The seventh chapter of Part I, “The Exploiters and the Exploited”, begins with Dagny supervising construction on the
Rio Norte Line in Colorado. She is there because there has been difficulty with the new contractor, and the loss of McNamara’s company on the job is keenly felt. Ellis Wyatt, for whose company the new line is largely being, appears at the construction site, and both Dagny and Ellis are pleased with the other’s interest in and dedication to the job. Hank Rearden is also at the site, and Dagny and Hank share a thrilling moment when Hank tells her he could build a bridge from Rearden Metal. This would take less time to build, and be both lighter and stronger than a bridge made of steel. It would give the line a significant advantage, but there would be strong public resistance to a bridge made of an “untried” metal such as Hank Rearden’s revolutionary alloy. Dagny admires Hank’s new car, a luxury model made by a new company Hammond of Colorado. During the discussion Dagny learns that he has flown his own plane out to the work site. She asks if he is returning to New York, and he says he is not and therefore cannot take her back with him in his plane. The moment feels awkward, and Dagny wonders why Hank is suddenly acting so strangely toward her.
Back in New York, Dagny and her brother Jim are in a taxicab on the way to the New York Business Council dinner. Dagny is supposed to make a speech at this meeting, but in the taxi she learns from Jim that it is to be an on-air radio debate between her and Bertram Scudder on the topic “Is Rearden Metal a lethal product of greed?” (175). When Dagny finds out the nature of this stunt, she gets out of the taxi cab to go home. She is unable to get another cab, and she walks until she finds a coffee shop. In it she is surprised to see an efficient toaster and coffee boiler there, both made in Colorado. Because she looks depressed, a bum sitting next to her misguidedly tries to comfort her by saying that man is a “low-grade animal, without intellect, without soul, without virtues or moral values” (177). Dagny does not believe it, and she wonders what has happened to make an educated man so downtrodden and degraded.
The scene changes to Rearden’s office, where he is in conference with Dr. Potter from the government-run State Science institute. Dr. Potter wants to issue a statement, vague in its wording and avoiding responsibility, which would discredit Rearden Metal. If Hank will take Rearden Metal off the market for a couple of years, the Institute will give the Metal their stamp of approval. When Hank refuses, Dr. Potter attempts to buy the rights to Rearden Metal for any price Hank would care to name. Again Hank refuses, and Dr. Potter ominously warns that the Institute will condemn Rearden Metal.
The public denunciation, however slapdash and vaguely worded, does come from the Institute. Dagny knows that this could hamper her progress on the Rearden-Metal Rio Norte Line, so she goes to see the most eminent scientist in the country. He is Robert Stadler of the State Science Institute, formerly of Patrick Henry University. He has capitulated to the looter government, Dagny finds, and cannot be swayed to back Rearden Metal. Though he somewhat admits that the attack on the Metal is a piece of propaganda rather than science, he is so completely in thrall to his government masters that he refuses to help Dagny or Hank. Before she goes, he tells her a cryptic story about three exceptionally bright students he had at Patrick Henry University. They were to be the kind of young men who change the world, but part of Stadler’s disillusionment is that two of them went on to becomes a wastrel and a criminal. They were, respectively, Francisco d’Anconia, and the pirate Ragnar Danneskjold. The third Dr. Stadler will not name, but he says that he “vanished without a trace – into the great unknown of mediocrity. He is probably a second assistant bookkeeper somewhere.” (192)
This public condemnation is the precipitating event which causes the Taggart stock to plummet to such a degree that Taggart Transcontinental cannot continue building the Rio Norte line of Rearden Metal. Dagny, who is so committed to the project that she will even leave her family company to complete it, takes the project under her own direction as a separate company. Eddie Willers will act as the acting Vice President in her absence. As a maverick railroad builder, Dagny takes Spartan offices near the Taggart Building and, on a whim, calls her company the John Galt line. She manages to scrape together financing from Hank and other companies in Colorado, and she continues to build the line.
Hank Rearden’s mother comes to visit him at his office, and she begs him to give his wastrel brother Philip a job at his mills. Rearden strongly refuses, citing Philip’s contempt for business and his refusal to work. Mrs. Rearden cannot understand why Hank will not employ his brother, for she says that he “needs to gain self-confidence and to feel important” (207). Since Philip is a grown man and should be able to work for himself, Hank feels no remorse in refusing to hire him. At the end of this chapter, Hank learns that his man in Washington, Wesley Mouch, will not return his calls after the passing of the Equalization of Opportunity Bill. Knowing that this will seriously hamper his business freedom, specifically because he will not be able to own more than one business now, Hank is eager to do something about it. Mouch, however, has abandoned him to become part of the looter government.
Chapter VIII “The John Galt Line” Eddie is having dinner in the Taggart Terminal cafeteria with the mysterious railway worker again. Eddie pours out his fears for Dagny and her new John Galt line, since she has had to leave the company and go it alone. Despite considerable public sentiment and a host of difficulties, Dagny succeeds. One lonely night when she is working in her office, she sees a man who comes and stands in the shadows outside her shabby offices of the John Galt Line. She never sees his face, and he jerks back from the doorway without knocking. She runs after him to see who it is, but he is gone. This encounter makes her feel slightly uneasy, as if she is being watched.
The plan is now set to run a Diesel engine at high speed down the line of Rearden Metal, and across the bridge of Rearden Metal. Dagny does not want to force any of her employees to go on the first run, so she asks for volunteers. She is touched to find that every engineer in the company wants to be on the first run of the John Galt Line. Dagny and Hank plan to ride in the cab of the engine on the first run to show their confidence in Rearden Metal. In the meantime Hank, because of the Equalization of Opportunity Act, has to sign over his businesses other than Rearden Steel to Ken Danagger and Paul Larkin.
The first run of the John Galt line is a complete triumph, with the engine running at over one hundred miles an hour and the rail and bridge performing beautifully. Dagny and Hank are in the cab of the engine for the first run, and they are both excited and moved by the success of their work. One of the line’s major customers, Ellis Wyatt of Wyatt Oil, hosts the two of them for dinner. They stay at his house for the night, and as they go up to bed, Hank confesses his desire for Dagny. She returns the ardor of his advances, though he is married, and the two begin a passionate affair.
Chapter 7 is full of clues to later events in the novel. The aborted radio debate between Bertram Scudder is a foreshadowing of the actual radio show Dagny is forced to do with Scudder in Part III Chapter III. At this point, however, Dagny is still completely mistress of her own affairs, and the threats and pleas of her brother cannot make her pander to the current looter government. Also, the reader receives the first hint of triumvirate of Francisco, Ragnar Danneskjold, and the unnamed third man. Later Dagny will learn how important the meeting of these three students of Dr. Stadler at Patrick Henry University actually was. When Dagny sits in the slum coffee shop and sees the good equipment, made in Colorado, the seed is planted in her mind that perhaps she will be able to make something of the John Galt Line.
The imaginary Patrick Henry University, situated not on the Ivy-League East Coast of the United States, but rather in the Middle West of Ohio, is one of Rand’s commentaries on higher education in the United States. Patrick Henry was a Founding Father of the United States, and famously announced to the House of Burgesses, before the American Revolution, “Give me liberty or give me death!” It is no accident that Rand would send the characters of her novel which are most responsible for the “strike of the producers” to a university named after one of the most radical of the Founding Fathers, and one who sought to shake off the traditions and monarchical, authoritarian rule of a European power. For Rand America was the most moral of countries, and the American Revolution was the moral act of shaking off tyranny and creating a capitalist state in which each human being could reach his or her own potential. So the early, radical hero of the Revolution, whose extreme views were considered too radical even by Franklin and Washington, would to Rand represent the kind of intellectual freedom necessary for a great university.
The relationship begun, in Chapter 8, between Dagny and Hank, will prove to be of great importance later. The public knowledge of a prominent, married businessman having an affair with an unmarried female executive (who would be held to a higher sexual standard than men in business at this time in history) would have more explosive consequences for both the business and personal lives of the people involved even than it would have in today’s world. Hank Rearden, especially, was known as a very strict and careful businessman, and his affair would have brought a very real degree of devastation to his work and his social standing. Dagny, at least under the old regime, before the looter government, would have been so severely chastised by everyone in her world that it would have been difficult, if not impossible, for her to continue as Operating Vice President.
What is also interesting about this very risky affair undertaken by two intelligent and successful business people is that, at first, there is no mention of love. It is certainly not a relationship of pure lust, for Dagny thinks, on their first night together, “Whatever I am, she thought, whatever pride of person I may hold, the pride of my courage, of my work, of my mind and my freedom – that is what I offer you for the pleasure of your body, that is what I want you to use in your service…” (251). Rearden is, at first, very disgusted with himself, and Dagny seems to derive some satisfaction from his disgust and his insults to her. She sees Rearden as a sexual prize. It is an odd joining of people, which starts out as attraction mingled with selfishness and contempt, and moves toward tenderness (rather than the reverse). While this may be an accurate portrayal of some human relationships, it is odd that these two would choose to risk their all-important careers on something less than love; but this episode is used to illustrate part of Rand’s philosophy about sexual morality. The fact that two “producers” like Dagny and Hank were attracted to each other, and, at least in Hank’s case, would love each other, makes perfect sense because of their inherent morality. Certainly physical attributes play a part, and Hank and Dagny like the look of each other, but their striving, hard-working spirits are what really create their kinship.
The luminous, triumphant run of the first train on the John Galt line shows Rand’s ability to create a powerful scene of industrial success, and the meaning of that success for society. The people cheering on the platforms as the train rushed by knew that the John Galt Line would bring their areas prosperity and opportunity. For transportation, especially, this romantic and enthusiastic love for progress permeates Rand’s novel. The purpose and aim of all business ventures is to create happiness, according to Rand, and the John Galt Line, at least temporarily, does just that.