"What is Capitalism?" by Ayn Rand, List 2

The recognition of individual rights entails the banishment of physical force from human relationships: basically, rights can be violated only by means of force.

The moral justification of capitalism lies in the fact that it is the only system consonant with man’s rational nature, that it protects man’s survival qua man, and that its ruling principle is: justice.

It is accepted precisely for its elastic, undefinable, mystical character which serves, not as a moral guide, but as an escape from morality.

Observe the significant fact that that assumption is tacit: even the most collectivized mentalities seem to sense the impossibility of justifying it morally.

But “the good of the majority,” too, is only a pretense and a delusion: since, in fact, the violation of an individual’s rights means the abrogation of all rights, it delivers the helpless majority into the power of any gang that proclaims itself to be “the voice of society” and proceeds to rule by means of physical force, until deposed by another gang employing the same means.

But if one begins by accepting “the common good” as an axiom and regarding individual good as its possible but not necessary consequence (not necessary in any particular case), one ends up with such a gruesome absurdity as Soviet Russia, a country professedly dedicated to “the common good,” where, with the exception of a minuscule clique of rulers, the entire population has existed in subhuman misery for over two generations.

Whether they are held consciously or subconsciously—in the explicit form of a philosopher’s treatise or in the implicit chaos of its echoes in an average man’s feelings—these theories make it possible for a man to believe that the good is independent of man’s mind and can be achieved by physical force.

Thus, in practice, the proponents of the intrinsic and the subjectivist schools meet and blend.

But both serve as a rationalization of power-lust and of rule by brute force, unleashing the potential dictator and disarming his victims.

The recognition of individual rights implies the recognition of the fact that the good is not an ineffable abstraction in some supernatural dimension, but a value pertaining to reality, to this earth, to the lives of individual human beings (note the right to the pursuit of happiness).

It implies that the good cannot be divorced from beneficiaries, that men are not to be regarded as interchangeable, and that no man or tribe may attempt to achieve the good of some at the price of the immolation of others.

But if a given man’s intellectual potential can barely manage to enjoy true confessions, there is no reason why his meager earnings, the product of his effort, should be spent on books he cannot read—or on subsidizing the airplane industry, if his own transportation needs do not extend beyond the range of a bicycle.

Values are not determined by fiat nor by majority vote.

Just as the number of its adherents is not a proof of an idea’s truth or falsehood, of an art work’s merit or demerit, of a product’s efficacy or inefficacy —so the free-market value of goods or services does not necessarily represent their philosophically objective value, but only their socially objective value, i.e., the sum of the individual judgments of all the men involved in trade at a given time, the sum of what they valued, each in the context of his own life.

Within every category of goods and services offered on a free market, it is the purveyor of the best product at the cheapest price who wins the greatest financial rewards in that field—not automatically nor immediately nor by fiat, but by virtue of the free market, which teaches every participant to look for the objective best within the category of his own competence, and penalizes those who act on irrational considerations.