Sunday, 19 February 2012

Ayn Rand v Karl Marx, part two The myth of the creative outsider

Ayn Rand’s appeal (see part one) is not merely that she supplies a patina of ideological justification for exploitation (also known as bullshit). That’s not the reason for her mysterious endurance. It is because she satisfies a deep psychological need of successful people who want to think of themselves as misunderstood outsiders. Her great conceit is to link the stubborn individualist nobly struggling against mass timidity and ignorance, with capitalism. But as Marx saw, and is becoming more and more apparent, there is no link. Capitalism is not about individualism. It’s about conformity.

In Capitalism: the Unknown Ideal, Rand writes of “the exceptional men, the innovators, the intellectual giants” “It is members of this exceptional minority,” she claims, “who lift the whole of a free society to the level of their own achievements, while rising further and ever further.”

Randian heroes are geniuses whose creations are at first not understood by the ignorant masses, and who suffer hardship but ultimately emerge victorious and vindicated.

Howard Roark, the architect hero of the novel The Fountainhead, declares: “The great creators – the thinkers, the artists, the scientists, the inventors – stood alone against the men of their time. Every great new thought was opposed. Every great new invention was denounced.”

Roark, thought to be based on the maverick architect Frank Lloyd Wright, believes in pure art and despises convention. He refuses to water down his creative impulses to satisfy approving committees and eventually blows up a building he designed, but that was compromised in its construction by other architects.

This is Gary Cooper as Howard Roark in the 1949 film of The Fountainhead:

At the same time, Rand felt she had discovered a “logical foundation” for capitalism. This foundation was all about individualism and the struggle against what she decried as “the herd instinct”. She penned a Manifesto of Individualism as a refutation of Marxism.

But the “logical foundation” was profoundly illogical and built on fantasy. Great creators ahead of their time will be shunned not only by the general public, but by business as well. Especially by business. Because their denounced inventions cannot be sold. Ayn Rand’s “innovators” make terrible capitalists.


A cursory look round the built environment in modern capitalist countries demonstrates that individual creative visions have not won out. Buildings are ugly and crassly utilitarian, frequently designed by computer. Rand’s Howard Roark would not prosper today, yet capitalism has undeniably triumphed over “collectivism”.

Capitalism, the accumulation of profit, is nothing to do with individualism, and not giving a fig what anyone else thinks does not make you a capitalist. As Marx said in The Communist Manifesto: “In bourgeois society, capital is independent and has individuality, while the living person is dependent and has no individuality.”

Capitalism, as Marx understood, is about perceiving and manipulating the needs and desires of consumers in order to get an immediate financial return, not nobly standing alone against the caprices of public opinion. “The entrepreneur,” says Marx, “accedes to the most depraved fancies of his neighbour, plays the role of pander between him and his needs, awakens unhealthy appetites in him and watches for every weakness in order, later, to claim the remuneration for this labour of love.”

The key word here is “pander”. The herd instinct is alive and well and living in advertising agencies the world over. The contemporary Marxist thinker Mark Fisher says the most powerful desires are precisely cravings for the strange and the unexpected. But these are needs that, whatever Rand’s belief in the lonely outsider, cannot be satisfied by a market economy.  “These can only be supplied by artists and media professionals who are prepared give people something different from that which already satisfies them;” says Fisher, “by those, that is to say, prepared to take a certain kind of risk.”


And risk is something that, despite the propaganda, capitalism does not nurture. What Fisher has noticed is that letting capitalism rip, Ayn Rand’s deepest desire, does not lead to innovation, but conservatism and stagnation. We live in a society dominated by fear and cynicism, he argues. “The emotions do not inspire bold thinking or entrepreneurial leaps, they breed conformity and the cult of the minimal variation, the turning out of products which very closely resemble those that are already successful.”

Of course it is not clear exactly what kind of society does enable innovation to happen, to encourage a genuine creativity which may at first baffle or outrage. But it is obvious that capitalism does not do this. “Since it is now clear that a certain amount of stability is necessary for cultural vibrancy,” writes Fisher, “the question to be asked is: how can this stability be provided, and by what agencies?”

In a sense, the Randian titans at the crest of the economy are creative. “Asset-backed” securities that sell shares, not of parts of flesh and blood companies, but of the interest payments people make on debt, are creative. Credit default swaps, traded promises to pay losses in the event of loan defaults that people know now cannot be met, are creative. Private equity “leveraged” buy-outs of companies that load firms with debt and force mass redundancies, are creative. But they are also immensely destructive. Innovations like Alan Turing’s work to create the first computer (done in the public sector, it should be said) have proved useful to billions of people. Financial innovations, the dominant innovations of the last thirty years, have benefited their architects and harvested nightmares for everyone else.

The irony of the renewed popularity of Rand’s magnum opus, Atlas Shrugged, is that what has transpired in the last five years, is the exact opposite of the scenario it sketches.

“The absurdity of this reaction lies in the fact that it totally misreads the situation:” writes the Slovenian Marxist philosopher Slavoj Žižek. “most of the bail-out money to is going to precisely those Randian deregulated ‘titans’ who failed in their ‘creative’ schemes and thereby brought about the downward spiral. It is not the great creative geniuses who are now helping out lazy ordinary people, it is rather the ordinary taxpayers who are helping out the failed ‘creative geniuses.’”


But what accounts for the absurdity, for Ayn Rand’s baffling appeal in spite of the fact that history has proved her spectacularly wrong about everything? It is, I submit, that the alternative is too painful to face. That if you don’t believe in Ayn Rand’s reassuring illusions, you will have to accept the reality of the world as it is. That you aren’t a genius and you are being continually exploited. And Karl Marx was, for want of a better word, right.

The sane response to the threat of Atlas shrugging, which is presented regularly as corporations or hedge funds threaten to relocate if they are taxed properly, is: “Shrug away, preferably on another planet because this one has had enough of you”.

Thursday, 9 February 2012

Ayn Rand v Karl Marx who would you choose?

According to a 1991 Library of Congress survey no book, aside from the Bible, has influenced more American readers than the Ayn Rand novel, Atlas Shrugged.

Atlas Shrugged is a dystopian fantasy, published in 1957, about how businessmen, tired of incessant government meddling and blame for exploitation, resolve to show the world how it would fall apart without them. They go on strike. Under the leadership of a genius inventor, John Galt, they disappear into a mountain hideaway, while outside civilisation disintegrates. Then they issue demands. “If you ever again wish to live in industrial society, it will be on our moral terms.”

Atlas shrugs and millions of “subhuman creatures” realise their hopeless ineptitude.

Needless to say Ayn Rand was a believer in capitalism. She believed in it so much she wrote a book called The Virtue of Selfishness, wore a gold lapel pin in the shape of a dollar sign and claimed that “if civilisation is to survive, it is the altruist morality that men have to reject.”

Rand had acolytes, including most notably Alan Greenspan who found in Rand’s objectivist philosophy “a sense that markets are an expression of the deepest truths about human nature”.

Weirdly, although perhaps weird is the new normal, economic collapse has not dented Rand’s popularity. Indeed, according to her biographer, she is a more active presence in American culture than she was during her lifetime. More than 800,000 copies of Rand novels were sold in 2008 alone and sales of Atlas Shrugged spiked after Obama became US President.

But the fans aren’t just conservatives. Rand also has a following among Hollywood humanitarians. According to UN refugee ambassador, Angelina Jolie, Rand “has a very interesting philosophy”. The actress Eva Mendes says that any boyfriend of hers “has to be an Ayn Rand fan”. And Michael Caine is an Ayn Rand fan, though he isn’t, as far as is known, Eva Mendes’ boyfriend.

Rand’s “very interesting philosophy” has been described as “Marxism of the master class” and she quite consciously tried to be a capitalist Karl Marx. She penned a Manifesto of Individualism as an answer to The Communist Manifesto.

So it’s only fair, in this time of economic flux, to do a brief comparison of the philosophies of Rand and Marx. It couldn’t be, could it, that the reason why so many people believe in Rand’s view of the world, is that it blots out the disquieting thought that the alternative, Marxist view of reality, is basically correct? That the bearded one was right all along.

Let’s compare.

Who exploits who?

“We’ve heard it shouted that the industrialist is a parasite,” says John Galt in Atlas Shrugged, “that his workers support him, create his wealth, make his luxury possible – and what would happen if they walked out? Very well, I propose to show to the world who depends on whom, who support whom, who is the source of wealth, who makes whose livelihood possible and what happens to whom when who walks out?”

In Rand’s philosophy, the industrialists, the billionaires are exploited by everyone else. And oppressed by government.

“You have the courage to tell the masses what no politician told them,” said the free market economist Ludwig Von Mises (a contemporary of Karl Polanyi) in a letter to Rand. “You are inferior and all the improvements in your conditions which you simply take for granted you owe to the efforts of men who are better than you.”

But who really does what to who? In Marx’s conception of reality, exploitation occurs when people, seeking the wherewithal to survive, are employed by private sector firms (capitalists in other words). They work and produce more than they are paid. This extra is the surplus which goes straight into the hands of the capitalist.

Exploitation, in this Marxian sense, is not limited to labouring 12 hours a day in a sweatshop. Everyone who is employed is exploited. They have to be, otherwise they wouldn’t be employed. No employer ever “gave” anyone a job. The employee gives the employer something. If that can’t happen, neither will “job creation”.

The employer attitude is expressed by Marxist economist Richard Wolff: “You’ve got to produce more for me than I pay you for coming here to do it – and that difference is the surplus, that all capitalist employees are required to produce. If you don’t produce surplus, you don’t work and if that results in your death, ‘have a nice day’”

Here is a very clear explanation of exploitation from Wolff (from 7.17)

But in Ayn Rand’s view, there is no such thing as the surplus, and exploitation is the other way round. This leads to a feeling of victimhood on the part of “producers” but also a sense of their unappreciated power, that only they have the ability to create wealth and that scarce and much-desired resource, jobs.

Here is the Randian philosophy expressed in all its glory by a Silicon Valley executive (Silicon Valley is honeycombed with Ayn Rand fans): “Money is extracted by Silicon Valley and then wasted by Washington. I want to talk about people who create wealth and jobs. I don’t want to talk about unhealthy and unproductive people.”

In a sense, “we are all Randians now”  - at least governments in Britain and the US are. The producer class (employers) have to be coaxed and pandered to. Government and in Rand’s words “the sub-humans” (employees) can only obstruct this magical wealth and job creating alchemy from occurring. So we must de-regulate and cut taxes further even though that formula led to economic collapse just four years ago. If jobs do not appear, we must have offended the demigods in some way with too much red tape. And so onward to hell.

Blame yourself

This philosophy leads inexorably to self-blame. If you can’t blame the economic system for failing to produce the goods, the only place left to look is inwards. Here is someone from North-West England, who has just got a job after nine months on the dole, asked by a Guardian journalist if he thinks being unemployed was his fault : “Yeah,” he says. “I do. I think I should have applied for more [he applied for 25-30 jobs a week]. I should have picked myself up in the morning, got out, come to a place like this – tried more. When you're feeling down you start blaming the world for your mistakes … You feel the world owes you. And it doesn't. You owe the world.”

Who exploits who is rather an important question to answer. And a lot depends on which side you come down on.

One more thing before we leave exploitation. Marx did not just explain how exploitation produces surplus, he went on to say how the surplus is used by employers, how it creates what he called the “superstructure” of culture and controls the world of ideas. In January this year, researchers in US found that political donations from the finance sector have increased by more than 700 per cent in 20 years. The richest of the rich, one per cent of the one per cent, they conclude, act as ideological gatekeepers on the political process. In Britain, over half of Conservative party funding comes from financiers in the City of London

They certainly know how to use it.

In part two we will examine the myth of the Ayn Rand hero. How the misunderstood creative individualist, makes a terrible capitalist.

As Marx once said: “In bourgeois society, capital is independent and has individuality, while the living person is dependent and has no individuality.”