I just read this article that attacks Ayn Rand's objectivist theory at several levels. As someone who has barely read a quarter of The Fountainhead, I base my understanding of Rand on this (rather biased) article. Click here for reading the article.
Let me not even attempt a critique of Wikipedia claims was Rand's espousal of full, pure, uncontrolled, unregulated, laissez-faire capitalism. For even those with the most cursory knowledge of economics, it is not difficult to disprove such an assertion. There are so many market failures that unregulated capitalism cannot be optimal even in theory. Marx, of course, takes it further - he says that capitalism is a doomed regime that will one day fall under the weight of its own contradictions. In practice, the numerous crises have taught us that capitalism by itself cannot stand. However, trying to critique Rand at this point would end up becoming a lesson in basic economics, which I do not wish to detail here.
It is the second assertion, which I have accidentally dealt with earlier, that I will elucidate a bit here. As I have discussed in my previous article on norms and compliance (click here to read), many kinds of socially optimal behaviour can be made individually optimal using a set of incentives. In fact, according to the Folk Theorem, if an individual is patient enough, then any outcome in which the payoff to the individual is at least as much as his worst-case scenario, can be sustained. Given that a young person would not discount the future heavily, we can abstract away from the details and state that almost any social outcome can be sustained as a Nash equilibrium.
For our purpose of our argument, it is sufficient to say that Rand's argument that only selfish acts can be sustained, is false and myopic. Human society is a society of repeated social interactions. If interaction between any two individuals occurred only once, then Rand would be correct. However, since we need to interact at several times, we need to also consider how our action today would affect the state that will materialise tomorrow. While a more complete discussion can be found in my article I referenced earlier, let me give a simple example. When someone wants to photocopy my notes, then it would be in my selfish interests to not give those notes because the notes provide me with a comparative advantage that will help me score more. Sharing would reduce my comparative advantage. However, I might need notes in the future, and refusal to share notes today might jeopardize my chances of getting them in the future. Hence, the 'altruistic' task of sharing notes today becomes the Nash equilibrium.
Why I put 'altruistic' in quotes is because even this behaviour is selfish in that I still take the cost-and-benefit (to me) approach while deciding whether to share notes or not. However, the key thing to note here is that this selfishness differs from that of Rand in that it has a social context of incentives. In case the societal norms are removed and exchange of notes is made depersonalized (every person uploads his notes voluntarily on a network and others can download it, such that the uploader does not know who is downloading), then cooperation would break down and nobody would share notes. Instead, if anyone who refused to share notes was flogged, then everyone would share notes. The basic point is that seemingly selfish behaviour can also be modified and contained.
Going by my reading of Ms.Bekiempis' article, I can strongly assert that Rand was wrong - selfish behaviour isn't the only sustainable ones. Better outcomes can be sustained, and very often without the need for the Government.
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