Posted on 03/28/2009 7:39:14 AM PDT by Publius
Synopsis
At the State Science Institute, Dr. Robert Stadler reflects on the harsh winter just ended. There had been rail incidents that affected society, a five day power outage at the Institute and talk about conserving fuel. What irks Stadler is the book on his desk, Why Do You Think You Think?. It demeans logic and rational thought, questions the very nature of reality, is written by Dr. Floyd Ferris, Top Coordinator of the State Science Institute, and is published under the Institute’s aegis.
Dr. Ferris arrives half an hour late due to a car breakdown and the inability to find an open gas station on America’s empty roads. Stadler complains that Ferris is spending too much time in Washington and asks what is going on with the oil shortage. Ferris says the Institute has taken over the reclamation of the Wyatt oil fields while explaining to the country that Wyatt had never fired his fields but had perished in the accident that set them ablaze. The government is now operating those fields. Reclamation is going well, and Wesley Mouch has agreed to a larger appropriation for the effort with the concurrence of three other bureaucracies. But other than getting one well to give up six and a half gallons of oil, the effort is not a success.
One of Stadler’s concerns is Project X. Ferris explains that “X” stands for “xylophone”, and it would be most inadvisable for Stadler to mention this top secret project.
But Stadler is most concerned with Ferris’ book, characterizing it as “indecency”. Ferris says it is a best seller. Stadler calls it the work of a drunken lout, leering with its hatred of the mind; it can be summed up by one word: “Obey.” He is furious that it has come from the Institute. Ferris says the book is not for scientists, but for the general public. Stadler is upset that Ferris has taken the work of Simon Pritchett and given it legitimacy by turning it into science. Ferris says that people don’t want to think and that they will bless anyone who takes the obligation of thinking away from them; Wesley Mouch himself is pleased by the book. Stadler is unable to permit himself to think that the things suggested by the book are possible in a civilized society. Ferris says, “That is admirably exact ... You cannot permit yourself.” Ferris tell Stadler to stick to his science. Stadler heads to New York for a meeting with Dagny.
Dagny scratches a Colorado freight train off the Taggart roster as she has struck so many others. Lawrence Hammond has retired and disappeared, and Hammondsville will no doubt dry up and blow away as have the towns of Wyatt Junction and Stockton. With Wyatt’s fire, new operators had claimed the oil business until prices rose to the point where large customers turned to coal, and the government rationed oil and levied a special tax to subsidize out-of-work oil hands. Then the government subsidized the oil operators but just those with connections. Coal briefly became king until Andrew Stockton retired, closed his foundry and disappeared. The only thing that Dagny can discover is that somebody spent most of the night talking to Stockton before he vanished.
With the oil shortage, Dagny is running coal burning steam locomotives and depending on Ken Danagger for coal. Jim is getting a government subsidy for every train running, and those subsidies produce more revenue than Dagny’s operations. Jim brags that he is responsible for the best six months in the railroad’s history.
Wesley Mouch has unfrozen the nation’s railroad bonds but only to certain people. A whole new profession of “defreezing” has been created by young wonders just out of college who know how to fill out the government paperwork – and who have connections.
Dagny’s engineers, who searched the abandoned plant of the Twentieth Century Motor Company, found nothing; they interviewed people who worked there and learned nothing. The Patent Office was yet another dead end. Dagny’s friend at the Taggart Terminal cigarette stand can’t even locate the brand of Hugh Akston’s dollar sign cigarette.
Dagny’s attempt to find an engineer to reconstruct the motor encounters people who don’t think it will work, don’t care if it will work, want too much money to make it work, or believe that if the motor works, it should be suppressed because of the harm it would do to the egos of lesser scientists. She decides to approach Dr. Robert Stadler.
Stadler is happy to see Dagny, but remembering her last meeting with Stadler, Dagny is extremely formal. Her statement that Stadler is the only great mind left in the world touches him deeply. Showing him the incomplete specifications of the motor, Stadler quickly becomes the consummate professional and is beside himself with excitement as he perceives what the designer has wrought. But Stadler can’t think who could have designed the motor, why he would have designed it – making a massive scientific breakthrough in the process – at a factory in rural Wisconsin, and he is even more shocked that the designer didn’t seek him out. His statement that even a greedy industrialist with no brains would have taken the motor to make a fortune prompts a bitter smile from Dagny. She asks him to recommend someone who could work on the motor, but Stadler tells her he can’t even find the kind of simple talent possessed by a decent garage mechanic. He asks to see the motor.
Dagny takes him to the underground vault. Upon seeing the motor, Stadler is thrilled to see a great new idea that isn’t his. He condemns the mediocrities who fear anyone with an idea better than their own and who envy achievement. He and Dagny briefly experience a meeting of the minds. Stadler recommends a young engineer named Quentin Daniels who works at the Utah Institute of Technology; he has no desire to work for the government but only for his own wealth. Utah Tech has gone under, but Daniels is still there.
As they walk through the underground warren, they hear a frustrated rail crew working on a repair, and one of the men says, “Who is John Galt?” Stadler doesn’t like the expression but says he once knew a John Galt, now deceased. Had he lived, the whole world would have talked of him. Dagny points out that the whole world is talking of him. Stadler reacts in terror: “He has to be dead.”
Hank Rearden refuses an order from the State Science Institute for ten thousand tons of Rearden Metal for something called Project X. He has had problems with the Fair Share Law and ended up with an arbitrary government figure for what he could produce. He now has a backlog of orders for the next fifty years. The rights to Rearden Metal – what we would call “derivatives” today – are being bought and sold on a gray market by speculators with everybody making a profit but Hank. Those speculators who get the rights are those with connections in Washington.
The government has assigned him a bright young boy just out of college as his Deputy Director of Distribution; the plant workers call him the Wet Nurse. He offers Hank a shot at getting Rearden Metal to his friends with a little help from Hank’s wallet for “expenses”. Hank rebuffs him after the Wet Nurse’s lecture on moral flexibility in the absence of absolute standards. He warns Hank about his rejection of the Institute’s order.
Hank is visited by a paramilitary inquiring about Hank’s reasons for refusing the order. Hank won’t provide that answer and refuses to sell anything to the Institute for any purpose. The paramilitary explains that Hank must obey the law; Hank tells him to arrest him and steal whatever he wants from the railcars sitting in the steel mill’s yard. The paramilitary is horrified at how the public would react but tells Hank that he will regret his decision.
Hank gives Dagny a priceless ruby pendant, undresses her and puts it on her naked body. But his best gift is a fur coat he gives Dagny before they go out to dine in New Jersey. Hank tells Dagny that he is giving her these gifts for his own pleasure, and Dagny seconds that emotion. He tells Dagny that he was so cold and formal to her at the party at his house because he wanted her.
After a meeting with copper producers, Hank discovers that they are hamstrung by a sweetheart deal between the government and Francisco d’Anconia.
Hank visits Dagny at her apartment, and she updates him on her meeting with Stadler about the motor. Hank tells Dagny she should not have met with Stadler because he was seeking validation for what he had been before he sold his soul. Hank is now penetrating the heart of darkness. He and Dagny are the intended victims, and the looters seek the sanction of the victim, forcing him to face the world from the looters’ perspective.
Derivatives and Hank Rearden
A derivative is a security whose value is derived from another security. As early as 1792, when the New York Stock Exchange opened for business, derivatives were sold as bets on the rise and fall of interest rates. It started as a form of hedging but ended up as the source of our first government scandal.
Alexander Hamilton had bedded a woman who was involved in a badger game with speculators on Wall Street as accomplices. In return for her silence, Hamilton was to give her accomplices advance notice of the purchase and sale of Treasury bonds. To his credit, Hamilton fell on his sword, admitted his infidelity and saw his political career go up in flames. From his perspective it was a small price to pay to preserve the credit rating of the infant United States.
Rand makes an interesting point here. Hank Rearden is the inventor and developer of Rearden Metal; by rights the profits should go to him. But thanks to government interference, he is not reaping the benefits of his labors; Wall Street speculators are. These are people who neither sow nor reap but profit from their connections in Washington. It is the epitome of immorality.
What Chapter Are We Living In Today?
This question came up when this project was conceived; essays and newspaper columns likened our time to the book. Well, look what happened in Olympia, Washington.
Six Democratic legislators in the Washington State Legislature introduced a bill to prevent Boeing from threatening to move out of state. That's right. Threatening.
Our tale begins with a different bill, one that would have forbidden any company from requiring employees to attend a meeting about labor issues. It was called the “Worker Privacy Act”, and it violated federal labor law. Although Boeing maintained a respectful silence, its friends said that this would be the last straw that would cause the company to move its production facilities to North Carolina. But then the Washington State Labor Council got caught sending threatening e-mails to legislators about it, e-mails that opened a window into corruption in Olympia. The governor and Democratic leaders in the legislature then publicly killed the bill and sent the e-mails to the Washington State Patrol for investigation.
Organized labor and its allies in Olympia were livid, so six legislators introduced a bill that would make it illegal to threaten the relocation of manufacturing jobs, especially jobs involving commercial airplane manufacturing. Boeing could leave, but it could not threaten to leave.
Do you remember Bertram Scudder’s Public Stability Law, later enacted by Wesley Mouch via administrative law? We have arrived.
Some Discussion Topics
Next week’s chapter contains Francisco’s Root of Money Speech, one of the large set pieces of the book. It is a critical insight into Rand’s philosophy of Objectivism and a good primer on capitalism. There are three ways one can handle the speech.
The speech is important to understanding what Rand is trying to get across, so it’s critical to pay proper attention to what she is saying. Take your time, read it, and prepare to discuss it thoroughly.
I haven't seen your thread, but I hope it is obvious that the America de Tocqueville described was gone with the wind.
ML/NJ
My experience is that you are wrong. I went to an engineering school (RPI) back in the 60s because I had no patience for anything that couldn't be expressed in a formula like F=Ma. Now I'm different and I think that taking a year of Atomic and Nuclear Physics was probably the most useless thing I ever did. I go back to the schools my kids attended and participate in "liberal arts" classes. To be sure I rarely, if ever, take a class in something that includes the word studies in its course title; and my kids did go to prestigious schools. My experience has been that the kids in those classes I've participated in are extremely bright, articulate, thoughtful. What other adjectives should I use. It is a dangerous myth that these kids are all mind numbed robots. That may be the way it is these days at CCNY, but it isn't that way at the schools the kids in the top ten of their HS graduating classes attend if they attended any sort of competitive HS.
ML/NJ
I very respectfully disagree with your self assessment.
I would like to point out a few relevant facts that I based my opinion on but there are rules about spoilers on this thread and I don't wish to be in violation.
To stay and fight would have taken your time and money, both being absorbed by the very beast that you wished to defeat. You would have lost even if you had legally prevailed.
I wanted to fight. I called my lawyer and asked him if they could link a business license renewal to this new law. And he said probably not. But they did. And fighting them would cost way more than the cost of painting the building. And the big companies, L3 and Campbell Soup could afford fences around their property and would not help. And they also had been contributors to the "community groups" petitioning for a cleanup.
And as my lawyer said, I was a suburban living, exploiter of the community refusing to paint my building....ha, I would be burned out probably.
So it was better to cut and run and leave the rest of my buddies to fend for themselves. This is prison camp morality I'm afraid...but it is reality in America today. Ugly.....but Ayn Rand captures it perfectly in the story of the Twentieth Century Motor Company.
Probably. See post 45.
If you’re only talking about the top 1% of each high school, then you are excluding 99% of the student body. You can concentrate only on the ‘elite’, just as this administration does, but you do a disservice to the real working people that make this country run.
And you are ignoring the stats that show that a BA in almost anything is worth just the paper it is printed on. A technical degree, however, is in demand and pay for those majors far exceeds the easier degrees. (joboutlook.com is one such site)
You can just look at yourself and how it didn’t work out for you. And you can look at a handful of other people. But making a generalization out of a low sampling pool isn’t accurate. And you are pretty biased.
typo - ‘mad’ should’ve been ‘had’. My degree is obviously not in writing - or proofreading.
Anyway, I think the technical side of the majors would be dumbed down last because those are the least subjective.
ML/NJ
Oh, it's not a coincidence. It was planned a long time ago. Soon there will be a book issued by an important national foundation titled Why Do You Think You Think? with one message for Americans: "Obey!"
Agreed. We were watching the Tim Geithner hearings this week a bit, since you can’t seem to avoid either him or Obama if you have the TV on. Wesley Mouch came to mind.
It was astounding. He talked about having the right to go in and take over private companies if he felt they posed risk to the banking system. When confronted on the radicality of that plan, he seemed dumbfounded and said that it wasn’t radical at all. He thought it was perfectly normal for a non-elected, appointed Sec. Treasury to sweep in and take over any private company as long as he along wanted to. WOW!!
Then Congressman Bachman asked him to point to the Constitution and show her where in that document it indicated that he had the right to do anything in that regard (may have been a different, but related issue) and he just gave that deer-in-the-headlights look. ( U.S. Constitution? Why would that matter?)
But, I believe they are overreaching and a very large backlash is a comin’
Bill, the Carbon Credits fiasco is the single most asinine thing I believe I’ve ever seen in politics. And that’s a VERY high bar. People make, and will continue to make huge sums of money on this. It simply amazes me that people are actually able to talk about this with a straight face. And the people listening to them sit there with serious looks on their face, and nod in approval. I’d like to say it’s unbelievable, but I can’t.
So when we find that we are in a period of global cooling, which we appear to be entering, do we sell carbon debits?
Earth Hour was not predicted in AS. What are Freeper AS book club readers planning for Earth Hour? I plan to turn on all lights including outside flood lights. It will drive some of my liberal neighbors crazy. Maybe they will report me to the Obama Youth.
I feel that, actually, the technical majors have been dumbed down for some time as well. I know I’m going to come off as an old fogie, but I got a degree in Math in 1974, went to grad school, then got a job as a computer programmer. Back then, most of the programmers were math/physics/engineering majors who had learned and/or developed their logical thought processes in their majors, then went on to learn a language in which to implement them.
When I was hiring programmers a few years ago, I was hard pressed to find anyone who knew more than the computer language itself. There was a depth of education that is lacking now, IMHO.
I am turning on every light, radio, tv and other electrical appliance in the house, along with the Christmas lights . . . and I'm going to leave them all on until about 11:00PM.
My company has resorted to hiring computer security (Information Assurance) engineers who have history and psychology degrees. Ever try to get something done while working with totally incapable people?
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