[Conservatives] are paralyzed by the profound conflict between capitalism and the moral code which dominates our culture: the morality of altruism . . . Capitalism and altruism are incompatible; they are philosophical opposites; they cannot co-exist in the same man or in the same society.
Rand is wrong in so many ways on this one that it is difficult to untangle the masses of intertwined error. But let us give it a try.
Error 1: The Incoherence and unreality of Rand’s distinction between egoism and altruism. I wrote about this in-coherency in an earlier post:
Both from common experience and psychological research we know that human beings, generally speaking, are inveterate rationalizers, particularly when it comes to issues touching their own interests and predilections… What makes rationalization so very easy and so very inevitable is the scandalous ambiguity of words. It is so very easy to equivocate our way to the conclusion we desire. The equivocation is so artfully masked by the ambiguity of the terms used that it remains unnoticed…. Rand makes use of [this] ambiguity ... when distinguishing between egoism, on the one hand, of which she approves, and altruism and “self-sacrifice” on the other, of which she strongly disapproves. Self-interest, for Rand, is good; living for others is evil. The chief difficulty in taking this approach stems from the fact that many human interests are inter-personal. Hence an individual’s self-interest is normally intertwined with interests of family, friends, and society at large, so that the distinction between egoism and altruism is, at its very root, an artificial one, intelligible, if intelligible at all, on paper; much less intelligible in reality, where selfish and social interests are, more often than not, all jumbled up, making it problematic to determine whether a given interest is selfish or altruistic.
The idea, therefore, that there can be a moral base that is either “altruistic” or “egoistic” is chimerical. Human beings are motived by both self-interest and concern for others. This is why, in practice, Objectivists can't always provide a coherent explanation of how to distinguish between egoism and altruism. As I wrote in the earlier post:
These paradoxes arise because Rand could not bring herself to be consistently selfish. There were some conventionally altruistic acts which she approved of. But since she was loathe to admit this, she merely called meritorious altruistic acts selfish and rationalized this odd usage away by redefining the term sacrifice in a way that entirely flouts and tramples upon common usage. Thus we find her declaring: "If a mother buys food for her hungry child rather than a hat for herself, it is not a sacrifice: she values the child higher than the hat; but it is a sacrifice to the kind of mother whose higher value is the hat, who would prefer her child to starve and feeds him only from a sense of duty." So the mother who values her child more than she values her hat is acting altruistically if she buys the hat! And the mother who buys food for her child although she would prefer a hat is also acting altruistically!
Error 2: Rand assumes, despite all the evidence to the contrary, that ethical theories—or, rather, ethical rationalizations—determine political conditions. It is important to understand what Rand asserts in this context. By ethics, she does not mean proclivities of action, sentiments, interests, or any other emotive or non-logical phenomenon. On the contrary, she means a specific ethical theory stated in broad principles. It is these principles which Rand declares determine all the sentiments, interests, and political motives that shape the social order. In countless posts (including this one ), I have criticized this conviction of Rand's. It goes against everything that scientific psychology and cognitive science teach us about human nature.
Error 3: Rand assumes, without doing any research, that people determine their ideological allegiances based on their ethical premises. It is amazing how many times one finds Rand taking this controversial point for granted. But perhaps that’s just as well, because the way Rand sets it up, her view becomes empirically untestable. If an individual supports socialism, Rand would tend to believe that individual held “altruistic” ethical premises, regardless of that individual’s professed beliefs. (If the socialist professed himself an "egoist," Rand would probably claim that he held "altruistic" premises in his subconsious.) How does she know this? She simply takes it for granted that ethical beliefs must determine political beliefs, regardless of the evidence.
Error 4: Rand suggests (at least tacitly) that no individual can consistently favor free markets because they produce more wealth and a greater standard of living for more people than alternate systems without suggesting or implying “altruistic” premises. Rand is (perhaps unwittingly) implying that it is dangerous or ineffective to base arguments for free markets on benevolence. But assuming that that more people will be “better off” under free markets than under other systems, why is it wrong to support capitalism for this reason rather than for self-interest? Many people are turned off by self-interest arguments for the very sensible reason that self-interest is not always benevolent. Rand’s stress on the so-called "moral base" inevitably suggests a motivational argument that stresses intention (egoistic intentions versus “altruistic” intention). But it’s not clear that intentions are all that important in social issues. What is most crucial is the end result. And if the end result of free markets is “better” than the end result of other systems, wouldn’t arguing on the basis of the end result prove more effective?
The tendency of conservatism is to look beyond the intentions and motives of actors and focus on the end result of social processes. As Adam Smith put it in a famous passage from the Wealth of Nations:
...every individual necessarily labours to render the annual revenue of the society as great as he can. He generally, indeed, neither intends to promote the public interest, nor knows how much he is promoting it. By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was no part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good.
Rand simply misunderstands conservatism when she tries to interpret and criticize it through her assertions about capitalism requiring a moral base. Sophisticated conservatives don’t frame the issue in that way. They look at outcomes, not motives, intentions, or moral bases. They understand that what Rand calls a “moral base” is, for many people, merely vague moral sentiments that can often be interpreted in disparate, conflicting ways. Most people have both egoistic and altruistic sentiments. But because people seek pleasure and avoid pain, the self-interested motives, in the ordinary course of life, tend to predominate, regardless of whatever moral principles they pretend to pursue. Hence the value of Rand’s moral base argument is grossly exaggerated by her disciples.