Goddess of the Market: Ayn Rand and the American Right (20 page)

On their way back from New York Rand fulfilled a long held dream and paid a visit to Frank Lloyd Wright’s compound Taliesin in
Wisconsin. Wright’s changed attitude toward Rand had been among the sweetest fruits of
The Fountainhead
. It would have been impossible for him to ignore the novel, for many readers drew an immediate parallel between Roark and Wright. Privately Wright criticized the book, but in 1944 he sent Rand a complimentary letter, telling her, “Your thesis is
the
great one.” Rand was thrilled and once again pushed for a meeting, telling Wright she wished to commission a house from him. She had not selected a site, but anticipating a move back to the East Coast told him it would be built in Connecticut. Once at Taliesin she was disappointed to observe the “feudal” atmosphere of the estate, where Wright’s protégés shamelessly copied the master. The visit severely dimmed her admiration for Wright. From then on she would classify him as a Howard Roark professionally, but a Peter Keating personally. Her own Wright house remained unbuilt. Although she loved the design, Wright’s exorbitant fee was far beyond even her substantial means.
³⁹

Back in California, as she resumed work for Wallis, Rand closely followed political developments on the right. Her hopes for political change rested almost entirely on Leonard Read, who moved to New York in 1946 and shortly thereafter started the Foundation for Economic Education (FEE). The most successful libertarian organization of the postwar years, FEE quickly replaced the scattershot efforts of myriad small anti–New Deal organizations. It was well funded, courtesy of corporate supporters including Chrysler, General Motors, Monsanto, Montgomery Ward, and U.S. Steel, and received its single largest donation from the Volker Fund. The Foundation got off to a quick start primarily through the charms of Read. Armed with a formidable Rolodex and an affable personality, Read inspired confidence in business donors and intellectuals alike. Even the dyspeptic Paterson pronounced him “good stuff.”
⁴⁰
He quickly ensconced the new organization in a rambling Westchester County mansion, a short trip from New York. From these headquarters FEE sponsored seminars with libertarian professors and commissioned writing on the free market ideal.

During FEE’s founding year Read assiduously courted Rand. Her work for Pamphleteers had been a success, and Read had every expectation their collaboration could continue through FEE. In 1946 he described moving into FEE’s new headquarters and deliberating on proper quotations to be hung on the wall: “Then, I got to thinking what
I should put up over the fireplace in my own office. So I came home, got into my slippers, provided myself with a good quantity of martini and was reading Roark’s speech for the most suitable quotation.” On another occasion he thanked Rand for praise she had given him, noting, “Your comments about my speech please me to no end. Getting that kind of approval from you is what I call ‘passing muster.’ “ Read tapped Rand to serve as FEE’s “ghost,” asking her to read material he intended to publish to make sure it was ideologically coherent.
⁴¹
Rand was delighted with the chance to influence the new organization.

From the start she pushed Read to assume a stance that mirrored her own. She was particularly insistent that Read promote her moral views. He must explain that profit and individual gain were “the capitalist’s real and proper motive” and ought to be defended as such. Otherwise, if the very motive of capitalism was “declared to be immoral, the whole system becomes immoral, and the motor of the system stops dead.”
⁴²
It was the same criticism she had made of Hayek: a partial case for the free market was worse than no argument at all. Read was naturally more cautious. Like Rand he believed that government functions such as rent control, public education, the Interstate Commerce Commission, military training, and the Post Office should all be done by “voluntary action.” But he told her, “I had luncheon last week with the chief executive of the country’s largest utility holding Corp. and a financial editor of the Journal American. They are regarded as reactionaries, yet each of these gents, while being [against] price controls generally, suffered rent control. This is typical.” With an eye to public perception, Read had chosen the FEE’s rather bland name rather than use the inflammatory word “individualism,” as Rand had urged.
⁴³
Although Rand was generally pleased with Read’s efforts, she could see nothing but apostasy where others saw necessary compromises with political and economic realities. Despite their early productive collaboration, significant differences underlay Rand’s and Read’s approach to political activism.

Trouble came on the occasion of FEE’s inaugural booklet,
Roofs or Ceilings?
, authored by Milton Friedman and George Stigler, then young economists at the University of Minnesota. Like her reaction to Hayek, Rand’s reaction to Friedman is illuminating for the differences it highlights between her and another famous libertarian.
Roofs or Ceilings?
was written as Friedman, then a new faculty member at Minnesota,
was moving away from a position he characterized as “thoroughly Keynesian” to his later libertarianism. Friedman had long opposed rent control for its inefficiencies. He and Stigler argued that by interfering with the free working of the market, rent control removed incentives to create more housing stock, improve existing units, or share housing. Therefore it created, rather than alleviated, the housing shortage. They did not question the underlying motivation for rent control, even identifying themselves as people “who would like even more equality than there is at present.”
⁴⁴
The problem with rent control was simply that it did not achieve its stated policy objectives.

This dispassionate tone infuriated Rand, who saw
Roofs or Ceilings?
through the lenses of her experience in Communist Russia. Friedman and Stigler’s use of the word “rationing” particularly disturbed her. She did not know such usage was standard in economics, instead flashing back to her days of near starvation in Petrograd. “Do you really think that calling the free pricing system a ‘rationing’ system is merely confusing and innocuous?” she asked in an angry letter to Mullendore, a FEE trustee. She believed the authors were trying to make the word “respectable” and thus convince Americans to accept permanent and total rationing. Focusing entirely on the hidden implications of the pamphlet, Rand saw the authors’ overt argument against rent control as “mere window dressing, weak, ineffectual, inconclusive and unconvincing.”

Rand believed that Friedman and Stigler were insincere in their argument against rent control because they failed to invoke any moral principles to support their case. And when they did mention morality, it was to speak favorably of equality and humanitarianism. She fumed to Mullendore, “Not one word about the inalienable right of landlords and property owners . . . not one word about any kind of principles. Just
expediency
. . . and humanitarian . . . concern for those who can find no houses.”
⁴⁵
In addition to her eight-page letter to Mullendore, replete with exclamation points and capitalized sentences, Rand sent a short note to Read. She called the pamphlet “the most pernicious thing ever issued by an avowedly conservative organization” and told him she could have no further connection with FEE. To Rose Wilder Lane she described the incident as “a crushing disappointment,” adding, “It is awfully hard to see a last hope go.”
⁴⁶

The irony was that Read too disliked the pamphlet. Prior to publication he and the authors had tussled over several passages. The authors’
implicit praise of equality as a social good was a particular sore spot. When Friedman and Stigler refused to alter their text, Read inserted a critical footnote, stating, “Even from the standpoint of those who put equality above justice and liberty, rent controls are the height of folly.” His willingness to publish a pamphlet he disliked indicated the paucity of libertarian intellectual resources at the time. That two economists with legitimate academic positions would take a public stand against rent control was enough to ensure FEE’s support. Still, the whole episode was problematic. In addition to incurring Rand’s wrath the pamphlet alienated Friedman and Stigler, who were deeply offended by Read’s unauthorized footnote. For many years they refused any collaboration with FEE or Read, until finally reconciling through their mutual connection to the Mont Pelerin Society. For her part, Rand felt betrayed by Read’s failure to understand the principles at stake in their work and wounded by his disregard for their “ghost” agreement.
⁴⁷

Only weeks later Read added insult to injury when he sent Rand a sheaf of anonymous comments on her short article, “Textbook of Americanism.” Rand had written the piece for
The Vigil
, the official publication of the Motion Picture Alliance for the Preservation of American Ideals, the Hollywood anti-Communist group that had recruited her to its board. “Textbook” was a very brief piece that included her first published discussion of rights. Written in the style of a catechism, the piece defined a right as “the sanction of independent action.” Rand offered a secular defense of natural rights, which were “granted to man by the fact of his birth as a man—not by an act of society.” Paramount in the “Textbook” was the noninitiation principle, the idea that “no man has the right to initiate the use of physical force against another man” (she capitalized the entire phrase for emphasis).
⁴⁸
The noninitiation principle, sometimes called the nonaggression principle, can be traced to thinkers as varied as Thomas Aquinas, John Locke, and Herbert Spencer. Placing it at the center of her natural rights theory, Rand breathed new life into an old idea.

At Rand’s urging, Read shared the “Textbook of Americanism” with the FEE staff and selected donors, all “men high in the country’s business and academic life.” The principle of noninitiation in particular appealed viscerally to Read. But most FEE friends were less enthusiastic. Rand had not spelled out or defended her basic premises, and much
of what she wrote struck readers as pure assertion. “Her statement that these rights are granted to man by the fact of birth as a man not by an act of society, is illogical jargon,” wrote one, advising, “If Miss Rand is to get anywhere she must free herself from theological implications.” Another respondent was “favorably impressed by the goals which she seeks to attain, but the line of logic which she uses seems to me to be very weak.” Such readers thought Rand left a critical question unanswered:
Why
did “no man have the right to initiate physical force”? Out of thirteen readers, only four recommended supporting the work in its present form.
⁴⁹

Rand, who saw herself as helping the unenlightened at FEE, was entirely unprepared for this criticism. She was livid, telling Read, his actions were “a most serious reflection on my personal integrity and a most serious damage to my professional reputation.” She was particularly angered that the FEE readers evaluated her work as if she had requested financial backing. She informed Read, “I do not submit books for approval on whether I should write them—and my professional standing does not permit me to be thought of as an author who seeks a foundation’s support for a writing project.” Not only had Read disregarded her role as ghost, but now he had downgraded her from instructor to pupil and “smeared” her reputation. Rand demanded an apology and the names of the people who had written the comments on her work. Read refused both.
⁵⁰
The breach would never heal.

Rand’s break with Read drew her closer to Rose Wilder Lane, whom she had heard about through Isabel Paterson. The two established a correspondence shortly after Rand moved to California, but had never met. A magazine writer with a vaguely socialist background, Lane was the daughter of the famous children’s author Laura Ingalls Wilder. Although she took no public credit, Lane was essentially a coauthor of the best-selling
Little House on the Prairie
series. She wove her libertarianism delicately through the nostalgic books, filling her fictional Fourth of July orations with musings on freedom and limited government and excising from her mother’s past examples of state charity.
⁵¹
In 1943 she published
The Discovery of Freedom
, a historically grounded defense of individualism.

Like Paterson and Rand, Lane took a hard line on compromise of any type. As one friend remembered, “Rose used to go and talk about dead rats, that you’d bake a gorgeous, succulent cherry pie and cut into it and there in the middle of it would be a dead rat. She thought that Robert Taft supporting federal aid to education was such a dead rat.”
⁵²
Accordingly, Lane was sympathetic to Rand’s anger. She told Rand that the problem with Read was simple: “He simply does not possess a mind that grasps abstract principle; he has no constant standard of measurement.” Lane listed his many intellectual deficiencies but defended him against any challenge of malice. Read had also ignored advice that both she and Isabel Paterson had offered, she told Rand, although it was certainly “valid ground for the most extreme indignation” that he had reneged on their ghost agreement.
⁵³
Grateful for her understanding, Rand sent Lane a copy of the censorious letter she had mailed to Mullendore.

In contrast to Paterson and Rand, who thrived on face-to-face contact, Lane was a homebody who exerted her influence through a network of well-placed correspondents. She was a guru figure to Jasper Crane, a wealthy DuPont executive who funded many libertarian causes, and exchanged dense philosophical letters with Frank Meyer, later an influential
National Review
editor. For many years Lane was employed by the Volker Fund to assess the ideological fitness of potential applicants. After the death of Albert Jay Nock she assumed the editorship of the National Economic Council’s
Review of Books
, a slim publication sent mostly to corporate subscribers. Within the world of libertarianism Lane was a force to be reckoned with. In fact she played the kind of role Rand coveted: tablet keeper and advisor, sought after for her judgment and council.