Objectivism and Thomas Jefferson
Seven Essays on the Philosophy of Ayn Rand


5. Capitalism Over Self-Government

The Randian ideal is not a nation built upon self-government, establishing a free society in which capitalism emerges, but a nation built upon the relationships established by, and conducive to, capitalism. Capitalism replaces government of the people as the security for their rights.

Equal rights become the adjunct, not of republican government, but of the economic system.

This, however, is putting the cart before the horse in a free society, because capitalism flourishes best under the protections and guarantees of a republic founded on self-government. And it is a people themselves who are the safest depository of rights.

This is an important point, because Rand in other areas proposes ideas that undermine the concept of popular sovereignty. Thus, what she is really doing is replacing government of the people with capitalism and capitalistic principles. This idea runs into a few problems when it comes time to decide who is actually running things. But on that Rand punts, asserting that our free society was established under the Constitution, and its basic guarantees cannot be altered, thus skirting a head-on confrontation with the issue of "popular sovereignty."

The foundation of American society is not the economic relationships of the capitalist system, but the natural rights derived from a proper understanding of human nature. A consideration of natural rights must come first, else we have no criteria for determining what are the proper relationships under capitalism. Shall we have laissez-faire capitalism, or some level of regulation? And if regulated, how much regulation? Who decides, and upon what principle? According to Rand, it should be laissez-faire capitalism.

Church and state were separated because the church previously had promoted itself through the agency of the state and to the detriment of the people. But under a separation of state and economics, especially with laissez-faire capitalism, the state no longer has a role to play in protecting the people and assuring their happiness. Laissez-faire means capitalism is outside the regulatory control of the state and that the people are entirely at the mercy of the capitalists. Thus, Rand assigns a very limited role to the government, which has the interests of all the people to look after, and an unlimited role to capitalism, over which the people of a nation will have no control whatsoever.

Separation of church and state has worked fine, because it means that any person can choose to affiliate themselves with any church they please, or no church at all, if that pleases them. But does the same condition apply under laissez-faire capitalism? Are the people free to participate or not to participate in the economy? Is the economy a function of society about which the people as a whole have no interests that need protecting?

Quite the contrary. Economic concerns were, and always have been, at the root of social and political concerns. The "rich" and the role they play have always been a threat to liberty, leading Jefferson to observe,

As a rule, the wealthy do fairly well under any form of government. The rich have always worked their way into government to their own advantage, and to the detriment of the poor.

According to Rand, however, this distrust of the rich arises from illiterates who misinterpret the intentions of those who seek wealth above all.

Through clever manipulations, rationalizations, and redefinitions, Rand attempts to turn morality on its head as she makes its opposite intellectually acceptable. The self-destructive tendency of self-interest is not only ignored, but converted into a good. Rational self-interest always considers ultimate consequences, but where except in some fictional Utopia does unregulated self-interest always--or ever--turn rational? Whereas Rand apparently would give the rich carte blanche, Jefferson felt that they were hardly the ones we would rely upon for the preservation of liberty.

Those seeking profits, were they given total freedom, would not be the ones to trust to keep government pure and our rights secure. Indeed, it has always been those seeking wealth who were the source of corruption in government.

Are we to assume that under laissez-faire capitalism, unregulated wealth would keep itself apart from government, would not be corrupted by the opportunity to use governmental powers towards its own ends? Shall we preserve liberty by limiting government and giving the wealthy full reign?

Putting an economic system outside the control of government ignores the natural tendency of individuals to use all powers for their own interests and to the detriment of others, if they can get away with it. Economical considerations form some of the strongest motivations in man. The idea that absolute economic freedom is conducive to justice and fairness, not to corruption, might work in the world of fiction, but it has no relationship to the real world.

Recognizing this, and protecting against it, was one of the aims of the Founders. Rand proposed certain rules to protect citizens against one another, such as the "non-initiation of force," but only in a novelist's imaginary world could it be assumed that a rule would protect against those who would abuse power if the protection is not an intrinsic part of the way society is organized. Every government tends toward corruption abetted by self-interest.

Protection was to be found, not in admonitions or trust, but in strict oversight of government by the people.

Throughout the history of the world, men have struggled and died to win freedom from the corruptions of wealth and power. In this country, their struggles resulted in a form of government that guaranteed to all the blessings of liberty. The Founding Fathers determined that the key to securing this liberty was self-government, not an economic system.

It is this right of self-government which secures our other rights, because it puts the people themselves in charge as overseers. It is the establishment of self-government that is the foundation upon which all other social functions are built. It is only under self-government that reason can be effective, i.e., that reason instead of force can be the power which directs the course of government.

Thus, when Rand speaks of capitalism, as in the following passage,

she is putting capitalism and its requirements above government of the people. But it is the forms of self-government that allow capitalism to flourish, not the other way around. Unregulated wealth and power always tend to corruption, and corruption to despotism and force. Certainly, it succeeds in the beginning, else it would not commence on such a course. But for the long-term preservation of liberty, a nation requires a government of the people, not a society where wealth and power roam ad libitum.

Thus Rand builds her theories on the outcome without comprehending the true source of both liberty and capitalism. Ignoring the dynamics of the struggle for liberty throughout history, she assumes the results of that struggle and builds a system that ignores what created the system to begin with.

NEXT PAGE Against Collectivism


Go to the Essays

Front Page | 1. Reason as Absolute
2. Safety in Error | 3. Happiness as Moral Purpose
4. Selfishness as Virtue | 5. Capitalism Over Self-Government
6. Non-Initiation of Force | 7. Adversaries of Democracy

© 1997 by Eyler Robert Coates, Sr.
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