Rand philosophy contradicts her economics

Ayn Rand contradicts herself 1.9

Ayn Rand published two essays about monetary systems, one written by Alan Greenspan and one written by herself. They both cite events for which there is no objective evidence, which is a violation of Rand’s philosophy.

WHEREAS, Rand’s philosophy says, “… concepts represent classifications of observed existents…ⁱ; which means that mental concepts are true only if we saw examples of them in the real world…

AND Alan Greenspan asserts that “The existence of (money) is a precondition of a division of labor economy. If men did not have some commodity of objective value… as money, they would have to resort to primitive barter or be forced to live on self-sufficient farms. If men had no means to store value, i.e., to save, neither long-range planning nor exchange would be possible”ⁱⁱ…

BUT, there is no objective evidence for Greenspan’s assertions. The objective evidence is to the contrary. Most people have lived as part of an interdependent group, whether with a monetary system or not. Communities without money have had division of labor and operated non-monetary economic systems, such as communism or gift/obligation. They also remembered who shared what with who, and acted equitably. They made long-range plans and had systems of exchange within the community and with other communities,ⁱⁱⁱ not necessarily using barter…

THEREFORE, Greenspan is in violation of Rand’s philosophy. Because she published Greenspan’s essay as appropriate for her system of thought, Rand contradicts herself.

WHEREAS, Rand’s philosophy says, “… concepts represent classifications of observed existents…^iv; which means that mental concepts are true only if we saw examples of them in the real world…

AND Ayn Rand asserts that mediums of exchange and money grew out of barter systems. “… you discover you can trade with other farmers… , and you trade your products by direct barter… You can trade your grains for something that will keep longer, and which you can trade for food when you need it… but which commodity?… You devise a tool of exchange – money”^v…

BUT, there is no objective evidence for Rand’s assertions regarding barter and monetary systems. There is no evidence or record of barter economies. There is no evidence of monetary systems arising from customs of barter. There is no record of barter practices which did not operate within a larger economic system along with complex financial instruments, such as credit^vi. Rand may be repeating Aristotle’s speculations^vii…

THEREFORE, Rand’s statements are violations of her philosophy. Because she violated her own philosophy, Rand contradicts herself.

i The Analytic/Synthetic Dichotomy, Pg 131, Leonard Piekoff, Introduction to Objectivist Epistemology,

ii Pg 96, Gold and Economic Freedom, Alan Greenspan, Capitalism the Unknown Ideal, Ayn Rand, Signet, New American Library, 1967

iii This paragraph is based on material in https://libcom.org/files/__Debt__The_First_5_000_Years.pdf by David Graeber, Melville House Publishing, 2011

iv The Analytic/Synthetic Dichotomy, Pg 131, Leonard Piekoff, Introduction to Objectivist Epistemology,

v Rand pg 127 Egalitarianism and Inflation, Philosophy: Who Needs It. Signet, Penguin 1984

vi This paragraph is based on material in Debt the First 5000 years. Pg 21 and more, David Graeber, Melville House Publishing, 2011

vii Aristotle, Politics I.9.1257 paraphrased in Debt the First 5000 years. Pg 24, David Graeber, Melville House Publishing, 2011

Rand contradicts herself 1.8

Ayn Rand’s philosophy proves her concept of Capitalism is false and invalid.

According to Ayn Rand’s Objectivist philosophy, a true concept must be observed before it is thought. If there is not an example in the real world, the mental concept is false and invalid.

“…concepts represent classifications of observed referents…”^ⁱ

”There are… invalid concepts, i.e. … without referents…”^ⁱⁱ

“Truth is a product of … identification… of the facts of reality”^ⁱⁱⁱ

“All truth is a product of logical identification of the facts of experience^{^iv}

According to Ayn Rand, Capitalism is an “unknown ideal”^{^v}. A Capitalist economic system has “never yet existed, not even in America”^{^vi}.

If concepts must be observed and Capitalism has never been observed, then Capitalism is not a concept.

If truth is real and Capitalism has never existed, then Capitalism is not true.

If truth must be experienced and Capitalism is unknown, then Capitalism is not true.

If concepts without referents are invalid and Capitalism does not have a referent, then Capitalism is an invalid concept.

Therefore, Ayn Rand’s philosophy proves Ayn Rand’s concept of Capitalism is false and invalid.

Sources:

Introduction to Objectivist Epistemology, New American Library, Mentor edition (paperback) 1979 Library of Congress # 78-71454

Capitalism: The Unknown Ideal, New American Library, Signet edition (paperback) 1967 Library of Congress # 66-26772

i Introduction to Objectivist Epistemology, Definitions, pg 62

ii Introduction to Objectivist Epistemology, Definitions, pg 65

iii Introduction to Objectivist Epistemology, Definitions, pg 63

iv Introduction to Objectivist Epistemology, The Analytic-Synthethic Dichotomy pg 158

v Capitalism: The Unknown Ideal

vi Capitalism: The Unknown Ideal, The Objectivist Ethics, pg 33

Rand’s philosophy supports unemployment compensation

Rand states profitable businesses require people to be unemployed, yet applying for jobs: “that business concern requires the availability of more than one applicant for any job – that if only one applicant existed … the business concern would have to close its doors”[1].

Rand says this is justice: “… giving value for value… the principle of trade… is justice” [2]

If a person’s unemployment is a service of value which keeps a business open, separate from the value of being employed, then that service should be paid for separately as well, according to Rand’s philosophy. By the same reasoning, maintenance of a national pool of unemployed should be paid for.

Therefore, Rand’s philosophy supports unemployment compensation.

[1] The Virtue of Selfishness, The “Conflicts” of Men’s Interests Pg. 56

[2] The Virtue of Selfishness, The Objectivist Ethics, pg 31 .

Rand contradicts herself 1.5

Ayn Rand’s philosophy contradicts her economic theory.

Ayn Rand asserts that capitalism has never existed.ⁱ Economic systems in her history have all been “statist” (for the state).ⁱⁱ She calls some of these statist economies “mixed” because capital investment played a part:

“Thus what existed in practice in the nineteenth century was not pure capitalism but variously mixed economies… … it was the statist element of the mixtures that wrecked them; it was the free capitalist element that took the blameⁱⁱⁱ
“It must be remembered that the political systems of the nineteenth century were not pure capitalism, but mixed economies. The element of freedom however was dominant^iv…
when the repressive element of England’s mixed economy grew…”^v

Rand is dividing the observed characteristics of an economic system into two groups. She claims one group of characteristics to be the separate concept of “capitalism”; excluding the other characteristics.

However, her philosophy says not to do that : “Observe that concepts mean existents, not arbitrarily selected portions of existents. There is no basis whatever… … for a division of the characteristics of a concept’s units into two groups one of which is excluded from the concepts meaning”^vi.

She violates her own philosophy.

iCapitalism the Unknown Ideal, Ayn Rand, Signet, New American Library 1967

iiThe Roots of War, Ayn Rand, Capitalism the Unknown Ideal, Signet, New American Library 1967

iiiWhat is Capitalism? Pg 31, Ayn Rand, Capitalism the Unknown Ideal, Signet, New American Library 1967

ivThe Roots of War pg 38. Ayn Rand, Capitalism the Unknown Ideal, Signet, New American Library 1967

vThe Roots of War pg 39 Ayn Rand, Capitalism the Unknown Ideal, Signet, New American Library 1967

viThe Analytic-Synthetic Dichotomy pg 133, Leonard Piekoff, Introduction to Objectivist Epistemology, Ayn Rand, Mentor, New American Library 1967

Rand contradicts herself 1.4

Ayn Rand’s philosophy invalidates her concept of capitalism.

On the one hand, according to Rand’s philosophy, “There are invalid concepts, i.e. words… without referents…”[1] In Rand’s philosophy, a word without a referent is a word without a real world example.

On the other hand, according to Rand’s economic history, capitalism has “never yet existed”[2]. There is no real world example of capitalism according to Rand.

Capitalism has no referent, therefore it is an invalid concept according to Rand’s philosophy.

According to Rand’s philosophy, “An invalid concept invalidates every proposition or process of thought in which it is used as a cognitive assertion.[3]”

Therefore, all of Rand’s propositions and processes of thought regarding capitalism are invalidated by her own philosophy.

[1] Intro to Objectivist Epistemology, Definitions, Pg 65

[2] The Objectivist Ethics pg 33. Also Atlas Shrugged.

[3] Intro to Objectivist Epistemology, Definitions, Pg 65

Rand contradicts herself 1.3

Rand’s concept of capitalism is overly broad according to her philosophy.

According to Rand’s philosophy, “The requirements of cognition forbid the arbitrary integration of concepts into a wider concept by means of obliterating their essential differences[1]”

She gives the example of running. Running is a characteristic. Running is not an entity in and of itself. People run. In her philosophy, classifying running people, running clocks and running stockings together as “running things” is an error because it makes the action of running the “higher order concept” over the entities with that characteristic .[2]

According to her, the consequence of this error is “the panic of facing an immense, undifferentiated chaos of unintelligible data – which means: the regression of an adult mind to the perceptual level of awareness, to the helpless terror of primitive man.”[3]

A business structure of capital investment is an activity characteristic of people in just the way running is. It is one of many very different activities in an economic system, which is one system among many in a society of very different people.

Rand proposes the capitalist attribute to be the entire economic system. By obliterating essential differences, she imagines a capitalist legal system, a capitalist medical system and a new entity, the capitalist state[4]; not merely operating on capitalist principles, but existing only as a function of capitalism. The state would be an attribute of the capitalist ideal.

Rand’s proposal is that the concept of capitalism is the higher order concept above the entities which have that characteristic. That is a violation of her philosophy.

[1] Page 95 the cognitive role of concepts

[2] Intro to Objectivist Epistemology pg 95

[3] Intro to Objectivist Epistemology pg 95

[4] The Virtue of Selfishness, The Nature of Government

Ayn Rand contradicts herself 1.2

Ayn Rand’s concept of capitalism violates the rules of her philosophy.

In Rand’s philosophy, mental concepts must be observed in the real world. What we observe are the characteristics of the concept, what she calls an “existent”. We can’t take part of what we see and make the part into a new concept:

“Nor can the concept of an existent mean its characteristics (some or all) apart from the existent which possesses them. A characteristic is an aspect of an existent. It is not a disembodied Platonic universal[1]…”

Rand says that her concept of capitalism has never existed in the real world[2]. Rand says her concept of capitalism is an “Unknown Ideal”[3], which is a term referring to a disembodied Platonic universal. She says her concept of capitalism is based on elements of other economic systems which have existed[4]; which means she parted characteristics from real things to create her ideal.

Therefore she is in violation of her philosophy.

[1] Intro to Objectivist Epistemology: The Analytic-Synthetic Dichotomy pg 143

[2] The Virtue of Selfishness: The Objectivist Ethics pg 33.

[3] Capitalism: The Unknown Ideal

[4] The Virtue of Selfishness: The Objectivist Ethics pg 33. Capitalism: The unknown ideal: The Roots of War pg. 39

Ayn Rand contradicts herself 1.1

Ayn Rand claims her economic and political theories about capitalism are based on her philosophyⁱ. But, according to the rules of her philosophy, her concept of capitalism is false.

According to her philosophy of Objectivist Epistemology, our mental concepts are the things which we observe in the real world. For example, our concept “table” is true only if we observe a real table. If we cannot see a table, we do not have a concept of it. If someone claims to have the concept “table” without observing a real table, their statement is false and so is their conceptⁱⁱ.

On the other hand, according to Ayn Rand’s economic theory, capitalism is an “unknown ideal”ⁱⁱⁱ which has “never yet existed”^iv. In her economic theory all the economic systems which have existed are called “statist”^v.

Logically, according to her premises: if capitalism is unknown, then capitalism cannot have been observed and Rand’s concept of capitalism cannot be true.

Therefore, Rand’s concept of capitalism is false according to the criteria of her philosophy.

iThe Objectivist Ethics

iiIntro. to Obj. Ep. pg. 54

iiiCapitalism: The Unknown Ideal, Title

ivThe Objectivist Ethics, Pg. 33

vThe Roots of War, Pg 35 and on.

Ayn Rand contradicts herself 1.1b

Rand’s philosophy contradicts her economics.

According to Ayn Rand’s economic theory, capitalism is an “unknown ideal”ⁱ which has “never yet existedⁱⁱ”. According to her philosophy, that means her concept of capitalism cannot be true.

Rand’s philosophy has strict rules about what is true. Here are some quotes from her philosophy. She has a unique vocabulary. The word “existent” means “a real thing”. The phrase “observed existents” means “the real things you saw”. Quote:

“Truth is the identification of a fact of reality.ⁱⁱⁱ

“… truth vs. falsehood … By what method is truth discovered and validated? … The content of the concept … the characteristics of the existents … must be discovered and validated by observation.^iv

“… concepts represent classifications of observed existents…^v

“Concepts represent classifications of the known facts of reality.^vi”

Logically, according to her premises; if capitalism has never existed, then capitalism is not a fact of reality and Rand’s concept of capitalism cannot be true. If capitalism is unknown, then capitalism cannot be recognized, identified, classified or validated and Rand’s concept of capitalism cannot be true.

Therefore, Rand’s concept of capitalism is false according to the criteria of her philosophy.

iCapitalism: The Unknown Ideal, Title

iiThe Objectivist Ethics, Pg. 33

iiiIntroduction to Objectivist Epistemology, The Analytic/Synthetic Dichotomy Pg.158

ivIntroduction to Objectivist Epistemology, The Analytic/Synthetic Dichotomy, Pg 136

vIntroduction to Objectivist Epistemology, The Analytic/Synthetic Dichotomy, Pg 131

viIntroduction to Objectivist Epistemology, Definitions, Pg 62