After a night of passionate lovemaking, Dagny and Rearden wake together. Rearden is angry and disgusted. He sees sex as a base and obscene impulse and believes both Dagny and he worthy of contempt. Dagny laughs in disagreement. She is proud to make love to him and share her desire with someone she respects. She tells him she makes no claims on him except that he come to her with his lowest physical desires.
Jim meets Cherryl Brooks, a young, poor shopgirl who recognizes him from the newspapers. She thinks he is responsible for the success of the John Galt Line, and he allows her to believe it. Cherryl worships heroes and their accomplishments, and Jim enjoys the attention. He invites her to his apartment for a drink. She finds some of his comments odd, especially his contempt for Hank Rearden, whom she believes is a great man, but she is thrilled to be with him.
Dagny and Rearden go away for a vacation together, driving around the countryside. Hoping to locate some scarce machine tools, they stop at the site of the Twentieth Century Motor Company manufacturing plant. They are shocked to find the plant not just closed, but ruined, and the town it supported in abject poverty. Inside the plant’s lab they find the remnants of a motor designed to run on static electricity. Its existence would revolutionize industrial production. They are determined to find the inventor and rebuild it.
Wesley Mouch, recently promoted to top coordinator of the Bureau of Economic Planning and National Resources, issues a number of statements urging the use of emergency powers to balance the economy. The Union of Locomotive Engineers demands that the maximum speed of all trains be reduced to sixty miles an hour. The Union of Railway Conductors and Brakemen demands that the length of all freight trains be reduced to sixty cars. The states of Wyoming, New Mexico, Utah, and Arizona demand that the number of trains run in Colorado not exceed the number running in each of these neighboring states. A group headed by Orren Boyle demands the passage of a law limiting the production of Rearden Metal to an amount equal to the output of any other steel mill of equal capacity. Another group demands a law giving every customer who wants it an equal supply of Rearden Metal. Still another group seeks to prevent eastern businesses from moving out of state, hoping to stop the trend of businesses relocating to Colorado. Rearden finds that Paul Larkin did not deliver his supply of ore. He sent it to Orren Boyle instead (as a term of the deal arranged earlier by Jim Taggart). After this, Rearden begins to obtain ore through shady illegal deals, the only option left to him.
Dagny’s search for the motor’s inventor leads her to Lee Hunsacker. He tells her that he purchased the factory from the heirs of Jed Starnes. He had asked Midas Mulligan, the richest man in the country, for a loan, but Mulligan had refused him. When Mulligan refused, Hunsacker filed suit against him. The judge in charge, Judge Narragansett, ruled for Mulligan, but Hunsacker appealed. A higher court ordered Mulligan to issue the loan based solely on Hunsacker’s “need” and despite his lack of ability or collateral. Instead of paying, Mulligan disappeared without a trace. Narragansett disappeared a few months later. When Dagny locates Starnes’s heirs, she discovers why the company fell apart. It had been run according to a radical plan in which workers were paid based only on their proclaimed needs, and those who worked hardest were required to support those who did not. The resulting chaos destroyed the company. Dagny finds the wife of William Hastings, the former chief engineer. She sends Dagny to find a man who she thinks would know the name of the inventor. Dagny finds him working as a cook in a Wyoming diner. He does know the inventor, but he will not give the name. Dagny is shocked to learn the cook is Hugh Akston, a famous philosopher who retired years ago. He gives her a mysterious cigarette stamped with the sign of the dollar.
When Dagny returns to New York, she finds that every law the looters were seeking has been passed. A special tax has been imposed on the state of Colorado. Dagny tries to reach the defiant Ellis Wyatt, but when she gets to Colorado, she sees that he has set fire to his oil fields and disappeared.
Dagny’s rejection of Rearden’s critical view of sex reflects Rand’s attitude that the mind and body cannot be separated. Rearden sees the achievements of the mind as noble but the desires of the body as base and unrelated to the mind. In contrast, Dagny (like Rand) sees the desires of the body stemming naturally from the rational mind. Dagny desires Rearden precisely because her mind perceives the value of his great accomplishments, and she knows he chooses her for the same reasons. Therefore, she sees sex as a grand expression of the values they represent to each other, not as a shameful impulse. Rearden must learn to integrate the mind and body if he is to be released from his self-made bonds.
Jim and Cherryl’s romance is entirely different. Cherryl chooses Jim because of the values she thinks he represents, but she is wrong about him. Jim chooses Cherryl out of his need to destroy. Although he claims to have noble, altruistic goals and a desire to help the “little guy,” his true nature is to destroy the efforts and aspirations of others. The young hero-worshipper is easy prey, much easier to destroy than Dagny, Rearden, or Francisco. However, neither Jim nor Cherryl are aware of his nature—yet.
When she discovers the remnants of the motor, Dagny has a new motivating purpose in the story. With its potential to revolutionize not only the transportation industry, but every industry, Dagny knows the motor could save a crumbling society. Finding its inventor and rebuilding it gradually become even more important than saving her railroad. Also, the motor represents the concept of motive power. It can power a society, just as a locomotive engine can power a train. In Ayn Rand’s philosophy, the mind, fueled by rational thought, is the motive power that fuels man’s existence.
The new laws demonstrate the absurdity of socialism in action. There is no way the businesses affected by them can possibly survive in the long term if they are to follow the rules. For example, if Taggart must run fewer, shorter, and slower trains through Colorado, it will lose money through increased operating costs and lower shipping fees. Meanwhile, the Colorado businesses will not be able to ship their goods efficiently because they will face a shortage of trains, and they will lose money as well. Meanwhile, Rearden cannot possibly meet the demands of the new laws. One requires him to limit his output of Rearden Metal, while another requires him to sell a “fair share” of Rearden Metal to everyone who requests it, regardless of output. Rand demonstrates how a society that controls its economy through harsh regulations eventually creates new criminals by creating new crimes. Rearden is made a criminal under one set of laws to meet the requirements of another. To the rational mind, these outcomes are obvious, but since the looters have rejected reason and rationality, they cannot see the long-term issues.
The story of Lee Hunsacker, Midas Mulligan, and Judge Narragansett further illustrates the irrational nature of socialist laws and offers some clues about the motives of the men who have disappeared. Although he had believed he was following noble socialist ideals, the judge who overturned Narragansett’s ruling created an impossibly absurd situation. By ordering Mulligan to issue a loan to Hunsacker precisely because of Hunsacker’s need and, more importantly, his inability to repay it, the judge had allowed the doctrine of need to triumph over reason. In response to this, Mulligan and Narragansett have retired and disappeared, just like the industrialists. Dagny gets more clues to the motives behind the disappearances when she finds Hugh Akston. He retired because he could no longer practice as a philosopher. Since his philosophy is the philosophy of reason, only reason could have pulled him away from the world. To live in the world as Dagny and Rearden live—under the yoke of weak, malicious men—presented to Akston and the others some fundamental logical contradiction. Though its full nature has not yet been revealed, the force at work among the nation’s vanishing industrialists may simply be the force of reason.