Capitalism, according to John Galt, is "mutual trade to mutual advantage," (Rand Atlas Shrugged 989) or as Adam Smith put it: "[trade] by mutual consent and to mutual advantage." In true capitalism, the economy is strictly separated from the state, just as there is a separation between church and state in the USA. This basic tenet of capitalism describes the only economic system that can be morally justifiable. Communism, fascism, socialism, dictatorships and "regulated capitalism" are all systems that breach upon an individual's basic rights, while capitalism respects and recognizes a man's right to control the product of his mind. In her philosophical treatise Atlas Shrugged, Ayn Rand uses fictional characters and events to dramatize the only economy that is consistent with man's rights and virtues.
Before Ayn Rand, no one had ever seriously attempted to justify capitalism on moral grounds. It was a given that capitalism was immoral; the proponents of capitalism merely tried to exhibit the efficiency of the system (i.e., it is a "necessary evil"). Economists did this because they focused only on the people who would be helped by an anti-capitalist society: the "needy." What Ayn Rand presents so masterfully through Atlas Shrugged is the objective perspective of what is occurring in societies where people may take from others for the "public good"; in the novel, she repeatedly begs the question: "At whose expense?" When the People's State of Mexico nationalizes the San Sebastián mines, Ayn Rand clearly presents what is really happening: a gang of looters is robbing an honest business for their own benefit. In any other case, this wo...
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...and certainly undeserving Orren Boyle can use it without compensation. Is that justice? It is clear that capitalism is the only economic system that gives people what they deserve; capitalism is economic justice.
Capitalism has been proven time and time again to be the most "effective" (in terms of production) economic system in existence, but this is only secondary to the primary fact that it is the only moral economy. In Atlas Shrugged Ayn Rand shows that, by its very nature, capitalism is freedom: the freedom for a man to do what he wants to do with the product of his own mind and effort and, the corollary to that, the freedom to live.
Rand, Ayn. Atlas Shrugged. New York: Random House, Inc., 1957.
---. "Man's Rights." Capitalism: The Unknown Ideal. New York: The New American Library, 1967. 286-94.
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