Atlas Shrugged – Part Two, Chapters V–VI

Summary—Chapter V: Account Overdrawn

John Galt is Prometheus who changed his
(See Important Quotations Explained)

The order for Taggart rail is the first failure in the
history of Rearden Steel. Without the copper, there is
nothing Rearden can do, and without the metal, Taggart cannot fix
its crumbling mainline track. There are more accidents, and shippers
who cannot get goods through go out of business. The economy spirals
quickly downward.
Colorado has become destitute, and virtually no businesses remain
on the Rio Norte Line. At a board meeting, Dagny is forced to close
the line and use the Rearden Metal to repair the worst problems
on the main line. A representative from Washington tells Jim that
in order to get the permits he needs, he will have to offer Wesley Mouch
something. As she leaves the meeting, Dagny finds Francisco D’Anconia
waiting for her. He asks her how long she is willing to continue
working for people who do not deserve her. She tells him that whatever
the cost, she cannot abandon the railroad.
Jim Taggart finds himself pulled in different directions
by the politicians and looters, and must find something valuable
to use to curry favor. The government wants no trouble from Rearden
when they announce another new law, so Jim seeks information about Rearden
that might help. He asks Lillian Rearden to dinner. She agrees to
help. After some investigation, Lillian discovers that Dagny is
Rearden’s mistress. When she confronts him, Rearden refuses to end
the affair, saying he would sooner see Lillian dead.
Summary—Chapter VI: Miracle Metal
Wesley Mouch, Jim Taggart, Orren Boyle, Dr. Floyd Ferris,
Mr. Weatherby, Fred Kinnan (head of the Amalgamated Labor of America),
and Mr. Thompson (the Head of State) meet to discuss Directive 10-289.
This set of laws is designed to freeze the economy in its present
state and prevent further decline. Although they fear the public’s
response, they vote to enact the laws.
According to the directive, workers must remain in their
present jobs or face prison, and all businesses must remain in operation.
All patents and copyrights must be turned over to the government
by means of voluntary Gift Certificates. No new devices, inventions,
or products can be produced. Every company is required to produce the
same amount of goods as the previous year, no more and no less. Wages
and prices are to be frozen, and every citizen is required to spend
the same amount of money as in the previous year. All research departments
must close except for the State Science Institute. To oversee the
law, the Bureau of Economic Planning appoints a Unification Board,
whose rulings are final.
Dr. Ferris notes that Hank Rearden will fight
them for his patent, but Jim assures Mouch that he can control Rearden
in exchange for Mouch’s raising his freight rates before the directive
freezes all prices.
Along with many other people around the country, Dagny
immediately resigns when she learns of the directive. She goes away
to a lodge she owns in the country. Dozens of industrialists disappear. Even
the Wet Nurse is outraged at what the government has done. He has
not been reporting Rearden’s illegal activities. His work at the
mills has made him begin to reject the ideologies he has been taught.
Dr. Floyd Ferris comes to see Rearden to demand he sign over the
patent for Rearden Metal, now to be called “Miracle Metal.” When
Rearden refuses, Ferris shows him evidence of his affair with Dagny
and threatens to ruin Dagny’s reputation by making it public. He
tells Rearden it was Lillian who sold him out. Rearden blames himself
for not divorcing Lillian and making his relationship with Dagny
legitimate. But he cannot see her destroyed, so he signs.
Analysis: Part Two, Chapters V–VI
The country’s economic decline is the logical result of
recent events. In a vast ripple effect, the problems are compounded.
A lack of copper means Rearden cannot make his metal. As a result,
Taggart cannot fix broken track and must run limited service. This
leads to shippers losing customers, causing them to go bankrupt,
leaving Taggart with fewer customers, forcing them to make further
cuts in service, and so on. Everything in an economic system is
connected. By outlining these related failures, Rand demonstrates
how interference in any part of an economy has consequences on every
other part of it. To Rand, the only legitimate role for government
in an economic system is noninterference.
The politicians seem surprised at the spiraling economy
and never entertain the idea that their policies may be to blame.
As consummate bureaucrats, their only response is to enact even
more policies, culminating in the overreaching Directive 10-289.
The absurd act is riddled with contradictions and double-speak,
such as the order that inventors be compelled to “voluntarily” give
up their patents. In blindly piling irrational law upon irrational
law, the politicians reveal their unwillingness to see the reality
before them. They have become so used to feeding off the productive
elements in society that they have not noticed that these elements
are no longer there. Among the looters, only the Wet Nurse
can see how insane the directive really is. He has begun to see
that the ideas he believed in were absurd. For some time, he has
been keeping Rearden’s illegal activities to himself, partly out
of personal admiration for Rearden. Now he can no longer support
the system he has been part of. The Wet Nurse is a notable character
in that he is the only one of the looters to have such a realization
and to accept the reality of what is happening.
Rearden’s transformation is nearly complete. He now understands
that he follows the code of life and creative production while the
looters, by seeking to destroy his ability to produce, follow a code
of death. By allowing them to ensnare him in their false, self-sacrificing
morality, he has unwittingly helped them. This knowledge is liberating
for him, but there is one more price he must pay. He knows now that
his affair with Dagny is a noble and good thing, and he wishes he
had been free enough to see it sooner. He does not care how the
public views him, but he will not allow Dagny to pay the price for
his mistake. He signs the Gift Certificate to protect her, but it
is the last time he will do anything to help the looters.