Is greed good? Yaron Brook responds
The website Ednews,org recently posted an interview with Yaron Brook in which he discusses the importance of Ayn Rand and a number of other issues. (Update – April 28 – the Ednews website is presently down for maintenance.) One of these other issues is the question of whether greed is virtue or vice, and I find Dr. Brook’s remarks on the matter particularly insightful.
Here’s an excerpt:
The answer to this question really depends on what you mean by “greed.” If you mean the pursuit of short-term gratification at any cost, then I do think greed defined that way is bad. And indeed what we’re seeing is some–certainly not as many as the media would lead you to believe–some businessmen, some CEOs are pursuing short-term self-gratification at the expense of long-term profit, long-term happiness, and the long-term success of their shareholders, to whom they owe a fiduciary duty. Ayn Rand would be disgusted by this behavior-but she wouldn’t be surprised. She portrayed this kind of CEO in Atlas Shrugged, in characters such as Orren Boyle and James Taggart.
If by “greed” you mean a long-term, rational pursuit of profit, however, then that in my view is a virtue, not a vice. CEOs should be focused on the bottom line, on long-term profitability, on long-term shareholder wealth maximization. That form of greed is good, and I think the majority of CEOs in America still seek those goals.
Unfortunately, the regulatory system we have today encourages bad CEOs–the Orren Boyle/Jim Taggart type of CEO. The more regulated a business is, the more a CEO has to know how to deal with politicians. He has to be a schmoozer who’s a smooth talker at cocktail parties and knows how to lobby Congress for goodies, rather than a real businessman concerned with the bottom line. Without a regulatory regime, without laws impinging on economic activity, there’s no way for such people to gain an edge through political pull because there’s no political pull to be had. In a truly free market, the people who rise to the top are truly the most capable, the most rational, the best long-term thinkers. There’s no other way to succeed.
In this respect, what Ayn Rand’s philosophy offers is a different view of selfishness–a view of selfishness as the long-term rational pursuit of self-interest, with one’s own long-term happiness as the primary goal of one’s life. When selfishness is looked at in this way, it’s evident that such pursuits as lying, cheating, and stealing are not selfish. They’re not in one’s long-term self-interest and they’re not the way to achieve happiness.
Read the full interview here.