[Editor note: With the Atlas Shrugged movie (Part I) opening this week, MasterResource is examining the book (Part II–today), the philosophy behind the book (Part III–Wednesday), the moral obligation of capitalists according to Rand (Part IV–Thursday), and Atlas shrugging in the energy market (Part V–Monday).]

Ayn Rand’s first major novel, The Fountainhead, is the story of a lone architect struggling against the altruistic, collectivist norms of his profession. Atlas Shrugged describes the process by which men and women of accomplishment and honor withdraw their talent to defeat a parasitic, collectivist society.

Rand described her major plot device, an anti-Industrial Revolution:

Reverse the process of expansion that goes on in a society of producers: Henry Ford’s automobile opened the way for industries: oil, roads, glass, rubber, plastics, etc.

Atlas Shrugged (Part I) had a strong debut weekend despite the effort of its philosophical critics, including some leading movie reviewers, to pan the effort and to discourage attendance (see the Appendix below where Walter Donway challenges Roger Ebert).

This movie and the classic 1957 book are important for today’s energy debate in a variety of ways, beginning with Enron and continuing with Obama energy policy. And how Rand undressed Richard Nixon with the energy crisis of her day(Part V–see schedule below)!

“Ah, Ha!”: Interpreting Enron/Ken Lay

For me personally, Ayn Rand’s philosophy was the key that unlocked the mystery of Ken Lay and the magical new energy company, Enron. I had once studied Objectivism but lost interest in Ayn Rand, finding it too dogmatic for my taste. (In retrospect, I ‘threw the baby out with the bath water’.)…

[Editor note: The original title of the post of Dr. Brätland (bio at end) was “Institutions and Policies that Impede Capital Maintenance for Extractive Firms.” Resourceship is a term used by the late economist Stephen McDonald (1924–2006) to describe entrepreneurship applied to mineral resources.

Dr. Brätland’s post below complements a series of entries at MasterResource under the terms resourceship, peak oil (fixity-depletion), and ultimate resource, as well as subsoil privatization.]

Although capital maintenance by extractive firms refutes the exhaustion myth of minerals, this refutation hinges on access to lands, entrepreneurial latitude in managing resources, and secure private-property rights.

In particular, certain institutions of governmental control and jurisprudence hinder entrepreneurial actions of extractive firms striving to maintain capital (defined as the asset value of to-be-extracted minerals).

These hindrances include:

(a) Foreclosure of land access by government ownership of mineral lands;

(b) Foreclosure of entrepreneurial latitude by court imposed covenants enforcing obligations to surface owners; and

(c) In the case of petroleum, the extractive firm’s inability to acquire full control and ownership of reservoirs it has discovered.

What did Julian Simon have in common with Bjorn Lomborg? Both had strong statistics experience, and both started their research believing in popular environmental and over-population fears. Both Simon and Lomborg were convinced they could employ statistical  research to document and address these problems.

However, both Simon and Lomborg unexpectedly proved themselves wrong by looking seriously at empirical evidence.  Simon’s Malthusian-paradigm-busting book, The Ultimate Resource (1981), influenced many with its optimistic pro-technology data, analysis, and conclusions. (1) Years later Wired magazine interviewed Julian Simon and put him on the cover, complete with Julian’s little red devil’s horns.

Bjorn Lomborg picked up the Wired issue at the Los Angeles airport and read Simon’s claims with skepticism and even dismay.  Simon had to be wrong! And as a statistic professor, Lomborg was confident he could document and popularize the errors. …