Riding Coach Through Atlas Shrugged: Part 4 – Governor’s Ball

Pages 48 – 53

Chapter Summary – A group of industrialists sit around a shadowy table plotting the downfall of our favorite rugged individualist.

[Part 3]

I love how cliché this chapter is. Four figures sitting around a table, their faces shrouded in darkness as they scheme over the fate of the world, the sycophant politician sniveling his consent to their plans. This is one of those times where I am not quite sure if the fiction created the trope or the fiction is following the trope but it is okay either way, it is delightful to read.

We have at our table:

James Taggert: Who is far less whiny when not in the presence of his sister.

Orren Boyle: Our socialist-industrialist representative in the story.

Wesley Mouch: Our aforementioned politician, in the pay of Hank Rearden but in the pocket of Orren Boyle.

And finally –

Paul Larkin: The man at Rearden’s dinner party last chapter.

Essentially they spend the chapter plotting against Hank Rearden and promoting a philosophy of non-competition among businesses. From a historical standpoint this is essentially what happened with Hoover and the industrialists leading up to the great depression. A series of price and wage controls were set up that distorted normal market activity leading to the boom-and-bust cycle as described by Ludwig von Mises. As a side-note it is an interesting historical misconception that Hoover “did nothing” during the great depression. Hoover was arguably the most meddling president up to that point in regards to the economy except perhaps for Abraham Lincoln, but total economic warfare is hard to beat.

But to get back on track here, for what it lacks in literary creativity this chapter makes up for with pure economic and political insight that is delightful to read. The most illuminating part is a speech, or perhaps rant, by Orren Boyle that goes as follows, some of Taggert’s responses are edited out for brevity:

“Listen Jim…” He began heavily.

“Jim, you will agree, I’m sure, that there’s nothing more destructive than a monopoly.”

“Yes.” Said Taggart, “on the one hand. On the other, theres the blight of unbridled competition.”

“That’s true. That’s very true. The proper course is always, in my opinion, in the middle. So it is, I think, the duty of society to snip the extremes, now isn’t it.”

“Yes,” said Taggart, “it isn’t fair.”

“Most of us don’t own iron mines: How can we compete with a man who’s got a corner on God’s natural resources? Is it any wonder that he can always deliver steel, while we have to struggle and wait and lose our customers and go out of business? Is it in the public interest to let one man destroy an entire industry?”

“No,” said Taggart, “it isn’t.”

“It seems to me that the national policy ought to be aimed at the objective of giving everybody a chance at his fair share of iron ore, with a view towards the preservation of the industry as a whole. Don’t you think so?”

“I think so.”

This exchange is a fantastic summary of the process involved when the government gives special privileges to favored industries under the guise of regulation. Essentially Rearden is out-competing his fellow steel producers and since they cannot compete under market conditions they intend to compete politically by ham-stringing his business through the legal process.

This process has happened time and time again throughout history and the ironic part is that these actions have almost universally been heralded as “anti-business” when in fact it is the businesses itself that propose this regulation. The first anti-monopoly laws in America were lobbied for by the competitors of the successful oil, rail, and steel businesses which resulted in the *rise* in prices of those goods. It seemed the “natural” monopolies were pro-consumer while the regulation was pro-business.

There are also historical comparisons to be made to the great depression. The whole concept of “protecting an industry” at the expense of a single, productive, individual was the cornerstone of “Hoover-nomics” especially in the farm industry. The industrial revolution brought about a massive increase in farming productivity which naturally led to a decline in prices and a surplus of labor in that industry that came to a head during the “dirty thirties”.

The natural course of the market would be for inefficient firms in that industry to liquidate; with the entrepreneurs and workforce moving to other industries. This would cause a short period of transitional unemployment as workers moved into similar or growing industries while the more efficient firms and prospective entrepreneurs would buy the liquidated capital goods of the inefficient businesses at a discount.

Consumer goods prices would fall to equilibrium where only firms able to produce goods below that price would be able to maintain production. This would have the net effect of expanding the labor pool and be a net gain for society as new areas of production would be made available by the increases in productivity. Instead, Hoover organized industrial cartels that maintained price and wage controls over the entire economy propping up inefficient businesses that continued to waste and malinvest resources resulting in what we know today as the great depression.

To summarize, this chapter is a fantastic must read five page tour de force of economic insight.

Next chapter: More Dagny, more snark, and more family drama.

Riding Coach through Atlas Shrugged: Chapter 2 – Whistling In the People’s Key.

Part One

50th Anniversary edition pages 20-32

Chapter Summary – We are introduced to Dagny Taggart, brother of James, who reflects on neo-classical music, throws her family name around a bit, cuckolds her brother’s business, and smokes, also Kellogg turns down an offer he can’t refuse.

Dagny is one of the characters who I am somewhat familiar with due to cultural osmosis. Her strong willed antagonism, her intelligence and stubbornness, her anger, her misery, and her smoking. All things that I expected that were confirmed in her first chapter in Atlas Shrugged.

What I didn’t expect however was the amazing paragraphs about Richard Halley’s symphony.

“It was a symphony of triumph…”

the notes of the symphony

“spoke of rising and were the rising itself.

Emphasis mine. The way Dagny is enveloped by the symphony, it consumes her, and just for a moment she can do nothing but feel when she hasn’t in so long.

Then it is revealed that she is merely hearing it being whistled from across the train car by some blond brakeman. If one man whistling one part of that symphony can fill Dagny with such joy then what effect would a full orchestra have on her, on the people, on society?

That feeling is the very thing I hope to gain from this project. The sense of wonder that Dagny is overwhelmed with and a reminder that

“[T]his is why the wheels have to be kept going, and this is where they’re going.”

The brakeman is interesting as well. Rand’s description of him as a worker with no loose muscles was very telling to me. This blue-collar laborer is the one carrying the tune that is Dagny’s hope. This is in stark contrast to the train conductor for example who doesn’t seem to care about the problems he faces and simply hopes everything will work out.

He jerked his head up at the red light. “I don’t think the signal is going to change. I think it is busted.”

“Then what are you doing?”

“Waiting for it to change.”

I almost wonder if this theme of hard working but uneducated versus apathetic educated middle class will continue. I always felt that Rand was somewhat anti-laborer, that those who were not entrepreneurs were merely leaches on the productive members of society but I am beginning to think that impression may have been unfounded.

Speaking of entrepreneurs there were two major economic principles stated in this chapter. First was Dagny exemplifying the attributes of an entrepreneur when she makes the call to use Rearden Metal for the new railroad tracks. When James protests the use of the new metal she tells him that she is making the call using her own judgment, knowledge, and personal experience. She is willing to assume the risk for this venture based on a gut feeling and her own personal belief that it will work. It is important to notice that she doesn’t deflect responsibility or assume some other person or entity will absorb any losses if she is wrong.

The second economic point was in regards to monopolies. A great exchange takes place between Dagny and James that goes as follows:

“It isn’t fair,” said James Taggart.

“What isn’t?”

“That we always give all our business to Rearden. It seems to me we should give somebody else a chance, too. Rearden doesn’t need us; he’s plenty big enough. We ought to help the smaller fellows to develop. Otherwise, we’re just encouraging a monopoly.”

“Don’t talk tripe, Jim,”

“Why do we always have to get things from Rearden?”

“Because we always get them.”

“I don’t like Henry Rearden.”

“I do. But what does that matter, one way or the other? We need rails and he’s the only one who can give them to us.”

“The human element is very important. You have no sense of the human element at all.”

“We’re talking about saving a railroad, Jim.”

“Yes, of course, of course, but still, you haven’t any sense of the human element.”

“No. I haven’t.”

This exchange exemplifies the free market vs anti-property positions on monopolies but misses one crucial point. This anti-monopoly activity is driven solely by the free choice of the individual. Taggart is perfectly able to restrict his business from any source he chooses for any reason he chooses and this is the pure libertarian position on the matter.

Now, don’t get me wrong, he is making a poor entrepreneurial choice since Associated Steel has repeatedly failed to deliver on the contract and from a purely economic standpoint Dagny is correct. From a libertarian standpoint however, both are correct.

James is totally justified running his business into the ground for any reason he chooses and Dagny has every right to seek out new opportunities. Assuming of course she owns part of the company or has been granted the authority to act in the company’s name. The latter is the case here as far as I can tell.

I would also like to point out that other non-humanistic arguments against monopolies are almost universally false. Predatory pricing for example has essentially never happened successfully even in the case that made it illegal.

Now for the negatives.

Primarily I feel like James is a bit too obvious as a villain, he is almost too petulant and whiny. I just don’t buy that anyone would follow him and that the board of directors would have kicked him off years ago. I suppose Rand is pushing the whole feudalism thing. How many nations have fallen because of a weak King or Queen?

Also, I just don’t know how to feel about Dagny yet. The quirkiness is what bothers me the most. Sitting on the arm of the chair, her snarkyness and her general self-importance. I am not sure how much I am going to like her character yet but there is plenty of book to go so we shall see.

Finally I have to give the last story beat in this chapter credit. The final conversation Dagny has with Kellogg was an amazing piece of the mystery that literally gave me chills of anticipation. Where are these people going? Why are the best and brightest suddenly missing but still creating? And most importantly…

Who is John Galt?

Riding Coach Through Atlas Shrugged. Chapter 1: The Calendar Hung Itself.

50th Anniversary Edition pages 11-20*

*Note: The actual chapter ends on page 33 but I am splitting these up based on POV changes for easier digestibility.

Chapter Summary: White-collar worker Eddie Willars runs into a peculiar homeless man, reflects on a decaying city, and attempts to convince his boss of an urgent matter in Colorado.

My initial impressions are all pretty positive. The opening line: “Who is John Galt?” accomplishes everything an opening should and most importantly sets up a mystery to pique the reader’s interest.

Even with my limited knowledge of small parts of this book I was still immediately hooked by the questions presented on the first page: “Who is John Galt?”, “Why does it [the above question] bother you?”, and without missing a beat (or answering those questions) Rand describes the world that frames these questions quite beautifully with several potent, if a bit obvious, metaphors.

The bum as the faceless masses, intelligent but wearied and cynical without the energy to change their station but able to if inspired. “The face was wind-browned, cut by lines of weariness and cynical resignation; the eyes were intelligent.”

It also seems to be relevant that the bum is our introduction to the character of John Galt. The nameless, faceless masses knowing about the coming change almost instinctively and long before the more comfortable and well off middle class.

The city, in my estimation, represents society as a whole. Once beautiful but now decaying and, like the old tree on the Taggart estate, hollow and rotting from within. “…the shafts of skyscrapers against them were turning brown, like an old painting in oil, the color of a fading masterpiece.” The seed of beauty and triumph is there but it has rotted from within.

Eddie is who really intrigued me though; he reminded me a lot of Tolstoy’s Ivan Ilyich. A middle man in society who knows something is wrong but doesn’t have the skills to do anything about it. While he cannot identify the sinking feeling that permeates every fiber of his being he does have a stable foundation to latch onto.

“When he was asked what he wanted to do [in life], he answered at once, “whatever is right”…”twenty two years ago. He had kept that statement unchallenged ever since; the other questions had faded in his mind…[B]ut he still thought it self evident that one had to do what was right; he had never learned how people could want to do otherwise.”

As a natural-rights libertarian I believe that there are absolute moral and ethical truths and Eddie’s commitment to a similar personal philosophy deepened my ability to relate to the character. It also stands in stark contrast to more modern interpretations of ethics such as “rule utilitarianism” which will always decay to subjective act-utilitarianism.

“David Lyons argued that collapse occurs because for any given rule, in the case where breaking the rule produces more utility, the rule can be sophisticated by the addition of a sub-rule that handles cases like the exception. This process holds for all cases of exceptions, and so the ‘rules’ will have as many ‘sub-rules’ as there are exceptional cases, which, in the end, makes an agent seek out whatever outcome produces the maximum utility.”

In short, any attempt to prevent the “ends justify the means” outcome of utilitarian ethics, without some sort of higher moral authority, inevitably fails and the system is reduced to one of pure utilitarianism. I was actually under the impression that Rand was a bit of a utilitarian herself so I will be interested to see if this commitment to the universal “right” turns out to be a character flaw in Eddie or whether it remains an ideal to be upheld.

Eddie’s confrontation with James Taggart was also quite inspiring. A man who knows he is stepping out of line but is willing to do so for the sake of his personal convictions is an ideal that many of us could due to imitate. I will save my examination of James until the next installment but the important thing I took from this interaction between James and Eddie was how uncomfortable James grew when Eddie looked into his eyes.

“What Taggart disliked about Eddie Willars was this habit of looking straight into people’s eyes. Eddie’s eyes were blue, wide and questioning; he had blond hair and a square face, unremarkable except for that look of scrupulous attentiveness and open, puzzled wonder.”

If, as I suspect, Eddie is the everyman (or reader avatar) in this story and James is an (the?) antagonist then what I am supposed to take from this is that the villains in this world, and in ours, cannot stand up to scrutiny. They are filled with uneasiness when we examine their actions and question their motivations. If Eddie is an ideal, then his attentiveness is an ideal as well.

Eddie’s relationship with the Taggarts as a whole is something I hope is explored more. It is obvious he admires and respects Dagny since they grew up together and the fact that he still has some sort of respect for James leads me to believe that the latter wasn’t always so insufferable. What made Eddie so devoted to this family? Was it simply their entrepreneurial spirit or was there something more?

I had a few small criticisms but I am going to have to wait to see how they play out. As I mentioned briefly at the start of this entry Rand’s metaphors were really straight forward which isn’t bad in and of itself but simply something I am taking note of and will look for as the chapters go by.

I cringed a bit when Eddie admitted that he was simply a serf pledged to the Taggart lands. The whole feudalism angle is one that I am going to keep an eye on since one of the most common attacks on libertarianism is that it would descend into a neo-feudal corporatist society.

Of course I may be taking the line a bit too seriously since Eddie was simply trying to get James to agree to his requests to support the Rio Norte line. In fact it could very well turn out to be a rebuke of that attack once all is said and done.

Finally I have no idea what the giant calendar is supposed to represent or foreshadow. Perhaps it is simply a literal translation of the city’s days being numbered which would both be very clever and kind of groan-worthy at the same time. Hopefully Eddie shows up again soon to let us know but I have a sneaking suspicion that our protagonist isn’t Mr. Willars despite my initial preoccupation with his character.

Check in next time for first impressions of Dagny, a word of support for monopolies, and our first real look at James Taggart. I wish this was a George R.R. Martin novel so maybe he would be dead before the book was over. Hey, I never said I would be impartial.

Part 2

An Act of Self-Defense: A Review

“The Tree of Liberty must be refreshed from time to time with the blood of patriots and tyrants,” said Thomas Jefferson.  Erne Lewis does a terrific job of adapting this theme to 21st-century America in his new novel, An Act of Self-Defense.

Like Atlas Shrugged, his story is set in an immediate future where the economy is collapsing, and more so than in Atlas, personal freedoms are vanishing.  Unemployment is at 20 percent and all communications are recorded and tracked by the NSA.  RFID badges are worn by all federal employees and will soon be required for all citizens.  A small group of patriots takes matters into their own hands, and the action is fast and furious.

Lewis draws the correct battle lines of our time: not left versus right but libertarian versus fascist.  The f-word correctly describes anyone on the left or right who would use government power to suppress personal or economic freedom while leaving nominal ownership in private hands.  The novel’s villains are of both stripes, some of them decent people who entered politics with good intentions but became corrupted.  That leaves libertarians as the only consistent defenders of what Ludwig von Mises called the “Free and Prosperous Commonwealth” founded on the rule of law, particularly respect for property rights.

I had to wonder, when reading his portrayals of  atrocities committed by government agents: How much of this is fiction?  Can they do such things?  Are they close? Have they already?  The Patriot Act is law, so the atrocities seem disturbingly plausible. Continue reading

Atlas Shrugged Part II

I got around to seeing the movie this morning along with about ten other folk. I was reminded of why I don’t go to movie theaters: they’re run by sadists who like to torment people with a quarter hour of promos following the advertised starting time, meat-locker temperatures and ear-splitting sound. I didn’t bring my wife knowing she couldn’t have endured the torment but I’ll get the DVD later.

So, what of the movie? Quite good, mostly. The screenplay is faithful to the novel, thanks, no doubt, to David Kelley. The special effects, notably the tunnel disaster and the airplane chase and crash, are powerful. I wasn’t bothered by the change to an all-new cast. Rearden’s trial was done well. The acting, however, is mixed. Rearden is good and the bad guys are good but Dagny, who is really the central character, was a disappointment. She looked almost bored as she piloted her plane toward what increasingly looked like death. Only later did she crank up the intensity.

Just a couple of nits: two men can’t lift a concrete railroad tie. Galt tells Dagny not to move because she’s hurt and then extends a hand to drag her out of the wrecked plane. A few others but nothing substantial, really.

I give it 3.5 stars out of 4, but I’m sure the critics won’t agree. It looks like the movie will follow Part I into oblivion, sad to say. One only hopes that DVD sales will pick up and that it will enjoy the same sort of underground success that the novel enjoyed following its scathing reviews.