Cato Shrugged: Panic About An Incoming Leader’s Admiration for Ayn Rand

When we last looked at the Cato Institute’s battle for ownership – current honchos versus the Kochs, who saw a way to take control of the think tank – the storm had calmed. A negotiated deal would retire Cato’s longtime president Ed Crane and install a new leader, John Allison, a banker whom everyone got on with. Crisis averted.

On to the next crisis. My friend Jeremy Lott broke the news of an Allison speech at a meeting of the Ayn Rand Institute, the Objectivist group run by Leonard Peikoff, whom Rand considered an intellectual heir. According to tweets from the meeting, Allison had been open to “reform” of Cato’s foreign policy shop – meaningful because pure Objectivism is hawkish, and Cato’s current national security hawks are not. The Lott story trafficked the libertarian blogosphere. It surprised people, even though Allison had recently written the introduction to a “capitalist guide” through Atlas Shrugged.

Allison has now sent out a water-calming e-mail to Cato staff. “I was being ‘grilled’ at the event,” he writes, “and will not guarantee that my answers were the best. Also, I was still learning about Cato.”

The whole email is posted below.

From: John Allison

Subject: Update/Rumors

Date: August 30, 2012 

All Cato Employees,

I have now had the pleasure of meeting with almost all the Cato team. I’m impressed with the quality of Cato’s employees and their commitment to Cato’s mission. 

However, there a couple of rumors circulating that are creating unnecessary anxiety. The first has to do with  my association with the Ayn Rand Institute ( ARI ). I participated in a Q and A at a previously planned ARI event shortly after the announcement that I would become President of Cato. There has been Internet chatter based on “tweets” from the Q and A. I was being “grilled” at the event and will not guarantee that my answers were the best. Also, I was still learning about Cato. However, in the many sessions I have had with employees at Cato my answers have been totally straightforward. Make your own judgment. 

As regards to my philosophy, I had a number of discussions with Ed Crane long before being approached to become Cato’s President. I believe Ed and I are in fundamental agreement on all essential philosophical issues. Also, I have written a book, The Financial Crisis and the Free Market Cure, which will be published by McGraw Hill on September 27. The book focuses on economics, but also includes fundamental comments on individual liberty, national defense, and the overall role of government. Ed said he agreed with everything in the book, except my position on Fair Value accounting which is an esoteric issue. I think you will find my philosophy as expressed in this book very consistent on every major issue with Cato ‘s core beliefs. The book was written before I considered becoming Cato’s President. Furthermore, I certainly do not expect anyone at Cato to always agree with me and I have a great deal to learn. 

As discussed at several employee meetings, while I am proud to be an objectivist, the focus on my association with ARI is completely out of context. I am also on the boards of the Duke, UNC, and Wake Forest business schools and universities are fundamentally philosophical organizations. I guarantee some of the faculty at these universities are dramatically less philosophically aligned with Cato than is ARI. I have learned from this university engagement and possibly changed some minds. In fact, now that I have a deeper understanding about Cato, I believe almost all the name calling between libertarians and objectivists is irrational. I have come to appreciate that all objectivists are libertarians, but not all libertarians are objectivists. I respect this distinction, (although I consider anarchy to be dangerous).

It’s important to understand that my primary life experience is as a businessman, with over 40 years of working with BB&T. The conspiracy theories that seem important in think tanks appear very odd to me. When I retired as CEO, BB&T had $152 billion in assets and 30,000 employees. There was a radically wider range of fundamental beliefs among these employees than exist at Cato. Yet, we worked together to create a great organization. Having run a large organization with many different constituencies, I am a “big tent” thinker. I have long encouraged ARI to work with Cato. Furthermore one of the reasons I came to Cato is that I believe we can play a leadership role in the greater free society movement without sacrificing our principles. Frankly, if all of us who believe in a free society don’t become more impactful, the future wellbeing of the U.S. is at risk. Being successful demands both a long term perspective and current action plan.

We are in the last stages of finalizing the settlement documents. If all goes as planned, I will assume the Presidency of Cato October 1 and Ed will continue in a consulting role (after year end). By the way, the Cato Board who are long time libertarians offered me a contract which I refused. If I am not optimizing the performance of Cato in fulfilling its mission then the board can and should find a new leader. All of you (especially Ed) have the right to be proud of Cato’s many accomplishments. However, everything can be improved. Some of the strategic thinking skills I learned leading a rapidly growing and highly successful organization can drive Cato to even greater effectiveness. We will make the world a better place to live by powerfully communicating the principles of individual liberty, limited government, free markets and peace while creating a culture where each employee can pursue their personal happiness. 

Best Wishes,


P.S.  For those interested in foreign policy, these are some quotes from my book:

The Founding Fathers did not see the purpose of the U.S. military to eliminate injustice on the planet as liberals demand. They did not expect the U.S. military to make the world safe for democracy as the neo-conservatives demand. They viewed the role of our armed forces to protect and defend the U.S.  George Washington wisely advised to avoid foreign entanglements. The Founding Fathers were familiar with the economic waste of European military adventures. 

It is clear that the defense budget in the U.S. could be cut at least 25% and the U.S. be better defended than it is today.