Belding: Economic problems call for solutions, not denial

Michael Belding

This column is directed at anyone — especially any Republican spouter of ideological drivel — who weighs in on the current state of the American economy, its sluggish performance, or the way it’s imperiled by the national debt.

Our economic reality is completely different from the one that obtained when President Reagan’s tax cuts passed congressional muster. It’s even more different from the one that existed when Ayn Rand penned her magnum opus “Atlas Shrugged.” (It may interest you to know, dear reader, that I have read that legendary tome three times in the past five years.)

Our economy would be totally unrecognizable to the Founding Fathers and the framers of the Constitution. They would probably be shocked by the extent to which this country’s wealth is concentrated in the hands of a few individuals, and the extent to which enormous corporations control the fate of smaller ones.

Remember their definition of political tyranny: a concentration of the three branches of government (legislative, executive, and judicial) in the hands of a few, or one. It is not such a stretch to apply the same concept to economics.

As we confront the problems of unemployment, slow economic growth, and potential default on the public debt, we should open our minds to this possibility: the tried-and-true solutions of presidents and politicians used for decades and centuries are no longer appropriate to our circumstances.

Allow me to point out a few differences between the economies of 2011 and the one Ayn Rand conjured in “Atlas Shrugged.” We now live in a service economy. As they’ve been for decades, most people are paid for the time they spend doing a task, instead of for the manufacture of a product. Workers, from lawyers to waitresses to teachers, are paid largely for their time.

Americans are no longer paid to make things. Instead, they are paid to sell the cheap wares designed by Americans and fabricated in poor countries. Executives of U. S. firms are more interested in profits than creating a product that will not need replacing in a year. Some are plainly indifferent to the plight of their workers.

The general sense one gets from Rand’s writing is that profits follow from dedication to quality and respectability, not from profit-seeking. To her, profits are the byproduct of dedication and honest hard work. Even in Rand’s works, profits are not pursued for their own sake. She means readers to emulate her heroes’ work ethic, not just seek the rewards it earns them.

Consider a few of her characters and their businesses.

One summer, Dagny Taggart worked on her family’s railroad, Taggart Transcontinental, in one of its lowest-level jobs. She acquainted herself with all aspects of running a railroad – not merely with managing people, as her pathetic brother James did.

Francisco d’Anconia’s pursuit was mining copper, and hated himself for appearing everywhere as a spendthrift, pleasure-crazed playboy.

Henry Rearden used vertical integration (a single company taking on all tasks required to make a product) as his steelmaking method, for the sake of easing production.

The concern of these and Rand’s other industrialists was for their work. They did all of it for its own sake. Rearden could bear the thought of having spent millions of dollars to no profit on his Rearden Metal because he produced a product worthy of being made. Rand’s hero in “The Fountainhead,” architect Howard Roark, didn’t build in order to attract clients. Instead, he sought clients in order to build.

In other words, he was more interested in architectural perfection than in selling his wares.

To say that America’s current economic impotence can be solved by a method used 30 years ago on a completely different economic situation is madness, especiallly when the differences between then and now are so apparent. I write here, of course, of House Speaker John Boehner’s insistence that new sources of revenue are not necessary to solve the problem of our unfathomably large national debt.

Of course they are. Of course, when rent, utilities, and food must be paid for, a second or third job must be found. A person facing such a shortfall in his bank account will recognize the necessity of finding a job — no matter how repulsive — so that he can pay his bills.

That’s true unless he plans on declaring bankruptcy and leaving his creditors in the lurch — unless he plans on cheating and swindling his way out of making good on his contractual obligations.

Confronting one problem by proposing the solution to a second, completely different problem is no way to reach a resolution.