The Most Politically Dangerous Book You’ve Never Heard Of
When Alan Greenspan began his political career in 1974, he asked two people to accompany him to his Oval Office swearing-in ceremony as chairman of the Council of Economic Advisers: his mother, Rose Goldsmith, and his guru, Ayn Rand. From the time of his appointment years later as Federal Reserve chair until his retirement in 2006, Greenspan would implement Rand’s ideology of “objectivism” as monetary policy: Counting on market players to self-regulate in the pursuit of their selfish interests, he deregulated the financial industry and scoffed in the late 1990s when warned of the systemic risks posed by the unregulated derivatives market. Soon enough, these “financial weapons of mass destruction,” as Warren Buffet once called them, would explode, destroying the plans and lives of countless Americans in the Great Recession. A congressional inquiry placed the blame for the 2008 financial crisis squarely at Greenspan’s feet, and, under questioning by members of the House, Greenspan admitted that there must have been “a flaw” in his Randian worldview.
A flaw, yes, but where did it really come from?
The answer will surprise even the most avid Rand fans. The fundamental idea underlying her objectivism was a twin ideology known as rational egoism—the belief that rational action always maximizes self-interest. And Rand, who wielded the phrase “second-hander” as a cudgel against her enemies, had herself borrowed this idea from the scribblings of her countryman, a Russian writer named Nikolai Chernyshevsky, whose 1863 utopian novel, though critically mocked, became an inspiration for Rand’s generation of the early 1900s.
That’s not all Chernyshevsky is known for. Rand’s aversion to socialism is well-documented, but in Russia, that same Chernyshevsky novel became a user manual for revolutionaries, starting with the author’s radical contemporaries and ending with Vladimir Lenin and his Bolshevik Revolution of 1917.
Which means that, although he is all but forgotten now, Chernyshevsky was one of the great destructive influences of the past century: first in his home country, where his writing helped spawn the Soviet Union, and now, of all places, in the United States, where his rational egotism continues to reverberate in American political and economic thought. For decades Rand has been a muse to American politicians ranging from Ronald Reagan to Ron Paul to Paul Ryan to Clarence Thomas—not to mention businessmen like Ted Turner and Mark Cuban, to say nothing of Greenspan at the Fed. The libertarian movement claims her as one of its original inspirations. And Rand’s Atlas Shrugged has become a cult classic, continuing to sell hundreds of thousands of copies every year.
Born in the city of Saratov in 1828, Chernyshevsky was a loyal follower of Karl Marx’s technocratic predecessors, Henri de St. Simon and August Comte, who inspired him with the idea of a scientific utopia run by technical experts. From reading the French socialist Charles Fourier, Chernyshevsky took to the notion of the “phalanstery,” a communal housing project for the brave new world. And in the writings of the German philosopher Ludwig Feuerbach, Chernyshevsky found the idea of the “man-god,” the replacement of god by man in a materialist universe. Into this roiling cauldron of ideas Chernyshevsky dropped one last secret ingredient: Adam Smith’s “invisible hand,” the notion that an individual’s selfish gain is a gain for all society. The rational pursuit of self-interest should form the basis for all human interactions, and once this “rational egoism” becomes universal, it will result in happiness, harmonious economic and political conditions, and an ideal reconfiguration of the world. ...