Ganesh Prasad: How Does the Capitalist View Open Source?
May 16, 2001, 17:05 (82 Talkback[s])
(Other stories by Ganesh Prasad)
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By Ganesh Prasad
Open Source advocates are often embarrassed at the suggestion
that their favorite type of software may be a socialistic
Though they protest, many secretly fear it may be true. The
sharing aspect of Open Source, its emphasis on community and its
availability free of charge certainly sound like some form of
Socialism. And Open Source doesn't lend itself easily to commercial
exploitation. Is it anti-capitalist, then?
The recent pronouncements by Microsoft executives, that there is
no value in "free" and that it is impossible to make money by
giving away the very thing that is of value, ring true. It would
indeed be dreadful to discover that Open Source is anti-capitalist,
Many advocates of Open Source fervently hope for companies
offering Linux-related services to finally turn profits and prove
that there is a business model behind Open Source, but such a
prospect doesn't seem likely in the near term.
In any case, that's a roundabout way to establish Open Source's
A Capital Idea
The fundamental principles of capitalism are laid out very clearly
by that hardcore ideologue, Ayn Rand. So we should be able to
determine objectively (her favorite word) whether Open Source,
especially GPL-ed software, is opposed to the capitalist
In each of the following sections, we will look at Rand's view
on a particular concept and see how it compares with the state of
Open Source and the GPL. That should tell us where Open Source
stands with respect to capitalism -- or at least establish
"objectively" whether it is friend or foe.
The Wealth of OSs
"Wealth is the result of man's ability to think applied to the
sphere of production and trade. Reason, ultimately, is the source
of all wealth."
"Fundamentally, wealth is the product of man's mind -- and
belongs to each man to the extent that he created it."
"Wealth belongs to the individual who produced it."
Ayn Rand never wrote about software in her lifetime, but she
surely would have recognized it as wealth. Indeed, if Rand were to
write "The Fountainhead" today, her hero might very well be a
programmer rather than an architect. Nothing epitomizes individual
human creativity as well as software, being the product of pure
It is probably also safe to assume from her writings that Rand
would have considered software to rightfully belong to the
programmers who wrote it.
"Capitalism is a social system based on the recognition of
individual rights, including property rights, in which all property
is privately owned."
Ayn Rand believed that there is no such thing as "public
property." What is commonly referred to as such is the private
property of a government.
She would probably have had no use for "public domain" software,
treating it as wealth without an owner. However, Open Source
software, including all of GPL-ed software, is copyrighted by its
authors, and hence is not "public domain" but clearly privately
Not only that, since the software is owned by none other than
its creators, Ayn Rand would have had no argument at all with the
property ownership aspect of Open Source.
"The right to dispose of one's income belongs to the producer, and
if he wishes to give it to an heir, a charity, or to flush it down
the toilet -- that is the producer's right. It is not any of your
concern, and it certainly is not the concern of the
Rand clearly believed that the producer of wealth alone had the
right to determine what to do with it, and stated this belief in no
When we say today that the author of a piece of software gets to
choose the license under which to release it, we are echoing
License To ...
A programmer may release his or her work under a commercial license
or an Open Source license, such as the BSD license or the GPL. We
may all have our individual preferences for one or another, but as
Rand admonishes, the producer alone has the right to decide how to
dispose of his or her creation.
Therefore, Rand would have had nothing to say against
programmers choosing to release their software under the GPL of
their own free will.
"Free competition is the freedom to produce, and the freedom to
trade what one has produced, for one's own self-interest, i.e., in
the pursuit of one's own happiness."
Rand also wrote that under capitalism, one may obtain property
from other people in only one way: by voluntary consent of the
other. Rand said that by banning the initiation of physical force,
capitalism leaves only one way for people to deal with each other
-- through trade, which Rand termed "the highest form of voluntary
Rand was implacable in her opposition to the use of force for
any purpose but self-defense. She believed that capitalism is based
on individual rights, free will and free choice, not force or
What would the capitalist view of the general public license
(GPL) license be?
The GPL is by no means a coercive or deceptive license. It
clearly states the rights and obligations of any party who accepts
its terms. It offers access to the intellectual wealth created by a
producer, for a certain consideration.
The consideration is that any derived works that are publicly
distributed must also be made available under the same terms. This
consideration may seem strange, but stranger contracts have been
known to exist, which are legally valid and defensible.
The important thing is, there is nothing in the terms of the GPL
that is illegal, coercive or deceptive. If the terms of the GPL are
unacceptable to any party, those people are at liberty to walk
away. However, once they agree to the license, they are bound by
its terms and cannot renege on the deal.
Of Contract Bondage
Indeed, our archetype capitalist, Ayn Rand, believed that one of
the legitimate functions of a government is to enforce
So far from Rand considering the GPL an evil socialistic
phenomenon, it seems very likely from her writings that she would
have seen nothing in it contrary to the principles of capitalism.
Under the GPL, there are creators owning their creations, deciding
without coercion what to do with it, and entering into voluntary
agreements with other free individuals to use and improve their
work for mutual benefit.
The GPL is a textbook example of the enlightened self-interest
that capitalism talks about. It is clearly a way to increase
wealth, not to destroy it, and therefore it is objectively
The Money Train
And what about making money? Does Open Source fail the capitalism
test on that point? I'd say not as a matter of principle.
Rand always talked about "wealth" rather than money. She
recognized that there are many different forms of wealth created by
the humans for their enjoyment.
In that view, Rand remains light years ahead of today's
self-styled capitalists who see the capitalist system as a system
designed to make money.
No Status Quo
"How does capitalism differ from statism? Statism is the opposite
According to Rand, only capitalism declares that each and every
person has a right to live his own life and pursue his own
happiness. Rand wrote that men live not by permission of others,
but by right, and that the role of government is to protect that
liberty right because it is inalienable.
Rand believed that individuals must be free to carry out trade
with other individuals based on free will. She also identified
forces that seek to prevent the functioning of such a free system
and called them "statist," because they are enemies of
Since the GPL works according to principles approved of by this
capitalist ideal, those who seek to have it outlawed are attempting
to interfere with individual freedom. They are therefore statist --
and the real enemies of capitalism. Thus, when software giant
Microsoft talks about the need to educate policy makers about the
"threat" from Open Source, it is posing a statist threat to
Supporters of Open Source need not be embarrassed if no corporation
makes money from Open Source. Capitalism does not guarantee
corporations a profit, and Open Source does not need "proof" of its
What is important is that Open Source works exactly according to
the principles of capitalism. While many corporations may make
significantly less money due to the disruptive effect of Open
Source, Open Source will continue to create wealth for its creators
to enjoy and to share with everyone of their own free will.
And that is the ultimate measure of its value.
1. Capitalism - "The Unknown Ideal," Ayn Rand (New American Library
, a Web site
devoted to the philosophy of Ayn Rand
Ganesh Prasad is a strong supporter of Linux and Open Source
software. He considers himself a capitalist in the broadest sense,
because he believes that wealth is potentially limitless and must
be sought to be maximized. He also believes that individual wealth
is maximized when everyone is wealthy, because of the greater
variety and abundance of things to trade, and so it is in the
long-term self-interest of everyone to work towards increased
Ganesh offers permission to copy, distribute and/or
modify this document under the terms of the GNU Free Documentation
License, Version 1.1 or any later version published by the Free
Software Foundation; with no Invariant Sections, no Front-Cover
Texts and no Back-Cover Texts. A copy of the license is available
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