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Dagny has just returned from a trip to the United Locomotive Works in New Jersey, where she had to deal with more idiots.
She's starting to suspect that the whole world is in on some big secret that she's clueless about. She can't understand why people are so vague and incompetent and doesn't know how to communicate with them.
Dagny decides the world needs Motive Power, which we suspect is a metaphor. We shall see.
It's pretty late when Dagny gets to her office, and Eddie is the only one still there.
He tells her that McNamara, their last hope, has quit. Uh oh.
No one knows why he quit or where he's gone, which is weird.
Dagny is shocked and doesn't know what to do – the Rio Norte Line repairs seem screwed.
Dagny leaves the office to think and passes a series of images of cultural decline. For instance, the current best-selling book is called The Vulture is Molting. We would pay good money to read that gem.
It's about a greedy, depraved businessman.
Dagny then spies a couple stumbling out of a nightclub, looking both trashed and trashy.
At any rate, the whole cultural decline thing has about as much subtlety as a sledgehammer.
Dagny arrives home to her classy apartment and puts on some Richard Halley music.
We learn that no one knows what has happened to Richard Halley. He struggled for years to make it as a composer and, after finally achieving success, he quit and disappeared.
He quit on the opening night of his opera, called Phaethon, based on a Greek myth.
Context Lesson Time! OK, so in Greek mythology, Phaethon was the son of the sun god, Helios. On Take Your Kid to Work Day, Phaethon decided he wanted to do his dad's job, which consisted of driving a chariot across the sky with the sun in tow – to make the sun rise. Oh, those wacky Greeks. Anyway, Phaethon apparently didn't have his learner's permit. He ended up losing control of the sun-chariot and died. The moral of the story: always take a driver's ed class before getting behind the wheel of a sun-chariot.
Halley, though, changed the story around and had Phaethon succeed. Halley is apparently something of a romantic optimist.
Dagny was in the audience the night Halley's opera opened.
After chilling to some tunes, Dagny looks over at the newspaper and has a mild freakout when she sees Francisco's face on the front page. The story is about his adulterous affair with a Mrs. Gilbert Vail, and her upcoming divorce trial.
Dagny is massively upset after reading this. The plot thickens.
Scene break! We're back to James again.
James is having an affair himself, with some woman named Betty Pope.
Betty goes up a notch in our book when she tells James that he looks like a snail first thing in the morning.
James is bragging about his upcoming board meeting, where he and his cronies plan to smack down Dagny for being smarter than them.
But then James gets a panicky phone call from an underling. Mexico has just nationalized the San Sebastián mine and railroad line. Whoops.
Scene cut again, in medias res this time (a fancy term for starting in the middle).
James is in the middle of a big speech, taking credit for Dagny's foresight. Since he saw this nationalization business coming a mile away, he says, he took all the valuable Taggart equipment out of Mexico.
He then offers up the names of a few scapegoats the railroad can fire in order to save face. James is also a massive punk.
Later James is hanging out with his BFF Orren. The two complain about how they lost tons of money in Mexico, and we learn that Francisco refuses to speak to James since he finds him boring. Francisco might be all right after all.
Later still: the National Alliance of Railroads has passed an "Anti-Dog-Eat-Dog Rule." Basically it acts like a bailout for big railroads that aren't performing well, like Taggart Transcontinental. Who is paying for the bailout? Smaller railroads, which basically have to give up business to the bigger ones.
This spells doom for Phoenix-Durango, everyone's favorite Old West railroad. Phoenix-Durango is mainly a regional line out west in places like Arizona and Colorado. They will now have to give up business to Taggart, since the super-cool Phoenix-Durango has been stealing all of Taggart's customers in Colorado.
So, imagine you get an A on a quiz and your classmate gets a C. Using this same logic, you would have to deduct points off your own grade and donate them to your classmate so that you'd both get Bs.
The president of Phoenix-Durango, a nice older man named Dan Conway, is devastated by this rule. He's going to lose his Colorado customers, which will ruin his business.
Dagny is furious when she finds out about the rule.
She rushes to see Dan Conway and tries to convince him to fight it.
But poor Dan is tired and beaten. He can't figure out why people would set out to ruin him like this.
Dagny is beside herself with anger. She wanted to beat Dan fair and square in a competition for Colorado customers, not have them all stolen from Dan and handed to her.
Dan takes pity on Dagny. He tells her that she has to get her Rio Norte line up and running fast, since all the industrialists in Colorado are counting on having reliable transportation for their merchandise. It's a quest!
Quick Context Lesson: What's with this freakout over the railroads? Well, remember, back in the day trains were the way stuff got moved around. There weren't eighteen-wheeler trucks cruising around yet, so lots of people traveled on trains and most businesses shipped their goods to various places by train. So for the Coloradans, not having a decent railway is a disaster.
Later Dagny is back at her office when she gets a visitor. It's Ellis Wyatt, oil mogul from Colorado!
Ellis is pissed about losing Dan Conway and gives Dagny an ultimatum: either she gets him decent rail service before the Phoenix–Durango in Colorado shuts down in nine months, or he will take her business down with him.
Dagny says: game on dude. You will totally have your railway up and running in nine months.
This takes the wind of out Ellis's sails. He says, OK then, and then leaves rather anticlimactically. No throw-down.
Later still: Dagny is having a meeting with Hank Rearden. Good times.
She tells him about her epic quest to save Colorado and how she now needs a ton of steel from him even sooner than before, since she only has nine months to get her line done.
Hank assures Dagny that he's got her back. Then he gives her a pep talk about how they are like two industrial superheroes who will save the country from its own stupidity.
Hank and Dagny start to make plans for the future. Hank wants to open a factory in Colorado, since that's where all the cool kids are.
Hank then shows Dagny her order of Rearden Metal being poured outside the window, and the two get excited about all the cool possibilities for Rearden Metal in the future. They get along very well and could even be considered friends.