In response to the critics of capitalism, many conservative Christians turn to philosopher Ayn Rand for ammunition. Rand was a staunch defender of capitalism, but also an anti-Christian atheist who argued that capitalism was based on greed. Greed, for Rand, is good. But if Rand is right, then Christians can’t be capitalists, because greed is a sin. Fortunately, Rand was wrong. She missed the subtleties of capitalism. First, we should distinguish self-interest from selfishness. Adam Smith, the father of capitalism, famously wrote, “It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest.” True enough; but that alone isn’t a problem. Every time you wash your hands or look both ways before you cross the street, you’re pursuing your self-interest—but neither activity is selfish. Second, Smith never argued that the more selfish we are, the better a market works. His point, rather, is that in a free market, each of us can pursue ends within our narrow sphere of competence and concern—our “self-interest”—and yet an order will emerge that vastly exceeds anyone’s deliberations. Finally, Smith argued that capitalism channels greed, which is a good thing. The point is that even if the butcher is selfish, he can’t make you buy his meat. He has to offer you meat at a price you’ll willingly buy. So capitalism doesn’t need greed. What it does need is rule of law, freedom, and human creativity and initiative. And we can point that out without any help from Ayn Rand.

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SELFISHNESS AND SELF-INTEREST

Some thirty million books by Rand have been sold, and more than five-hundred thousand copies of her books are still sold every year. In a poll conducted by the Library of Congress and the Book of the Month Club in the 1990s, Atlas Shrugged came in second behind the Bible as the most influential book. Although her work is best known in the U.S., it’s read around the world.

Perhaps it’s not surprising that many conservatives, including many Christians, embrace her: they think they have nowhere else to go. Who but Rand made industrialists the heroes of novels? Whatever the reasons for her popularity, however, she completely missed the subtleties of capitalism. Her hatred of Marxism and collectivism led her to defend a caricature of capitalism more grotesque than anything Marx imagined.

Her praise of “greed” is the reduction to the absurd of a bad interpretation of Adam Smith’s concept of self-interest. Smith, a moral philosopher, didn’t goad butchers, brewers, and bakers to be more selfish.¹⁰ He believed that normal adults aren’t self-absorbed monads but have a natural sympathy for their fellow human beings. His point about self-interest is that, in a rightly ordered market economy, you’re usually better off appealing to someone’s self-love than to their kindness. The butcher is more likely to give you meat if it’s a win-win trade, for example, than if you’re reduced to begging. Smith isn’t suggesting that butchers should never help beggars.¹¹

Smith was a realist. He wasn’t naïve about the motives of merchants and everyone else. In fact, like most academics, he harbored snobbish prejudices against business. He knew the difference, however, between self-interest and mere selfishness.¹² Smith believed humans are a mixed breed. We are pulled to and fro by our whims and passions, but we’re not a slave to them, since our passions can be checked by the “impartial spectator” of reason. We are capable of vices such as greed and virtues such as sympathy.

Unlike Mandeville, moreover, Smith didn’t view all our passions as vicious. We may be passionately committed to a just cause, for instance. At the same time, he saw greed as a vice. So while he agreed with Mandeville that private vices could lead to public goods, he was an ardent critic of the Dutchman. “There is,” he said, “another system which seems to take away altogether the distinction between vice and virtue, and of which the tendency is, upon that account, wholly pernicious: I mean the system of Dr. Mandeville.”¹³ You’d never catch Smith endorsing Ayn Rand.

For Smith, pursuing your self-interest was not in itself immoral. Every second of the day, you act in your own interest. Every time you take a breath, wash your hands, eat your fiber, take your vitamins, look both ways before crossing the street, take a shower, pay your bills, go to the doctor, read a book, and pray for God’s forgiveness, you’re pursuing your self-interest. That’s not just okay. In most cases, you ought to do these things.

In fact, proper self-interest is the basis for the “Golden Rule,” which Jesus called the second greatest commandment, after the command to love God: “In everything do to others as you would have them do to you, for this sums up the Law and the Prophets” (Matt. 7:12 NIV). I’m supposed to use my rightful concern for myself as a guide in how I treat others. This makes sense, since I know best what I need. “Every man is, no doubt, by nature,” Smith said, “first and principally recommended to his own care; and as he is fitter to take care of himself than of any other person, it is fit and right that it should be so.”¹⁴

Self-interest isn’t just looking out for number one at everyone else’s expense. Since we’re social beings, our self-interest includes our friends, families, communities, coworkers, coreligionists, and others.¹⁵ When I pay my bills, I’m not just pursuing my narrow interest, but the interests of my family, my bank, my community, and whomever I’m paying. I chose my church and my neighborhood and my car not just for myself, but for my children. (Mostly for them, in fact. If I were childless, do you think I’d drive a grey Honda Accord?)

Most of your choices involve the interests of others, too. Self-interest has to do with those things we know, value, and have some control over. I’m most responsible for what I do. Smith’s point was not that the more selfish we are, the better a market works. His point, rather, is that in a free market, each of us can pursue ends within our narrow sphere of competence and concern—our “self-interest”—and yet an order will emerge that vastly exceeds anyone’s deliberations.¹⁶ The same would be true, even if we did everything with godly rather than mixed motives. The central point is not our greed, but the limits to our knowledge. The market is a higher-level order that exceeds the knowledge of any and all of us.

10 See the excellent article on this point by Robert A. Black, “What Did Adam Smith Say about Self-Love?” Journal of Markets and Morality 9, 1 (Spring 2006): 7–34.

11 The “butcher, brewer, baker” quote is notoriously misinterpreted when pulled out of context. For context, see Wealth of Nations, 15.

12 So Smith, in his Theory of Moral Sentiments, says: “It is the great fallacy of Dr. Mandeville’s book to represent every passion as wholly vicious which is so in any degree and in any direction.” Quoted in F. B. Kaye’s commentary to Bernard Mandeville, Fable of the Bees, vol. 2 (Oxford: Oxford University Press, 1924; repr. Indianapolis: Liberty Fund, 1988), 414.

13 Adam Smith, The Theory of Moral Sentiments, ed. D. D. Raphael and A. L. Macfie (Oxford: Oxford University Press, 1976; reprint Indianapolis: Liberty Fund, 1981). Quoted in P. J. O’Rourke, On the Wealth of Nations (New York: Atlantic Monthly Press, 2007), 157.

14 Smith, Theory of Moral Sentiments.

15 Smith understood this, but he is often misinterpreted by later economists working in a more thoroughgoing utilitarian and individualistic mindset. As James Halterman puts it, “Clearly Smith’s notion of self-interest is not expressed as the isolated preference of an independent economic agent, but, rather, as the conditioned response of an interdependent participant in a social process.” In “Is Adam Smith’s Moral Philosophy an Adequate Foundation for the Market Economy?” Journal of Markets and Morality 6, 2 (Fall 2003): 459.

16 Robin Klay and John Lunn develop this idea in their excellent article, “The Relationship of God’s Providence to Market Economies and Economic Theory,” Journal of Markets and Morality 6, 2 (Fall 2003): 547–59.

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