Category Archive 'Atlas Shrugged'
25 Apr 2016

Venezuela’s Suicide

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Venezuela1

Joel Hirst looks on as the lights begin to go off in Venezuela. That country has arrived recently at a point resembling the closing chapters of Ayn Rand’s Atlas Shrugged.

Tonight there are no lights. Like the New York City of Ayn Rand’s “Atlas Shrugged”, the eyes of the country were plucked out to feed the starving beggars in abandoned occupied buildings which were once luxury apartments. They blame the weather – the government does – like the tribal shamans of old who made sacrifices to the gods in the hopes of an intervention. There is no food either; they tell the people to hold on, to raise chickens on the terraces of their once-glamorous apartments. There is no water – and they give lessons on state TV of how to wash with a cup of water. The money is worthless; people now pay with potatoes, if they can find them. Doctors operate using the light of their smart phones; when there is power enough to charge them. Without anesthesia, of course – or antibiotics, like the days before the advent of modern medicine. The phone service has been cut – soon the internet will go and an all-pervading darkness will fall over a feral land.

All it would take is the election of one more radical Progressive democrat like Bernie Sanders and the USA could share in the full Venezuela experience.

30 Dec 2014

Dagny’s Texts

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Dagny_Taggart_by_kait_wrait
Kait Wraith, Dagny Taggart

Mallory Ortberg imagines Dagny Taggart texting:

Francisco
Francisco are you awake?
Francisco?

what is it
Francisco, I can’t sleep
I’m sorry
I had a bad dream
the one about the Communists?
I don’t want to talk about it
tell me about the root of money again, Francisco

what time is it?
Come on, Francisco
tell me
I’ll help get you started
“Money is a root of exchange…”

Dag, please
I have to work in the morning
“Paper is a mortgage on wealth that does not exist…”
you don’t even need me to tell you what money is
I like the way that you tell it best
all right
all right, I’ll tell you about the root of money
do that voice you do for the looters, ok
do your looters voice

I’ll do my looters voice
k

19 Jul 2012

Channeling Ayn Rand

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Jeff Carter points out that the argument made by President Obama in Roanoke, Virginia has been made before: Chapter 9, Page 1.

He didn’t invent iron ore and blast furnaces, did he?”

“Who?”

“Rearden. He didn’t invent smelting and chemistry and air compression. He couldn’t have invented his Metal but for thousands and thousands of other people. His Metal! Why does he think it’s his? Why does he think it’s his invention? Everybody uses the work of everybody else. Nobody ever invents anything.”

She said, puzzled, “But the iron ore and all those other things were there all the time. Why didn’t anybody else make that Metal, but Mr. Rearden did?”

21 Aug 2011

Why Obama is So Confused Right Now

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John Hinderaker shrewdly diagnoses the source of recent liberal paralysis of will in Washington.

Many liberals believe that government policies have little impact on the economy. A number have expressed that view to me privately. They think that the private sector will produce wealth regardless of what happens in Washington, and the only question is how to split it up. I think that is what President Obama and his advisers believed when he took office. The country was in economic turmoil from which it inevitably would recover, as it always does. When it did, Obama would get the credit.

In the meantime, the administration’s mantra was “never let a crisis go to waste.” Obama saw economic decline as an opportunity to pave the way for socialized medicine, to enact a near-trillion-dollar payoff to public sector unions in the guise of “stimulus,” and to extend the government’s control over various sectors of industry.

I think Obama and his advisers were genuinely surprised, not that their policies didn’t bring about economic recovery–they couldn’t have expected that–but that recovery didn’t happen of its own accord. That is why they are so nonplussed today.

I think John is perfectly correct.

Barack Obama and the democrats in general thought the Panic of 2008 was just a bump in the economic highway, contrived by smiling liberal Fates intending to deliver them into power. A panicked public would accept the leadership of the left during a momentary crisis and find themselves soon after living in a European-style welfare state. The New Deal’s march in the direction of socialism would be completed. President Obama would join the pantheon of progressive builders of grand collective entitlements, going down in history beside Franklin Roosevelt and Lyndon Johnson. The economy would fix itself; it always does. And President Obama would receive the credit for both the recovery and for Obamacare.

But, then, the economy did not heal itself.

There comes a point in Ayn Rand’s Atlas Shrugged, after the announcement of Directive 10-289, when the efforts of capitalist heroes Dagny Taggart and Hank Rearden to keep the railway system operating and steel mills in production begin to fail.

Somebody like James Taggart, one of the leftist supporters of the regime, begs Dagny or Hank to keep the failing system afloat. The hero assures the collectivist that the burden of regulations and redistribution has made it impossible. But we want it, insists the second-hander looting collectivist. It’s your responsibility to make it work for us.

Barack Obama is no more able to understand than James Taggart the incompatibility of limitless liberal demands and a viable economy.

26 Jul 2011

Atlas Shrugged in Alabama

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Danny Lemieux:

I know of several people of considerable net worth who have already left the U.S. to settle elsewhere. I know others who have opted out of the workforce altogether to retire on what they have, knowing that their futures look grim. This morning, I listened to the founder and former CEO of The Home Depot, Bernie Marcus, explain that there is no way an enterprise such as The Home Depot could ever be founded in today’s regulatory climate. Around me, I see empty store fronts and shuttered businesses. The comments about the business climate from my contacts in California’s San Joaquin Valley are cringe inducing.

Then, via the blogs Small Dead Animals and Instapundit, I am directed this blog, linked below, describing one Alabama mine owner’s response to the current environmental, regulatory and business climate: read it carefully and read the comments.

http://www.davidmcelroy.org/?p=1586

Is Atlas shrugging?

Hat tip to Karen L. Myers.

19 Dec 2010

Re-Reading Atlas Shrugged

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David Ross
was recently moved to re-read Atlas Shrugged.

In an experience shared by many, he found the novel much better, and far more worthy of respect as a work of literature, than he had remembered.

The Obama era was, for me as for so many others, an open invitation to reread Rand, so thoroughly does she seem to diagnose the psychology of our present slide into statism (Obama’s constant rhetoric about sibling-keeping might as well be plucked from the mouth of Wesley Mouch). News that Atlas Shrugged is finally being filmed also helped inch the book to the top of my pile. …

I was trepidacious, however, not sure to what extent I might have outgrown Rand. I was not concerned about the palatability of her philosophy, to which I have never specifically subscribed, but about her prose and her craftsmanship, which self-congratulatory journalist types constantly deride as second-rate, the kind of thing that only a teenager or cultist could fail to smirk at. This passing reference in a December article in the Weekly Standard is typical:

    Atlas Shrugged, while a perennial bestseller and an important artifact of 20th-century culture, is not exactly great literature (stilted dialogue and cardboard characters have ranked among the defects pointed out by critics).

I have now reread the first half of Atlas Shrugged, and I can offer my very educated opinion that it is great literature, not necessarily at the sentence level, but in the unstoppable propulsion of its narrative (has a philosophical novel ever been so engrossing?), in the massive, dauntless sweep of its ideas, and in its enormous imaginative feat of creating a myth of our entire world (Dante and Milton are Rand’s compeers in this limited, formal respect).

Even more, Atlas Shrugged is a great work of literature in its comprehensive taxonomy of modern men, in its comprehension of all their hidden springs and insecurities and frustrations and ambitions. Rand fancied herself a political theorist and metaphysician, but she misunderstood herself; she was a psychologist foremost, and Atlas Shrugged is a formidable system of psychology to contraindicate that of Freud. Eschewing the usual bedroom and bathroom preoccupations, Rand grasps that behavior is driven by what she calls ideals, conscious or unconscious structures of value that provide the context for everything we do and everything we are. Freud tends to reduce these structures to underlying psychosexual dynamics, but Rand insists on their primacy and irreducibility, and she illustrates their role as the ceaseless motive forces of life. She is also a particularly shrewd diagnostician of a certain kind of resentment and leveling instinct – James Taggart is the obvious embodiment – and she is nearly alone in realizing that this mindset is no trivial phenomenon but the rotting core of our world, explaining everything from the Soviet world-blight to our failing schools and lousy art.

Rand’s characters are ‘cardboard’ in the sense that they speak for philosophical positions and represent certain types, but each character embodies something slightly different; there is no overlap or redundancy. In the aggregate, they form a spectrum of humanity – a human comedy – that is convincing and powerfully explanatory. Rand is accused of engaging in moral black and white, but this is not entirely fair; while her scheme is moral in logic and purpose, many of her characters – Dr. Stadler for example – represent subtle, equivocal positions. They are not gray, but an intricate admixture of black and white.

Rand sketches her characters in only a few clean strokes, but these strokes are rendered so deeply and forcefully as to be ineffaceable. Who can forget Hank Reardon or Dagny Taggart? Who can forget their triumphant inauguration of the John Galt Line? Who can forget their strange, violent lovemaking? What character drafted by Henry James, by contrast, does anything but deliquesce and drift imperceptibly from consciousness, becoming a vague haze of inflection and velleity?

Atlas Shrugged is a great novel, finally, in its astonishing originality. It has no precedent in terms of style, tone, mood, or philosophy, as far as I know. Victor Hugo may account for its sweep and social engagement, and someone like Zamyatin may have influenced its anti-totalitarianiasm and latent dystopianism, but nothing accounts for its strangeness, for everything powerfully eccentric and not infrequently repellent that Rand herself brings to it, everything rooted in the passionate kinks and quirks of her personality. In the end, it belongs in the category of the sui generis along with modern masterpieces like Ulysses, The Castle, and Pale Fire.

I suppose I would say that Atlas Shrugged needs to be viewed as a fantasy mystery story operating as an extended exercise in political argument and moral instruction, different from, but fundamentally akin to such non-realistic, and intrinsically polemical, works of literature as the Divine Comedy, Pilgrim’s Progress, Utopia, Hudibras, or Gulliver’s Travels.

Rand’s characters are not so much one-dimensional cardboard figures as they are what Erich Auerbach in Mimesis refers to as figura, characters serving as rhetorical illustrations of the operation of virtues, vices, and political ideas in social, business, and civic interaction. The wonder is not that Rand’s characters do not completely plausibly resemble ordinary real world human beings, but that her walking, talking illustrations of virtues, character flaws, rationality, and corrupting delusion are as successfully animated as they are.

Rand’s really conspicuous failures, far more than in characterization, lay in her Bohemian intellectual’s lack of understanding of the normal attitudes and perspectives of businessmen and her glaringly atrocious apprehension of the state and direction of technology. Ayn Rand living in the American 1950s sees the Count of Monte Cristo commuting to the office instead of the Organization Man. George Babbitt, in her mind, becomes transformed into Zarathustra. Rand is also disastrous as a prophet of the direction of business opportunities. One pictures her taking those whopping royalty checks and purchasing bundles of stock certificates in such cutting edge industries of the future as railroads, coal mines, and steel mills. Rand was oblivious to a post-industrial reality which was just around the corner. There are no data processing engineers, chip designers, or programmers in her cast of technologists. Hank Reardon has a lighter new metal alloy. John Galt is monkeying around with cosmic rays. Nobody is building personal computers, cell phones, or the Internet.

12 Oct 2010

“Atlas Shrugged” Becomes an Issue in Wisconsin Senate Debate

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The Milwaukee Journal-Sentinel reports on the latest manifestation of the influence of Ayn Rand’s 1957 novel on contemporary American politics.

U.S. Senate candidates Ron Johnson and U.S. Sen. Russ Feingold clashed sharply Monday night on Ayn Rand’s famous novel “Atlas Shrugged,” about an economy crumbling under the weight of government intrusion and regulations. …

While the two went back and forth on issues such as the economy, Social Security, the health care law and the war in Afghanistan, the most spirited discussion came from a book that was written in 1957 and remains popular among some conservatives and people who espouse limited government.

Rand’s book describes a dystopian America where the leading innovators leave society out of frustration with rules and regulations. It is a book that Johnson says he admires and has been a driving force in his political philosophy.

Asked by a panelist about the book, Johnson said “Atlas” represents the producers of the world, while “Shrugged” represents how overburdened the producers are with rules, regulations and taxes.

“It’s a warning of what could happen to America,” Johnson said. “When you hear people talk about a tipping point, that’s what we’re concerned about. . . . We have more people who are net beneficiaries of government than are actually paying into the system. That’s a very serious thing to think about.”

“I believe in the community,” Feingold responded. “I believe in the community of Wisconsin. . . . You believe the producers are a very special group of people. I guess they’re better than the rest of us. When things aren’t going their way, you take the position that people shouldn’t have unemployment compensation because you have the view they don’t want to work.”

Johnson said he wasn’t against the minimum wage and the extension of unemployment benefits. He said the fact that Feingold was talking about that showed that the stimulus bill was a failure.

“The last thing we should be doing is increase taxes on anybody in this recovery,” Johnson said.

After the debate, Feingold said Johnson “had a very narrow view of who actually does the work in society. I think everybody is working hard.”

It sounds a lot like Hank Reardon debating Wesley Mouch.

14 Jun 2010

Atlas Shrugged Movie Begins Production

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Shooting of the film version of Atlas Shrugged, after years and years of rumors, actually began over the weekend, Variety reports.

No Angelina Jolie as Dagny, no (magically young again) Max von Sydow as John Galt. Also no James Cameron-scale hundred million dollar production. No major studios. Just a humble $5 million independent production.

Shooting started Saturday because the producers were contractually obligated to begin the five-week shoot or lose the rights to Ayn Rand’s novel.

The reported cast includes:


John Galt (Paul Johansson)


Dagny Taggart (Taylor Schilling)


Henry Rearden (Grant Bowler)

The film does have an IMDB page.

Hat tip to Walter Olson.

05 Jun 2010

BP Should Simply Shrug

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Atlas sostiene la volta celeste, 2nd Century A.D., Collezione Farnese, National Archaeological Museum, Naples.

Claude Sandroff reacts with wholesome indignation to the ritual immolation of the corporate scapegoat by the High Priest of the Cult of the State and his media acolytes.

Obama and his team of thugs are dressed out in heavy boots aimed at BP’s neck. Apparently, oil booms and actionable emergency plans are in short supply in the government, but the Obama administration is buried under a glut of hard heels in a variety of men’s and women’s sizes. And they’re all ready to stomp on BP’s jugular.

Adding to BP’s public relations woes are some of Hollywood’s film geniuses, probably armed with decades of deep-water drilling experience, only too happy to dismiss the exhausted and skilled BP repair staff as a bunch of morons. My advice to the BP board of directors is that they simply accept the third-party assessments of their qualifications and tell Obama, his government, and his media acolytes that the time has come for them to take charge of capping the Deepwater Horizon riser. …

In the midst of this major ecological calamity, when BP can least cope with major distractions and vile recriminations, Obama’s clueless legal team has decided to threaten the company with a criminal probe. Tone-deaf Eric Holder is unable to pronounce the words “Islamic terrorist,” but he has already unleashed his justice department to cripple BP, essentially labeling it a criminal enterprise. Perhaps Obama and his band of goons need to hear from BP that they are stopping all capping efforts to concentrate on their legal defense.

As a BP shareholder, I wouldn’t be upset. Rather, I’d applaud BP’s actions and even buy more stock with full knowledge that its declaration of bankruptcy is all but guaranteed. It’s already rumored that some of BP’s valuable drilling assets in Alaska might have to be sold off to pay for the Gulf cleanup.

It’s a brilliant idea to sell those assets as quickly as possible. The environmental hit teams have no intention of letting anyone, anywhere, drill in the U.S. ever again. Not in Alaska, not in the Rockies, not in shallow water, and certainly not in deep water. Only the Brazilians and the Norwegians and the Mexicans, and the Chinese and the Indians and the British and the Angolans — only everyone else will be allowed to do that. …

BP must accept the reality that it is not GM. BO has no vast democrat union base of employees that must be protected at all costs and no mass vote-generating machine to deliver for Obama. They are expendable. They are not even GE, in complete control of a sycophantic media outlet always ready to sing the praises of Obama on broadcast and cable outlets, all day and all night.

BP might become Government Petroleum soon enough if they don’t act quickly. They should offer to sell off their expertise and assets to the Chinese, who at least will appreciate them and use them aggressively. While China’s state-owned oil exploration company, CNOOC, was denied the prize of Unocal in 2005, the United States is in a much weaker economic, military, and political position today with respect to China. Surely a BP sale would breeze through a regulatory review in today’s climate.

Assured access to a plentiful, long-term oil supply is the chief foreign policy concern of China. And BP could revel soon in the irony of drilling again in deep Gulf waters — only this time for the Chinese off the coast of Cuba.

22 Jul 2009

“Barack Will Never Allow You to Go Back to Your Lives as Usual”

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Glenn Reynolds reports that, for some strange reason, sales of books like Ayn Rand’s Atlas Shrugged and Friedrich Hayek’s Road to Serfdom are soaring.

The amused cynic contends:

(W)hat is happening is that through the “economic emergency,” Obama is trying to implement Rand’s fictitious “Directive 10-289,” which is what the the combination of “stimulus package,” unsupervised TARP bailouts, “Cap and Trade,” and “Health Care Reform” equal when they are rammed down your throats without discussion (or even the reading of the details) by your supposed “representatives” in the national government.

He quotes none other than Michelle Obama herself, telling an audience at UCLA last year:

Barack, as Oprah said, is one of the most brilliant men you will meet in our lifetime.

Barack is more than ready. He’ll be ready today, he’ll be ready on day one, he’ll be ready in a year from now, five years from now – he is ready.

That is not the question. The question is: What are we ready for?

Wait, wait, wait – because we say we’re ready for change, we say we’re ready for change, butcha see, change is HARD.

Change will always be hard, and it doesn’t happen from the top down.

We do not get universal health care, we don’t get better schools because somebody else is in the White House. We get change because folks from the grass roots up decide they are sick and tired of other people telling them how their lives will be – when they decide to roll up their sleeves and work.

And Barack Obama will require you to work.

He is going to demand that you shed your cynicism, that you put down your division, that you come out of your isolation, that you move out of your comfort zones, that you push yourselves to be better, and that you engage.

Barack will never allow you to go back to your lives as usual – uninvolved, uninformed…

Who knows? Like the Khmer Rouge, he may decide to march urban populations out of energy consuming cities for resettlement at collective farm settlements in the countryside, too.

27 Jun 2009

Farrah Fawcett and Ayn Rand

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When Amy Wallace interviewed the late Farrah Fawcett by email a few months ago for an article about the history of efforts to produce a film version of Atlas Shrugged, she discovered that the blonde actress had had a special relationship with Ayn Rand and had been Ayn Rand’s choice to play Dagny Taggart (!).

How did you first learn of Ayn Rand’s interest in you? I gather she got in touch in the late ’70s, when Charlie’s Angels was one of the biggest hit shows ever to appear on TV?

Ayn contacted me with a personal letter (and a copy of Atlas Shrugged) through my agents. Even though we had never met (and never did), she seemed to think we must have a lot in common since we were both born on the same day: February 2nd.

Why did Rand say she was so determined to see you in the role of Dagny Taggart, the female heroine in Atlas Shrugged?

I don’t remember if Ayn’s letter specifically mentioned Charlie’s Angels, but I do remember it saying that she was a fan of my work. A few months later, when we finally spoke on the phone (actually she did most of the speaking and I did most of the listening), she said she never missed an episode of the show. I remember being surprised and flattered by that. I mean, here was this literary genius praising Angels. After all, the show was never popular with critics who dismissed it as “Jiggle TV.” But Ayn saw something that the critics didn’t, something that I didn’t see either (at least not until many years later): She described the show as a “triumph of concept and casting.” Ayn said that while Angels was uniquely American, it was also the exception to American television in that it was the only show to capture true “romanticism”—it intentionally depicted the world not as it was, but as it should be. Aaron Spelling was probably the only other person to see Angels that way, although he referred to it as “comfort television.”

Did Ayn have any favorite episodes of the show?

I have to admit that I don’t think Ayn was a big fan of the stories themselves because she kept saying that someday somebody would offer me a script (and a role) that would give me the chance to “triumph as an actress.” Ayn wanted that script to be Atlas Shrugged and that role to be her heroine, Dagny Taggart. But because of the challenges in adapting and producing the novel for television, several years went by and the script and role that Ayn hoped I would someday be offered turned out to be The Burning Bed and the role of Francine Hughes instead. And so, in an unexpected way, Ayn’s hope or expectation for me did come true. Looking back, she seemed to see something in me that I had not yet seen in myself.

Had you read Atlas Shrugged or any of her other famous books? What was your familiarity with the Rand world view?

At the time that Ayn contacted me about Atlas Shrugged, my only real familiarity with her work was the movie version of her previous novel, The Fountainhead, with Gary Cooper. I remember liking the movie because it was unique in that the characters seemed to be the embodiments of ideas as opposed to real flesh and blood people with interests and lives. Now that I think about it, I think that’s why Ayn was drawn to Charlie’s Angels. Because the characters that Kate, Jaclyn and I played weren’t really characters (the audience never saw us outside of work) as much as personifications of the idea that three sexy women could do all the things that Kojak and Columbo did. Our characters existed only to serve the idea of the show (even “Charlie” was just a faceless voice on a speaker phone).

But I also responded to The Fountainhead because, as an artist (a painter and sculptress) myself, I related to the architect’s resistance to make his work like everyone else’s—which was, of course, what Ayn’s own art was all about. And that resistance to conformity is probably one of the reasons that she was so determined to see me play Dagny: At the time I would have been the completely unexpected choice.

It sounds as if you and Rand got along pretty well.

Later, when I read Atlas Shrugged, I was reminded of my first and only conversation with Ayn and how some of the characters in her novel(s) take an immediate liking to each other, almost as if they had always known each other—at least in spirit. And this was the feeling I got from Ayn herself, from the way she spoke to me. I’ll always think of “Dagny Taggart” as the best role I was supposed to play but never did…

09 May 2009

Re-Reading Atlas Shrugged in the Age of Obama

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“Mr. Rearden,” said Francisco, his voice solemnly calm, “if you saw Atlas, the giant who holds the world on his shoulders, if you saw that he stood, blood running down his chest, his knees buckling, his arms trembling, but still trying to hold the world aloft with the last of his strength, and the greater the effort the heavier the world bore down upon his shoulders — what would you tell him to do?”

“I . . . don’t know. What . . . could he do? What would you tell him?”

“To shrug.”

Bruce Webster decides to re-read Atlas Shrugged and finds that Ayn Rand’s dystopian predictions are starting to read like the morning paper.

For a work written half a century ago, Atlas Shrugged remains surprisingly timely. In an eerie echo of today, many (if not most) critical economic and political decisions are made not by the President or Congress, but by a host of civilian advisors who spend as much time jockeying amongst themselves for position and influence as they do trying to solve the country’s problems. In the novel itself, the focus on trains, mining, steel, and manufacturing, especially within the United States, all seem very quaint and archaic in our digital/silicon/networked/globalized civilization, but every few pages, Rand will have a passage that is not only relevant but often prescient.

For example, consider this passage regarding one major (unsympathetic) character who ends up as a powerful government bureaucrat:

    “My purpose,” said Orren Boyle, “is the preservation of a free economy. It’s generally conceded that free economy is now on trial. Unless it proves its social value and assumes its social responsibilities, the people won’t stand for it. If it doesn’t develop a public spirit, it’s done for, make no mistake about that.

    Orren Boyle has appeared from nowhere, five years ago, and had since made the cover of every national news magazine. He had started with a hundred thousand dollars of his own and a two-hundred-million-dollar loan from the government. Now he headed an enormous concern which had swallowed many other companies. This proved, he liked to say, that individual ability still had a chance to succeed in the world.

    “The only justification of private property,” said Orren Boyle, “is public service.” (p. 45)

03 Apr 2009

John Galt’s Time May Have Come

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Recent political developments have made Ayn Rand’s masterpiece timely and topical and Hollywood.com reports that financing may be in the works to begin production of the film version.

Charleze Theron seems to have replaced Angelina Jolie as the front runner to play Dagny Taggart.

Ryan Kavanaugh is said to be circling the eternally stuck-in-development-hell big-screen adaptation of Ayn Rand’s self-styled ‘magnum opus,’ Atlas Shrugged.

Kavanaugh’s Relativity Media, according to the Risky Biz blog, could come aboard to finance the Baldwin Entertainment project with Lionsgate.

While Angelina Jolie was the most recent name attached to play protagonist Dagny Taggart, the blog says that other stars now interested include Charlize Theron, Julia Roberts and Anne Hathaway.

Given the book’s themes of individualism that resonate in the era of Obama, government bailouts and stimulus packages, this could be the perfect time to finally get the book to the screen.

“This couldn’t be more timely,” Karen Baldwin, who along with husband Howard is producing, told BIZ. “It’s uncanny what Rand was able to predict — about the only things she didn’t anticipate are cell phones and the Internet.”

With the recession, the book has experienced a resurgence. As of today, it is listed as top seller on Amazon in the Literature & Fiction Literary and Classics categories.

The story first appeared at Hollywood Reporter’s Risky Biz blog.

25 Mar 2009

Jake DeSantis Shrugged

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The New York Times published yesterday’s resignation letter from Jake DeSantis, executive vice president of the American International Group’s financial products unit, to Edward M. Liddy, the chief executive of A.I.G.

Dear Mr. Liddy,

It is with deep regret that I submit my notice of resignation from A.I.G. Financial Products. I hope you take the time to read this entire letter. Before describing the details of my decision, I want to offer some context:

I am proud of everything I have done for the commodity and equity divisions of A.I.G.-F.P. I was in no way involved in — or responsible for — the credit default swap transactions that have hamstrung A.I.G. Nor were more than a handful of the 400 current employees of A.I.G.-F.P. Most of those responsible have left the company and have conspicuously escaped the public outrage.

After 12 months of hard work dismantling the company — during which A.I.G. reassured us many times we would be rewarded in March 2009 — we in the financial products unit have been betrayed by A.I.G. and are being unfairly persecuted by elected officials. In response to this, I will now leave the company and donate my entire post-tax retention payment to those suffering from the global economic downturn. My intent is to keep none of the money myself.

I take this action after 11 years of dedicated, honorable service to A.I.G. I can no longer effectively perform my duties in this dysfunctional environment, nor am I being paid to do so. Like you, I was asked to work for an annual salary of $1, and I agreed out of a sense of duty to the company and to the public officials who have come to its aid. Having now been let down by both, I can no longer justify spending 10, 12, 14 hours a day away from my family for the benefit of those who have let me down. …

The profitability of the businesses with which I was associated clearly supported my compensation. I never received any pay resulting from the credit default swaps that are now losing so much money. I did, however, like many others here, lose a significant portion of my life savings in the form of deferred compensation invested in the capital of A.I.G.-F.P. because of those losses. In this way I have personally suffered from this controversial activity — directly as well as indirectly with the rest of the taxpayers. …

But you also are aware that most of the employees of your financial products unit had nothing to do with the large losses. And I am disappointed and frustrated over your lack of support for us. I and many others in the unit feel betrayed that you failed to stand up for us in the face of untrue and unfair accusations from certain members of Congress last Wednesday and from the press over our retention payments, and that you didn’t defend us against the baseless and reckless comments made by the attorneys general of New York and Connecticut. …

I have decided to donate 100 percent of the effective after-tax proceeds of my retention payment directly to organizations that are helping people who are suffering from the global downturn. This is not a tax-deduction gimmick; I simply believe that I at least deserve to dictate how my earnings are spent, and do not want to see them disappear back into the obscurity of A.I.G.’s or the federal government’s budget. Our earnings have caused such a distraction for so many from the more pressing issues our country faces, and I would like to see my share of it benefit those truly in need.

On March 16 I received a payment from A.I.G. amounting to $742,006.40, after taxes. In light of the uncertainty over the ultimate taxation and legal status of this payment, the actual amount I donate may be less — in fact, it may end up being far less if the recent House bill raising the tax on the retention payments to 90 percent stands. Once all the money is donated, you will immediately receive a list of all recipients. …

This choice is right for me. I wish others at A.I.G.-F.P. luck finding peace with their difficult decision, and only hope their judgment is not clouded by fear. …

Sincerely,

Jake DeSantis

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