The Economist recently reported that Ayn Rand’s novel Atlas Shrugged, first published in 1957, is back on the bestseller lists. A week before the president’s inauguration, more people were buying it than Obama’s Audacity of Hope.
For the uninitiated, Atlas explores a future world in which the nation’s economy is collapsing because of government interference. The theme developed out of Rand’s own era: she started planning her novel in 1943, in the midst of Franklin Roosevelt’s New Deal. But it’s no wonder that it seems relevant today. New Deal activism, which was principally responsible for prolonging the Great Depression, guides our current economic stimulators.
Rand’s disciples are a devoted lot. A recent issue of the New Yorker profiled one local group—the dentist with “John Galt,” the hero of Atlas Shrugged, on his license plate; the wealth manager who piously intones, “I’ve been a follower of Ayn Rand for five years”; the helpful fellow who suggests, “When civilization collapses, we’ll just have to organize an Objectivist gang.”
Mention the name Isabel Paterson in such a gathering, and you’re likely to draw blank looks. For all the fervor that Rand inspires, little notice is paid to the woman who most inspired her.
Paterson (1886-1961) was a novelist and literary critic. She was slight, just over five feet tall, with a delicate taste in food and drink, a deep love of nature, and a nationally famous sense of humor. Stubborn and sharp-witted, she was also one of the New Deal’s fiercest foes.
Paterson grew up in poverty on the Western frontier. She had only two years of formal schooling. But she learned from her own experience, as well as her encyclopedic knowledge of history, that economic success results from individual initiative, not federal management. As an author, she also knew what makes a plausible story and could see that there could not possibly be a happy ending to the government’s efforts to fix everything that was broken in the 1930s.
Both Roosevelt and his hapless predecessor, Herbert Hoover, tried to inspire confidence by keeping unsuccessful enterprises afloat at the expense of successful ones. Strangely, prudent investors declined to be stimulated, no matter how fervently they were exhorted to trust the government’s programs. For Paterson, that result was tediously predictable. She told readers she was “tired of being told that ‘credit depends on confidence.’ Fudge. Credit depends on real assets, sound money and a clean record. … When any one asks us to have confidence we are glad to inform him that the request of itself would shatter any remaining confidence in our mind.”
Then there was the issue of government planning. To Paterson, the notion that federal experts can plan to ensure the people’s welfare was a ridiculous projection of childish fantasies—“a mother’s boy economic program with a kind maternal government taking care of everybody out of an inexhaustible income drawn from mysterious sources.” Perfect planning requires perfect foresight—and who possesses that?
Paterson’s Golden Vanity, one of the few good novels about the Depression, focuses on reputed experts’ outrageous failures of foresight. Its climactic scene is a confrontation between an investor and the financier she entrusted with her money—a man who worked, with the government’s assistance, to create a baffling maze of bad investments. When she hears him admit, “We could not foresee…,” she has finally had enough. “Why couldn’t you foresee?” she demands. “If you can’t foresee, what are you paid for?” She is wrathful, and there is dignity in her wrath.
The fundamental problem, Paterson proposed, is confusion of the economy with politics. In 1932, when Hoover was still in office, she said that “our ‘best minds’ ... have already got the political machinery dangerously entangled with the economic system, disrupting both; and they are now demanding that the government should save them from what they’ve done to it.” As others stood for separation of church and state, Paterson stood for separation of politics and business. She wanted no new government programs to save an economy that government programs had already disrupted. Readers wrote to her, asking her to identify her own plan for the government to solve the nation’s problems. She replied, “What these correspondents really demand is dope. If we don’t believe in their dope, what dope can we suggest in place of it? None whatever. We do not even know a remedy for gullibility.”
Her idea was simply to leave people alone to make their own investments, to earn profits and keep them, and to liquidate unprofitable enterprises. History backed her up. She remembered the nation’s relatively quick recovery from the economic crisis of her girlhood, the depression of the 1890s: “This country experienced bankruptcy in the nineties. Part of the loss was borne by foreign bondholders. That part of the situation is now reversed. It is a much worse bankruptcy. But that is all it is.” She knew that once the incompetent were permitted to go bankrupt, the competent could “pick up the pieces.”
Such notions were contemptuously disregarded by the public intellectuals of the 1930s, men who considered Paterson a reactionary lady novelist, lacking the ability to comprehend big, hairy-chested Keynesian and Marxist theories. Edmund Wilson, America’s leading young literary critic, informed Paterson that she was “the last surviving person to believe in [the] quaint old notions on which the republic was founded.”
She maintained, however, that “the principle of the lever remains the same.” And she wasn’t the last to believe in the old Republic. Among the rising generation of conservative and libertarian intellectuals whom she influenced was a young escapee from Soviet Russia, Ayn Rand. At that time, Rand was an author without an audience. An avid reader of Paterson’s weekly newspaper columns, she sought the older writer’s acquaintance during the dark days following the election of 1940, when the Republicans ignominiously lost to Roosevelt for a third time. During the next few years, Rand sat at Paterson’s feet, learning about economics, politics, and American history. When Rand published her breakthrough novel, The Fountainhead, in 1943, she inscribed her gift copy to Paterson, “You have been the one encounter in my life that can never be repeated.”
Soon afterward, Rand started the long process of writing the 1,168-page Atlas Shrugged, a work of original genius that was nevertheless distinctively influenced by Paterson’s ideas. Both women were rigorous individualists, but when it came to images of the capitalist system as a whole, Rand yielded to Paterson.
In Rand’s opinion, The God of the Machine, Paterson’s great work of economic and historical theory, “does for capitalism what Das Kapital did for the Reds” and “what the Bible did for Christianity.” In her book, Paterson conceptualized capitalism as an enormous circuit connecting producers and consumers throughout the world, using real money and real profits to generate new efficiencies and larger amounts of energy. She stipulated that government’s proper role was to safeguard the infrastructure of this system, keeping it free from force and fraud. If government went beyond that and tried to manage the economy, it could only divert its energy and, eventually, short-circuit and destroy it.
This is exactly the way in which Rand depicts the world in Atlas Shrugged. The novel’s central story concerns a railroad—a literal circuit of economic exchange—and the people who try to keep it running, despite the government’s best efforts to connect it to projects that sap its energy. With every new government plan, with every new administrative proposal to stimulate a lagging economy, the railroad’s profits dwindle, its lines shorten, industrialists who rely on it go bankrupt, and consumers have less access to the means of life. Eventually, there is a massive breakdown. The circuit of production and consumption can be reconnected only by individuals who plan their own economic behavior. The greatest of these is the man who best understands how energy is generated.
It is a compelling picture of the world —one that demonstrates the importance of the literary imagination as a generator of intellectual energy. Indeed, if modern conservative and libertarian ideas had been forced to wait until professional economists and politicians conveyed them to the public, they would never have been conveyed. The task required people of imagination who were willing to offer America an alternative vision of itself. To put it bluntly, the task required people who could really write.
That is why William F. Buckley Jr., laying the foundation for the modern conservative movement with the creation of National Review in 1955, identified Paterson as one of the people he most wanted to write for him. He got her, too—for a while. She left NR because—an individualist in every respect—she preferred not to be edited.
Russell Kirk, the philosopher of American conservatism, had his own quarrelsome relationship with Paterson. Yet, he said, she “stood out courageously, in defiance of the Lonely Crowd. I thought that everyone must be reading her ... and could never forget her.”
Probably no one who encountered Isabel Paterson easily forgot her. Now a new generation needs an introduction. In this moment when, under stress, basic ideas are being recovered, Atlas is surging in popularity, and the historic failures of the New Deal are being re-examined, it is time to revisit her wit and learning. “The principle of the lever remains the same.”
