The president and executive director of the Ayn Rand Institute warned that the U.S. economy is in for more trouble, saying that while Americans may not accept socialism, they have accepted statist policies.

Sponsored by the USC Objectivists and speaking to a group made up predominately of USC students on Thursday, Dr. Yaron Brook argued against "prudish dictates" that are often rooted in religious moral codes and are opposed to true capitalism. Brook contended that these moral codes are dated and lack reason.

Brook said the U.S. economy has never exclusively favored capitalism. Instead, it is a mixed economy with some freedom and a lot of government.

“If you dig just a little bit, you discover government all over the place,” Brook said. “This is purely a government caused crisis.”

On October 3, 2008 the Emergency Economic Stabilization, often referred to as the bailout of the U.S. financial system, was enacted in response to the subprime mortgage crisis. Following congressional approval of the bill, President George W. Bush signed the bill into law and created $700 billion for the Troubled Asset Relief Program (TARP) that gave the government authority to buy failing bank assets. The goal of the law was to stabilize and provide immediate relief to the economy.

When President Barack Obama took office in January, he signed the American Recovery and Reinvestment Act of 2009, estimated to be worth more than $800 billion and aimed at expanding unemployment benefits and other social programs. Since the stimulus bill was passed, the Obama administration has since appealed for additional funds to help social programs and local aid. The U.S. deficit, moreover, is at more than $1.3 trillion.

Brook places blame on both Democrats and Republicans for the economic downturn.

“All Obama did was what Bush did badly… Change? There is no change. There’s more of the same and worse,” he said.

Brook said he thinks capitalists are often incapable of arguing for a biologically ingrained self-interest. The major premise of objectivism, the philosophy of Ayn Rand, is the pursuit of happiness or self-interest and living to the utmost. Many capitalists are afraid to take an assertive stance in favor of rational egoism, according to Brook.

Brook clarified, however, that self-interest does not mean taking away the fundamental rights of another human being, whether through physical force or fraud. 

Asked about upcoming elections and ballot initiatives, Brook said that his individual position, outside of the Ayn Rand Institute which is a non-partisan organization, is that it is better to vote for Republican candidates in the election despite any ideological misgivings because of the fiscal attitude of the country’s political left. 

Ultimately, though, Brook said he thinks the U.S. is headed toward a fall eventually. A politician like Ronald Reagan, he argued, will slow it down but won’t be able to fully stop it. Brook asserted that moving away from faith based values, particularly Christian values with “perverse” notions of sacrifice, are necessary in order for truly free markets to operate.

Reach reporter Reut Cohen here.

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