The Ayn Rand Institute’s op-ed, The Real Lesson of the Great Depression, opines that “The Great Depression does have something to teach us about the current crisis.” According to ARI, there were various causes of the Great Depression:
“Most people believe the Great Depression was caused by an ‘excessively’ free market–and they regard the massive expansion of government intervention under FDR as its cure. But as many economists have demonstrated, it was government intervention that caused and exacerbated the Depression–from the massive tariffs of Smoot-Hawley to a series of disastrous interest rate hikes by the Federal Reserve to antibusiness measures such as the National Recovery Act.”
ARI properly calls for abolition of the Fed and advocates the gold standard. The implication that the Fed should not have raised interest ratest is troubling, however, since it implies that interest rates should have been pushed lower by the fed, i.e. the money supply inflated; that failure to inflate was a cause of the Great Depression. But was it? Not according to Rothbard. See Mateusz Machaj, Friedman for Government Intervention: The Case of the Great Depression.
(For more, see ARC’s Response to the Financial Crisis; see also these comments (1, 2) on another thread, regarding Objectivists Richard Salsman’s and Yaron Brook’s denigration of the idea of a 100% reserve gold standard.)
Update: I’ve modified this post in response to criticism; readers can click the links and judge for themselves.
{ 50 comments }
An article that virtually quotes Rothbard 90% of the time and conceeds only minor concessions to the Chicago School should not be used to fan the flames of petty ideological bigotry. Don’t quote me, but I think I’ve even heard Joe Salerno admit to some negative effect of aforementioned rate hikes in his defense of Rothbard’s explanation of the Depression,
The Ron Paul Revolution, which has smashed orthodoxy and intolerance among freedom lovers, has a large umbrella. Seek common ground, not civil war.
Here, here to Nick Molling’s comment! Intriguing observations, Mr. Kinsella. Thank you also for the footnotes.
Well, first, monetarism is much more popular than Austrian economics, so it comes to me as no surprise that they espouse the monetarist point of view.
Secondly, the rate hikes did help create the depression. It’s obvious that higher interest rates meant less loans being given, which meant a fall in investment.
Of course, the free market response would be a free market hard currency. When the threat of contraction looms, as it did in the 30s, the “price of money” would be higher, and we’d see more businesses mining gold, silver, copper, or whatever else would be used as money.
So, in a sense, their statement can be justified, although at the same time they failed to point out that the late 20s bubble was created by the Fed in the first place due to easy credit policies so…
That’s a pretty hard line Stephan! I too wish that people would better understand MNR’s point that the Fed attempted to expand liquidity but failed, but I’m not sure that we can expect that to be universal knowledge just yet.
“ Nick Molling –
An article that virtually quotes Rothbard 90% of the time and conceeds only minor concessions to the Chicago School should not be used to fan the flames of petty ideological bigotry. Don’t quote me, but I think I’ve even heard Joe Salerno admit to some negative effect of aforementioned rate hikes in his defense of Rothbard’s explanation of the Depression,”
Sorry for quoting you, but sure, some capital goods industries will be affected negatively by the rising interest rates, but falling prices are good for the overall economy. Malinvestment can be reallocated to more profitable uses.
Jeffrey, you don’t want to deprive Stephan of an attack on the Randians, do you?
I think the argument was made by Mark Skousen in “Vienna & Chicago” that the Austrians were right in explaining the causes of the Great Depression but that the monetarist were correct in accusing the Fed of exacerbating the crash by decreasing the money supply more than was necessary.
GO Liberty Dollar!
Let the credit market dry up!
“I think the argument was made by Mark Skousen in “Vienna & Chicago” that the Austrians were right in explaining the causes of the Great Depression but that the monetarist were correct in accusing the Fed of exacerbating the crash by decreasing the money supply more than was necessary. ”
Richard, Rothbard explains how the Fed tried extremely hard to reflate but were not successful.
I think Skousen goes far too easy on the Chicago school in this book.
U- it is ironic that the federal government is trying to reward career counterfeiters and thieves with hundreds of billions of dollars while the one individual who tried to introduce circulating silver coinage is now facing serious criminal charges.
“There is overwhelming evidence that our current crisis is the result primarily of government intervention in the economy, from the Fed’s inflationary policy of keeping interest rates artificially low to the creation and regulatory coddling of Freddie Mac and Fannie Mae”
Here, Yaron Brook is clearly advocating the Austrian Business Cycle Theory.
See? I can quote of out context too!
I do not think that the passage “…to a series of disastrous interest rate hikes by the Federal Reserve..” really means that Fed should had put more money into the economy. Couldn’t that mean that Fed let those interest rates rise higher that it would had been without Fed regulations? The author of the article maybe thinks that natural interest rates would had been lower than they were in those times. But it does not imply that he wants Fed to pump money into the economy.
The idea that manipulating (some) interest rates is the same as manipulating the direction and rate of monetary expansion (or contraction) is worth debunking, at least for the more-sophisticated listener.
It buttresses the assertion that not only SHOULD the Fed not manipulate the money supply (nor should anyone else, on the strength of armed force), the Fed ultimately CANNOT manipulate the money supply. It not only doesn’t and cannot know how much (more or less) money there should be at any given time, it actually lacks the MEANS to make it so with any kind of precision (of timing or amount, or even DIRECTION).
If it DID have such means, it could rapidly correct policies that seemed in hindsight to be mistakes. Obviously (history of the Depression), it does not, or the Fed’s reflationary efforts would have worked, and the Depression snuffed out early.
I do not personally know anyone associated with the Ayn Rand Institute, but I do not believe they officially endorse any particular schools of economics beyond simply endorsing capitalism and non-governmental intervention into the economy. They focus on general principles of human interaction based upon Rand’s ethics. I have seen some debates over fractional-reserve banking in some circles sympathetic to ARI, but certainly not in favor of the Federal Reserve or fiat money. The arguments that I’ve seen in favor of fractional reserve banking in so-called “Randian” circles usually go:
“In a free banking system, a bank should be allowed to engage in fractional reserve banking AS LONG as the depositors acknowledge and agree to the risk involved. If a bank becomes insolvent from such fractional reserve banking, it will go out of business. The market will take care of it.”
That seems reasonable to me.
The title of this post implies that Objectivists support the Fed, or some of its recent activities and that they advocate particular Fed policies. It also implies that Yaron Brook believes that the Fed’s failure to inflate caused the Great Depression.
I don’t know what beliefs Dr Brook has regarding the *immediate* cause of the Great Depression, but he is clear on the long term-cause of the problems then and now: the existence of a central bank itself. He’s never advocated that the Fed raise or lower rates – just that it should cease to exist. I don’t know *any* ARI-affiliated Objectivists who support the existence of a central bank.
The larger context being ignored is that the Objectivist movement has always learned towards Austrian economics, and that no one in it advocates central banking. Ayn Rand and Mises wrote enthusiastically about each other’s writing, and Ayn Rand always recommended Mises’ works to aspiring economists.
Oh, come now. Interest rates ought to be determined by agreement between willing lenders and willing borrowers in an unrestricted market. If the interest rates are instead set by a regulatory agency or a government-created monopoly, they’re almost certainly going to be wrong. There’s no a priori reason to suppose that they’ll always be wrong by being too low, or to say that excessively low rates are bad but excessively high rates are good. So it’s perfectly reasonable and consistent with radical free-market capitalism to complain that the Fed has set the rates too high.
Moreover, if rates have previously been artificially low, creating a bubble, and are suddenly made artificially high, bursting that bubble, the burst may be faster than the market would impose, and thus suboptimal; it may hamper the market’s recovery.
I know that historically we’ve more often had to worry about excessively low rates, and they do lead to booms, inflation, and bubbles, but I don’t think that someone’s saying rates were excessively high amounts to abandoning support for the free market.
This article is so stupid that it doesn’t even accomplish its deceptive goal: convincing uneducated people that the ARI is full of statists. Everyone who’s ever read a word of Ayn Rand’s (or Yaron Brook’s) knows that she didn’t believe in ANY government regulation. She’s made it very clear that government intervention can only cause economic dislocations, regardless of the particular form they take. Yaron Brook is talking about a few particular forms–just because he said that interest-rate hikes were responsible for the depression doesn’t mean that he thinks artificial money is the solution! He never said that! In fact, if you go on their web site, the ARI is screaming, “decontrol!” and has been since its conception. They clearly want a complete and total separation of government and economics, and they’ve never departed from that view. Why such dishonesty?
I clicked on the link for this article with great surprise, given that I have never heard ARI or any Objectivist intellectual voice support for a Government controlled Reserve Bank or the expansion of fiat currency (I have heard them support a 100% gold currency many times). The tiny sliver of support for the Chicago school position in the ARI quote hardly supports the alarmist title of the article. Mr Kinsella would do well to find better grounds for his apparently visceral hatred of the Objectivist movement.
Wow! Talk about taking things out of context. Did you think a minute before childishly rejoicing your new (& unfounded) attack on ARI?
It’s very disappointing to see such a cheap attempt to smear Objectivism at this web site. Objectivism certainly does not advocate the existence of a fiat money supply or a government-run central bank — as you must surely know. Why, then, do you wish to suggest otherwise?
If you disagree with an actual Objectivist idea, fine, but attack that idea, not some hopelessly lame straw man that doesn’t withstand 30 seconds of scrutiny.
Do you not understand the enormous value of the moral justification for capitalism that Rand derived? Yes, as Rand herself specifically stated, Mises and other Austrians have done a magnificent job identifying the government’s role in creating the so-called “business cycle” and in proving time and again that government intervention is behind virtually every significant economic problem. But people will cling to all sorts of impractical notions — such as statism — if they believe them to be moral imperatives. Objectivism is the first, and only, philosophy to set forth the moral case for capitalism — and we will never win wide-spread acceptance of laissez faire capitalism as long as people regard its animating motivation — the pursuit of one’s own self-interest by means of one’s own honest effort — as evil.
At a minimum, you should retract the blatantly dishonest title of this article — it is a stain on this website’s credibility.
of course the latecomers here are all overlooking the evidence of mutually inconsistent theories despite the alleged association with objectivism in favor of attacking the blog post, its author, whatever else is handy, now that word has gotten around someone’s gone and pointed out a flaw in the One True Libertarian Way.
ah yes, ARI is full of statists… wait. is it, ryan? tell us more.
ah yes, “out of context!” surely something someone said somewhere else is consistent — and totally irrelevant — and we can just read that instead.
ah yes, “attack the idea!” not objectivism itself (please, it’s fragile).
except, hang on just a minute. i don’t see a single point made about objectivism anywhere in this post, i see it associated with… where it came from.
the ARI is publishing material with decidedly little problematic theory in it, the author refers to it as the “randians,” and… this is somehow dishonest. oh, well, is the ARI “randian,” or not? i mean i confess i don’t know a thing about it.
didn’t you say you were objectivists? i guess i don’t know anything about that, either.
Three words from a wise man:
Big Tent LiberalismRand, however great her novels are and defense of capitalism is, had obvious bias that lended itself to statism. See this quote from her:
“Whatever rights the Palestinians may have had — I don’t know the history of the Middle East well enough to know what started the trouble — they have lost all rights to anything: not only to land, but to human intercourse. If they lost land, and in response resorted to terrorism — to the slaughter of innocent citizens — they deserve whatever any commandos anywhere can do to them, and I hope the commandos succeed.”
She attaches the qualifier “innocent’ to the citizens of Israel, but only states “Palestinians” matter of factly. Rand even admits that she does not know the history nor does it seem to matter to her. So how can she assume that Israelis are innocent?
Objectionism, like any “ism”" is susceptible to perception based opinion.
Keep in mind: As long as we look to the government for solutions there will always be problems.
http://yubanet.com/regional/Michael-McDaniel.php
“Book ‘em Danno”:
Even if the Palestinian claims are true — namely, the claim that the Zionists “stole their land” when Israel was created and chased them out of the country — that does not give the descendants of those original Palestinians the right to initiate the use of deadly force against the Israelis current living in Israel.
So how on earth does this indicate any sort of bias toward statism?
Michael Smith,
True, Rand’s descendants can’t expect to get restitution from Stalin’s posterity for all the hell he caused her and her family. However,
Rand lumps all Palestinians and makes them all guilty of terrorism. Whereas she treats “citizens” with the qualifier “innocent”. (Are not some Palestinians citizens of Israel?) Couldn’t she at least differentiate between good and bad Palestinians and afford them the same respect she gave to Israelis?
Her use of “citizen” also implies her support of the state also (but not necessarily statism, granted).
How can anyone before action “have lost rights to anything”? If the roles were reversed would Rand still stick by her statement? Could she have said that the ghetto Polish-Jews have lost all rights to anything and the Nazi commandos should kill them all because the ghetto Polish-Jews resort to terrorism?
Historical context does matter.
I have responded in great detail to one Randian—Richard Salsman—-who discusses the Great Depression, and who rejects and condemns the Austrian Theory of Business Cycles. Here’s one tidbit from Salsman: stocks CANNOT be overpriced.
Anyone who wants a copy of my article (from the Journal of Ayn Rand Studies) please email me at larrys@sulross.edu.
Blaming the Fed for having finally halted its own credit expansion is troubling, notwithstanding ARI’s otherwise commendable support for the gold standard and for abolishing the Fed. It is perfectly reasonable for Stephan to point this out.
Accusing him of “deception” or “petty ideological bigotry” or “smearing Objectivism” and twisting the clear meaning of Dr. Brook’s erroneous statement is simply absurd. At this particular moment in history, it is especially important to articulate a correct understanding of business cycles–and that’s all that Stephan was doing in his criticism of Dr. Brook’s Op-Ed.
It appears that some people think it is more important to quash dissent among free market advocates, and others think it is more important to defend the reputation of Objectivism. Neither of these priorities, however, reflects well on the critics.
It is blatantly inconsistent to espouse tolerance for all freedom lovers except, it seems, for freedom lovers like Stephan. If supporting the “Ron Paul Revolution” means that one can’t argue for a correct analysis of what went wrong in the 1930′s, then who needs it?
Likewise, it is foolish to reflexively defend Dr. Brook when he is so obviously mistaken. It is Objectivists themselves who damage Objectivism’s reputation when they stake that reputation on every false statement their leaders make.
Stephan is acting well within the purposes of the Mises Institute by exposing economic falsehoods wherever they might crop up, however inconvenient such truth-telling might be for other organizations and movements.
The comments made objected to the (former) title of Mr Kinsella’s post, which was indeed deceptive and unsustainable on the evidence of his quote. It was completely accurate to say that it was “smearing Objectivism”. Mr Kinsella was not merely articulating a correct understanding of the business cycle. The title of the post implied that Objectivists advocate “pumping more money” (presumably in the current crisis, though it did not elaborate), a conclusion that cannot be sustained on the slender evidence in the quotation.
Mr Kinsella’s subsequent change to the new title is welcome and presumably means that he now agrees that the former title was not sustainable on the evidence.
Incidentally, since economics is a seperate discipline from philosophy, no argument about the causes of the Great Depression or the business cycle can properly be regarded as a part of Objectivist philosophy. If ARI scholars make an incorrect argument in this regard then this is a matter of their personal understanding of economics, not a matter of Objectivist philosophy.
It is absurd to characterise the objections to Mr Kinsella’s post as “quashing dissent”. They were well-founded objections (which he has ultimately accepted, to his great credit) to the initially incorrect and unfair title of his post.
If memory serves, Mr Kinsella has also softened the criticism in the post itself, to a much more measured and legitimate critique.
I join Ben in giving credit to Mr. Kinsella for changing the title of this post.
Book ‘em Danno: I agree that Rand should differentiate between good and bad Palestinians; given her life-long fight against collectivism and for individualism, I can’t believe Rand would refuse to make such a distinction if the situation called for it. It seems you are drawing a conclusion from one extemporaneous answer and ignoring everything she wrote to the contrary.
@O’Neill: “Mr Kinsella’s subsequent change to the new title is welcome and presumably means that he now agrees that the former title was not sustainable on the evidence.”
No; I just don’t want to derail this into a debate. I believe the Randians’ position is wrong and that remains clear. I agree completely with Cook’s comments. The bizarre hostility of some Objectivists to 100% reserve (i.e., sound, honest) banking, and the advocacy of fractional-reserves, not to mention the ignorant denunciations of Mises and “Kantians”, deserves to be highlighted. I thought more people were aware of this, but apparently not.
Mr Kinsella: Forgive me for jumping to conclusions; when one states that they have modified their statement in response to criticism, it usually means that they accept that criticism. Moreover, not wishing to “derail this into a debate” is a rather odd desire when one publicly gives such an unflattering denunciation of “Randians” on the basis of a peripheral point in an article from a scholar who explicitely argues for the abolition of the Fed and the establishment of a 100% gold standard. As you also point out, Dr Brook is in disagreement with George Reisman, another prominent Objectivist scholar, on this very point, so it is difficult to see how it reflects on “Randians”. It also seems to me very difficult to contend that Objectivists advocate “pumping more money” when they apparently favour getting rid of the Fed altogether.
Objectivist views on Kant and Mises (whether ignorant or not) were not highlighted in your post, so I’m afraid I do not see the relevance of this part of your statement.
In any case, I agree with the critique in your modified post, but I would note that there is no Objectivist position on the cause of the Great Depression, since Objectivism is not, and does not include, an economic theory.
O’Neill: No; I just wanted to remove any perceived excuse or impediment to gloss over or ignore the Randians’ erroneous views here.
“there is no Objectivist position on the cause of the Great Depression, since Objectivism is not, and does not include, an economic theory”
Well, that kind of line is often conveniently trotted out–after Objectivists claim it is a “complete” philosophy; after they, as Objectivists, pontificate on such matters as homosexuality, arts, Rachmaninov, literature, Dostoevsky, female presidents, capes, smoking…. and when called on it they crawfish out of it by saying that this embarrassing position is “not part of Objectivism.” Glad to know it!
Is Ayn Rand is not allowed to express a personal opinion without adding a disclaimer that “it is not part of Objectivism”? I think she intended you to use some common sense to figure the difference between philosophy and fashion, science, or whatnot.
After all, we don’t criticize Mises’ theory on the nature of money because he supported utilitarianism. Human Action offered a “complete†economic theory, right?
Whether the deliniation of philosophy from economics is convenient or not, the point is correct in this case. To my understanding, Objectivism encompasses theories of the five major branches of philosophy (including aesthetics) and is complete only in that sense –it does not include a theory of economics, though the epistemology may rule out certain methodologies. Positions on literature and art are therefore part of the philosophy of Objectivism, while Ayn Rand’s positions on homosexuality, Rachmaninov, Dostoevsky, female presidents, smoking, etc., are based on her view of the application of these general theories to specific issues.
It is possible that Yaron Brook is influenced by Richard Salsman – who is completely wrong on the subject of a 100% gold standard vs. a “fractional” gold standard – but I don’t think one can jump to conclusions merely on the basis of a short line in a press release.
And by the way: do I count as a “Randian”? I am in complete agreement with the idea that only a 100% gold standard will do.
I wonder what Ayn Rand would think of ARI and Yaron Brook. Rand and Brook believe in an inherent moral superiority of the United States and Israel, the collectivization of security between the two, and the collective right to use violence against, well, just about anybody they subjectively deem as uncivilized- or just happen to be around the targeted group at the time of attack.
Rand defends philosophically the act of violence in a singular person’s instance- but her real life example is in the “weâ€, as in the massively collective entities United States and Israel. Rand stated:
“If we go to war with Russia, I hope the ‘innocent’ are destroyed with the guilty. … Nobody has to put up with aggression, and surrender his right of self-defense, for fear of hurting somebody else, guilty or innocent. When someone comes at you with a gun, if you have an ounce of self-esteem, you answer with force, never mind who he is or who’s standing behind him.â€
Killing innocents through collectivism is what both of them really advocate.
Brook takes it a step further than Rand and argues for an almost celebratory attitude towards killing innocents through state action. Here is Brook on the decimation of 300,000 mostly civilian Japanese in 1945:
“America should be proud to have dropped the Bomb.â€
Granted, Rand did say, “If nuclear weapons are a dreadful threat and mankind cannot afford war any longer, then mankind cannot afford statism any longer.â€
Yet Brook has a pattern. There are no shortages of savage collectives and ancillary innocents to beat down. He call’s for pre-emption in this regard. After all “they†are savages.
“Islamic totalitarian states pose a severe threat to the security of the United States,” Brook says, adding that a way to defeat these regimes “is to kill up to hundreds of thousands of their supporters.” This, he said, would “shrink popular support for extremist ideas to a small minority of the population,” instead of the 40% which he claims supports such regimes now.
How can ARI be considered a champion of anti-collectivism, anti-statism, capitalism and individual rights when Brook and Co. constantly display a bias lending itself to collectivism/statism and forms of violence that make a mockery of the very ideals they claim to espouse?
@Veksler: “#
Is Ayn Rand is not allowed to express a personal opinion without adding a disclaimer that “it is not part of Objectivism”? I think she intended you to use some common sense to figure the difference between philosophy and fashion, science, or whatnot.”
She is allowed to do whatever she wants, but not without criticism and ridicule, where warranted; and where she establishes a cult of personality that grays the lines between mere personal preferences and the fundamentals of philosophy (for example, she viewed esthetics as a branch of her philosophy, and stated that Bach was “evil” and Rachmaninoff was “good”; Dostoevsky had an evil “sense of life” while Victor Hugo was “good”; it’s no surprise these are taken by her acolytes not merely as her personal “preferences”), then yes, she needs to specifically state that it is not a “required” view for Objectivists.
“After all, we don’t criticize Mises’ theory on the nature of money because he supported utilitarianism. Human Action offered a “complete†economic theory, right?”
As far as I can tell, Mises’s confused views on ethical/value utilitarianism don’t contaminate or affect his economic reasoning–if they did, that would be a fair criticism. By contrast, Rand claimed to have figured out a complete philosophy, everything is “integrated,” “context matters,” blah blah blah, and she quite often mixed her personal preferences in with her other sweeping pronouncements.
Oh, we forgot to mention facial hair. It means you are hiding something. Evil!
@ Kinsella
> esthetics as a branch of her philosophy
Aesthetics is a branch of philosophy. Aesthetic opinions of particular works on the other hand, are an *application* of both one’s personal taste *and* one’s individual philosophy.
> stated that Bach was “evil”
Nope. That’s a lie made up by Rothbard in his play and repeated by people who should know better.
“Rand did not dislike the classical composers; she merely preferred those of the Romantic period to a greater extent. In The Romantic Manifesto, a book particularly devoted to aesthetics, Rand does not direct a single disparaging remark toward Bach, Mozart, or Beethoven, nor does she in any other works. She writes of all high Western music, “the modern diatonic scale used in Western civilization is a product of the Renaissance. It was developed over a period of time by a succession of musical innovators.”
http://rebirthofreason.com/Articles/Stolyarov/A_Critique_of_Murray_Rothbards_Sociology_of_the_Ayn_Rand_Cult_(Part_3_of_3).shtml
> [Rand] claimed to have figured out a complete philosophy, everything is “integrated,”
Well, reality *is* integrated. That doesn’t mean that a theory about a certain aspect of reality (its basic nature) must include one’s opinions about all other parts of reality. This is why we have concepts for the different sciences like philosophy, economics, physics, chemistry, etc.
It is rational to apply one’s philosophy to life – people who fail to do are called hypocrites.
@Vincent:
> “deception” or “petty ideological bigotry” or “smearing Objectivism”
A suggestion: when you use quotation marks in reference to someone’s comments, you are expected to quote their actual words. Using quotation marks to enclose statements someone did not actually make is intellectually dishonest.
David Veksler: I think you´re right that the statement “Bach was evil” is just a lie made up by Rothbard. (I’ve never seen or heard a word on Bach from Miss Rand.)
She did say she didn’t like Beethoven (although she realized his greatness).
Btw, both Bach and Beethoven are among my personal favorites.
Now, the subject here is not Ayn Rand’s musical preferences (or mine) but the question of the gold standard and the causes of the Great Depression.
And as to the actual issue – whether “Randians” in general subscribe to a 100% gold standard or a “fractional” standard – I think they are divided.
Salsman – who is a “fractionalist” – certainly has some influence. But I have noticed that the person who nowadays gives lectures on economics at Objectivist conferences is Brian Simpson – and he has declared that he is an admirer and a disciple of George Reisman. And that must mean that he is in favor of the 100% gold standard.
OK, this battle isn’t over. I can just hold my thumbs…
Ben O’Neill: “Incidentally, since economics is a seperate discipline from philosophy, no argument about the causes of the Great Depression or the business cycle can properly be regarded as a part of Objectivist philosophy. If ARI scholars make an incorrect argument in this regard then this is a matter of their personal understanding of economics, not a matter of Objectivist philosophy.”
Well, yes… But the importance of a gold standard has been stressed so often by Ayn Rand and her associates that I think this is actually part of the philosophy. (It is not like Ayn Rand’s view on beards, which can hardly be viewed as a philosophical issue. Or her view that Rachmaninoff is better than Beethoven, for that matter.) It is no coincidence that the money used in “Galt’s Gulch” was exclusively gold and silver.
To advocate a “diluted” gold standard, as Salman and some other Objectivists do, I regard as a serious inconsistency. But I grant you the issue is not self-evident. (Just almost,)
Even Alan Greenspan – while he was still a decent guy – wavered on this issue. If you read his essay “Gold and Economic Freedom” with a magnifying glass, you will see this.
Unfortunately, too few Objectivists are familiar with Austrian economics. And unfortunately, too few Austrians are familiar with Objectivism.
@Veksler:
“> stated that Bach was “evil”
Nope. That’s a lie made up by Rothbard in his play and repeated by people who should know better.”
You may be right that I confused her condemnation of Beethoven with Bach. That is irrelevant; and I believe your maligning of Rothbard’s honesty is uncalled for–I would assume it was an honest mistake based on the utter stupidity of Rand’s remarks here. Who can keep her cranky stuff straight?
“”Rand did not dislike the classical composers; she merely preferred those of the Romantic period to a greater extent. In The Romantic Manifesto, a book particularly devoted to aesthetics, Rand does not direct a single disparaging remark toward Bach, Mozart, or Beethoven, nor does she in any other works. She writes of all high Western music, “the modern diatonic scale used in Western civilization is a product of the Renaissance. It was developed over a period of time by a succession of musical innovators.”"
Yes, yes, whatever. She is entitled to her pet preferences. She also had horrible, insulting, obviously biased things to say about non-Western art and music, e.g. that of Asia.
“> [Rand] claimed to have figured out a complete philosophy, everything is “integrated,”
Well, reality *is* integrated.”
With what?
“It is rational to apply one’s philosophy to life – people who fail to do are called hypocrites.”
Oh, for God’s sake.
“> “deception” or “petty ideological bigotry” or “smearing Objectivism”
“A suggestion: when you use quotation marks in reference to someone’s comments, you are expected to quote their actual words. Using quotation marks to enclose statements someone did not actually make is intellectually dishonest.”
In a thread like this when people can easily glance up the page to check quotes, it’s hardly “dishonest.” What a serious charge to so lightly hurl at others.
@Samuelsson
“David Veksler: I think you´re right that the statement “Bach was evil” is just a lie made up by Rothbard. (I’ve never seen or heard a word on Bach from Miss Rand.)
“She did say she didn’t like Beethoven (although she realized his greatness).”
Huge difference!
“Btw, both Bach and Beethoven are among my personal favorites.”
You don’t have an evil beard too, do you? Or refrain from taming fire at your fingertips (smoking)??
“Salsman – who is a “fractionalist” – certainly has some influence. But I have noticed that the person who nowadays gives lectures on economics at Objectivist conferences is Brian Simpson – and he has declared that he is an admirer and a disciple of George Reisman. And that must mean that he is in favor of the 100% gold standard.”
Oh, good; I hadn’t heard of Simpson.
“Unfortunately, too few Objectivists are familiar with Austrian economics. And unfortunately, too few Austrians are familiar with Objectivism.”
I don’t think this is a symmetrical case. One doesn’t need Objectivism to lead a happy life or to be a libertarian or to have sound economic views.
In fairness to Murray Rothbard, his play about Rand (I presume that Mr Veksler is referring to his play ‘Mozart was a Red’, since I am not aware of any other plays Rothbard wrote) was a parody, and so it intentionally exaggerated his critique of Rand and her circle. It is a bit much to call this “a lie”, since it was an intentionally fictional play, with the fictional Carson Sand standing in for Ayn Rand. (Incidentally, the play has Carson Sand denouncing Beethoven and Mozart, not Bach.)
It is true that people should be more careful not to confuse Rothbard’s parody with reality, but this is hardly Rothbard’s fault.
@Ben O’Neill:
Rothbard makes very similar claims about Bach in other places, like this statement from “The Sociology of the Ayn Rand Cult”:
“Preferring Bach, for example, to Rachmaninoff, subjected one to charges of believing in a “malevolent universe.” lf not corrected by self-criticism and psychotherapeutic brainwashing, such deviation could well lead to ejection from the movement.”
I wasn’t there in the 1960′s, but I did read _The Romantic Manifesto_, which was written in the same time period, and in it Miss Rand states that musical tastes are a matter of personal preference and not subject to moral judgment, since their basis cannot be rationally examined.
I think I’m done with this thread, but there’s a lot more than can be said on Rothbard’s absurd and malicious vilification of Rand over the years – see
http://www.noblesoul.com/orc/essays/obj_cult2.html
http://www.geocities.com/rationalargumentator/mixedpremises.html
Geeze…I googled my son’s name..Carson Sand…and this is what I discover…wow…freaky…won’t disclose any more freaky coincidences…I need to do more research.
I don’t see ARI calling for not raising interest rates in the link provided. Quote:
“By keeping interest rates artificially low and inflating the currency, it created the illusion that homes and subprime mortgages were can’t-miss investments.”
Further, there is indeed disagreement WRT fractional reserve banking and 100 % reserve banking. While Rothbard (I’ve just read his book about the American Depression) argues that FRB is inherently fraudelent and 100%RB is the only way to go, I differ and agree with ARI: FRB is, when done properly and on a gold standard, a legitimate way to conduct banking. It permits the banker to use his skill to channel funding to worthy projects, and in returns provides the bank, as well as the depositors in the bank, with a sensible profit.
The current situation, where the bankers’ skill is replaced by reckless money printing, is obviously absurd. Not only does it aggravate the problem, it also obscures what is the true skill of banking, that of discriminating between profitable and useless projects.
“Secondly, the rate hikes did help create the depression. It’s obvious that higher interest rates meant less loans being given, which meant a fall in investment.”
Missing the mark a bit, are we?
Rate hikes triggered the 1929 crash, but didn’t cause it. The cause of the bubble was the inflationary policies of the Fed. The cure was to return to reasonable interest rates – a cure speedily abolished by the Hoover / Roosevelt administrations.
But I think we need slow, consistent rate hikes, or the economy would be killed overnight.
Ad hominem FTW.
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