Sounds like there are some cultural differences in discussing this book, which should prove to be interesting....

Rand's agenda is to reform government so that businesses can succeed or fail on a level playing field based on merit and public rules. Secret collusion between inefficient producers to drive out the efficient is the main story in Atlas Shrugged, using political influence and conspiracy to achieve goals which are couched as public spirited but actually harm the public good.

Rand's agenda is rather the reverse: to eliminate the Gov't almost entirely except for the enforcement of contracts and defense of borders. Government restrictions on secret collusion could be seen as unwarranted Gov't intrusion in business affairs.

When government sets the rules of the game to prevent such idiotic and destructive initiatives as the dog eat dog rule, businesses have to compete on merit rather than on patronage.

Agreed, but this involves Government regulation, which is not laissez-faire capitalism, Rand's unknown ideal. We'll see, perhaps this will be dealt with in the book.

In mining, all income additional to the amount needed to pay for production costs and normal profit is rent.

What a peculiar idea. In America, "all income additional to the amount needed to pay for production costs and normal profit" is called PROFIT!

LanDroid wrote:Sounds like there are some cultural differences in discussing this book, which should prove to be interesting....

Rand's agenda is to reform government so that businesses can succeed or fail on a level playing field based on merit and public rules. Secret collusion between inefficient producers to drive out the efficient is the main story in Atlas Shrugged, using political influence and conspiracy to achieve goals which are couched as public spirited but actually harm the public good.

Rand's agenda is rather the reverse: to eliminate the Gov't almost entirely except for the enforcement of contracts and defense of borders. Government restrictions on secret collusion could be seen as unwarranted Gov't intrusion in business affairs.

Hi Landroid, thanks. The dog-eat-dog law in Atlas Shrugged is an example of secret collusion that Rand condemns as a moral evil. The level playing field provided by government of enforcement of contracts and other property rights is aimed at success based on merit rather than patronage. Libertarian economists such as Hayek and Mises explain this in great detail, setting rule of law as the core business of government. Another Nobel winning economist, Doug North, explains this topic in terms of setting the 'rules of the game'. Government should steer, not row.

When government sets the rules of the game to prevent such idiotic and destructive initiatives as the dog eat dog rule, businesses have to compete on merit rather than on patronage.

Agreed, but this involves Government regulation, which is not laissez-faire capitalism, Rand's unknown ideal. We'll see, perhaps this will be dealt with in the book.

Laissez-faire (leave them alone) is a straw man used by the left to demonise Rand as a supporter of robber barons. Real freedom is built upon rule of law. The whole problem Rearden faces of Wesley Mouch as his unreliable man in Washington is illustrated by how Jim Taggart assumes that sucking up to power is the only way to get results, so he (Taggart) is less concerned about efficient production than about playing the political game to peddle influence. Rand condemns Jim Taggart as a weakling and idiot, bereft of all morals, exactly the sort of loser who needs a cartel to exclude efficient producers.

In mining, all income additional to the amount needed to pay for production costs and normal profit is rent.

What a peculiar idea. In America, "all income additional to the amount needed to pay for production costs and normal profit" is called PROFIT!

You might like to read about Australia's new Mineral Resources Rent Tax which uses this concept of rent as including super profits. It is economic orthodoxy, but it depends on who is seen as the owner of mineral resources. In most countries subsoil assets are owned by the state, and the US is an exception.

Heh, that rent tax is an interesting piece of work, a surcharge on profits over $75. million. Compare that to the U.S. where General Electric earned $14.2 Billion in profit in 2010, but not only paid ZERO corporate taxes, they also got a $3.2 billion tax benefit. GE invests heavily in one of the best tax departments on the planet.

I hear what you're saying on leveling the playing field for business, ensuring fair competition, etc. But I'm waiting to see what Rand will say about the role of Gov't regarding the anti-dog-eat-dog rule and other abuses. I suspect she will say Gov't should not interfere, see following quote. This is not a straw man argument in her case.

When I say “capitalism,” I mean a full, pure, uncontrolled, unregulated laissez-faire capitalism—with a separation of state and economics, in the same way and for the same reasons as the separation of state and church.

President, you said "Monopoly by definition is the absence of competition"

Where does one find such a definition?

On the subject of monopoly, the only time competition is barred, is governmental intervention into the economy, which bars competition and which can create a coercive monopoly and the like.

In laissez faire capitalism, competition is not barred by government, anyone is free to start a business and compete with other businesses. A business that is very successful or has no competition, is still open to competition.

Listen, this will be my last post to you as you are a fanatic. I'm happy you've come onto the forum so that everyone can see what Rand's book has the potential to create and to feed - fanatics who think as you do.

Pick up a dictionary or any book on economics and you'll find that when a company has such a control of a market as to be considered exclusive and when it has the ability to control the prices in that market - that company is a monopoly. Monopolies don't need to be created by the government.

President Camacho wrote:Listen, this will be my last post to you as you are a fanatic.

That's an ad hominem/insult. It's what people use in place of logical argument.

Pick up a dictionary or any book on economics and you'll find that when a company has such a control of a market as to be considered exclusive and when it has the ability to control the prices in that market - that company is a monopoly. Monopolies don't need to be created by the government.

If a business is successful enough to not have any competitors in a given market in Rand's laissez-faire capitalism, competition is still not barred, regardless. While there might be an absence of competitors, competition, as such, is always open in Rand's laissez-faire capitalism, the government does not bar competition. If people have a problem with such a business, they are free to start their own to compete, or not deal in any way with said business, as all such associations in laissez-faire capitalism are voluntary - no one is forcing you to buy their products, use their services, etc.

If a business is successful enough to not have any competitors in a given market in Rand's laissez-faire capitalism, competition is still not barred, regardless. While there might be an absence of competitors, competition, as such, is always open in Rand's laissez-faire capitalism, the government does not bar competition. If people have a problem with such a business, they are free to start their own to compete, or not deal in any way with said business, as all such associations in laissez-faire capitalism are voluntary - no one is forcing you to buy their products, use their services, etc.

Sounds delicious in theory, but ridiculous in practice. Some experience from the "whirled" of procurement:

• Corporate customers frequently require the procurement of say part # 123.45 Rev. D. from Company XYZ without exception as the only approved source.
• Competition is indeed barred, although Government has no role in this restriction.
• Company XYZ fully understands its position and behaves accordingly with absurd pricing, delivery, quality, and service problems.
• The cost and time to develop an alternate source, while available in theory, are insanely expensive with intolerable delays, hence the monopoly continues for the life of the customer's product.
• Unless you want to stop selling the assembly requiring component 123.45 Rev. D to your customer, yes you are forced to procure from Company XYZ and endure the consequences.
• Monopolies are frequently very small scale compared to DeBeers Diamonds, OPEC, your cable company, etc.
• Why did I start talking with bullets? Can I stop?
• No.

LanDroid wrote: Rand's agenda is rather the reverse: to eliminate the Gov't almost entirely except for the enforcement of contracts and defense of borders.

But more: Rand is in full support of laissez-faire capitalism, where the government would be constitutionally limited to recognize, uphold, protect man's rights. There would be police, courts, national defense. There would be a separation between state and economics (no governmental intervention in the economy), state and religion (no religious views are to enter government policy/laws), state and science (science is not to be funded by taxation, but privately), state and education (education would be privatized), state and money supply (government would not control money supply) .

Nat Taggart built that (in chapter 3):

Nathaniel Taggart had been a penniless adventurer who had come from somewhere in New England and built a railroad across a continent, in the days of the first steel rails. His railroad still stood; his battle to build it had dissolved into a legend, because people preferred not to understand it or to believe it possible.
He was a man who had never accepted the creed that others had the right to stop him. He set his goal and moved toward it, his way as straight as one of his rails. He never sought any loans, bonds, subsidies, land grants or legislative favors from the government. He obtained money from the men who owned it, going from door to door— from the mahogany doors of bankers to the clapboard doors of lonely farmhouses. He never talked about the public good. He merely told people that they would make big profits on his railroad, he told them why he expected the profits and he gave his reasons. He had good reasons.
[…]
In his lifetime, the name “Nat Taggart” was not famous, but notorious; it was repeated, not in homage, but in resentful curiosity; and if anyone admired him, it was as one admires a successful bandit. Yet no penny of his wealth had been obtained by force or fraud; he was guilty of nothing, except that he earned his own fortune and never forgot that it was his.

Independent people, like Nat Taggart, can benefit from trading with others in society, as others create products and services that they market and others are then able to purchase/use, to make other products, services, businesses, etc. This does not change the fact that he did built that. This is how Rand’s trader principle functions in laissez-faire capitalism (LFC) functions, in that it allows individuals to trade voluntarily to mutual benefit.

This passage immediately reminded me of this video I had seen on you tube in regards to what Obama had said “You didn‘t build that.” in a speech of his:



She built that, with those materials. Those materials didn’t build themselves into that structure, she built that. She obtained those materials, she put them together, she built that structure. Honey, you did build that.

Just as in the case of Nat Taggart, the same applies to Rearden Metal, if someone were to say to him “You didn’t make that, Rearden”, “You didn’t build your business, Rearden”. He did make Rearden Metal, he did build it.

In LFC, individuals are independent of one another. Their business might need certain materials/metals, that they purchase from others to make a new metal with. If they are unable to get one of the other materials/metals to make that new metal with, then their business is affected, as they would not be able to produce the new metal without one ingredient missing. Rearden’s business is dependent upon Rearden obtaining those materials/metals and a lot of other things to keep the business going. If he is unable to either get them himself from mines he owns, or purchase those materials/metals from others that are able to manufacture the materials/metal, and so forth, then he can’t produce his new metal without all them. He’s dependent upon himself in obtaining the necessary materials/metals, the services, the employees, and so forth involved in the making and selling of Rearden Metal.