Who is Wesley Mouch?

Ayn Rand and her philosophy are once-again entering the public discourse. This is ironic because many of the people today who are today worshiping Ayn Rand are, in fact, the antithesis of the characters Rand held up as exemplars for society. Rand celebrated creators, inventors, and producers and despised those who thrived by parasitically appropriating the fruits of the producers’ labor. Yet many of the new Randian advocates are not producers — but rather are politicians, financiers, and lobbyists — exactly the kind of figures Rand so caustically criticized in her novels. While an occasional creator or entrepreneur espouses Rand’s philosophy in public discourse, it is far more common for figures who make a living from the fruits of producers’ labor to do so. Economists use the term rent seekers for those who extract wealth from society without creating new wealth. It is ironic that many of the new Ayn Rand acolytes are rent seekers rather than wealth creators.

When I was a college sophomore in the mid-1970s, I read Ayn Rand’s book, Atlas Shrugged. Like many sophomores, I was profoundly influenced by her book and philosophy — for a few months. I espoused my belief in personal achievement and responsibility and adopted a radical libertarian outlook. I preached Rand’s philosophy of “The Virtue of Selfishness” and began to see every action and purpose as about my own accomplishment and — ultimately — reward for those accomplishments. It was all about me.

For those unfamiliar with Ayn Rand’s philosophy, she was a novelist who espoused a belief she called “objectivism” which she claimed was

“the concept of man as a heroic being, with his own happiness as the moral purpose of his life, with productive achievement as his noblest activity, and reason as his only absolute”

Her novel Atlas Shrugged, is about a group of heroic creators — mostly scientists, engineers, and inventors — who decide to go on strike against a society that is focused on altruism, collectivism ,and redistributing their wealth. John Galt is the leader of this strike and the heroes invoke the rallying cry “Who is John Galt?”. The rallying cry appears throughout the book as society descends into socialist turmoil and it becomes obvious that the heroic creators are striking and will not return to society until it changes its ways.

As a college sophomore, Atlas Shrugged had an appeal to me and many of my classmates. It painted the world in black and white terms. It was a snarky caricature of the world that resonated with many of the things I saw around me. It provided an internally consistent philosophical framework that made it socially acceptable to be selfish. It provided the justification for the world to be all about me. It was sophomoric.

As I matured, I realized that Atlas Shrugged was very one-dimensional. The world was more nuanced than the strident and absolute philosophy that Ayn Rand depicted in her novels could explain. A sole focus on individual achievement was not a great basis upon which to build a life, a career, or a relationship. I realized it was not all about me. It ignored the interdependence we all must recognize as we navigate life. Although I still believed in self-reliance and personal responsibility, it was along the more nuanced lines of Ralph Waldo Emerson than the caricatures of Ayn Rand. I still re-read Atlas Shrugged (and Rand’s other novel — The Fountainhead) — occasionally — and find it thought provoking — but I am able to keep it in perspective and see Rand’s philosophy as one thread in an overall tapestry of personal belief.

It is with surprise, amusement, and some concern that I see Ayn Rand re-enter public discourse. Conservative figures such as Congressman Paul Ryan, former Federal Reserve Bank Chairman Alan Greenspan, and members of the Tea Party espouse her philosophy — often in a very fundamentalist and dogmatic way. Some have even tried to explain the 2008 financial meltdown as analogous to the societal meltdown depicted in Atlas Shrugged. There are people in public discourse who are once again taking Ayn Rand seriously. I even occasionally hear someone ask “Who is John Galt?” This is amazing to me. It seems like they are still stuck in sophomore year.

I was in New York City recently — down in Soho — near Wall Street. I saw a very nice and expensive Porsche with GALT as its license plate. I could not help but wonder whether this car belonged to some financier who fancied himself a master of the universe and a wealth creator — but who actually was a rent seeker.

Clearly, the U.S. economy has suffered because it has become overly dominated by finance. Finance’s role in society is to facilitate productivity but it has become an end in itself. Our society has become financialized — with financial services occupying too large a share of the U.S. economy. Arguably, much of financial services consists of classic rent-seeking behavior — extracting income from transactions, fees, and arbitrage — rather than creating any real value in the economy. Three recent New York Times articles reinforced this notion that rent-seeking behavior was running rampant in society.

  1. In May of 2015, NY Times columnist Nicholas Kristof reported, in a column title Inequality is a Choice, that the 2014 bonus pool for New York Wall Street employees was roughly twice the size of the salary pool for all Americans working at the federal minimum wage. That is an astonishing figure — clearly New York’s Wall Street workers cannot possibly be enough value to the economy to justify such outsized rewards.
  2. In April of 2015, Harvard economics professor Sendhil Mullainathan wrote an NY Times article about his mixed feelings when his students went into financial careers. He said that any job creates value for society and value for the individual doing the job. He feared that the individual rewards in financial jobs were so great that his students were opting for those jobs — with a lot of rent-seeking behavior and questionable benefit to society.
  3. Ayn Rand aficionado and Tea-Party favorite Ted Cruz has a new backer, a hedge fund manager who “made his fortune using computer patterns to outsmart the stock market” — yet another rent-seeker.

Finance seems to have gone beyond its legitimate societal role as a facilitator of economic growth and productivity and grown to a self-perpetuating economic sector that engages in classic rent-seeking — extracting value from wealth created by other people.

Those who have studied the root causes of the recent financial meltdown clearly point to financialization and rampant rent-seeking behavior in the financial industry. It is common knowledge that this happened, yet none of those responsible has been held to account.

Another Atlas Shrugged character was Wesley Mouch. Mouch was the product of inherited wealth who was initially a lobbyist who later became a government bureaucrat. He was clearly vilified by Ayn Rand as someone who made his living from appropriating the wealth created by others. Mouch exemplified the worst in rent-seeking behavior. He produced nothing himself and sought to extract value from producers and redistribute it to himself and others.

When I hear someone ask “Who is John Galt?”, with the obvious implication that they represent what John Galt stands for, I have to wonder — is this someone who is a creator, inventor, or entrepreneur creating value for society — or is this a politician, lobbyist, or financier — extracting value from wealth created by others? If so, a more apropos question for this person might be “Who is Wesley Mouch” — for indeed, many of those espousing to value creating wealth for society seem to be engaged in rent-seeking pursuits to extract value from wealth they did not create. While their rhetoric adulates John Galt —their behavior exemplifies Wesley Mouch. That is the irony of the sophomoric view of the world painted by Ayn Rand.