It has become trite for American fiction writers to lambast capitalism and the free market system as inherently immoral. Because few have entered the fray to counter these spurious notions, progressives dominate fiction, allowing them to mold the cultural milieu into one that is increasingly statist. Of the few in fiction who do defend liberty, Ayn Rand is perhaps the most prominent. Yet, while Rand makes a persuasive case for her worldview, she misunderstands key components of the market system, inadvertently giving ammunition to those who wish to characterize the market as merely a selfish, base enterprise.
Rand defined selfishness in The Virtue of Selfishness as “concern with one’s own interest.” Since she writes that this is the dictionary definition, it is not unreasonable to expand upon that by including Merriam-Webster’s definition as well: “concerned excessively or exclusively with oneself.”
Since Rand believed that selfishness was a moral virtue, Rand’s heroes and heroines exhibit the trait by design – it is what separates her protagonists from the other characters. But Rand’s veneration of this vice causes her defense of capitalism leaving much to be desired. Setting aside moral philosophy and discussions of the like, selfishness is not something central to capitalism at all – in fact, quite the opposite. Capitalism is a system that works only if agents are not selfish.
Ludwig von Mises argues in Human Action that the free market is a system of social cooperation organized around the division of labor. This system, says Mises, is driven by the wants of consumers:
In his capacity as a businessman, a man is a servant of the consumers, bound to comply with their wishes. He cannot indulge his own whims and fancies. But his customers’ whims and fancies are for him the ultimate law, provided these customers are ready to pay for it.
Mises continues by pointing out the obvious fact that people are “never merely a consumer.” Because our activities are organized according to division of labor, people serve multiple roles in the marketplace at the same time. For example, when we work, we produce as producers, and when we patronize businesses, we consume as consumers. We must provide something that others desire so that we can trade for the goods and services we don’t produce ourselves. Making something that others want to purchase requires us to consider what others’ interests may be. Those that are selfish, by definition, cannot do this – or at the very least cannot do it well.
It is certainly true that people’s actions are guided by self-interest. Adam Smith in The Wealth of Nations and The Theory of Moral Sentiments describes self-interest as a restrained version of selfishness in which people pursue goals they deem desirable while considering the effects their actions will have on others. Put another way, when people act in their self-interest, they act in such a way, within the bounds of just behavior, that will help them reach the ends they have selected as good.
For people to attain the goals they believe good in a market system, they must satiate the desires of those around them. If people were blind to what their neighbors needed, goals would be left unachieved for lack of the necessary means. Under capitalism – that is a system organized around persuasion and trade rather than coercion - people must look beyond themselves and serve others if they hope to serve themselves. If market actors were selfish, they would never seek to understand - nor care to understand - how to satisfy others’ wants and needs. Self-interest is not selfishness and vice versa.
Thus, Rand’s protagonists are misinforming readers – the market system is not a system guided by selfishness. Certainly, the market system’s virtues do not come from the fact that it allows people to act selfishly. The market system demands that actors not be selfish, else there would be no trade, and everyone would become a Robinson Crusoe on their own island, fighting for survival and struggling for self-sufficiency.
Since criticizing Ayn Rand without proposing a replacement is useless, I propose we should turn to Jean Valjean in Victor Hugo’s Les Misérables as a character whose actions better argue the case for free markets.
Valjean is an ex-convict who, in dodging parole, assumes a new identity and moves to a hamlet outside of Paris. He reshapes the town’s economy, which is driven by manufacturing consumer goods, when he suggests using a lower cost substitute for one of the inputs in the production process. Hugo writes, “This very slight change had worked a revolution.” Valjean becomes incredibly wealthy, providing jobs for people in the town and donating generous sums to build hospitals and schools - just like the “robber barons” of the Gilded Age. Because of Valjean’s ingenuity, “idleness and misery were unknown” in the town. In proposing a change in the production process – that is, in innovating – Valjean “had become rich, which was well, and made all around him rich, which was better.”
Valjean, unlike Dagny Taggart, was not guided by selfishness – he was guided by self-interest, which in his case was to improve the lives of those around him. As Hugo’s narrative explains, in the entrepreneur’s pursuit of their own interests, they enrich others and enhance the lives of those around them. He helped himself only by first helping those around him. Valjean’s actions explicate the fact that the free market necessitates that people concern themselves with others’ interests. Rand’s view of capitalism neglects this truth entirely, lending credence to asinine conceptions of the market system as an inhumane system driven primarily by self-centered materialism.
Defenders of liberty must utilize fiction if they hope to make the case for the market system. People’s minds are not changed through economic theory or political philosophy so much as they are changed through fiction – through the stories we tell ourselves. But proponents of the free market must not settle for authors who feed into the erroneous arguments raised against capitalism. Jean Valjean and characters like him - not John Galt - should serve as the spokespeople of capitalism.
