On When Alan Met Ayn: "Atlas Shrugged" And Our Tanked Economy

After parsing through all the disjointed personal attacks on Ayn Rand, it became clear to me that Maria Bustillos wanted to link Objectivism to Alan Greenspan, and Alan Greenspan to the 2007-current financial collapse. She misses a big point, and ultimately fails in her attempt. The Alan Greenspan->Financial Crisis connection is a strong one, and I agree. However, she claims it was his lifelong adherence to strict objectivism that resulted in the disaster. Nothing could be further from the truth. In fact it was his rejection of objectivism that fueled the financial fires in the past decade.

When Alan Greenspan became a central banker, he conveniently abandoned all of his fervent opposition to a fiat currency system, and operated under the arrogant assumption that he could steer the economy without consequences.

This is wholly contradictory to Objectivisim, which you will find in the famous "Money" speech from Atlas Shrugged:
"Whenever destroyers appear among men, they start by destroying money, for money is men's protection and the base of a moral existence. Destroyers seize gold and leave to its owners a counterfeit pile of paper. This kills all objective standards and delivers men into the arbitrary power of an arbitrary setter of values. Gold was an objective value, an equivalent of wealth produced. Paper is a mortgage on wealth that does not exist, backed by a gun aimed at those who are expected to produce it. Paper is a check drawn by legal looters upon an account which is not theirs: upon the virtue of the victims. Watch for the day when it becomes, marked: 'Account overdrawn.'

I am not sure if Maria read Atlas Shrugged, appears to have based on some statements in the article, so it is curious why she conveniently left out this principle rule.

Still not convinced she is wrong about Greenspan? Take a look at this article, entitled "The Maestro Changes His Tune" written by Ron Paul after a particularly heated exchange in Congress in 2005:

Nearly 40 years ago, Federal Reserve chair Alan Greenspan wrote persuasively in favor of a gold monetary standard in an essay entitled Gold and Economic Freedom. In that essay he neatly summarized the fundamental problem with fiat currency in a few short sentences: “The abandonment of the gold standard made it possible for the welfare statists to use the banking system as a means to an unlimited expansion of credit… In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value… Deficit spending is simply a scheme for the 'hidden' confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard.”
Today, however, Mr. Greenspan has become one of those central planners he once denounced, and his views on fiat currency have changed accordingly. As the ultimate insider, he cannot or will not challenge the status quo, no matter what the consequences to the American economy. To renounce the fiat system now would mean renouncing the Fed itself, and his entire public career with it. The only question is whether history will properly reflect the destructive nature of Mr. Greenspan's tenure.

Link here: http://www.lewrockwell.com/paul/paul236.html

History has properly reflected the destructive nature of Mr. Greenspan's tenure... Unfortunately, it is partisan hacks like Maria Bustillos who seek to conveniently rewrite history and distort facts in an effort to somehow score points for their own favored ideology. It should be clear now that this critical point was lost on the author, and for that reason the article is worthless.


Posted on April 15, 2011 at 4:19 pm 0