aynrand.org/impact Volume 18, Number 10, October 2012

Introducing the Institute eStore

ast month ARI launched the eStore, a new way to shop L online for the most complete selection of Ayn Rand’s works. The eStore, which has replaced ARI’s previous online store, known as the Ayn Rand Bookstore, allows customers to download MP3 audio files of recorded lectures and interviews by Ayn Rand, and others. Since products won’t be delivered as physical media, ARI is now able to offer these products at a far lower price. Courses that once cost hundreds of dollars can now be purchased for a fraction of that. The eStore will continue to offer a large selection of books, but most of these titles will now be sold through Amazon. Visit the ARI eStore at estore.aynrand.org.

Interview with John A. Allison—Author of The Financial Crisis and the Free Market Cure Free Market Revolution Is a Best Seller! n its first week, Free Market Revolution hit the best-seller lists: mpact had the exciting opportunity of discussing the I I new book The Financial Crisis and the Free Market • #4 in the Washington Post’s Hard- Cure: Why Pure Capitalism Is the World Economy’s cover Nonfiction/General category Only Hope with author John A. Allison. Mr. Allison • #9 in Publishers Weekly’s Hard- is retired chairman and CEO of BB&T Corporation. cover Nonfiction category During his tenure as CEO, he grew BB&T from $4.5 billion to $152 billion in assets. • #103 in USA Today’s All Genres Mr. Allison is president and CEO of the Cato Institute. category The book is a game-changing Impact: Thank you for speaking with Impact, Mr. Allison. To start, what is look at how our current crises are your book about? caused by too much government, and John Allison: My book analyzes the fundamental economic and philo- how Ayn Rand’s bold defense of free sophical causes that led to the recent financial crisis and the ensuing failed markets can help us change course. It economic recovery. It then looks at both the economic and philosophical is available in hardcover, Kindle and ideas that are necessary for us to return the United States to a free and pros- audio formats. perous society. Impact: In your view, what are these principles? JA: Individual rights, free markets, limited government, and a focus Elan Journo in Magazine on productivity, innovation and creativity that are only possible in a society Foreign Policy characterized by respect for the individual. Impact: How do you make the case for the government’s role in the aul Ryan’s nomination as the Republican candidate for financial crisis? Pvice president of the United States has led to a surging JA: The book starts with an analysis of the economic causes of the interest in Ayn Rand—Ryan is on record for being a fan recent financial problems. It looks at the fact that we don’t live in a free of , though not a follower of Rand’s phi- market in the United States but in a mixed economy. losophy. To capitalize on the increased media coverage of The mixture varies a lot by industry. Technology is the least regulated Rand, Elan Journo, fellow and director of policy research industry in the United States and financial services is the most regulated at ARI, recently wrote an article for Foreign Policy maga- industry. It is not surprising that technology has continued to do well and zine, comparing Ryan’s foreign policy with what Rand’s financial services has had the biggest problems. might look like. After I analyze the economic factors, I look at the philosophical beliefs According to Foreign Policy magazine’s website, its that underlie those factors—such as altruism and pragmatism—and how “readers include some of the most influential leaders in business, government, and those principles are inconsistent with not only the Founding Fathers’ focus other professional arenas throughout the United States and more than 160 other on life, liberty and the pursuit of happiness but also with the recognition that countries.” The magazine features Pulitzer Prize-winning reporters and has been and rational self-interest are the foundation for personal happi- awarded the National Magazine Award for General Excellence several times. ness and societal success. Mr. Journo’s article was published on August 28 under the headline “Galt Impact: What government policies caused the financial crisis of 2008? Goes Global.” He writes: “Rand’s approach implies a re-thinking of the moral val- JA: The Fed is the basic cause. It’s not mathematically possible to have a ues that should inform foreign policy. The result is a foreign policy based on pure, bubble (a major misinvestment) unless the Fed is printing money excessively, ‘rational self-interest’—defined as the aggregated ability of individual Americans which it was. Secondly, FDIC insurance distorted risk-taking in the banking to enjoy life, liberty, and property unmolested by foreign aggressors. Crucially, it business. It allowed some financial institutions to take irrational risks. rejects the duty selflessly to serve others, whether they are next door or overseas.” The other contribution was government housing policy, specifically Mr. Journo identifies areas of similarity between Rand’s and Ryan’s foreign Freddie Mac and Fannie Mae. These government sponsored-enterprises policies—such as their views on the importance of championing individual rights continued on page 4 continued on page 5 Popular “Books to Free Market Students” Program Is Renewed

ast year ARI launched a new educational L initiative to introduce college students interested in free markets and capitalism to Rand’s distinctive contributions to moral and schools of philosophy, or two opposite attitudes political thought. Due to the immense enthu- The Meaning of toward life. . . . the ‘reason-individualism-capitalism siasm ARI received, the Books to Free Market Atlas Shrugged axis’ versus the ‘mysticism-altruism-collectivism Students program has been renewed this year. axis.’ The story demonstrates that the basic conflict Through the program, ARI distributes Atlas of our age is not merely political or economic, Shrugged and other titles to organizations who In this section, Impact highlights writings from but moral and philosophical—that the dominant work with young people interested in free mar- Ayn Rand’s corpus for fans who wish to learn philosophy of our age is a virulent revolt against ket ideas. These organizations hold summer more about her philosophy, . reason—that the so-called redistribution of wealth seminars and internship programs for college is only a superficial manifestation of the mysticism- students. n the midst of one of the worst economic down- altruism-collectivism axis—that the real nature and One organization said last year, “The books Iturns in history, interest surges in Ayn Rand and deepest, ultimate meaning of that axis is anti-man, . . . provided have been a great addition to our her name regularly surfaces in the media. Much anti-mind, anti-life.” (“Is Atlas Shrugging,” Capital- programs. We distributed them at our summer of the attention focuses on her masterpiece Atlas ism: The Unknown Ideal) seminars . . . and have been passing out any Shrugged, which in the last four years has sold Elsewhere, Rand explains how this deeply extras at various student events we hold. A lot more than 1.5 million copies, a figure unsurpassed philosophical theme sprang from her personal moti- of people are interested in them. . . . [I]t has when compared to any similar period in the book’s vation to write fiction. “The motive and purpose of helped us attract more minds to the ideas of lib- fifty-five-year publication history. my writing is the projection of an ideal man. The erty, which are desperately needed these days.” In commenting on the popularity of Atlas portrayal of a moral ideal, as my ultimate literary This year ARI expects to distribute up to nine Shrugged, mainstream coverage often characterizes goal, as an end in itself—to which any didactic, thousand copies of the novel, more than 6,500 the novel as a paean to capitalism or a caution- intellectual or philosophical values contained in a of which have already been claimed, to students ary tale against big government. But while Atlas novel are only the means.” attending seminars conducted by organizations Shrugged does tell the story of an America crum- “Since my purpose is the presentation of an such as the Koch Foundation, the Foundation for bling beneath the weight of an ever-intrusive govern- ideal man,” Rand wrote, “I had to define and pres- Economic Education and the Cato Institute. ment, the novel is not fundamentally about politics. ent the conditions which make him possible and Within each book As Ayn Rand explained: “The political aspects which his existence requires. Since man’s character distributed is infor- of Atlas Shrugged are not its central theme, but one is the product of his premises, I had to define and mation about ARI’s of the consequences of its theme. The theme is: the present the kind of premises and values that cre- other programs and role of the mind in man’s existence and, as a corol- ate the character of an ideal man and motivate his resources for stu- lary, the presentation of a new code of ethics—the actions; which means that I had to define and pres- dents, including the morality of rational self-interest. ent a rational code of ethics. Since man acts among Atlas Shrugged essay “The story of Atlas Shrugged shows what hap- and deals with other men, I had to present the kind contest, our summer pens to the world when the men of the mind—the of social system that makes it possible for ideal men internship program, originators and innovators, in every line of ratio- to exist and to function—a free, productive, rational the Objectivist Aca- nal endeavor—go on strike and vanish, in protest system, which demands and rewards the best in demic Center, our against an altruist-collectivist society. . . . every man, great or average, and which is, obvi- campus club program “The story of Atlas Shrugged presents the con- ously, laissez-faire capitalism.” (“The Goal of My and the Principles of a flict of two fundamental antagonists, two opposite Writing,” ) Free Society website.

ARI Hosts Event at Leading Free Market Conference

RI staff attended last month the 2012 General president of Education and Research, discussed resources to professors and graduate students inter- A Meeting of the Mont Pelerin Society. “The resources ARI has available that economics scholars ested in Ayn Rand’s books and ideas. Mont Pelerin Society,” explained , in particular might find valuable. ARI and the Anthem Foundation cohosted an ARI’s executive director, who attended the meet- ARI’s breakfast talk was attended by approxi- exhibit table at the conference, at which they adver- ing, “is one of the most prestigious gatherings in the mately eighty people, all of whom were offered tised their resources for academics and displayed world for free market intellectuals. It is invite-only, a copy of the essay “Ayn Rand and the Fight to books exploring Objectivist thought. The table and the fact that ARI is regularly invited to attend Limit Government,” written by Dr. Brook and highlighted, in particular, three recently published speaks to the growing respect for Rand in economic ARI fellow , and a pamphlet contain- books: Free Market Revolution by Dr. Brook and scholarly circles.” ing Ayn Rand’s essays “Man’s Rights” and “The Mr. Watkins, Why Businessmen Need Philosophy, At the meeting, which was held this year in Nature of Government.” edited by Ms. Ghate and Richard E. Ralston and Prague, Czech Republic, ARI hosted a breakfast The latter was made available courtesy of the The DIM Hypothesis by Leonard Peikoff. talk by Dr. Brook, titled “Free Market Revolution: Anthem Foundation for Objectivist Scholarship, a “This was a fantastic opportunity,” said How Ayn Rand’s Ideas Can End Big Government.” nonprofit organization, separate from ARI, that pro- Ms. Ghate, “to engage with scholars interested in Before opening the floor to Dr. Brook, , vides funding to colleges and universities in support Rand’s ideas and to share with them the opportuni- ARI senior fellow, presented to attendees ARI’s of academics engaged in serious scholarship based ties ARI and Anthem offer to further understand- mission and programs, and Debi Ghate, ARI vice on Objectivism, and provides teaching and other ing of and scholarship on Rand.”

ARI and FEE to Hold Morality of Capitalism Conference

he Ayn Rand Institute is cohosting with the we’ve provided resources to FEE, such as cop- leaders of free market student groups, have been TFoundation for Economic Education a confer- ies of Atlas Shrugged through our Books to Free invited to engage with instructors and staff the ence for undergraduates about the moral founda- Market Students program [Editor’s note: see evening prior to the event. tions of capitalism. The event will be held later this related article on this page], this is the first time Conference speakers include John A. month on October 27, and will bring students to we are working together on an educational event. Allison, president and CEO of the Cato ARI’s headquarters in Irvine, . ARI and FEE have extensive networks of college Institute (via videoconference); Peter Boettke, “The conference is a unique opportunity for students and professional intellectuals, and the professor of economics at George Mason college students in Southern California to learn combination of our resources and areas of exper- University; Yaron Brook, ARI’s executive about laissez-faire capitalism, to engage with tise is sure to make this a phenomenal educa- director; Ms. Ghate; Onkar Ghate, senior fellow top free market thinkers and to network with tional experience for young people eager to learn at ARI; Lawrence W. Reed, president of FEE like-minded students in the region,” explained about the morality of capitalism.” (via videoconference); and Tsvetelin Tsonevski, Debi Ghate, ARI vice president of Education The daylong conference later this month director of Academic Affairs at FEE. and Research. will feature lectures, panel discussions and Q&A More information about this event is avail- “We at ARI are extremely excited about col- sessions about the moral and economic issues able at students.aynrand.org/moc2012. Please laborating with the Foundation for Economic surrounding capitalism. Students must register refer students who may be interested in the con- Education to bring this initiative about. While to attend. A select few, such as those who are ference to that site. 2 Atlantis Legacy Events at San Diego Conference

uring the Objectivist Summer Conference Exclusive Reception Din San Diego last July, ARI hosted events Michael S. Berliner was the related to the Atlantis Legacy, the Institute’s special guest at a reception for planned giving program: an introductory session Atlantis Legacy donors held during the confer- open to anyone interested in learning about ence. Following brief remarks and introductions planned giving, as well as an invitation-only by Yaron Brook and Kathy Cross, Dr. Berliner reception exclusively for those who are already took questions from the seventy-eight assem- Atlantis Legacy donors, with this year’s special bled guests, focusing primarily on the history of guest Michael S. Berliner. the Institute and the . Atlantis Legacy donors are those who have Dr. Berliner is co-chairman of the board arranged bequests and other estate gifts to ARI by of directors of the Ayn Rand Institute and including the Institute as a primary or contingent senior adviser to the Ayn Rand Archives. He beneficiary through a will, insurance policy, was the executive director of ARI for its first retirement plan, etc., and/or of a specialized fifteen years. He and his wife Judy are long- charitable gift plan. Such contributions help time Objectivists and ARI donors, as well as ensure the continued existence of the Institute, Atlantis Legacy donors. and as such are essential to the future success of After earning his PhD in philosophy in Objectivism. Participation in the Atlantis Legacy 1970 at Boston University, Dr. Berliner taught is not limited by the value of the legacy gift or by philosophy and philosophy of education at contingencies placed on such gift designations. California State University, Northridge, before Donors who qualify but who have not informed taking the helm of the newly formed Ayn Rand ARI are encouraged to do so and be recognized as Institute in 1985. He is the editor of Letters Atlantis Legacy participants. of Ayn Rand and of the recently published Understanding Objectivism. Introductory Session During the Q&A, Dr. Berliner talked Early in the conference, ARI’s about the original ARI board offering him Gift & Estate Planning Manager the job of executive director in the mid- Kathy Cross gave a lunchtime 1980s: “Talk about someone throwing me a presentation titled “Introduction life preserver. . . . It was the beginning of a to Planned Giving and ARI’s Atlantis Legacy.” second life.” He regaled his audience with Topics included: reducing taxes through charitable stories about some of the most enjoyable, and giving; structuring gifts that return income to the most stressful, times in the early days of ARI, donor; providing future support for the Institute the “quaintness” of the technology and office while achieving one’s estate planning objectives; infrastructure at the time and much more. and creative ways to support ARI and minimize Responding to a question about meeting taxes during tough economic times. A buffet lunch Ayn Rand for the first time, Dr. Berliner related was served, compliments of the Institute, to the that he met her at a private party in the 1960s, thirty-nine attendees. following one of Rand’s Ford Hall Forum talks Strategies, assets and techniques were in Boston. What struck him most vividly, on illustrated with real-life examples of planned gifts that occasion and others over the years, was the made by Atlantis Legacy donors, with the donors contrast between her public, “firebrand” style themselves in attendance at the session. On hand of presentation on the speaker’s platform and this year to help concretize various gift options her demeanor at social gatherings. “She was were longtime ARI donors Marilyn George and quiet, unobtrusive. She spoke when spoken to, Adri Kalisvaart. They generously agreed to share did not insert herself into conversation. Very the details of their gift arrangements and/or their nice, very pleasant. I remember thinking (this is motivation for supporting ARI both now and in sort of embarrassing), she’s like a nice Jewish the future. grandmother. . . . She was so much not the In presenting her reasons for leaving a kind of person described in some of the vile bequest to ARI in her estate plan, Ms. George, a books about her, I must say. . . . I found her to retired Montessori school owner and teacher, said, be exactly as portrayed in Charles and Mary “When you die, what’s left is leftovers: the money Ann Sures’s Facets of Ayn Rand: very old- you earned for yourself, but didn’t spend on world European, a very polite, very dignified yourself during your lifetime. What better legacy woman.” can I leave my children and grandchildren than a ARI hosts special events annually for better world to live in?” Atlantis Legacy donors. We anticipate that the Mr. Kalisvaart, a retired electrical engineer, next event will take place in Chicago during elaborated on the tax advantages resulting the 2013 Objectivist Summer Conference from his gift to ARI of appreciated stock in an (visit objectivistconferences.com for more arrangement that pays him income for life. He information). commented, “The Ayn Rand Institute has been an To be invited to future Atlantis Legacy Photos courtesy of Bennett Karp inestimable value to me over the years.” events of this kind, become a planned giving ARI board co-chair and former executive director Michael S. Both donors spoke candidly about the donor by naming the Institute as a primary or Berliner answering questions at the Atlantis Legacy reception practical as well as the spiritual aspects of their contingent beneficiary through a will, insurance Gift & Estate Planning Manager Kathy Cross ARI support, and encouraged others to follow policy, retirement plan, etc., and/or through a at 732-242-9408 or [email protected]. For their lead. ARI is most appreciative of their specialized charitable gift plan, and inform more information about planned giving and the outspoken participation on this occasion. ARI that you have done so by contacting Atlantis Legacy, visit atlantislegacy.org.

ARI Benefactor Marilyn George explaining her motivation for supporting the Institute after her lifetime ARI Benefactor Adri Kalisvaart commenting on his charitable gift annuity arrangement with ARI

3 Interview with John A. Allison—Author one that the left likes to promote is that greed omy will continue to be stuck in first gear—like of The Financial Crisis and the Free is people acting to take advantage of other the Japanese—in which case you don’t have people. In fact, there’s little evidence for that a huge amount of inflation but you have poor Market Cure, continued from page 1 kind of behavior in the years leading up to the economic outcomes. would not exist in a free market. When they financial crisis. It’s interesting how few fraud In either case, the very fact that those extra failed, they owed five trillion dollars and had cases there have been—there have been a few reserves are sitting there creates an economic two trillion dollars in sub-prime mortgages. but they’re trivial. uncertainty because if you’re running a busi- Did people make irrational decisions and ness, you know that if things do get better get overly optimistic? Yes, but that’s not neces- you’re going to face significant inflation and if sarily greed—it’s just bad judgment. In a free the economy doesn’t get better your business market those people go out of business and will just hang on to survive. the market deals with that very aggressively— Impact: Next year is the one hundredth except when the government steps in and keeps anniversary of the Fed. Some people have them in business. called for abolishing the agency. Is this a seri- The proper definition of greed in an eco- ous proposal on the table? nomic context is to say that people are highly JA: There is some serious discussion about motivated to pursue wealth. People can be eliminating the Fed. By any objective standard, greedy for justice. They can be greedy for truth. the Fed has failed. If you look at economic Greed, per se, is neutral—it depends on what activity from 1870 to 1913—during which the you are greedy for. If people are greedy for the United States had no central bank—we had the earned, for more productivity, that is the founda- greatest economic growth period in the history tion for positive economic activity. of man. We integrated millions of immigrants— The other context I tell people to keep in continued on page 6 mind is that whatever motivation you want to attribute to Wall Street—be it greed or some- thing else—there’s not one shred of evidence Impact is published monthly by the Ayn Rand® Institute (ARI) and is that there was any more of it right before the complimentary to current donors who contribute $35 or more per year. For information on how you can support ARI and to learn about our financial crisis than there was in the past. projects, please visit our website: aynrand.org. Atlantis Legacy®, the I’ve been working with Wall Street for forty Institute’s planned giving program, and related indicia are registered trademarks. The Ayn Rand Center for Individual Rights (ARC) is the years. If you want to call it greed, fine—call it public policy and outreach division of the Ayn Rand Institute. Objectivist Conferences (OCON) and the Ayn Rand Bookstore are owned and MHP1102 Allison postcard.indd 1 6/14/12 4:08 PM excessive motivation. But to say that there was operated by the Ayn Rand Institute. The Ayn Rand Institute does not evidence of more greed than usual is nonsensi- necessarily endorse the content of the lectures and courses offered. So you can think of the Fed as the primary cal. It’s a blind assertion—there are no facts to All photos of Ayn Rand are used by permission of Leonard Peikoff. Purchases from the Ayn Rand Bookstore and OCON do not qualify as cause of the bubble. The bubble ended up in support it. In fact, most of the firms on Wall tax-deductible contributions to the Ayn Rand Institute. housing primarily because of Freddie Mac and Street were doing exactly what the government Editor: Rituparna Basu Fannie Mae’s sub-prime lending. Sans Freddie was incenting them to do—supporting the gov- Editorial Advisers: Yaron Brook, Mark Chapman, Jeri Eagan, ernment’s “affordable housing” policies. Julie Ferguson, Debi Ghate, Elan Journo, Anu Seppala, Lin Zinser and Fannie’s policies in housing, there would Designer: Simon Federman have been a bubble somewhere else since the Impact: Given the Fed is still keeping inter- Printing: David Antonacci Copy Editor: Donna Montrezza Fed was printing too much money. est rates low today, are we going to see inflation Headquarters: 2121 Alton Parkway, Suite 250 Impact: The common view is that the finan- in the near future? Irvine, CA 92606-4926 Phone: 949-222-6550 Fax: 949-222-6558 © The Ayn Rand Institute 2012. All rights reserved. Not to be reproduced cial crisis was caused by corporate greed. How without permission. ARI is a 501(c)(3) nonprofit organization. Contributions do you address that view in your book and move to ARI in the United States are tax-exempt to the extent provided by law. readers towards your perspective? Greed, per se, is neutral—it depends JA: I start out by just simply presenting the on what you are greedy for. facts of what really caused the financial crisis. I look at the role of the Federal Reserve and how, by creating money, it misled people into believ- ing they were wealthier than they were. When JA: The most likely scenario is stagfla- people believe that, they overconsume. tion—like during the 1970s when we had higher Housing is consumption; you consume a inflation, some real but slow growth and high house just like you consume an automobile. unemployment. You could argue that’s exactly People think they invest in a house. You don’t— where we are today. We’re stuck with slow you consume a house. And when the Federal growth, high unemployment and inflation in Reserve makes people think they’re wealthier basic commodity prices. than they are, they accelerate consumption and Even though the Fed’s trying to incent peo- reduce savings—that leads to a bubble. ple to take business risks, they are undermining In this case the bubble was focused in business confidence. During the Great Depres- housing because of the policies of Freddie Mac sion, the Fed tried to encourage risk taking and Fannie Mae, which are large government- (investment) but the government raised taxes so sponsored enterprises, whose primary con- much and created so many regulatory burdens cern was ensuring “affordable housing,” i.e., that the Fed couldn’t print enough money to sub-prime lending. Sub-prime lending is not incent people to spend it. a greedy policy—it’s an altruistic idea that To some degree you can argue that that’s everybody deserves a nice home paid for by exactly what the Obama administration has the government. done. They’ve had new and intensified regula- The Federal Reserve itself was not driven tions across the board in every industry, and by greed—it was driven by altruism. It was try- then they’ve created this tremendous uncertainty ing to keep us from having a natural market cor- in the business community because business rection, to protect incompetent firms instead of leaders don’t know how taxes and regulations letting them go out of business. are going to change. Obama wants to raise taxes The fact is that altruism—i.e., the Federal a lot, which changes economic calculations. So Reserve trying to keep us from having a natural even though the Fed’s printed a lot of money, correction of the economic cycle and, thereby, people haven’t spent it yet because they’re so eliminating the inefficient businesses, and Fred- uncertain about the future—they’re just trying to die Mac and Fannie Mae driving an irrational keep what they’ve got. increase in home ownership—was the real cause Either confidence will develop, in which of the financial crisis. case the Fed has a tremendous problem undoing When it comes to the concept of greed, the amount of excess banking reserves it cre- I point out there are two definitions of it. The ated which are highly inflationary, or the econ-

of the enclosed envelope or email your request to Impact by Email [email protected].

In place of the print edition, ARI donors may opt to receive Impact by email each month. The email edition saves ARI $30 annually per donor on printing and mailing costs. To start receiving Impact by email, please see instructions in the lower-right-hand corner

4 The Virtue of Employee Layoffs

he following is a reprint, by permission, of an article written by ARI execu- But when a business does the same thing? When it judges that some jobs T tive director Yaron Brook and ARI fellow Don Watkins for Forbes.com. are draining profits and need to be cut? Then it’s as if some nefarious sin has Dr. Brook and Mr. Watkins write a regular column for the publication—under been committed. the title “The Objectivist.” Visit blogs.forbes.com/objectivist to keep up with Well, if Bain thought shedding those jobs would foster its bottom line, then their writing. This article was published on September 6, 2012. why shouldn’t it have done so? A business exists to make a profit for its own- ARI board member also writes regularly for Forbes ers. That’s why owners and lenders risk their wealth investing in companies to .com—under the title “Market Justice.” Read his writings at blogs.forbes.com/ begin with. No profit motive, no businesses—and no jobs. harrybinswanger. A productive employee adds value to the company over and above what it costs to retain him. A good salesman may get paid a hundred grand a year. But A CEO stands in front of his crumbling, century-old factory and speaks to his if he brings in two million dollars in business? Small price to pay. employees. “I promise that no matter what, I will never renovate this place. No When it comes to the employee who costs more than he brings in, though, matter how many worn-out items break, no matter how much our out-of-date laying him off is as necessary as replacing out-of-date machinery. It doesn’t machinery slows us down, no matter how many people tease us for clinging necessarily mean the employee is incompetent—often it’s the job itself that to fax machines over email, I will keep this factory going as-is. It’s time to is not productive. Perhaps you’re the greatest C++ programmer around, but embrace the inefficient.” if your company’s customers start demanding programs written in Java, then How long do you think a company operated in such a fashion would last? from an economic standpoint, your role at the organization is no longer produc- How long do you think its employees would have jobs? tive. You’re hurting your company’s profitability, not helping it. Everyone understands that in a competitive economy, businesses face an Small comfort to the guy who finds himself out of work, though, right? ultimatum: maximize efficiency or die. But although few today would demand Actually, it should be something of a comfort. Think about it. You work for an that a CEO tolerate an unproductive factory, the notion that a CEO has a duty employer because you think it’s a good deal for you: would you really want to to maintain unproductive jobs is sacrosanct. stay if you thought it was a bad deal for him? If you thought all your hard work “You’re fired.” Two words that were unpleasant even before they were contributed nothing to the bottom line? A business relationship should be win- associated with Donald Trump. Losing your job can be incredibly painful, par- win—profit-profit—for both parties. Anything else is charity. ticularly in today’s economy, where Washington’s Byzantine regulatory regime Losing your job is never fun, but it’s worth keeping in mind the big pic- has kept unemployment near double digits. ture. We all benefit from living in an economy where there is a relentless push But keeping employees who are hurting a company’s bottom line isn’t for efficiency—even more so if you happen to be out of work. Think of how good for anyone—not even the employee whose unproductive job is (tempo- much worse it would be to lose your job in a world where you couldn’t take rarily) allowed to weigh down the enterprise. advantage of Walmart’s low prices. It’s a lesson that is clearly needed in the wake of recent attacks on private And in a dynamic economy the more ability, skills, and work virtues you equity firms, which profit by making other companies profitable. Mitt Romney develop, the more companies can’t afford not to hire you. Besides, if no one has been excoriated because his firm, Bain Capital, sometimes acquired com- appreciates your talents, you are always free to start your own business. panies that could only be made attractive to lenders and buyers by laying off The problem today is not that companies are laying off employees in pur- significant numbers of employees. suit of profits. It’s that the government has hamstrung everybody’s ability to Why is this even controversial? Because we have a weird double standard. pursue profits, leading to the sort of widespread, prolonged unemployment that When an employee leaves a company for greener pastures—maybe higher pay, wouldn’t exist in a genuinely free market. In an economy where the govern- maybe more satisfying work, maybe a more pleasant commute—nobody com- ment gets out of the way and unleashes the profit motive, layoffs can be, dare plains. Of course he should do what’s best for him. we say, a good thing for everyone involved.

Elan Journo in Foreign Policy Magazine, continued from page 1 and promoting free trade—and also areas where TM Recent Media Appearances Ryan “could not be less Randian”—such as his view that it is America’s moral duty to police the rest of the world. The article can be read at bit.ly/arryanfp. RI intellectuals regularly speak to the media about how Ayn Rand’s timeless ideas clarify issues of Athe day. Visit ARC-TV.com to keep up with ARI’s media appearances. Here is a selection. Mark Your Calendars • September 25: Elan Journo on Front Page (PJTV; “ABC’s Big Beef with Meat”) • September 24: Elan Journo on Front Page (PJTV; “Appeasement in the Middle East”) for Objectivist Summer • September 21: Elan Journo on Front Page (PJTV; “America’s Looming ‘47 Percent’ Nightmare”) Conference 2013! • September 20: Don Watkins on KFMB’s The Mike Slater Show (“The Real Meaning of ‘Selfishness’”) • September 19: ext year’s Objectivist summer Yaron Brook on The Dennis Miller Show (“Take the Moral High Ground”) N conference will take place • September 19: Yaron Brook on KFMB’s The Mike Slater Show (“QE Infinity”) July 5–11, in Chicago, at the Westin • September 19: Don Watkins on KFMB’s The Mike Slater Show (“The ‘47 Percent’ and the Danger of Michigan Avenue. ARI has already Package-Deals”) begun preparations for the event to • September 18: Yaron Brook on WNYC’s The Brian Lehrer Show (“Free Market Revolution”) make it as exciting and informative as ever! • September 17: Doug Altner on Front Page (PJTV; “Why Seniors Can’t Afford to Retire”) We are currently working on the course lineup • September 16: Yaron Brook on Book TV (C-SPAN2; “Yaron Brook, Free Market Revolution: How and events. Impact will list course offerings for next Ayn Rand’s Ideas Can End Big Government”) year’s conference when they are finalized. The full • September 15: Doug Altner on Front Page (PJTV; “Government Turns Profit in AIG Bailout”) schedule of events will be posted early next year. • September 13: Doug Altner on Front Page (PJTV; “Chicago Teachers on Strike”) For the latest updates on the conference, visit objectivistconferences.com or “Like” OCON on • September 13: Elan Journo on KMJ’s KMJ Morning News (“US Embassy Attacked”) Facebook (facebook.com/Objectivistconferences). • September 13: Elan Journo on WINA’s The Schilling Show (“US Embassy in Libya Attacked”) • September 13: Elan Journo on KFMB’s The Mike Slater Show (“Turmoil in Libya”) • September 10: Rituparna Basu on Front Page (PJTV; “Competitiveness of US Economy Drops for Fourth Year”) • September 8: Rituparna Basu on Front Page (PJTV; “Are You Better Off Than You Were Four Years Ago?”) • September 5: Yaron Brook on Afterburner (PJTV; “Did Ayn Rand Provide a Path to Economic Prosperity?”)

5 Interview with John A. Allison—Author because everybody’s agreed we have it. At any cause to the financial crisis—a combination of of The Financial Crisis and the Free point in time, the rest of the world (especially deregulation and greed on Wall Street, neither China) could say this emperor has no clothes one of which caused the financial crisis. And if Market Cure, continued from page 4 and, therefore, the dollar is no longer the world you start with the wrong premises you will, by reserve currency. That could be in ten, twenty or necessity, get the wrong conclusions. Unfortu- the people who couldn’t make it in Europe— fifty years—but it is inevitable. nately we have made many destructive public and we had phenomenal growth. At that point we’ll be so deep in debt policy decisions based on these false premises, We did have some ups and downs, but none that we won’t be able to fix it without major so we’re moving in exactly the wrong direction. of those were as bad as the Great Depression economic trauma. So the U.S. has this special I wanted to dispel those beliefs, and I believe and none were as long as our current recession. short-term temptation not to implement a gold that I have a special insight into how false the So there’s a lot of evidence that you don’t need standard. But without monetary discipline we premises were—because of both my concrete a Fed. Since we’ve had the Fed, we’ve had a face long-term economic disaster. experiences and my interest in philosophy. massive increase in inflation and we’ve had Impact: Given your understanding of the Impact: What do you want readers to take some very bad economic cycles. economic and philosophic trends right now, away after reading your book? what do you think America’s economic future JA: The main theme is that certain philo- looks like? sophical principles create certain kinds of impact By any objective standard, JA: If we continue our current trends, in in the real world, economic and otherwise. twenty to twenty-five years, the United States I believe that the vast majority of people the Fed has failed. faces the equivalency of bankruptcy. That is a want a better life. They just believe that a cer- mathematical fact. It’s not an argument—it’s tain set of principles will produce that better just plain numbers. life, which, in fact, they will not. Most people The economic evidence is strong that the We’re certainly moving in the wrong direc- are altruistic in one sense or another. Many Fed has not been successful. But there are a lot tion today. The question is, do we have the people who aren’t altruistic are pragmatic, and of people arguing that you just need to make courage and do we have the philosophical in both cases, they don’t understand that ideas some technical changes to it. To me that’s like understanding to change direction? And I don’t that may sound good or sound practical aren’t saying, “Communism killed a few hundred mil- know the answer to that question. Realistically, really good and aren’t really practical. lion people, but if they’d just done it differently, the odds are against us—we’re fighting some The Founding Fathers of the United States it would have worked.” The analogy is, “The very destructive long-term philosophical trends. broadly understood that life, liberty and the pur- Fed hasn’t worked, but if we’d just done it dif- Most people do not grasp that our dominant phi- suit of happiness were the foundations for both ferently, it would have worked.” losophy is ultimately self-destructive. societal and individual success and happiness. However, I wouldn’t call getting rid of the On the other hand, often times, out of the They understood that a government that governs Fed a mainstream argument. I do think there is sense of crisis is when you get change, so while best governs the least. a mainstream argument about forcing the Fed the probabilities are against us, I don’t believe I hope readers of my book understand that to establish a gold-based monetary standard, it’s hopeless. you have to be willing to defend individualism i.e., making the dollar convert- and rational self-interest if you’re ible to a fixed amount of gold. For going to defend a free society. example, $1,600 would buy one Impact: What did you find to be ounce of gold, or one ounce of gold the most enjoyable aspect of writing? is equal to $1,600. I think there’s JA: Overall, I really enjoyed a very serious—I’m not saying a writing the book. In a certain sense, I majority—movement to discipline have been doing research throughout the Fed with a gold standard. I don’t my banking career and I was now think it’ll prevail in the short term, putting that together in an integrated but I wouldn’t be surprised to see, fashion. I found it both stimulating say, four to eight years down the and thought-provoking to go through road that kind of discipline forced that process—to present an integrated on the Fed. story relating economic outcomes to Impact: How would returning philosophical principles and being to a gold standard improve our eco- able to concretize that for people. It’s nomic situation? a nonfiction book, but it has certain JA: It would create sound characteristics like a novel. There’s money which would significantly a theme and plot, in a certain sense, improve business confidence because that I enjoyed putting together. this would reduce uncertainty. The Impact: You’re on the road fre- Fed couldn’t manipulate the money quently talking about the financial supply. They couldn’t just print John A. Allison delivering a talk in 2009 titled “The Financial Crisis: Causes and Possible Cures” as part of the Ayn Rand crisis. Do you have a heavy promo- money willy-nilly. The dollar would Center Speaker Series. The event took place at the National Building Museum, Washington, DC. tional plan for this fall? become a reliable standard of value. JA: Yes. I do a lot of speak- If you look at economic history, when Impact: Who is your book’s intended ing anyway, but I’m going to be doing a lot of we’ve had meaningful gold standards—even audience? speaking this fall. I’m going to hopefully be on when we’ve had central banks—is when we’ve JA: This book is for thoughtful people who radio and TV—as I have been in the past—to had real economic growth. And whenever are concerned about the direction of the United talk about the book and use it as a means to there’s not a meaningful monetary standard, States and want a better understanding of what defend individual rights and free markets. So I when governments can arbitrarily manipulate happened and what the cures are—both eco- see the promotional efforts as not only helping the value of the currency, we have experienced nomically and philosophically—for the prob- to sell more books but also giving me an oppor- poor economic times. lems we’ve experienced. tunity to defend these ideas in the media. When Richard Nixon took the U.S. off the I think that, certainly, Objectivists, libertar- gold standard in 1971, the world reserve cur- ians, classical liberals and economic conserva- rency became totally dependent on the will of tives will be interested in the book. It will also bureaucrats and politicians. hopefully give some thoughtful independents a I believe that the vast majority of The United States dollar is the reserve cur- much better understanding of what really hap- people want a better life. They just rency of the world, and, in one way, that’s a pened than what they have been able to learn huge short-term advantage. If the dollar were from the press. believe that a certain set of principles not the reserve currency of the world, given Impact: What advantage did being a suc- will produce that better life, which, in our debt levels, we’d be having a lot of the cessful business leader give you in writing this fact, they will not. same problems that Greece is having. Because book? everyone accepts the dollar as the reserve cur- JA: I was the longest-serving CEO of a rency of the world, it’s like we have all the major financial institution in the United States. gold in the world. I was the CEO of BB&T for about twenty Impact: Do you have projects in the works Unfortunately, in the long term this is a years, and I’ve been involved in the banking that you can share with us? massive destructive incentive because it allows business for forty years. Because of that expe- JA: I haven’t started anything new. I want U.S. politicians to borrow willy-nilly and get rience, I can offer a lot of concrete evidence to get this project finished, and there’s still votes until we go broke, which is exactly what which supports the general principles that much promoting left to do. In the long term, they’ve been doing—both Republicans and I discuss in the book. I want to write a book on principled leadership, Democrats. Impact: Is that why you wrote the book— which is about using rational values to promote So we have this destructive incentive where because you have particular insight into the both your success and your happiness. there is basically no discipline on the United financial industry that others don’t? Impact: Thank you for speaking with States government running deficits because we JA: The primary reason I wrote the book Impact, Mr. Allison. have all the gold in the world—but that’s just is because people are being offered a false JA: Thank you. 6