Ayn Rand and the rise of moral economics
By Woody Little, Staff writer
In a 2011 interview, Rep. Paul Ryan was asked, “Do you think Republicans are doing a successful job making the moral case for capitalism?” He responded, “Not enough.” The discussion of a “moral case for capitalism” revives the ideas of Ayn Rand, a novelist and philosopher active in the 1950s and 60s who advocated a morality based on selfish action. Rand proclaims that free market capitalism effectively channels this moral human selfishness and is thus the only moral economic system, allowing the morally successful to become wealthy and the moral failures to fail financially.
Though many modern Republican economic policies can be traced back to the Reagan era, the rhetoric and thinking surrounding them has greatly transformed since then. Reagan’s GOP kick-started the conservative push for free markets with their deregulatory and tax-cutting policies in the 1980s. However, they did so based on amoral, pseudo-scientific arguments that predicted quantitative economic growth to follow qualitatively-instructed policy.
The presence of strong economic growth following the recession of 1981 earned Reagan’s policies significant acceptance. However, the Bush tax cuts, which lowered taxes most on the wealthy, preceded the slowest period of growth under any postwar president. Several recent studies have debunked the correlation between high-income tax cuts and growth scientifically. Owen Zidar, a UC Berkeley Ph.D candidate in economics, found it to be “statistically insignificant.” Additionally, expanded deregulation is credited as a major cause of the 2008 financial crash and the Great Recession. With the evidence largely against their scientific and predictive economic policies, conservatives have rebuilt their economics on Randian moral grounds, attempting to change the discussion from market failure to moral failure.
To some degree this project has succeeded. Debate over substantive financial reform stagnated after the passage of Dodd-Frank, even though critics such as UC Berkeley professor Robert Reich contend the bill was “effectively neutered” by Wall Street lobbying. In the policy vacuum, Republicans have shifted focus to reforming the social safety net.
Jennifer Wolch, Dean of the College of Environmental Design at UC Berkeley, claims, “Americans, steeped in ideologies of individualism and self-reliance…have always been uneasy with welfare.” Proponents of the 1990s welfare reform tapped into this unease by alleging the existence of “welfare queens,” single women so morally degraded by government dependency that they cheated the system for ever more benefits.
Modern Republican reformers evoke the same individualist legacy but with more morally charged language. Rep. Allen West has alleged, “the Democratic appetite for ever-increasing redistributionary handouts is in fact the most insidious form of slavery remaining in the world today.” Painting Democratic redistributive polices as slavery puts the GOP in the moral position of abolitionists, and in doing so evokes a moral paternalism that reinforces a Randian narrative of the poor’s moral failure.
Mitt Romney’s recent comments about the 47% of Americans who pay no net income tax illustrate how far moral economics have penetrated into the mainstream. Lamenting his inability to persuade those in this 47% to vote for him, he characterized them as “victims” of dependency, and declared that he could “never convince them they should take personal responsibility and care for their lives.” This is a moral judgment. Whether or not he reads Rand, Mr. Romney’s comments broadly reflect her ideology.
Instead of pointing to theories like the Laffer curve or supply side economics, conservatives now intone the job creator mantra when advocating for tax cuts. While Newt Gingrich tried to privatize Social Security in the 1990s to prevent it from “going broke,” Paul Ryan sought to do the same in 2005 because he views it as a “collectivist system.” Scientific theory and pragmatism have given way to an ideology that deifies “job creators” and abandons the poor to their moral failure. The relative policy focus on the wealthy and the poor has followed from this structure.
The GOP’s rapid embrace of Randian morals may help explain recent Republican intransigence. Counter to the narrative of Reagan the unbending conservative, an LA Times editorial reminds that “at bottom, Reagan was a pragmatist, willing, when necessary, to cut a deal and compromise.” Forcing economic policy into a moral framework eliminates much of the flexibility needed for such compromise.
Randian rhetoric, by deifying the rich and castigating the poor, also threatens to reinforce an already stratified socio-economic hierarchy. These divisions will only widen as economic inequality increases.
“Not enough” for Paul Ryan, the shift towards a morality of success and failure may yet continue. So will the consequences.
Image credit: wikipedia.org