We the Living

Ayn Rand's laissez-faire tracts have enjoyed a revival in recent years – Alan Greenspan was an early devotee. Her thinking continues to influence all levels of US finance and politics.

Ayn Rand's novels are pictured
Ayn Rand's novels are pictured as an Indian bookseller arranges books at his roadside stall. Photograph: Getty Images

Back in the 1980s, there was a story circulating on the American right, according to which the Russian émigré novelist and thinker Ayn Rand had pronounced on the correct way of dancing. Only one dance form was truly rational, she was supposed to have declared. Some dances she viewed as semi-instinctual physical performances lacking intellectual content: the tango, perhaps. Others - the foxtrot, possibly - she condemned as too contrived and abstract.

So what was the dance form that best combined mind and body? Why, tap-dancing. Fred Astaire may not have known it, but he embodied the Apollonian and the Dionysiac, the opposing forces of reason and instinct which, according to Nietzsche in The Birth of Tragedy, shaped life and culture in an ideal synthesis.

Whether the story is true, I cannot say, but it may well have had some basis in fact. Like all cults, Rand's aimed to embrace every aspect of life, so it is not surprising that it might have prescribed the way to dance. Rand, an assiduous promoter of her own ideas, helped set up the Foundation for the New Intellectual to disseminate them. After she died in 1982, her followers established an Ayn Rand Institute to protect her legacy. In politics, she was a right-wing individualist: the state should be minimal and people should be left to organise their own lives in the free market. But Rand's religion - a brand of evangelical atheism so extreme that Richard Dawkins's version sounds almost reasonable - required that everyone think alike and live in the same way. She was a dedicated smoker, so everyone else had to smoke, too. She also used a cigarette holder. The result, described to me by a former disciple, could have been a scene from Monty Python: when Rand addressed the faithful, a thousand cigarette holders would move in harmony with hers. Not for nothing were her followers sometimes referred to as "the Collective".

Rand claimed that her ideology was based on pure reason - just as the rationality of tap-dancing could be deduced from indisputable first principles, so was the free market. It is this crackpot rationalism that distinguishes her cult from other fringe religions and explains its influence, especially in America. Though anathematised by purists for back­sliding on the virtues of the gold standard, Alan Greenspan was an early devotee who has never renounced her philosophy. Greenspan has acknowledged how an a priori view of the free market shaped his policies, even admitting - in testimony to a Senate committee in October 2008, after the crash occurred - that what he described as his "ideology" was "flawed" as an account of "how the world works". Greenspan's admission illustrates something progressives prefer to forget: the maddest ideas are very often those with the largest historical consequences.

We the Living (1936), Rand's first published novel, recounts the struggles of a romantic heroine in the early years of the Soviet Union. Neither the story nor the writing is in any way remarkable. The heroine, Kira, an idealised version of the author, has a number of personal entanglements and decides to leave the Soviet Union. Rand left Russia on a tourist visa in 1926, aged 20, never to return. Unlike the author in real life, Kira dies in the attempt. The characters are thin and cartoonish; the historical background is only vaguely sketched.

If Rand had not gone on to found her cult and to give it a bible in the form of the 1,200-page Atlas Shrugged (1957), there would likely never have been a second edition of We the Living. Yet the book deserves its place in the Penguin World Classics series, and not only as a prelude to Rand's later work, because even by its omissions it tells us something important about her "philosophy" - a pastiche of myths and assertions that she called, with unwitting humour, "Objectivism".

In her foreword to We the Living, written for its republication in 1959 and reprinted in the new Penguin edition, Rand tells the reader that in some places she has "reworded the sentences and clarified their meaning, without changing their content. All the changes are merely editorial line-changes. The novel remains what and as it was." Her insistence that nothing of substance has been blanked out is disingenuous, to say the least. The first edition has long been a rare book. Years ago, coming across a copy while browsing in the stacks of an American university library, I was amused to read passages that had disappeared in the second edition. Most have faded from memory, but Wikipedia reminds me of some of them. The heroine tells a Bolshevik admirer, "I admire your methods. I loathe your ideals", and later asks him, "What are the masses but mud to be ground underfoot, fuel to be burned for those who deserve it?" One of the few writers of fiction to succeed in making the Bolsheviks seem attractive, Rand did not hate the new Soviet regime because it oppressed the masses. She hated it because she believed it did not oppress the masses enough.

The Nietzschean quality of the deleted passages is not accidental. She belonged to a generation of young Russians whose view of the world was shaped largely by Nietzsche. Just about every literate Russian teenager had read or heard about the excitable German thinker. Where Rand was original was in transmuting his ideas, in her later work, into an American myth. Nietzsche's absurd Superman became a heroic entrepreneur - John Galt in Atlas Shrugged, for example - and an explicitly elitist ideology merged with the American folk religion of laissez-faire capitalism.

Reprocessed as Americanised myth, Rand's vulgar-Nietzschean world-view fuelled a publishing phenomenon (Atlas Shrugged has sold millions). More significantly, her bizarre confection had some influence on US public policy. Greenspan may have deviated from the strict Randian faith, but he retained one of its craziest tenets: get rid of government interference, and freedom and prosperity will inevitably follow. As much as reckless greed, it was this ideology that led to the crash whose first act has been playing out over the past two years.

Rand is easily mocked - and rightly so - but the type of thinking she exemplified is to be found not only on the right. Her capitalist superman is a ludicrous conception, but no more so than Trotsky's idea that, in a future socialist society, the human animal would be replaced by a higher species whose average member, he predicted, would far exceed Aristotle in abilities. It is childish to argue, as right-wing ideologues do, that the failures of global capitalism derive from there never having been a truly free market; but it is just as silly to maintain that the horrors of Soviet communism occurred only because real socialism never existed in Russia. In each case, disaster predictably followed from attempting to impose a dream of reason on society.

Left-wing progressives are not as remote from Rand as they like to think. They also aim to remake society through reason. And they, too, dream of turning the shifts and turns of history into a rational dance.

We the Living
Ayn Rand
Penguin, 464pp, £10.99

John Gray is the New Statesman's lead book reviewer. His latest book is "Gray's Anatomy: Selected Writings" (Penguin, £10.99)