Atlas Shrugged Updated for the Current Financial Crisis

Ayn Rand's classic gets dusted off and humorously brought into 2008 over at McSweeney's. Worth a read. 

As a side note, you may want to revisit the New York Times 2007 piece, Ayn Rand's Literature of Capitalism, which talks about the influence that Atlas Shrugged (and its free market philosophy) has had on Fortune 500 CEOs and particularly Alan Greenspan, the former head of the Federal Reserve, who helped architect the deregulated banking system that's now unwinding around us. Belatedly, Greenspan would acknowledge a "flaw in the model" that he "perceived is the critical functioning structure that defines how the world works" -- which is a fancy way of saying "on second thought, maybe the free markets don't always regulate themselves." And there we have it, another utopian ideology collides with reality. Not the first, and it won't be the last.

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  • Dary says:

    Don’t get mad at deregulation, get mad at the Federal Reserve. Your argument – “…if you let banks govern themselves, they won’t actually do the right thing” – isn’t valid. If you add the premise “and you let the government’s central bank keep interest rates as low as they want thereby making credit extremely cheap and encouraging malinvestment” you’d be getting warmer. I’m not saying the banks aren’t culpable, I’m just saying the Federal Reserve is the root cause of this problem.

  • Dan Colman says:

    There is no doubt that the Fed created the conditions for the bubble. But low interest rates can’t really explain why the banks started dealing in subprime loans and liar loans, essentially eliminating all loan standards, once they sold all the legitimate loans that they could. The Fed tempted the banks. But the banks crossed the line, and they deserve a good part of the blame.

    At least in my mind, you can’t have a fully deregulated system if you can’t depend on the players to make prudent decisions, even if they’re tempted to do otherwise.

  • Alex Mocaby says:

    um….If you actually knew anything about the principles Ayn Rand taught, you would know that Greenspan has followed almost none of them in this crisis.

  • Dan Colman says:

    Um, the last time I looked, Greenspan hasn’t been running the Fed since 2006. Sure you’re not thinking about Bernanke?

    Dan

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