Making the moral case for capitalism


On Tuesday evening the ASI hosted Dr Yaron Brook, the president and executive director of the California-based Ayn Rand Institute, who spoke about 'capitalism without guilt: the moral case for freedom'. His speech, which was followed by a Q&A session and then a drinks reception, was recorded on video, so I hope to link to it in due course. For now though, here's my write-up...

Dr Brook started by emphasizing the importance of defining terms. For instance, many people say that 'unregulated free-market capitalism' has caused the economic crisis, and yet the economic system we have had in recent years does not even approximate 'unregulated free-market capitalism'. What we have actually experienced is a relatively free, but still decidedly mixed economy. And that's what has failed, not pure capitalism.

Indeed, as Dr Brook argued, it is not the free market bits of that mixed economy that have landed us in trouble. Our biggest problem has been bad monetary policy, presided over by central banks. They held interest rates so low for so long that the government was practically paying people to borrow. In the US, that was exacerbated by social policies, which encouraged lending to people with low incomes. The credit bubble and subsequent debt crisis was (and continues to be) a natural consequence of these interventions in the market.

The main argument that Dr Brook advanced, however, was that defenders of freedom must do more than just talk about economics. They also need to make the moral case for capitalism and rational egoism. Freedom to pursue your own interests must not be reduced in argument to a utilitarian system of maximizing outcomes, Brook said, but should instead be celebrated and advocated as the ultimate, moral ideal. And that, of course, is what Ayn Rand did so well.

All in all, then, an excellent evening. And despite Rand's relative obscurity in the UK, a very well attended one too.