Part One, Chapters III–IV (3 - 4)

[sal10e]

Hi LanDroid, I don't think Rand really means that Hank, Dagny, Conway and Ellis Wyatt are emotional cripples as they are actually very passionate about their work and want others to feel passion as well (it doesn't have to be about work, but for example Hank wants his brother to feel passion about anything). I see James, Hank's brother and many of the others as emotional cripples as the do not feel very little other than what they think they are suppose to

To them, the act of sex was neither joy nor sin. It meant nothing. They had heard that men and women were supposed to sleep together, so they did.

In particular to the line you quote about Conway, I see Rand using that to ridicule the supposed upper crust of society who believes they are better and have more culture than those who do not. You can be good at something and make money, you just have to work and really understand what it is your doing. James and his friends all believe themselves to be cultured and highly intelligent but they extremely incompetent and don't even realize despite their having the qualities that society believes are necessary to be goodand powerful business men. They refuse to make decisions and don't actually work (James hadn't read Dagny's reports in 3 months), and their lack of decisions often have to be undone by others for their to be an real achievement.

[lindad_amato]

We meet Dan Conway, head of the Phoenix-Durango railroad line.

The whole sphere of human endeavors, with one exception, left him blankly indifferent; he had no touch of that which people called culture. But he knew railroads. p.60

Good lord, ANOTHER robot? Dagny, Rearden, (Ellis Wyatt?), and now Dan Conway? What is with these emotional cripples? Is this required in order to be Heroic? I suspect this interior vacuum is required in order to accept the flinty detached philosophy we are uncovering...

I agree completely Rand's characters are too one dimensional for me.

[LanDroid]

sal10e said " I don't think Rand really means that Hank, Dagny, Conway and Ellis Wyatt are emotional cripples as they are actually very passionate about their work and want others to feel passion as well..."

OK maybe emotional cripple isn't quite right, perhaps more like Asperger Syndrome or a mild Autism. These characters do have emotions, but Rand describes them as being quite baffled by most human interactions. Reardon cannot understand why people go to parties and want to be gay in the old fashioned sense of the word. It's not work, they're not making money at the activity, so why do they bother to be happy in these surroundings? Again I suspect that sort of deep aloofness is required to accept the philosophy that is being revealed...

[sal10e]

Hi LanDroid, I think Asperger's or mild Autism is a better description but I think ascribing the personality problem to Hank, Dagny, Conway and Ellis Wyatt is a bit one-sided. These characters are the few characters that appear to have real emotions. The other characters James, Betty Pope, Reardon's family aren't happy and don't enjoy parties or have emotions about them-they go to parties and have them because that is what they think they are suppose to be doing and it is what society expects them to do. this is really shown in chp 6.

[LanDroid]

Is there anything about the "anti-dog-eat-dog" rule that could not happen in pure laissez-faire Capitalism? I think the answer is no. Business leaders get together and enforce an industry rule about how to compete; the Government is not involved. In fact Government regulation is about the only way to prevent such collusion, ay? Is Rand unwittingly building a strong counter-argument to her own position?

[President Camacho]

If a business can sell below what their cost is to produce something in order to put their competition out of business, they will. That means a small business that is more efficient and profitable may go out of business. Rand doesn't touch this except that some of her hypothetical companies actually do this to stay in business (run at a loss). What of the company that's 'better' but without such deep pockets? What of Rand's fear mongering then? Scary, fear, new fear, new terror, new monster... nothing about any of this is new. Government corruption is as old as civilization. Rand is a fiction writer trying to implant emotional arguments where there should be facts. She's a HUGE hypocrite.

[Robert Tulip]

If a business can sell below what their cost is to produce something in order to put their competition out of business, they will. That means a small business that is more efficient and profitable may go out of business. Rand doesn't touch this except that some of her hypothetical companies actually do this to stay in business (run at a loss). What of the company that's 'better' but without such deep pockets? What of Rand's fear mongering then? Scary, fear, new fear, new terror, new monster... nothing about any of this is new. Government corruption is as old as civilization. Rand is a fiction writer trying to implant emotional arguments where there should be facts. She's a HUGE hypocrite.

No way is Rand a hypocrite. The argument from Randian economists such as Hayek is that government role is to secure property rights and investment climate. Rand endorses this in the story when she says Colorado has the best business enabling environment because its government does not run social programs but just maintains impartial courts and police. Part of investment law is the problem of cartels, where businesses secretly collude to drive out competition. But Reardon Steel is not a cartel; it seeks to be completely transparent, competing only on quality and price. The collusion is the slimy intrusion of government to protect inefficient producers based on political patronage and populist demagoguery.

Part of the context behind Atlas Shrugged is the antitrust laws used to bust Rockefeller's Standard Oil. I agree this is a difficult problem because monopoly can prevent competition, and I suspect Rand would have sided with Rockefeller. But then, IBM used to have a monopoly, Microsoft used to have a monopoly, Kodak used to have a monopoly. Free market competition enabled new firms to emerge when the incumbents got soft and stupid, or when new ideas found a demand. Hank Reardon has a perfect right to control the intellectual property of Reardon Metal. Patent law provides a reasonable period of exclusivity to reward innovation. The moral of Atlas Shrugged is that government collusion with incompetent rent seekers is a recipe for economic stagnation.

Even firms like Walmart compete on range, quality, convenience and price. As Schumpeter put it, there is a creative destruction in the upheaval of capitalism. In retail, if Walmart doesn't deliver what people want, new firms will. But if Walmart gets politicians in their pocket to corrupt the market, that is exactly what Rand is arguing against.

[President Camacho]

Rand is a hypocrite because her argument is an emotional one. She lashes out at writing that is void of fact. Yet her fiction is a story. Not that it doesn't have merit.

I didn't mean a cartel in my argument. A single business is enough to edge out another even though the smaller business is better managed and provides a greater 'service'. Say two railroad companies competed. One had some delays, offered little in the way of amenities, and was a little dirty. The other ran flawlessly and on schedule, offered a drink service, and was spotless. But the larger corporation, in order to edge out the competition on that particular section of the country was able to cut their ticket prices in half. Since both are competing for the same consumer (hypothetically) - the smaller company becomes unable to compete. No cartels are in this example - only a large business snuffing out a much better company. What would Rand say about that? Good Riddance? In her book it's the small guy the government snuffs out!!!!!! WOW!!!! Not big business but government! That's very important to me.

Monopoly can prevent competition??? Monopoly by definition is the absence of competition.

I agree that the negative aspect of rent seeking is a theme in the book...but you never hear about dirty dealings in order to starve a company into submission and buy it up for pennies on the dollar except when the government gets involved with men like James - someone who supposedly is altruistic but really isn't because the San Sebastian was a money making scheme all along. He didn't put his faith in Mexico - he put it in D'Anconia. He was just foolish by TRUSTING SOMEONE WHO WAS SUPPOSED TO DO HIS JOB.

And I do feel breaking up Rearden was wrong - he didn't have a monopoly on anything but the metal which was his legal privilege. Supposed he owned all the Ore mines, though? Then sat back and collected a fee for any company willing to come mine and make a profit on it. Rand doesn't even approach this. Why?

[LanDroid]

R. Tulip said: Part of investment law is the problem of cartels, where businesses secretly collude to drive out competition. But Reardon Steel is not a cartel; it seeks to be completely transparent, competing only on quality and price. The collusion is the slimy intrusion of government to protect inefficient producers based on political patronage and populist demagoguery.

Wasn't the anti-dog-eat-dog rule an industry agreement? Businesses decided it was not efficient for multiple railroad service providers to invest huge amounts of infrastructure to compete in the same area, so they created rules to manage this competition. I think this was later solidified by legislation, but is Government the root cause of that problem? It's still early in the book, but I'm starting to wonder if Rand believes laissez-faire capitalism is the greatest invention under the sun only when business leaders are Objectivists? Seriously, what system does regulation free laissez-faire capitalism provide if business leaders are commies or corrupt? And what do you mean by "incompetent rent seekers"?

[Robert Tulip]

R. Tulip said: Part of investment law is the problem of cartels, where businesses secretly collude to drive out competition. But Reardon Steel is not a cartel; it seeks to be completely transparent, competing only on quality and price. The collusion is the slimy intrusion of government to protect inefficient producers based on political patronage and populist demagoguery.

Wasn't the anti-dog-eat-dog rule an industry agreement?

Rand's agenda is to reform government so that businesses can succeed or fail on a level playing field based on merit and public rules. Secret collusion between inefficient producers to drive out the efficient is the main story in Atlas Shrugged, using political influence and conspiracy to achieve goals which are couched as public spirited but actually harm the public good.

Businesses decided it was not efficient for multiple railroad service providers to invest huge amounts of infrastructure to compete in the same area, so they created rules to manage this competition. I think this was later solidified by legislation, but is Government the root cause of that problem?

Government, and a public culture hostile to entrepreneurial leadership and innovation. When government sets the rules of the game to prevent such idiotic and destructive initiatives as the dog eat dog rule, businesses have to compete on merit rather than on patronage.

It's still early in the book, but I'm starting to wonder if Rand believes laissez-faire capitalism is the greatest invention under the sun only when business leaders are Objectivists? Seriously, what system does regulation free laissez-faire capitalism provide if business leaders are commies or corrupt?

According to Rand, the business of government is to protect property rights. To do this systematically, government regulates against communism and corruption.

And what do you mean by "incompetent rent seekers"?

Rent Seeking is the effort to gain control of unearned income. In mining, all income additional to the amount needed to pay for production costs and normal profit is rent. The resource ownership is determined by law, either residing with the state or, I think in USA, with the finder.

It is frequent that those who have not earned an income seek to use politics to gain control of it, and this practice is highlighted in Atlas Shrugged by the incompetent crony firms who collude to manipulate Washington to distort the market to gain access to perceived rents associated with Taggart Rail and Reardon Steel and their resource suppliers. But Rand argues these perceived rents are not actually rents, because when they are stolen the producing firm becomes unviable.