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Of course Dagny Taggart was right to fight the construction of the San Sebastian Line and to minimize what the railroad would waste on it, both in terms of operating service and in terms of losses if the line were to be nationalized. However, true to form, James Taggart goes to the board and promptly takes credit for her actions, citing a couple of scapegoats to be fired.

Orren Boyle meets with James to discuss the situation. Boyle confirms that Francisco d’Anconia has lost millions of dollars on the deal, which perplexes them both. James tries to get an appointment to see d’Anconia, but is refused.

An organization called the “National Alliance of Railroads” is introduced to the reader for the first time, in which the member companies agreed to abide by decisions of the majority. Apparently, all railroads in the country belong to it.

A rule is introduced and passed: the “Anti-dog-eat-dog Rule”. As I remember, this event and the resulting rule will reverberate for some time, and is an important component of the book. Rand was clearly against artificial monopolies (those supported or enforced by the state somehow) and fine with natural ones.

‘The speeches dealt only with the public welfare. It was said that while the public welfare was threatened by shortages of transportation, railroads were destroying one another through vicious competition, on “the brutal policy of dog-eat-dog.” … since the prime purpose of a railroad was public service, not profit.’

The rule is clearly primarily aimed at Dan Conway’s Phoenix-Durango railroad, and essentially grants monopoly status to the single oldest railroad in protected regions. Dan is apparently stunned by the entire proceedings.

James is exuberant that this rule will stop the ability of the Phonenix-Durango to operate in Colorado. Incidentally, although I don’t think I’ve mentioned it before (and it may not have fully come up yet in Atlas), Colorado is the one state where there are hardly any regulations, symbolic as a laissez-faire haven. In any case, Dagny is furious, calling James and his cronies “rotten bastards:”

“For the flash of one instant, she thought that here, before her, in James Taggart and in that which made him smile, was a secret she had never suspected, and it was crucially important that she learn to understand it. But the thought flashed and vanished.”

This is still another recurring theme: Rand’s bad guys operate entirely via confusion and misdirection, looking for the worst in others, making cabals and conspiracies, and hiding secrets in the shadows; and the good guys, naturally, are the opposite, taking people and their words at face value, openly either cooperating or competing in favor of their self-interest, and generally hiding nothing.

Minor spoiler:

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Actually, now that I think about it, it’s interesting that John Galt and those who follow him are also operating in secret, because under normal circumstances, that would be anathema. Essentially, Galt (I really can’t call him “John” 🙂 ) is taking a play from the bad guys’ book. Hmm.

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