FReeper Book Club: Atlas Shrugged, The Immovable Movers

Dagny fails to get a straight answer from the president of the United Locomotive Works as to when she will get her diesel engines and what is the source of the delay. There is even a hint she is being impolite by asking these questions.

Upon returning to the office, Eddie Willers tells her that McNamara of Cleveland has gone out of business and disappeared.

Dagny walks home through the streets of New York, and along the way she encounters signs of the times. First, there is a shop where a radio speaker is broadcasting a classical music concert with a piece that is both atonal and pointless. Then a book store advertises a novel as “the penetrating study of a businessman’s greed.” A theater shows a movie that is trivial. A couple leaves a nightclub drunk and staggering.

Arriving at her midtown apartment, Dagny puts on a recording of Richard Halley’s Fourth Concerto, which leads to a flashback on the life and career of the composer who had disappeared eight years earlier after the triumph of his opera “Phaeton”. Reading the newspaper, she stumbles upon a picture of Francisco d’Anconia, in town at his suite at the Wayne-Falkland Hotel for the purpose of dating a hat check girl and eating at a famous deli. Dagny drops the newspaper and silently sobs.

Jim Taggart awakens past noon to the sound of Betty Pope cleaning up in the bathroom after a night of meaningless sex. He brags to Betty that at this afternoon’s board meeting he will put Dagny in her place. He is interrupted by a hysterical phone call from Mexico. The People’s State of Mexico has not only nationalized Francisco’s San Sebastian Mines but Taggart Transcontinental’s San Sebastian Line.

Jim puts the best face possible on this development at the board meeting. He takes credit for running substandard service with old equipment so that the Mexican government could not confiscate any useful assets of the railroad. Delegating blame, he asks the board to request the resignations of the consultant who recommended building the line and the railroad’s Mexican agent.

Upon returning to his office, Jim finds Orren Boyle waiting for him. Francisco has lost $15 million in the nationalization, and Jim and Orren want to find out how he plans to recover their investments. Jim asks for a meeting with Francisco only to be told that Francisco does not deign to meet with him because Jim bores him.

The National Alliance of Railroads passes an Anti-Dog-Eat-Dog Rule aimed at curbing “destructive competition”. Railroads defined as newcomers to an area serviced by a senior railroad must shut down within nine months. They can instead build in “blighted areas” where there is no need for rail service because “the prime purpose of a railroad was public service, not profit.” Major railroads, however, were entitled to public support to help survive. Dan Conway of the Phoenix-Durango Railroad, the intended victim of the rule, shuffles out of the meeting chamber demoralized.

Jim brags to Dagny that he has taken Conway out of the game, and Dagny is furious. She goes to Conway and offers to help him against the looters, but he demurs, pointing out that the majority has made its decision and he doesn’t have the right to buck it considering the tenor of the times. “Who is John Galt?” he asks. Conway tells Dagny that she needs to get the Rio Norte Line fixed up because it’s the only lifeline keeping Ellis Wyatt and the businessmen of Colorado going.

Returning to her office, she finds Ellis Wyatt himself barging in on her. He gives Dagny an ultimatum: in nine months time, either the railroad gives him the service he requires or he will take it down with him when its failure destroys him. Dagny tells him, “You will get the transportation you need, Mr. Wyatt.”

Dagny meets with Hank Rearden at his mill, asking him for a nine month delivery schedule for Rearden Metal rather than twelve, and Rearden agrees. He enjoys charging Dagny more for the rail, but Dagny has no problem with that. This is business, and she is not a moocher. The intent was for Colorado to save the railroad, but now the railroad must save Colorado. Hank sees their role as saving the country from its own lunacy, a lunacy that just has to be temporary. They understand each other: “We haven’t any spiritual goals or qualities. All we’re after is material things.” Dagny senses there will be a problem about that.

The early years of railroading saw competition that was vicious. It was not just that railroad men fought each other, they sought the aid of government in their battles. As soon as an operator of sufficient size built, operated and stabilized a line, he either acquired trackage rights over the line of a competitor, making him an ally, or acquired the competitor outright. This is how networks were built and America’s major railroads emerged.

In dealing with customers, railroads were predatory. This was standard behavior in the era after the War Between the States, a war in which American industry had defeated American plantation agriculture. Ellis Wyatt exclaims, “You expect to feed off me while you can and to find another carcass to pick dry after you have finished mine.” Wyatt is describing the world of Atlas Shrugged, but he could just as easily have been describing the second half of the 19th Century.

There is a saying in Buddhism known as the Law of Karma: “The good or bad you do in a given lifetime will come back to you in that life or a future one.” Americans prefer the pithier and more Protestant, “What goes around, comes around.” The predatory behavior of America’s railroads led to the Granger Movement which favored nationalization of the railroads. Outrage reached sufficient levels during the Cleveland Administration that Congress created the Interstate Commerce Commission to regulate the railroads.

Once a commission is created to regulate something, it takes about two decades before the regulated gain enough influence to become the regulators. This is a natural process, a revolving door that circulates executives from regulated industries, lawyers, lobbyists, politicians and regulators themselves. On occasion it also involves the passing of cash. Over time the ICC became the tool by which major railroads kept competitors out of the game by building a bureaucratic structure impossible for any but the best legal minds to penetrate. As long as railroads were the key movers of people and goods, this structure provided stability. But it failed as soon as real competition emerged.

By the early 20th Century, the internal combustion engine prompted states and counties to build roads to make space for all the cars pouring out of Henry Ford’s plant. After World War I, this began in earnest and increased exponentially during the Depression when the federal government created make-work jobs building bridges and highways.

The building of roads created space for trucks to compete with trains. At first, America’s highway network was a collection of two-lane roads, and trucks were not able to compete well for long distance hauling. But the Interstate Highway System changed all that. Antiquated work rules, featherbedding and deferred maintenance led to America’s railroads tearing out much of their physical plant in the Sixties. Wall Street believed it might even be in the best interest of investors to shut down the railroads and move everything by truck over the new subsidized freeway network. Railroads not only didn’t earn the cost of their capital, they were losing their shirts.

It was the Penn Central bankruptcy of 1970 that provided the reality check. The Penn Central, created in 1968 by the merger of the Pennsylvania and New York Central railroads, crashed so catastrophically that it took down all the railroads in the northeastern US.

The Penn Central’s (ex-Pennsylvania) Northeast Corridor was the single most important piece of transportation infrastructure in the area – just as important as the New Jersey Turnpike – and it ended up in the hands of the government’s Amtrak, which had been created to preserve nationwide passenger rail service after the railroads had given up on it. Passenger trains had been subsidized by the Post Office via the mail contract, but in 1967 that had been shifted to the airlines. Government ownership was good for the Northeast Corridor but ended up being a major policy mistake.

The rest of the railroad infrastructure in the northeastern US ended up in the hands of the government’s Conrail, which hemorrhaged money until the railroad sold off much of its branch network to short line operators. In 1986, the government sold Conrail back to Wall Street, and a decade later CSX and Norfolk Southern carved up Conrail between them.

The creation of a large number of short line railroads was one of the most important developments in railroading in the second half of the century. The Class I railroads had not been able to make money on these branch lines, but short line operators provided the kind of customer service the major railroads had long since forgotten. With short line operators making these branches profitable, the Class I’s could turn their attention to hook-and-haul operations on major rail trunks.

In 1980, Rep. Harley Staggers (D-WV) wrote a bill that would replace the ICC with the Surface Transportation Board and finally deregulate the railroads. Following its enactment, by the end of 1980 all major railroads were profitable again. This set off a wave of mergers that is still ongoing. Competition is stiff, and each railroad feels a need to chivy its competitors out of every last available scrap of cargo – while the trucking industry continues to eat the railroads’ lunch.

Until recently, America’s railroads had been loath to accept government money to fix up their infrastructure because of a terrible fear of Open Access, which the government might demand as its price. This would require the railroads to dispatch the trains of competitors on their tracks for a fee.

However, Norfolk Southern has accepted government money to crown-mine the tunnels on its Norfolk-to-Chicago route so they can handle double-stack containers, the latest innovation in railroading. NS is also looking at government money to expand the capacity of its I-81 line from Harrisburg to Chattanooga to take trucks off that saturated interstate, and CSX is looking for money to fix up its lines that parallel I-95 and I-85 in the South. (It’s fascinating that the states of the Old Confederacy are far ahead of their brethren in understanding the role of rail in hauling cargo efficiently.)

Today there exists the Association of American Railroads, which lobbies before Congress. It has none of the monolithic power of the National Alliance of Railroads, but there is a sentence in the book that refers to laws enacted by the National Legislature that the alliance appears to be enforcing. Much like the old ICC, its practical goal is to protect current operators against upstarts, but it’s a voluntary association. Dan Conway was a signatory, and he believes that he must, if necessary, sacrifice himself for the greater good.

Howdy Pub’!

A couple of thoughts before we get into the main argument. Rand takes a long time to set the table in this 1100-page monster but the supper will be worth it. Lots of courses in this meal.

What James Taggart and Orren Boyle (another great character name there IMHO) accomplish through the auspices of the National Alliance of Railroads is a restraint of trade that is nominally illegal in the United States since the 1890 Sherman Antitrust Act. It is a textbook example of a cartel, in fact, an old economics professor of mine actually used this selection as an illustration of how, and why, this sort of anticompetitive behavior takes place.

Meanwhile James Taggart deftly takes credit for his sister’s actions in moving railroad assets out of Mexico before the nationalization, taking caddishness to a new height. It’s perfectly in character. Very nice touch. Rand makes the point here that Dagny’s was the risk and his the reward, which is actually the premise of the entire novel in miniature. In view of the later historical nationalization by Mexico of her privately-held oil industry one has to tip one’s hat to Rand for prescience.

Well, here we are at the third chapter and we find ourselves discussing Aristotle. Aristotle? Yep. Rand’s philosophy is heavily dependent on Aristotle and she isn’t shy about informing us of that in the chapter title. The “Immovable Mover” (also translated as “unmoved mover”) is straight from Aristotle’s Metaphysics. If that weren’t clue enough, Rand entitled the three sections of Atlas Shrugged after the three axioms of Aristotlean logic: non-contradiction, either/or, and identity. She and her Objectivist followers add a fourth, the axiom of consciousness, more pertinent, in my opinion, to epistemology than logic, but that’s a topic for another day.

We’re also going to encounter a heavy dose of Nietzsche in AS. Rand studied both Aristotle and Nietzsche in Petrograd before emigrating to the United States, and Chris Sciabarra (Ayn Rand: The Russian Radical) informs us that Thus Spake Zarathustra was the first book she purchased upon arriving here. I’ll touch on Nietzsche a little in the following paragraphs.

First Aristotle. Rand’s persistent evocation of reason in all her works is to a great degree an invocation of Aristotle’s body of thought. The “immovable mover” of the chapter title is God, both for Aristotle and his subsequent interpreters, the brilliant rabbi Maimonides with respect to Judaism, the philosopher Averroes with respect to Islam and Christianity, and of course St. Thomas Aquinas with respect to Christianity. Here the existence of God is not so much “proven” by Aristotle’s system of logic but appears as a necessary consequence. Students of medieval philosophy will immediately recognize it in the roots of the Ontological argument for the existence of God, an argument that impressed even that unrepentant old atheist Bertrand Russell.

But there are difficulties inherent in having the existence of God dependent on the congruence of a system of logic to the bones of actual reality. That involves Russell and Kurt Godel and is the topic for another day.

And yet Rand herself was an atheist. How are we to reconcile the two positions? Enter Nietzsche. I think that far from denying it, Rand embraces Aristotle’s conclusion, moving not God but the functions of godhead into men and women, Dagny and Reardon, to be specific, at the end of the chapter. That is what she meant by her statement in the first paragraph that the skyscraper was dependent on motion for its existence. The building – the society – is not, in her view the immovable movers, certain creative, productive people are. Atlas shrugs when they decline to move it.

Nietzsche is most famous for his asseveration that God is dead, by which he did not mean that the Big Fellow was literally pushing up cosmological daisies but that God, being in Nietzsche’s view an imaginary collective construct, ceases to exist when His reality is rejected (as Nietzsche felt that it was in Europe at the time), and that when that happens God ceases to be a source of values and morals, not to mention spiritual comfort. Further, that this deficiency in the basis of morals needed to be addressed lest humanity slide into nihilism. (Jews, Christians, and Muslims might have some difficulties with the notion of God as Tinkerbelle but that need not impede the discussion of Nietzsche’s philosophy). I will note in Nietzsche’s defense that nihilism is, IMHO, the root of the multiculturalism that is gripping the cultural leadership of Europe at the present time, and that one cause is the popular rejection of religion as a cultural anchor. God may not be dead but He’s probably bored.

Nietzsche’s answer to this was the advent of an Ubermensch, imperfectly translated as “Superman” and carrying with it the unfortunate connotations of a fellow with a cape flying through the air. “Overman” is as good, but the basic idea was that this creature transcended humanity, being a more perfect version of its progenitor, exempt from the strictures that originally were necessary to circumscribe his behavior. And that once expressed, this new creature would be not only a paragon of a new morality but its very source and origin. One hears echoes of this in both the Blond Beast of Nazism and the New Soviet Man. One hears less malevolent echoes of it in Rand.

The reason Rand’s overmen and –women are less malevolent is something Rand commented on herself. The difference between her philosophy and Nietzsche’s is that “his epistemology subordinates reason to ‘will’, or feeling or instance of blood or innate virtues of character.” (introduction to The Fountainhead) . Hers celebrates the subordination of man only to reason. Enter Aristotle.

But before we put Nietzsche back on the shelf a few side comments. First, that his Zarathustra has so little to do with the historical character of that name that real Zoroastrians – there are quite a few – must be scratching their heads wondering how the old fellow could have come up with this stuff. Second, that Nietzsche places his statement that “God is dead” in the mouth of a madman, which is ironic inasmuch as Nietzsche himself later wound up in a psychiatric clinic in Basel. But nuts or not, it was Nietzsche who brought to my reluctant attention the difficulties encountered in rejecting God as a source of morality. Whether one can replace Him with will, reason, or even politics seems to me to be a very contemporary question.

Objectivism as a body of philosophy is taken less seriously than it otherwise might be in academia due to this necessarily derivative character. It is far more Aristotlean than Nietzschean. Atlas Shrugged, however, seems to me to circle the two in an irregular orbit like a planet circling a binary star system, now lurching one direction, now the other.

The novel is also taken less seriously than it otherwise might be in academia due to a couple of fairly serious flaws, most notably the brick wall it hits at chapter VII of the third section, “This Is John Galt Speaking,” wherein the dramatic narrative gives way- probably necessarily, we’ll discuss it - to a polemic. We’re not there yet so I’ll say little about it other than likening that brick wall to the building with which this chapter opens, a great edifice that must be supported by the motions of its occupants.

One last thought – my copy of AS has a different illustration from its predecessor (which I lost through lending), which was, logically enough, a fellow bent over with the world on his back. The new illustration is that of a tunnel from which two rails of Reardon Metal emerge toward the viewer. There is, as well, a circle of light that represents an oncoming train. Given recent events I find that more than a little disturbing. ;-)

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