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.”


  1. "But in Ayn Rand’s view, there is no such thing as the surplus, and exploitation is the other way round."

    And in Marx's view, capital does not exist. How does a company like Apple afford to research and develop a new product every 6/12 months? By reinvesting the profits! Profit is used to create new wealth, which creates new profits and so on.

    1. "And in Marx's view, capital does not exist" ???

      Strange that he managed to write a huge, three-volume book called, "Capital", all about something that apparently, in his view, didn't exist. Most peculiar