposal that seeks to limit executive pay to a maximum 12 times the lowest paid employees. While not likely to pass, I still know of several big companies preparing contingency plans for spinning off management teams into separate units, and laying off their lowest paid workers to instead use temps and insourced services. Talk about an own goal for both the strong and the weak — wasting all this time instead of focusing on business and creating jobs also for the low paid, instead of now laying them off.
So nowhere seems safe from populism and irrationality any longer. It is difficult to see the necessary reforms forthcoming, and sadly, we may have to go through a much more severe economic collapse before change will be forced upon us. Unfortunately, that change may also be totalitarian in nature, of course. In fact, that is the more likely outcome in the short run.
I don't believe the battle will be won by economic rationality. This goes out the door, once more than 51 percent of the voters live off the government — and probably even long before. We need to change the values, the morality, the misunderstandings, and to undermine the deliberate lies our politicians feed the electorate about what constitutes solidarity, justice and the common good. Is it solidarity to make people into losers and victims and leave them totally unable to care for themselves?
Is the common good to stop businesses and investors from creating wealth and prosperity? Is it justice to regulate every aspect of a normal person's life and continuously monitor his every move?
The change must start with the changing the values. Focusing on the young that will get a terrible deal in the future. Focusing on the many SMEs and smaller entrepreneurs that create 80 percent of all new jobs in Europe today, but which get only paperwork and bureaucracy in return from their governments. Focusing on micro rather than macro elements in the economy.
And when the message is values and fundamental change, no one is more powerful than Ayn Rand. Her books constitute an inspirational, understandable and practically-applied philosophy. Saxo Bank has given out more than 15,000 books in the past 10 years, and I hope that some of you here in the audience today will also feel inspired to help spreading her work among the receptive — the young, the entrepreneurs, the new political movements protesting EU excesses and against the growing lack of respect for the individual.
If we don’t succeed in changing the values and direction of at least the next generation, I fear the full prediction of Atlas Shrugged will become reality and while that may hold some promise for the distant future, it is not something that I think people of my age feel like going through if we can avoid it.