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.

Ugliness

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.”

Stagnation

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.’”

Why?

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”.

7 comments:

  1. I'd broadly agree that the Randian hero (innovator, visionary,etc.) would fail today because of our full-throttle neo-liberal capitalism (conformist, risk-averse) rather than for the lack of it, but think also that Rand's appeal to her adherents is not merely a comfortable mood music allowing an escape from basic realities but a destructive and vengeful one. Anyone that has worked in a low-paid factory environment will have seen how unnecessary cruelties and inconveniences are casually inflicted by those in authority purely due to their sense of entitlement, and Rand's heroes permit this ill-concealed sadism the full expression.

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  2. It's interesting that what Mark Fisher is saying about cultural sterility is being reinforced by other people. Jaron Larnier, author of "You are not a gadget" has noticed the same thing about music, how file-sharing has not unleashed creativity but creating cultural stasis. "Everything is retro, retro, retro."

    http://www.themillions.com/2012/04/the-bathrobe-era-what-the-death-of-print-newspapers-means-for-writers.html

    And, of course, this is a standing refutation of Ayn Rand's philosophy about the creative power of naked capitalism

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  3. "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."

    It is not clear indeed how in Marx's view technological progress and leaps in productivity do happen. Maybe through the dialectic of history. There is no variable in Marxist thought to account for leaps in productivity and technology outside of the natural progress of history (i.e. feudalism -> capitalism -> communism). That why you find this so "baffling".

    As I said in a previous post, Marx did not believe capital needed to exist. For Marx, capital is a superfluous interposition between labor and consumption. With Marx, we have what is commonly called a "labor theory of value". That is to say: labor that has gone into the making of a product gives it it's value. More labor = more value, but only in quantity and not in type. However, it is not difficult to imagine crackpots devoting years of their lives to projects that other people find worthless. And this does not explain why most of us are not still involved in labor intensive subsistence agriculture.

    This all stems from a misunderstanding of what "capital" actually is. Capital is knowledge. Capital is imagination. Capital investment may be thought of as the construction of machinery, but the machinery, with its use and purpose, must first be conceived. The new purposes require that new products be thought of. But then with the conception of new products, new uses, and new purposes, the machinery may only be one element, or no element, in it. Simply a different way of doing things represents new knowledge and new capital. Thus, we have the idea in modern economics of "human capital", where some people simply know how to do things better than others. Also, the value of capital can simply evaporate in misconceived investments. Bad investments must at some point be liquidated.

    Marx's thesis of the fictional nature of capital is thus equivalent to his lack of imagination regarding what it would be possible for people to do with their capital. That entirely new products and industries could be conjured up, to be brought to life with capital investment, was a process that was simply off the radar of Marxist economics.

    The fact that a multinational auto or computer company can start in someone’s garage (as was the case with Ford & Apple), is completely incomprehensible to Marxist theorists. They are the "petty bourgeoisie", who will be eaten up by ever larger monopolies.

    It is no wonder then, that much of the production in Soviet and East-European economies was based on 19th to early 20th century concepts of industry (which by the way, came with 19th century levels of pollution and environmental degradation). Most Soviet and East-European computers of the 70’s and 80’s were in fact clones of their western counterparts (http://en.wikipedia.org/wiki/History_of_computer_hardware_in_Soviet_Bloc_countries).

    So, in conlusion, to say that capitalism brings stagnation is ridiculous at best. As opposed to what?

    I won’t even get into the whole issue of “false needs”. I’m too tired. In short, I find it extremely patronizing.

    Adrian

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  4. You seem to find baffling what I refer to as baffling. What kind of economy/society does encourage innovation that at first society doesn’t understand or rejects, is a very important question, because this one certainty doesn’t. “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.” – Ayn Rand. Presumably investment in their creations would have been “misconceived” because if they stood alone, what they created would not have sold. I’m actually – my God – agreeing with Ayn Rand here. But to link the great creators with capitalism is stupid, and dishonest.

    I’m afraid you’re making the misunderstanding. Capital is investment of money to make more money. It may be the result of imagination and innovation that benefits society or it may do the opposite. The chief executive of pharma company, AstraZeneca resigned last year because of pressure from investors to curb research – research that might have resulted in a public good but wasn’t profitable, did not lead to a return on capital. Speculation and innovations like asset-backed securities do not, it seem plain to me and a lot of others, benefit society. But they required the investment of capital to happen. And they made a lot of money initially (and were blessed by Randians like Alan Greenspan). So they weren’t in your view, “misconceived”. Something can be very misconceived indeed, even if it does please the great market God.

    Many innovations, the internet/email, for example, did not need capital (they were done by universities, the state and NGOs) but they did need time and investment. The private sector was actually very late off the mark with using the internet. The Second World War was very creative in a sense – Werner Von Braun, radar and computers - but it didn’t need capital to create.

    As to the labour theory of value, some mighty figures of classical economics – Adam Smith and David Ricardo – believed in it, not just Karl Marx. Why only in quantity, not in type? Ideas add value, enterpreneuralism adds value, but what “value” does capital add? A non-capitalist corporation like Mondragon is very entrepreneurial but it does not have outside shareholders. Workers get collectively the value they create, which is in part achieved by entrepreneurial innovations.

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  5. (continued)

    You have a strange definition of human capital – “where some people simply know how to do things better than others” I think the kind of society a person lives in, the kind of education they have and the kind of organisation they work in, has a lot to do with how much they know and what they can do. Richard Wilkinson, author of the Spirit Level, made the interesting discovery that more equal societies have a higher level of patents than less equal societies because they don’t “waste the talents of their populations by making millions of people feel second rate and failures”. He advocates ‘economic democracy’ so that firms become communities and not just pieces of property where people are “brought together and used to earn a return on other people’s capital” (and doubtless made unemployment should the investments be “misconceived”) I agree. Such a change might improve the level of innovation as well as health.

    Wilkinson also said something very perceptive last year. “One thing is we need to make a clear distinction between economic growth and innovation. We need innovation very badly, partly to reach sustainability, like spin-offs from electronics and bioengineering and other stuff, which will have benefits. That is not the same as economic growth.” http://www.redpepper.org.uk/richard-wilkinson-interview-the-spirit-level-three-years-on/ . At the same time, constant change and innovation is not, in my opinion, desirable.

    I don’t believe in false consciousness actually, if that’s what you’re referring to. I think our present capitalist society magnifies and dotes on some needs and lets others wither – for example the need for and benefits of democratic participation, and the free time required to be a proper citizen. And it certainly doesn’t provide stability which I think is a basic human need

    I think stagnation is a very apt description of our contemporary state, and it’s not even controversial, far from ridiculous. Low or no growth which some people, like asset manager Jeremy Grantham, believe will go on for decades and stagnating personal incomes which cause stagnating demand and so impacts on growth.

    I find in interesting that in your comment you don’t talk at all about the other person the post was about, Ayn Rand. The person who, according to this article, http://www.guardian.co.uk/commentisfree/2012/mar/05/new-right-ayn-rand-marx- “described the poor and weak as "refuse" and "parasites", and excoriated anyone seeking to assist them. Apart from the police, the courts and the armed forces, there should be no role for government: no social security, no public health or education, no public infrastructure or transport, no fire service, no regulations, no income tax”.

    In the context of the huge and ongoing taxpayer bailouts of corporations - http://idealoblog.blogspot.co.uk/2012/07/wreath-of-conservatism-niall-ferguson.html- , and the total shite that is being inflicted on people that had no role in causing the economic crisis - http://idealoblog.blogspot.co.uk/2013/02/naught-for-your-comfort-british-work.html - doubtless “moochers”, I find her sadism and veneration of the powerful, not just patronizing, but sick-making.

    Crackpot, but not in a good way

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  6. Load of crap that I couldn't stand to read, but merely swipe till the bottom. The financial crisis was not caused by rand principles but was created by the ideology of Marx. Central banking and the power to dictate and control the money supply by a small group of people causes these things to happen. So pls read more before penning your opinions

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    Replies
    1. Is this your first visit to this part of the galaxy?

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