How Greed Became Good

John Paul Rollert traces the pursuit of self-interest over three centuries. He focuses on Ayn Rand and her influence:

[C]apitalism is the only economic system in which [Rand wrote] “the exceptional men” are not “held down by the majority” and in which … the “only good” that humans can do to one another and “the only statement of their proper relationship” are both acknowledged: “Hands off!” A woman who titled a collection of essays The Virtue of Selfishness, Rand was given to brackish candor. Yet at a time when many people think that the common good is more often imperiled than empowered by unbridled greed, she provides an alternative defense of the acquisitive instinct by appealing to an ethics of gross achievement and a formulation of personal liberty that looks with suspicion and disdain on any talk of civic duty, moral obligation, or even prudential restraint. Her aim was simple: To relieve greed, once and for all, of any moral taint.

“I think greed is healthy,” an apparent acolyte told the graduating class at Berkeley’s business school in 1986. “You can be greedy and still feel good about yourself.” The speaker was Ivan Boesky, who shortly thereafter would be fined $100 million, and later go to prison, for insider trading. His address was adapted by Oliver Stone as the basis for Gordon Gekko’s “greed is good” speech in Wall Street. An exhortation to shareholders of a sagging company, it reads like a corporate raider’s war cry, with Gekko the grinning avatar of Agency Theory.

Such a blunt endorsement of greed today remains far beyond the mainstream. If we tolerate greed, it is because we accept the hard bargain of the Invisible Hand. We believe that greed can do good, not that it is good. That, we are unwilling to say.

(Video: Gordon Gekko preaches greed in Wall Street)