Rise of Objectivism

Barbara Tuchman, in The Guns of August, details the				Such ideas represent a major phase shift for the
interlocking royal families controlling almost all European				world. Since even the concepts of manufacturing and
states prior to WW I. From Britain to Spain to Italy, the				mass production are not well understood it is natural
rulers of Europe were blood related. Even the far-flung				society would evolve new rules and structures for
Tsarina Alexandra of Russia was the first cousin of				people as well.
the German Kaiser. WW I was to last no more than a				I will not bore the reader with the history of unions,
month or two. Four years later, 20 million people from				welfare, Keynesian Monetary Policies, taxes on labor
the world over lay dead. Of all the things Karl Marx got				and an entire litany of social programs often borne by
wrong, the one thing he correctly foresaw was the				the corporation. Suffice it to note the 1900s was a
decline and destruction of Europe's Ruling Class. After				period of vast social change all built on large central
WW I, Royalty no longer controlled the majority of				governments and the evolution of the corporation. That
European states. Even Britain, in retaining the Royal				a middle class arose in every industrialized country is
Family, reduced the Monarch's power to that of a				enough proof of the positive effect of wealth
figurehead.				distribution.
There are times when punctuated evolution quickly				At any point in time we all have choices. We can
destroys existing social structures and gives rise to				choose one path or one or more others. There is no
new ones. The rise of the industrialist and the				knowing if we made the correct choice. Events leading
extraordinary wealth created by manufacturing bred				on one direction in multiple arenas are the result of
new social structures. Confined by totalitarian				action leading to inevitable outcomes. It is no
leadership Communism bled through and tainted the				coincidence that every implementation of Communism
rest of the world. No one can deny Marxist thinking				ended up with failed states, corruption, vast amounts
dominated the 20th Century. While Ayn Rand				of pollution and gulags. Communism being the greatest
attributes the corruption of society and government to				social experiment in history had only one possible
altruism, she never addresses Marxism inevitably				outcome - the destruction and complete consumption
leading to a new age of Objectivism. In this article I will				of wealth. Yet we dismiss at the same time that
explain why Communism is Ayn Rand's best friend				socialism follows industrialization as night follows day.
and why the world is on the threshold of a major				Social programs implemented by the state and the
phase shift.				corporation are the only logical and necessary
Maslow's Pyramid				outcome of the vast amounts of wealth produced by
Abraham Maslow's book "Motivation and Personality",				industrialization. Unions are simply an extension of
published in 1954 introduces a human Hierarchy of				Maslow's model providing protection and community.
Needs. Maslow's original five-stage Hierarchy of Needs				Objectivism Phase Shift
model, while intended to provide a better understanding				Today it is popular to question the role of government
of personal motivation, also applies to society. When				in our lives. The world has grown complex and with
the model is shifted to represent society there are				this complexity, governments the world over evolved
times when the individual gains a strategic advantage				and responded to the issues surrounding growth and
over the collective. Ayn Rand's struggle against the				industrialization. In an ideal world maybe there would be
corruption of the collective is better understood when				no need for government. In an ideal world Communism
viewed as part of Maslow's Hierarchy.				would work - it did not and there will never be an ideal
At the base of Maslow's pyramid is physical survival.				world. There will always be individuals of different
The basic needs are dependent on the talents of the				intellect and ability. There will always be groups gaining
individual. In some ways the fantasy of the Wild West				a strategic advantage. However, the world is changing.
can be likened to individual responsibility. The US				Our understanding of Marx's insights and Ayn Rand's
cowboy attitude of the super hero is bred from the				Objectivism can give us a view of this new world.
survival base of Maslow's pyramid. However as				After 2000 years of infighting, blood feuds and two
society advanced it discarded the nomadic hunter				World Wars the European Community has discovered
gatherer for an "in place" agricultural model.				something new. If they put aside their religious, ethnic
Before we can begin to explore the future we need				and social preferences and cooperate they all share in
to understand history. The upward push of mankind to				the rewards. Never in the history of the world has
greater glory, better health and expanding prosperity is				there existed such cooperation. No the EU is not
built on the shoulders of the past. Families at the turn				perfect, but the members of the EU are no longer
of the last century did not have a car, electricity, a				killing one another. Standing in Europe 55 years ago no
radio or TV or even indoor plumbing. In 1890 the				one could have predicted such an outcome.
majority of Western population lived and worked on				Wealth may not bring freedom. Freedom is as
small farms. The farmer's survival depended on a				individual as perception, but wealth brings opportunity.
strong family. Steinbeck's "Grapes of Wrath" describes				The growth of the middle class came from the vast
a matriarch concerned above all with keeping the				wealth created by industry. Feminism can credit the
family together. Facing poverty, starvation,				clothes washer and the microwave for the time to
displacement and the loss of everything, family				pursue careers and education. All of society can credit
connoted survival.				innovation for the freedoms we enjoy today. The
From a political and social sense a family is a collective.				social revolution of the 1950-60s was fueled by this
The needs of the family come before the needs of				vast increase in wealth. The growth in travel and
the individual. Each sacrifices for the benefit of the all.				recreation results from wealth and automation
On a larger level families bonded together to plant and				providing more free time.
harvest each other crops and even consulted on				The Middle Class
which crops to grow and the best methods to obtain				The key to understanding the place of Objectivism in
the highest yield. As we climb Maslow's pyramid				the new world is in understanding the growth of
collectivism becomes a form of protection and survival.				today's middle class.
Modern jobs created by the internal combustion engine				The demand for social programs came from a class
meant travel and separation from family members.				that outnumbered those with extraordinary wealth. The
The tractor allowing few people to farm vast tracts of				income tax implemented in 1913 has evolved from a
land destroyed the family farm. Greater wealth from				flat tax on the top two percent of income producers
manufacturing created options of independence only				into the most extensive and complex tax system ever
previously available to the very wealthy. And here we				devised by man. Yet the transfer of taxes from the
have a great revelation of innovation and technology.				high income earner through social programs provides
Innovation inevitably creates displacement. Every				an important feed back loop. The re-distribution of
period of innovation and every major labor saving				wealth not only pays for social benefits, it also
device in history creates both social and economic				increases the competition for labor driving up wages.
displacement.				Higher wages feed into the system increasing demand
Why Marxism?				for goods thus making those who control the means
John Reed's "Ten Days That Shook the World" was				of production richer. So successful is this feedback
written in the heat of the Bolshevik Revolution and				loop that today's economists encourage stimulating
even contains a forward by Lenin. Reed, normally a				spending rather than production.
first class reporter, is biased towards the revolution he				The income tax, especially the ATM (Alternative
sees as uniting the workers of the world. Reed's				Minimum Tax) is a perfect example of how the wage
motivation is important to understanding the times.				earner has evolved. Today for the first time there is
Reed, Lenin and Trotsky are intellectuals. They see a				serious discussion of scraping the income tax in favor
world of tremendous wealth and bone aching poverty				of taxes on consumption. Where "get the rich"
and desire equality. What occurs later is inevitable and				mentality of 1913 was limited to those anonymous rich
unstoppable, but often the simplicity of beginning belies				guys, today's income tax touches every worker,
a greater truth.				bringing into question the benefits vs. costs.
The wealth of the Monarchy is dependent on the				If the battle or rebellion was limited to only a few lonely
poverty of the masses. The Monarchs wealth requires				voices then it would be easy to dismiss the rising crisis
the sacrifice of others. Work in essence is slavery.				and expect society to maintain the status quo. Yet the
The UK's excellent growing environment and isolation				cry from afar and wide is not limited to the question of
produces a bounty of crops affording greater				taxes or health care or even outsourcing. The 1900s
freedoms. Not so for Russia, with a marginal growing				model of the "worker" is broken. Marx and Lenin cried
season the surfs are bound to the soil. While the Tsar				for uniting the worker into a common worker's
takes pride in freeing slaves well ahead of the				paradise because work roles of the late 19th and early
Southern US, serfs in reality are little more than slaves.				20th century were homogeneous. Today due to
Surfs can only leave the farm with the permission of				technology work roles have shifted. Diverse markets
the owner, for a fee and only one week out of the				emerge requiring the talents of the specialist. In such an
year. Fees are set arbitrarily high and the land owner is				environment union organizing is more difficult and less
often "on vacation" during this period. Further				rewarding.
complicating matters landlords have no motivation to				Enter Objectivism
improve farming methods preferring instead for small				In "Atlas Shrugged" Ayn Rand proposed a strike of
profits on many acres in fear the peasants will rise up				the competent. Those innovators building the wheels of
and demand more.				society abandon the world to form their own parallel
Such are the conditions found in Russia during the First				and elite society. Like Marx, Ayn Rand perceived a
World War. Adding to the troubles is the Tsar's				perfect world. Yet the long monologs on the role of
promise to come to France's aid in case of war.				the innovator in society are more valid today than in
Russian peasants are sent to the front with wooden				any other time in history. Rand describes a contrived
training guns, little ammunition and starvation rations.				perfect world of individual responsibility. A world where
Eventually a failed revolution deposes the Tsar and				one is rewarded for ones actions and those who fail
Russia falls into chaos. Lenin's rise to power is built as				to contribute suffer. Rand describes aptly and
a popular movement where the Bolsheviks promise to				generously the failings of collectivism.
end the war and redistribute land to the workers. In				Maslow described a hierarchy of needs placing
realty, Lenin and Trotsky after a period of adjustment				physical survival at the base of his pyramid. Second on
and a bloody purge actually deliver on their promises.				his original pyramid is the need for safety - law and
Farms and factories turn into "democratic"				order. To obtain safety man binds together forming
cooperatives with workers voting on conditions.				societies - collectives if you will. Now if we climb higher
Employing modern farming methods Russia				we find man needs love, companionship and
experiences a wave of prosperity for the first time in				relationship. Finally when all these needs are met man
history becoming a net exporter of grains and even				seeks achievement, status and self actualization. Man
surpassing the UK in the production and export of pig				when climbing Maslow's pyramid first goes from the
iron.				individual scratching out a meager existence to the
To all of these improvements Rand will argue the loss				collective combining efforts for the greater good and
of freedom and individuality. While correct, this				then finally back to the individual for self esteem,
argument misses the fundamental driver of				achievement and self actualization.
Communism - wealth. Communism and its cousin				Maslow missed an important factor in man's climb.
Socialism are only possible with increased wealth.				Only when there is a surplus at each level is society
Wealth created by industry made possible the equality				able to climb higher on the pyramid. Only when a
of the industrialist to the monarch and much later the				society achieves a level of wealth insuring this surplus
worker to the industrialist. This is a trend we will				will it demand individual freedom. Throughout history
examine in detail later, but for now let's concentrate on				there have always been groups able to climb to the
the drivers of socialism.				peak. Yet access to self actualization was very limited.
In the early 1900s no one understood manufacturing.				Limits of resources forced those at the top to violently
The well established MBA principles of the corporate				defend their gains. As I discussed above the Monarchy
model were still a nebulous mystery to all in 1900. Ford				of Europe was geared to the protection of the higher
was yet to implement his assembly line, Johansen to				levels of Maslow's pyramid for the few.ndustrialization
invent his go-no-go gauge and Taylor's efficiencies				and the destruction of the Monarchy moved society
were far in the future. Only one thing was known.				up a notch.
Manufacturing created wealth beyond all past levels.				Ayn Rand describes a world where those with ability
The platform established by Watt's steam engine				have no need for the lower support systems of
went into hyper drive with the development of				society. In realty, such independence is not possible.
electricity and the internal combustion engine. Like the				Isolation and voluntary cooperation is not a sustainable
Dot Com boomers who hired helicopters to locate				model. When one yahoo can highjack a plane or make
homes at the height of the boom the early industrialists				a bomb from fertilizer turning technology back on itself
were laden with wealth.				creating mass destruction, the motivations of society
The Bolshevik's biggest concern was the management				must change. Yet in the rise of Asymmetrical
of factories. Yes, thanks in part to Kondratyev's work				Terrorism lies the key to the future. Collectivism did little
at the Institute of Conjuncture, the Bolsheviks				to stop plane hijackings. After 9/11 never again will
modernized farms, created cooperates much like				passengers sit idle when a plane is hijacked. Flight 93 is
Granges in the US to share expensive planting and				a perfect metaphor of personal responsibility creating
harvesting equipment and disseminated the latest in				greater safety and freedom than the collective.
farming techniques. Focus, however, was on the				The 1960s push for Civil Rights and Feminism was
factory and the factory worker. And here maybe we				about the rights of the individual over the collective.
have Marx to blame.				Again referring to Maslow's model the desire for
The monarchies of Europe owned vast resources.				achievement, recognition and status engenders
Yet these resources were stable and followed a very				responsibility. Such a level of personal responsibility is
structured class system. The rise of industrialism and				only possible when there is a wealth base to support
the following colonial rebellion challenged existing class				physical survival, to provide security and order, and to
structures and rules. On top of a growing fire Marx				unfetter relationships. The collective cannot provide for
provides justification for wealth confiscation and				individuality. The collective cannot in the end meet the
re-distribution. For the first time society accepts on a				needs of the many. Just the progress made by
massive scale the "right" and necessity to redistribute				Western Society is the ingredient that will foster
wealth. In some ways Marx is right. God provides the				personal responsibility and reward the individual with
bounty on a farm. Good growing seasons and even				both freedom and self actualization. With responsibility
the health of a herd is in part dependant on nature.				comes unlimited potential. When one becomes
The farmer plants, tends and waters but the growing				responsible for the world then only the world limits
is done by nature. Not so with the factory. Idleness on				opportunity.
a factory floor is not compensated by growth. Wealth				Today as the world enters the information age, as
created in a factory only occurs from human actions.				globalization spreads, as innovation provides even the
As a result of this phase shift the worker can justify a				poorest in society freedoms only previously available
different protocol. As the worker grows old on the				to kings, the stage is set for a quiet revolution. The
farm the younger generation fills in. The older provides				bloodless defeat of Soviet Communism was seduction
wisdom and knowledge of weather patterns and the				by the wealth of the West. Even those at the top of
younger toils with the strength and energy of youth. In				the Soviet System were poorer than the lower middle
the factory the older worker is less valuable. Repetition				classes of the US and Europe. The Soviet revolution
of movement causes chronic injury. In a factory				came not from the people, but from the leaders who
environment the younger worker is often prized over				no longer had a need for security and were seduced
the older worker. Experience is often a handicap as				by higher needs.
modernization and innovation make a liability out of old				To the youth of the day, a job, public safety, and even
knowledge. There is no natural progression that allows				national defense are less important than
the older worker a graceful exit other than the select				self-satisfaction. A job today must offer more than a
few into management.				fair day's pay for a fair day's work. A job - a career -
So along comes Marx and seeds the idea that some				is an integrated part of life. Even those with trust funds
of the vast profits derived from industrialization are				adequate to provide for all needs seek satisfaction
owed to the worker. Since the worker built the plant				through participation in work and cooperative efforts.
and knows it is only through labor that production is				The path set out by Ayn Rand will become the
possible, the Marxist rationalization of re-distribution or				dominant voice of the 21st century.
even worker ownership is fair, valid and acceptable.

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Rise of Objectivism