In our society today, much like Ayn Rand’s Atlas Shrugged, the economy consists of makers and takers (“looters” in Rand’s vernacular). The makers are the giants of industry, the innovators providing goods and services through which the economy thrives. The takers are the government and crony capitalists who manage to stay afloat only by robbing the makers of the value they produce.
In the short space of an article like this, there is no way I can do justice to Rand’s book; frankly, I could not do it justice in a thousand pages. It is a masterpiece, and it counters the concepts of communism and socialism in an incredibly entertaining, enthralling, and educational manner.
In the book, Taggart Transcontinental is a railroad company providing both passenger and freight services, run by Dagny Taggart, a brilliant business woman. Her brother James, a counter-character to Dagny, is a ne’er-do-well who had a mediocre career in school that carried over into his career in business. Lacking any business acumen, James relies instead upon his political connections to seek gain and advantage in business.
Taggart Transcontinental is one of the primary makers, along with Reardan Steel, a metals manufacturer, and Wyatt Oil and Dannager Coal, two energy companies. However, after the leader of Taggart Transcontinental takes leave of the company and her brother takes over, it becomes a crony company for the government. After being taxed and pressured heavily, the owners of Wyatt Oil and Dannager Coal disappear, as had several other industrial leaders, leaving behind their companies with no one to run them, and leaving the looters in government to figure out how to manage these precious resources. The owner of Reardan Steel, who invents a steel alloy superior to any available from competitors, though also under pressures similar to those faced by Dannager and Wyatt, continues to battle to keep what he can of his company running while it is slowly being stolen, and what is not stolen is being destroyed through regulation, by the government. Rather than seeing Reardan succeed, the government prefers to loot Reardan in order to benefit themselves and their inferior crony corporations. James Taggart and his friends from high (low) places are seen regularly sitting around dimly-lit tables sipping their drinks and smoking cigars while discussing how to implement further legislation to profit their favored interests at the expense of those in industry who were the primary opposition. As “crises” arise the government implements more regulation. The rest of the population suffers through low wages, soaring inflation, and shortages of all sorts while this game plays out, and the government’s messaging never ceases to be one of positivity and of bearing the burden for the good of society.
Sound familiar? It should. This is what the government is doing now. Though such activity has been happening for decades, going at least as far back as the early 1900s, it has accelerated through the past few decades and has become the primary mode of operation under President Biden and his administration.
Upon his inauguration, President Biden immediately set about the task of battling one of the main adversaries of his favored green industry: oil and gas. On his first day in office, the President rejoined the ludicrous Paris Climate Accord, out of which Trump had pulled America due to it costing America billions while doing nothing to combat that mythical monster known as man-made climate change. Soon after, one of Biden’s first executive orders was to rescind the permit for the Keystone Pipeline project. While continuing to cite as the reason battling this same fictitious foe, the actual effect of stopping the pipeline was one of killing jobs and raising the cost of fuel and energy.
Next, Biden put a moratorium on drilling oil on federal lands and in federal waters, and he put a pause on new drilling permits. On top of that, he has sought to further regulate and reduce oil and gas production. Add to that a war fomented by our corrupt government and NATO interfering with a foreign corrupt government and sanctions intended to affect Russia that instead have caused more issue with our oil supply (note: I’m not supporting Putin in his actions; I do, however, recognize that our involvement in Ukraine, as well as NATOs, and a weak executive are the elements that motivated Russia’s invasion).
Is it any surprise to see gas prices rise? The administration claims it is “Putin’s price hike,” but it is the result of taking an industry that was producing all the petroleum this country needed and more (we were exporting oil) and crippling it to such extent that the President went begging to foreign nations to increase output so we could import more. Just as the government, at first, goes to Rearden begging for his metal after they had denounced it as inferior, despite it being a steel far superior to that produced by competitors.
Just as the government in Atlas Shrugged, this administration has demonized oil and gas, and coal, under the guise of a “climate crisis,” and in order to combat it provides subsidies to would-be competitors that can never provide the energy and the vast array other products that are direct derivatives of the oil and gas industry. The false pretense of being able to provide energy in a way that has less impact on the environment drives further regulation and stigmatization of petroleum and coal.
How could the problem be made worse? Follow more advice from Atlas Shrugged. Steal oil, in the form of the U.S. strategic petroleum reserves, and sell it to China. Further deplete domestic resources, driving prices higher still, by selling oil from these reserves, reserves meant to serve the U.S. during an oil shortage such as what we now face, to a foreign company with ties to…guess who…Hunter Biden. Never mind that the strategic petroleum reserve is meant to relieve domestic issues, the type of which we are experiencing. Of course, the government propaganda machine wants to redirect our attention, as can be seen from this Washington Post headline: “The misplaced outrage over Hunter Biden and U.S. oil reserves bought by China“. This is corporate cronyism at its absolute worst. Despite being at the root of the problem of outsized energy costs, the President blames the oil companies for being “greedy.” Can’t you just picture some rapacious old government employees and green-energy lobbyists, sitting in some dank back room, cigar smoke rising, half-empty whiskey glasses on the table, laughing about enriching themselves while the population suffers rising prices?
With all this, you might think there is nothing more that the government could do to worsen the situation, no other warnings from Rand to ignore. You would think wrong.
Let’s talk supply chain. In Atlas Shrugged, the railroads are the only mode of freight transport available. Despite this, the government imposes stricter and stricter regulation on the railroad corporations, helping James Taggart attempt to recover from poor business decisions (sort of like the bailouts of 2008 for the banks and auto makers), eventually consolidating, and essentially nationalizing, the railroads under Taggart Transcontinental. Since, after Dagny steps aside, this company is so poorly run under James’ leadership, the ability to deliver freight declines rapidly due to poor maintenance, lack of availability of components for repairs, and employees defecting.
Similarly, under the facade of protecting the country from a virus, shipping ports in the U.S. suffered from low staffing and an inability to handle incoming containers. CNN Business actually did a very nice job of visualizing, based on GPS tracking, the ocean-borne traffic jams off the Pacific coast that plagued the country starting in the latter half of 2021: https://www.cnn.com/2021/10/23/business/20211023-california-ports-animation/index.html . With freight being unable to reach land and be distributed to its final destination, the cost of goods rose both due to inability to be delivered directly as well as lack of components to assemble other products. While the President would like to take credit for easing the traffic jam, this administration and their policies did nothing to relieve the back-ups. It was the government’s policies, both state and federal, that caused the stack-up. Though there has been some improvement since the beginning of the year, due in part both to an increase in container and land transport availability, but also due to a decrease in ordering, there are still some struggles. As much of this has recently been released, stores also are struggling with the flood of products previously delayed. Many big box stores are now cancelling orders due to overstock as a result of this slow-down and hurry-up pattern.
Let’s see now…how can we cost the American people even more? Why, open the borders!!! If things weren’t bad enough, contrary to the strategy with the ports of minimizing staff to prevent the spread of a virus, the administration encouraged mass migration from our neighbors to the south. This costs the taxpayers in border patrol, intake facilities, court costs for immigration hearings (if they happen), transportation (moving immigrants in the night to “sanctuary cities” and other locales), and government hand-outs. Our own destitute and homeless can fend for themselves! Give everything to the illegals. This influx of “undocumented migrants,” as the politically correct prefer to euphemize, actually serves two purposes: cost those here who are suffering even more, and help perpetuate the power of those pushing these policies; after all, when you promise “social security” to those who have never paid into the system, of course you’ll find support among the receivers.
No inflation plan would be complete without printing additional currency. The more the government prints, and printing they have been, the less the dollar is worth. Drive down the value of currency, and inflation soars.
To rub salt in the wound, the government passes bills with names that make it seem as if the government truly cares for Americans - American Rescue Plan Act of 2021, Inflation Reduction Act of 2022 - but that have no chance of achieving what the name promises. Instead, under these auspicious titles is hidden more cronyism. Yes, the American Rescue Plan Act of 2021 offered Americans a pittance of $1400 for individuals, and a child tax credit for those who qualified. Of course, this tax credit was automatic and paid in the form of an income tax return advance which, if not opted out, would affect a family’s income tax filing. While many were excited about this minor financial assistance, what they failed to see was the tens of billions of dollars given away to large corporations. Then the government turns around and derides corporations for “not paying their share in taxes,” ostensibly forgetting that, when corporations get taxed, the increased cost of production gets passed on to the consumer. Reverse Robin Hood - take from the poor and give to the rich, just as you’d expect looters to act.
Now we have the Inflation Reduction Act that is increasing the size of the federal government, adding to the government spending spree, spending billions in subsidies for “green energy” that has no chance of providing the energy we need nor of helping the environment (what does that have to do with cutting inflation?), and doing nothing that could possibly hope to reduce inflation. As a matter of fact, the government is once again seeking to punish legitimate business people, as they did all through the supposed viral emergency, by prohibiting property-owners from charging rent or evicting people for non-payment. Similar cronyism was seen all throughout the virus crisis as small mom-and-pop shops were forced to close while big-box stores were deemed “essential” and permitted to remain open. This resulted in many small, privately owned stores permanently shuttering while retail giants raked in some of their largest profits in history. All of this has a tremendous negative impact on individuals and the economy.
Just as Professor Rand wrote, these (intentional) policy missteps would lead us down a path of ruin. Allowing such cronyism and corruption - looting is a better term - will destroy the American economy. We must right the ship through policy that makes sense, not by imitating the failed policies of a fictional government from a dystopian novel.