On a recent trip to Colorado, I fired up the Atlas Shrugged audiobook. As I passed a line of train cars sitting empty and idle, noted the high gas prices, and listened to complaints about gas station supplier shortages, it occurred to me that Rand’s 1957 novel made a number of chillingly accurate predictions about our modern Wokestopia (i.e. Woke-dystopia).
Like many immigrants who escaped communism, Rand knew firsthand the corrosive effect of politicizing the industries that supply and feed our economy. The central plotline of Atlas Shrugged follows the accelerating political corruption of American corporations. Rand painted a picture of a kind of corporate/leftist fascism that feels familiar to us in 2021. Below are some of the predictions that have partially or completely come true.
1) Politicizing industry strangles production.
Near the end of the novel, Rand wrote about a fictional (at the time) “Railroad Unification Plan,” under which, the “railroads of the country have been unified into a single team, pooling their resources. All of their gross revenue is turned over to the Railroad Pool Board in Washington, which acts as a trustee for the industry as a whole.” Something almost exactly like that happened in 1970 when President Richard Nixon signed into law the, “Rail Passenger Service Act of 1970,” which transferred railroad passenger service to the “National Railroad Passenger Corporation,” now known as “Amtrak.”
The railroads eagerly abandoned all passenger traffic because, for political reasons, government regulators required providers to maintain lightly-used lines at unprofitable rates leading to billions in losses. Amtrak since has operated at a loss as routes continue to be selected based upon political considerations instead of market conditions. Amtrak has performed exactly as Rand predicted—unreliably, inefficiently, and unsafely. Like any other politicized corporation, Amtrak’s focus has shifted from its business line to political priorities such as climate change and diversity. We’ve also seen education, healthcare, electric utilities, and many more industries become so dominated by government intervention as to totally disrupt normal market forces.
Rand correctly foresaw that corporations would eagerly comply to gain favor from an all-powerful regulatory state that possessed the power to harass any business into bankruptcy.
2) Freedom of speech is an endangered species.
According to a recent lawsuit, the government pushed social media to censor politically inconvenient questions about the COVID-19 vaccine. Gone are the days when we believed that good speech overcame bad speech. Rand’s novel depicts something similar as the government pressured and blackmailed the main character into making sure her public statements conformed with the mandate to praise its bankrupt policies.
3) Political corruption will sap our ability to get things done.
Returning to the example of railroads, the recent collapse of the high-speed rail project in California illustrated Rand’s premise. In 2008, the voters of California authorized a $33 billion project to connect Los Angeles and San Francisco with the kind of high speed rail service utilized by the Japanese or the French. As recently noted by Kevin McCarthy,
The California High-Speed Rail project is one of the most expensive failures in State history and could cost $100 billion, more than three times the $33 billion that was initially estimated. This project, still nowhere near completion, was also expected to begin service in 2020. But that timeline has since come and gone, and now rather than three years behind schedule—which was already inexcusable to California taxpayers that were sold a bill of goods in 2008—it is once again off the rails. As a comparison, the Transcontinental Railroad was built in 6 years almost completely by hand and over a century and a half ago.
All government-led construction projects seem to be taking longer and longer as the projects become increasingly weighed down by myriad lawyers and consultants who don’t build anything. Like an animal drained of its life by parasites, the California project simply died under the weight of opportunists cashing in on their political power.
4) “Temporary emergencies” created by bad policies are never temporary.
Rand depicts a vicious cycle of government intervention leading to bigger and bigger problems which, in turn, lead to even more calls for more government intervention. Economists have noted that the two industries suffering from the most inflation—education and healthcare—also have the most government intervention targeted at making the services affordable.
As the Rail Passenger Service Act destroyed the market for private passenger rail service, the 2008 Affordable Care Act ( ACA) “wreaked havoc on individual insurance markets.” These effects included astronomical increases in health insurance costs that required massive taxpayer subsidies, inadequate coverage for ACA participants, and shortages due to healthcare providers rejecting the oppressive ACA participation regulations. As Rand would have predicted, the failure of the ACA generated political demand for even more government intervention in the healthcare market. Indeed, the lack of affordable health insurance helped propel Biden to the presidency in 2020 in spite of the fact that Biden proudly boasts of his role in the original ACA legislation.
5) Everything is illegal.
Rand predicted that administrative agencies eventually would seize the power to promulgate laws. She described an agency, the Bureau of Economic Planning and National Resources, that had the power to issue “directives” with the full force of law.
We have only to reflect on 2020 and the many quarantine-related “recommendations” the government enforced as vigorously as any act passed by Congress. With the stroke of a governor’s pen, politically motivated mandates closed churches and canceled concerts while abortion clinics and liquor stores continued operations as usual. Rand’s character, Dr. Ferris, who bears an eerie resemblance to Dr. Fauci, explains the Left’s fetish for laws:
Did you really think that we want those laws to be observed?. . . We want them broken . . . We’re after power and we mean it. . . . There’s no way to rule innocent men. The only power any government has is the power to crack down on criminals. Well, when there aren’t enough criminals, one makes them. One declares so many things to be a crime that it becomes impossible for men to live without breaking laws. . . . [Just] pass the kind of laws that can neither be observed nor enforced nor objectively interpreted—and you create a nation of lawbreakers—and then you cash in on guilt.
In 2018, New York state and local governments collected $1.21 billion in criminal and traffic fines and fees as revenue while its murder rate continues to soar. The Drug Enforcement Administration has made a business of seizing billions of dollars in cash from Americans without bothering to charge them with crimes. Meanwhile, the illegal drug trade in the United States shows no sign of relenting.
When Democrats lost the 2016 presidential election, they immediately launched a multi-front legal assault on the elected president that continues to this day. Even as I write this, a New York prosecutor is working up a dubious criminal case against the former president based on the idea that it’s criminal fraud for Trump to argue for high asset valuation on an insurance or loan application if he also pressed for a lower valuation of that same property for purposes of his property taxes. We all know that it doesn’t matter what Trump did or didn’t do. The law will be bent to punish him for taking power away from Democrats. It’s that simple.
Rand’s vision had flaws. But history has vindicated her dire warnings about politicized corporate/government partnerships oppressing freedom. Central planning of an economy always leads to corruption, inefficiency, and oppression. The historical examples are abundant and consistent as similar tragedies played out in Europe, Asia, Latin America, and now the United States. Yet even after the spectacular collapse of the Soviet empire, pernicious socialism has accelerated from creeping incrementalism to a full-on march.