As you point out, anyone with a normal understanding of human nature would see the implausibility of libertarian doctrine.
But we're talking here about people who thought Ayn Rand wrote believable characters.
Her novels serve as a sort of pre-selection filter for people with simplistic theories of mind.
(This might suggest the corollary, that in a world where human beings were all replaced by Ayn Rand characters, libertarianism would work as advertised. That does not follow, though, because the grossly inaccurate theory of mind is only the first flaw in libertarianism, not the last.)
I've seen a lot of awed "he brought intellectual gravitas to the Fed" claims from financial journalists (my age too!) in the last couple of days. Every time I think "didn't you watch him admit that as a 70+ year old man he was shocked to discover that bankers wouldn't check their greed out of self interest?"
There's a certain amount of "out of touch" to be expected at that level, I guess, but that's "visiting from Neptune" levels. The untold misery the man unleashed with smug determination across the course of his reign was all based on literally childish naivete.
The naïveté of the man leaves me breathless. But what else could we expect from someone who had swallowed Ayn Rand’s Kool Aid? He inspired true belief which is not hard to do in the USA. We go from bad to worse, but I hope that Trump has established a bottom.
Ayd Rand's life was so insane that during the Tea Party-Occupy Wall Street moment I started writing a biographical musical about her. The title was Ayn ≠ Ayn, a reference to her fixation on Aristotle's Law of Identity. For research and masochism I read most of her corpus and blogged it, enough to fill a book in itself.
I didn't find a, uh, composer, so the musical ended up not working out. It was fun to write and think about, though. It would have been a piss-take of the Les Mis-style megamusical (because Victor Hugo was Rand's favorite author). The finale would take place at her funeral, with Alan Greenspan and Rand's toady/literary heir Leonard Peikoff vowing to build a whole new world in her name:
When Greenspan died I wound up reading an Observer article about Rand written around that time. I learned that at her funeral there was a 6’ neon dollar sign next to her coffin. Perfect for a musical, really.
The other tidbit that was news to me was that the NYT really helped her career along:
“Rand spent the next seven years writing The Fountainhead, which was rejected by 12 publishers before being published by the Bobbs-Merrill Company. Nobody took much notice, but the Times gave it a rave, saying Rand wrote ‘brilliantly, beautifully, and bitterly’ and assuring readers that ‘you will not be able to read this masterful book without thinking through some of the basic concepts of our time.’ There were many more dismissive reviews. ‘Anyone who is taken in by it deserves a stern lecture on paper rationing,’ Diana Trilling wrote. But after two years of slow, steady word of mouth, it really started selling. Soon, Ayn Rand was famous, and to celebrate she bought herself a mink coat.”
I recall a quip about Paul Ryan — that he was not smart enough to outgrow the Ayn Rand that enthralled him in junior high school. I guess your point is that Greenspan was smart enough — which in some ways makes him even more culpable.
Well said. The “free” market the neoliberals embraced was never free, only dangerously vulnerable to the legal fraud and illegal anti-competitive and monopolistic market behavior creating the affordability crisis and the hollowing out of the rural economy.
I can’t disagree with anything written here. The 2008 crisis was absolutely due to this ideological deregulation crap Greenspan promoted. He was also a major player in manifesting supply side economics. 100%
That said, I wish it were Greenspan and not Bernake that had been there to clean up the 2008 mess. There was an ideological switcheroo that made it even more unfair. Too big to fail was a total reversal from libertarian, laissez faire principles and it meant throwing tons of money at the banks and insurers instead of letting them go bust and face real consequences for their shortcomings. i think Greenspan would have had a much lighter touch. They didn’t prosecute anyone criminally (that’s on Obama’s DOJ not Greenspan or the Fed), and they bailed everyone out.
The major bank bailout was during Bush's term, but both Republicans and "leftists" blame Obama. By the time Obama took office, Bush had committed $450Billion in TARP money and the Fed had printed trillions to take unsellable securities out of the hands of financial system firms and put money into the hands of cash strapped bankers. Obama didn't prosecute because the laws were written to protect bank and investment executives from accountability. For example, even though the ratings produced by Moody etc. were obvious nonsense, they were legally acceptable evidence of due diligence.
i was blaming Bernake for the bailout policy, not Obama.
The lack of prosecution is on Obama’s admin. There should have been trials at least. There was an incredible amount of bad loans written. It was policy at major banks to write large loans to practically anyone, with widespread encouragement of applicants to lie. They were also sometimes fraudulently packaged and rated.
There were several layers of widespread fraud in the disaster. Its a travesty there were not at least attempts to prosecute senior corporate leadership whose firms fucked the global economy
Obama took this “I’m too good to get involved with independent DOJ” attitude. that it would be improper for him to intervene in any way. But stuff like this is why the AG reports to the President. Some heads needed to roll and they didn’t. Prosecution should have been much more aggressive.
It's not illegal to write bad loans or to make stupid investments even with other people's money. It's certainly not illegal to rely on ratings agencies - although it should be. Prosecutions of Abacus bank and the two guys from Bear Stearns resulted in acquittals not least because its hard to prove intent to defraud when the defendants lost their own money. The juries didn't buy the prosecution case. It's also hard to overcome a "we thought it was safe and so did all our peers" defense.
There are a lot of reforms in Dodd Frank that are there because pre-Dodd Frank law was outrageously lax. I read the Goldman prospectus for the infamous Paulson trade and it's pretty honest - but the investors, who were supposedly sophisticated bankers were grossly irresponsible.
What the Obama DOJ didn't do, was pursue money laundering aggressively since there was a lot of suspect money involved. That was bad.
Greenspan diverged from mainstream conservative thought in one key respect. He did not seem to believe that the pain of the lower orders is something good in itself. He was quite happy to let the labor market become tight as a drum in the late 1990's: very good for workers. This reflected a deal between him and Clinton where Clinton cut the deficit and Greenspan cut rates. It worked out pretty well, for its time.
As a pure central banker, Greenspan was okay. His failure was as a bank regulator.
I went through an Ayn Rand period in my teens that contact with college cured, but it lasted long enough for me to read some of Alan Greenspan’s essays. Here’s the thing we all know: there is no such thing as enlightened self-interest and no virtue to selfishness. Thanks for placing Greenspan in a context I didn’t have other than to shudder every time he spoke as Fed Chair. Amazing that Paul Ryan still adheres to those beliefs.
Hopefully he's the bottom, but no one should plan on that. Things can get a lot worse and America still has a very long way to fall. Whether he lives a few more years or dies soon, the broader right has tasted something that no enduring electoral majority could ever give them.
The Trump administration has sort of changed my mind about Rand, since the administration and its supporters feature so many of the talentless, grifting, apparatchiks who are the bad guys in her awful novels. JD Vance is a good example. She must have experienced those people in Communist Russia. But I think Greenspan's failures are due to a more general problem in right wing and conventional economics - the implicit claim that certain kinds of economic activity by governments are interference in the free operation of markets and other kinds are not. The operation of a central bank is by its nature a massive thumb on the scale and a subsidy of incumbents. But economists want us to believe it doesn't distort markets the way that industrial policy or public hospitals or environmental protection do. Greenspans term on the Fed involved a massive engineered bubble to protect the electoral prospects of the Bush administration at the expense of the manufacturing sector, but few economists reacted to it with alarm. The Obama bailout of the auto-industry, on the other hand, caused episodes of mass fainting among economists because it was interfering with the capitol allocation of the private sector.
As you point out, anyone with a normal understanding of human nature would see the implausibility of libertarian doctrine.
But we're talking here about people who thought Ayn Rand wrote believable characters.
Her novels serve as a sort of pre-selection filter for people with simplistic theories of mind.
(This might suggest the corollary, that in a world where human beings were all replaced by Ayn Rand characters, libertarianism would work as advertised. That does not follow, though, because the grossly inaccurate theory of mind is only the first flaw in libertarianism, not the last.)
I've seen a lot of awed "he brought intellectual gravitas to the Fed" claims from financial journalists (my age too!) in the last couple of days. Every time I think "didn't you watch him admit that as a 70+ year old man he was shocked to discover that bankers wouldn't check their greed out of self interest?"
There's a certain amount of "out of touch" to be expected at that level, I guess, but that's "visiting from Neptune" levels. The untold misery the man unleashed with smug determination across the course of his reign was all based on literally childish naivete.
>The Way Things Really Are–ism
The superior man knows Marketing is critical.
The naïveté of the man leaves me breathless. But what else could we expect from someone who had swallowed Ayn Rand’s Kool Aid? He inspired true belief which is not hard to do in the USA. We go from bad to worse, but I hope that Trump has established a bottom.
Ayd Rand's life was so insane that during the Tea Party-Occupy Wall Street moment I started writing a biographical musical about her. The title was Ayn ≠ Ayn, a reference to her fixation on Aristotle's Law of Identity. For research and masochism I read most of her corpus and blogged it, enough to fill a book in itself.
http://objectionism.blogspot.com
I didn't find a, uh, composer, so the musical ended up not working out. It was fun to write and think about, though. It would have been a piss-take of the Les Mis-style megamusical (because Victor Hugo was Rand's favorite author). The finale would take place at her funeral, with Alan Greenspan and Rand's toady/literary heir Leonard Peikoff vowing to build a whole new world in her name:
SO GIVE NOT
FORGIVE NOT
THE FUTURE WILL BE GLORIOUS INDEED
IN OUR PARADISE OF GREED
When Greenspan died I wound up reading an Observer article about Rand written around that time. I learned that at her funeral there was a 6’ neon dollar sign next to her coffin. Perfect for a musical, really.
The other tidbit that was news to me was that the NYT really helped her career along:
“Rand spent the next seven years writing The Fountainhead, which was rejected by 12 publishers before being published by the Bobbs-Merrill Company. Nobody took much notice, but the Times gave it a rave, saying Rand wrote ‘brilliantly, beautifully, and bitterly’ and assuring readers that ‘you will not be able to read this masterful book without thinking through some of the basic concepts of our time.’ There were many more dismissive reviews. ‘Anyone who is taken in by it deserves a stern lecture on paper rationing,’ Diana Trilling wrote. But after two years of slow, steady word of mouth, it really started selling. Soon, Ayn Rand was famous, and to celebrate she bought herself a mink coat.”
Barf! (article is here: https://observer.com/2012/08/paul-ryan-ayn-rand-atlas-shrugged/3/amp/)
I recall a quip about Paul Ryan — that he was not smart enough to outgrow the Ayn Rand that enthralled him in junior high school. I guess your point is that Greenspan was smart enough — which in some ways makes him even more culpable.
Well said. The “free” market the neoliberals embraced was never free, only dangerously vulnerable to the legal fraud and illegal anti-competitive and monopolistic market behavior creating the affordability crisis and the hollowing out of the rural economy.
I can’t disagree with anything written here. The 2008 crisis was absolutely due to this ideological deregulation crap Greenspan promoted. He was also a major player in manifesting supply side economics. 100%
That said, I wish it were Greenspan and not Bernake that had been there to clean up the 2008 mess. There was an ideological switcheroo that made it even more unfair. Too big to fail was a total reversal from libertarian, laissez faire principles and it meant throwing tons of money at the banks and insurers instead of letting them go bust and face real consequences for their shortcomings. i think Greenspan would have had a much lighter touch. They didn’t prosecute anyone criminally (that’s on Obama’s DOJ not Greenspan or the Fed), and they bailed everyone out.
The major bank bailout was during Bush's term, but both Republicans and "leftists" blame Obama. By the time Obama took office, Bush had committed $450Billion in TARP money and the Fed had printed trillions to take unsellable securities out of the hands of financial system firms and put money into the hands of cash strapped bankers. Obama didn't prosecute because the laws were written to protect bank and investment executives from accountability. For example, even though the ratings produced by Moody etc. were obvious nonsense, they were legally acceptable evidence of due diligence.
i was blaming Bernake for the bailout policy, not Obama.
The lack of prosecution is on Obama’s admin. There should have been trials at least. There was an incredible amount of bad loans written. It was policy at major banks to write large loans to practically anyone, with widespread encouragement of applicants to lie. They were also sometimes fraudulently packaged and rated.
There were several layers of widespread fraud in the disaster. Its a travesty there were not at least attempts to prosecute senior corporate leadership whose firms fucked the global economy
Obama took this “I’m too good to get involved with independent DOJ” attitude. that it would be improper for him to intervene in any way. But stuff like this is why the AG reports to the President. Some heads needed to roll and they didn’t. Prosecution should have been much more aggressive.
It's not illegal to write bad loans or to make stupid investments even with other people's money. It's certainly not illegal to rely on ratings agencies - although it should be. Prosecutions of Abacus bank and the two guys from Bear Stearns resulted in acquittals not least because its hard to prove intent to defraud when the defendants lost their own money. The juries didn't buy the prosecution case. It's also hard to overcome a "we thought it was safe and so did all our peers" defense.
There are a lot of reforms in Dodd Frank that are there because pre-Dodd Frank law was outrageously lax. I read the Goldman prospectus for the infamous Paulson trade and it's pretty honest - but the investors, who were supposedly sophisticated bankers were grossly irresponsible.
What the Obama DOJ didn't do, was pursue money laundering aggressively since there was a lot of suspect money involved. That was bad.
Thank you, thank you, thank you! Just finishing "When the Clock Broke".I can't wait to read your next book.
Well done, maestro! You are far more deserving of that designation than Greenspan ever was.
Greenspan diverged from mainstream conservative thought in one key respect. He did not seem to believe that the pain of the lower orders is something good in itself. He was quite happy to let the labor market become tight as a drum in the late 1990's: very good for workers. This reflected a deal between him and Clinton where Clinton cut the deficit and Greenspan cut rates. It worked out pretty well, for its time.
As a pure central banker, Greenspan was okay. His failure was as a bank regulator.
I went through an Ayn Rand period in my teens that contact with college cured, but it lasted long enough for me to read some of Alan Greenspan’s essays. Here’s the thing we all know: there is no such thing as enlightened self-interest and no virtue to selfishness. Thanks for placing Greenspan in a context I didn’t have other than to shudder every time he spoke as Fed Chair. Amazing that Paul Ryan still adheres to those beliefs.
But look at all the love he gets from the media as the Serious Republican on Economics. It's like crack for pols.
Hopefully he's the bottom, but no one should plan on that. Things can get a lot worse and America still has a very long way to fall. Whether he lives a few more years or dies soon, the broader right has tasted something that no enduring electoral majority could ever give them.
The Trump administration has sort of changed my mind about Rand, since the administration and its supporters feature so many of the talentless, grifting, apparatchiks who are the bad guys in her awful novels. JD Vance is a good example. She must have experienced those people in Communist Russia. But I think Greenspan's failures are due to a more general problem in right wing and conventional economics - the implicit claim that certain kinds of economic activity by governments are interference in the free operation of markets and other kinds are not. The operation of a central bank is by its nature a massive thumb on the scale and a subsidy of incumbents. But economists want us to believe it doesn't distort markets the way that industrial policy or public hospitals or environmental protection do. Greenspans term on the Fed involved a massive engineered bubble to protect the electoral prospects of the Bush administration at the expense of the manufacturing sector, but few economists reacted to it with alarm. The Obama bailout of the auto-industry, on the other hand, caused episodes of mass fainting among economists because it was interfering with the capitol allocation of the private sector.
Excellent summation
fixed it. thanks