Ethics of Capitalism: Individualism

“Individualism regards man—every man—as an independent, sovereign entity who possesses an inalienable right to his own life, a right derived from his nature as a rational being. Individualism holds that a civilized society, or any form of association, cooperation or peaceful coexistence among men, can be achieved only on the basis of the recognition of individual rights—and that a group, as such, has no rights other than the individual rights of its members.”

— Ayn Rand


Rational self-interest is opposed to sacrificing others or sacrificing oneself

In regards to one’s relationship with others, rational self-interest is opposed to sacrificing one’s interests for others (what philosopher Auguste Comte coined as altruism or “otherism”).

Rational self-interest holds that it is immoral to sacrifice a higher value (such as one’s self, beloved wife, or friends) for a lessor or non-value (an enemy or stranger). In cases where helping a stranger does not sacrifice one’s values, rational egoism does not prohibit such behavior, but sees it as an act of generosity and good-will (and not as a “duty”).

Neither does, rational self-interest mean sacrificing others for oneself (what is smeared as “selfishness”), such as when a thief attempts to get something for nothing by robbing a bank, or a con man attempts to commit fraud. Rational self-interest holds that such irrational, dependent behavior is not in one’s self-interest but is, in principle, self-destructive.


Rational self-interest means to deal with others by the trader principle

Rational egoism holds that life does not require giving up values, dependence, and destruction, but value-pursuit, independence, and creation. Rational self-interest means having a benevolent view of existence, seeing other individuals as traders with a shared harmony of interests, exchanging value for value — in the material (wealth and pleasure), intellectual (knowledge and discussion), and spiritual (love and friendship) realms.


Individualism regards the individual as a sovereign being; collectivism as a serf

Thanks to specialization under the division of labor, one can gain immense values by living with others in a proper society — namely knowledge and trade (in physical and spiritual values).

Such a society operates under the moral doctrine of individualism — where each individual is regarded as an end in oneself, and not as a slave for the ends of others. Individualism does not mean living a “rugged life” on a desert island or as a “lone wolf” in the wilderness, but like its antithesis, collectivism, specifies the nature of the relationship of the individual to the rest of society.

Where collectivism holds that the life of the individual is only justified in service to the group; individualism regards the individual not as a slave, but as a sovereign being (as an end in oneself and not a means to the ends of others) that owns their own life.

(Observe the powerful influence of ethics on politics: altruism, the ethics that upholds self-sacrifice as a noble ideal, leads to collectivism, the politics of sacrificing the individual to the group; rational egoism leads to individualism.)


The rational individual requires freedom from coercion

There are only two ways individuals may deal with each other: by reason (i.e., speech, contract, persuasion) or by force (i.e., physical blows, compulsion, fraud).

Only by the initiation of physical force (coercion) can one be: prevented from speaking, robbed, or murdered; that is, stopped from acting by one’s mind, rendering it useless as a means of survival.

Given that (1) reason is one’s only means of knowing reality, (2) that reason is the attribute of the individual, and that (3) one must use reason to produce the values one needs to survive, in a proper society the rational individual requires only one thing from his neighbors (and they in turn equally of him): to be left free to think and left free to act on that thinking. This is the meaning behind laissez-faire — to “leave alone” and to “let one do”.

The individual needs freedom — from the initiation of physical force. Freedom, not to act by permission of another, but freedom to act on principle. The moral concept that identifies such freedom of action in a social context is the principle of individual rights, , what philosopher Ayn Rand identified as the bridge between individual morality and social politics.



Capitalism regards the individual as a sovereign, independent being.

  • Rational self-interest is opposed to sacrificing others or sacrificing oneself (altruism).
  • Rational self-interest means to deal with others by the trader principle.
  • Individualism regards the individual as a sovereign being;
  • Collectivism regards the individual as a serf/slave.