Wednesday, March 4, 2009

Ayn Rand's Error

Ayn Rand is the author of the classic novel “Atlas Shrugged” and one of the foremost thought leaders of the freedom movement.

Her critique of socialism, and socialist thinking is quite good.

Her defense of freedom is IMHO significantly less so.

To my mind her argument is a variant of the following:

Greed is good.
Selfishness is a virtue.
Everyone should support it because it has trickle down effects that will benefit all.

This is hardly motivating.

I believe that Ayn Rand fundamentally misunderstood the basic nature of exchange.

The way she saw capitalism was not entirely different than the way that the socialists see it.

She saw people who acted greedily doing well for themselves and attributed the fact that they did well to the fact that they acted in their own self interest without regard to others.

This is simply a fundamental error in her interpretation of reality.

She basically adopted the same view of the world as the socialists and sought to defend it.

But it is the view itself that is erroneous.

It is, of course, true that many very successful people do, on occasion, act in a way that can be seen as greedy. But it is a logical fallacy to attribute their success to this behavior.

Invariably such people become wealthy not because of greed but in spite of it.

Consider the examples of Bill Gates and Steve Jobs.

Both of these men became very rich not because they sought to “take” for themselves but rather because they sought to “give” something of value to the world.

Bill Gates dreamed of a computer on every desk. He wanted to provide the software for that computer which enabled people to utilize this incredible new technology to make their lives better.

Steve Jobs had a similar dream. Apple Computer delivered the very first such desktop computers to the world. He saw an opportunity to deliver value to people and he pounced on it. He did the same with the iPod and the iPhone. He saw a need that was not being met and he took it upon himself to meet that need.

Both of these men, at times, acted greedily.

But each time that they did, however, it hurt them rather than helped them.

Bill Gate’s attitude towards competition, for example, hurt him badly.

He seems to have instructed his product managers to focus on the main competitors for each product with the intent of wiping out the competition.

Influenced by game theory he believed that fewer competitors made it easier to win.

Creating monopolies tends to kill innovation however. This was not his intent. He was all about innovation. But without healthy and vigorous competition the financial incentive to innovate deteriorates.

A fear-based view of competition which sees competitors as a threat is a selfish view because the act of wiping out a competitor does not “give” to anyone. It is an act of taking. It is a barbarian instinct to use force against an external threat to make it go away.

[Note the association of “fear” and “selfishness”. Fear is the destructive emotion which causes us to turn off empathy and become self-absorbed. I’ve written about this extensively elsewhere:]

Instead, people who view competition as something that should be enthusiastically welcomed tend to do well without creating feelings of animosity towards themselves. Competition drives self-improvement and helps us to give more to others.

Ultimately the bad feelings generated towards Microsoft as a result of this behavior led to anti-trust lawsuits being filed against the company.

Having created so many enemies Microsoft was left without any defenders to fend off this attack from the state.

Contrast that behavior with those of the executives of Google whose motto is “Don’t be evil”.

Google continues to grow and has done so without making enemies.

The state, therefore, is loathe to attack them because if they choose to do so, Google will be able to rally public opinion behind them in a way that Microsoft was not able to do.

Ayn Rand was simply wrong.

Selfishness is not the cause of success.

The opposite is true.

Selfishness is the cause of failure.

The universe gives back to each in proportion to what they give to it.

The universe also takes from each in proportion to what they seek to take from it.

It’s all about give and take.

Some incorrectly believe that they can get away with stealing a little more for themselves without having to pay for it.

They are mistaken.

The law of reciprocity is real.


Anonymous said...

Good stuff Alex. I'm not superstitious or believe in karma, but I am a firm believer in "what goes around comes around".

Words like greed are so loaded with negativity. The desire to improve our own existence is universal. How we respond to this desire, does make a big difference.

Some use crime/politics to take what they want by force. Most prefer to offer something useful in exchange.

There is a Steve Jobs quote that I heard somewhere: "Real artists ship."

fromonesource said...

Gates and Jobs saw an opportunity to do something they enjoyed at a young age and to make a lot of money doing so. While it is a romantic view to look at their motives as altruistic, I think the core of it had more to do with self-actualization, ego and personal advancement. Both were products of coincidence and circumstances. Gates had an improbable string of coincidences in his favor that allowed him thousands of hours programming state of the art terminals before most people had ever seen a computer (check out Malcom Gladwell's new book Outliers). He found something he was good at, realized he could make a lot of money, and followed through with it. The 'computer in every home' motto was only an afterthought.

It is the profit motive that drives us, otherwise, what do we have to show for our efforts? If we are working for the benefit of others then we are basically slaves.

I think Rand had it right on; humans are driven to improve their lives first and foremost. Any benefit to humanity is only a byproduct of the personal benefit to the individual.

The world advances when we advance.

The Beast said...

Thanks very much for the comment.
The seeming universality of the Golden Rule (a.k.a. "What goes around comes around") across all cultures throughout history is something that I find absolutely fascinating.
It's one of those things that we believe "tends to be" true based on our experience of life.
I wonder how the world might be changed if it could be "proven" to "always be true".
IMHO much of the evil in the world today is a result of the fact that people think they can cheat the system.

The Beast said...


Thank you for sharing your thoughts.
I think you are absolutely right that Gates and Jobs pursued something that they loved doing and that is key.
But the world is full of unsuccessful people who love what they do.
What made the difference for these two is that the products of their work were of great value to others.
If you actually study their biographies you will find that producing things of value to others was actually a part of "what they loved doing".
That is key.

IMHO the entire selfishness versus altruism debate is based on an erroneous understanding of basic human motives.
IMHO every single decision that every one of us makes is a decision to pursue the path that brings us the greatest joy and the least amount of suffering.
It is wired into the neuro-chemistry of our brain.
We cannot do otherwise.
This is as true for the altruist as the non-altruists.
The altruist simply derives joy from the fact that what they "give" to others helps to bring joy to and alleviate suffering from their lives.

It is no coincidence that the greatest entrepreneurs have always also been the greatest philanthropists.
Witness the Bill and Melinda Gates foundation.
Ayn Rand's theory of the virtue of selfishness cannot explain this fact can it?
Certainly the desire to give away the bulk of one's fortune cannot be seen as a "byproduct" of selfishness?
How can you explain this inconvenient fact?

P.S. My personal belief is that Malcom Gladwell has an extremely negative mental attitude which leads him to incorrect theories to explain why people are successful.
IMHO his book "Outliers" is completely and totally wrong.
I much prefer the work of Napoleon Hill was commissioned by Andrew Carnegie on a project to spend more than 20 years of his life actually interviewing the most successful entrepreneurs of his age to find out their secrets of success: Henry Ford, Thomas Edison, etc.
There was NOTHING improbable about the success of Gates.
He had a burning desire to change the world and a determination to see it through.
This "definite major purpose" or "life purpose" is a trait that he shared with all of the great entrepreneurs throughout history.
Ford and Edison did not have these "improbable string of coincidences"
Edison was kicked out school because his teacher said he had an "addled mind".
He failed 10,000 time before succeeding in the invention of the incandescent light bulb.
Gates, Jobs, Edison, etc. all shared a tenacity and a positive mental attitude that Malcom Gladwell does not have.

fromonesource said...

You're right, plenty of people love what they do but are 'unsuccessful' by our society's standards. So what is the missing link? Why are some successful and some not? Despite what you think of Gladwell's mental state (which I haven't picked up on in reading his books), the facts he presents are hard to argue with. It has been discovered that it takes approximately 10,000 hours of doing something to achieve greatness. I don't know why 10,000 but it just seems that this amount of practice trains our mind and bodies to deeply connect with what we are doing. If you removed the coincidental meeting between him and the individual who was responsible for the mainframe at the university which he learned to program on, we would likely have no Bill Gates, no Microsoft and no philanthropic organizations in his name. He would just have been another kid growing up in California. It is the combination of self determination and coincidence that allows us to achieve so much. How can you deny that the environment we are born into shapes our future dramatically?

Rand's theory can definitely account for this because if Bill had not been interested in increasing his wealth, he would not have had so much money for him and his wife to give away. (Although they give most of their money to population control foundations like planned parenthood so I'm not sure how truly 'altruistic' the motive is there ;] ) Besides, Gates shut out (sometimes in questionably unethical ways) his competitors at every opportunity (as you mentioned) so this would seem to agree with the idea that we look out for ourselves first. Or was Gates putting others out of business so that he could send mosquito nets to Africa?

Interesting that Edison tried and failed 10,000 times before he was successful. Maybe he spent an hour each time!

The Beast said...


Thanks again for sharing your thoughts.
What is the missing link?
I'm pretty sure that it is not "luck".

That's what ever unsuccessful quitter in the world attributes it to.
It is exactly this negative mental attitude that really successful people don't have.
They are optimists.
They always look on the bright side.
They have a different outlook on life.
They are "driven".

Most of them were distinctly disadvantaged in some way but they struggled to overcome these obstacles with a positive mental attitude.

Gladwell is a quitter.
Gladwell is offering a moral justification for quitting.
I get the distinct feeling that he is bitter at the fact that he personally hasn't achieved what he wanted and he wants to bring everyone else down with him.

Most people in our society share his belief.
But that is IMHO why most people are not as successful as they could be.

I would encourage you to keep an open mind and consult sources beyond Gladwell.

I believe in empiricism.
Many if not most people make up their own theories to explain reality and then seek to prove their theory by cherry picking "evidence" from the real world.
They ignore evidence that doesn't fit their theory.

That is very sad IMHO because such people are losing out on the opportunity to advance their own knowledge.

Naploleon Hill spent no less than 20 years interviewing the best of the best with an open mind to find out what really made them successful.

IMHO his finding are of significantly more value than Gladwell's.

The Beast said...

P.S. Re: The "missing link" ...
I believe that the "missing link" is "passion".
You have to be passionate about what you are doing.
You have to be so passionate about it that all the negativity of all of the quitters in the world trying to pull you down will have no effect on you.
Passion is what leads to persistence and the willingness to overcome obstacles.
Passion and persistence are traits that all of the great men and women of history share.
IMHO "money" and "wealth" is not a strong enough source of passion for most people. But a vision of a better world can be. :)

Delonix said...

I just searched my way to this interesting blog and am captivated by a similarity in certain of its themes to what, IMHO, is a great essay. In "What is Man?" Mark Twain explores the ideas of success and motivation quite fully.

I am an original (1960's) Objectivist who has come to see many flaws in the premises and arguments. The resurgence of interest is unsurprising, but sad in many ways.