Unfortunately, Dagny and Rearden do not live in a free country. The government holds the premise that individuals must sacrifice themselves for the public welfare. When individuals do not volunteer that sacrifice, the state has the legal power to force them to do so. This premise robs Rearden of his ore mines using the justification that Rearden is already successful, so someone less successful should be given a chance. Furthermore, because Rearden intends to sell his metal on the open market, he poses a threat to the State Science Institute. In the government's view, he is dangerous to the "public welfare." The Institute's response is a smear campaign based on fabricated allegations regarding hypothetical problems with Rearden Metal. The unjust campaign is designed to hinder Rearden's success, weakening him until he agrees to obey the Institute's wishes. The rulers aren't interested in promoting the metal's benefits to raise the standard of living. Instead, they're interested in increasing their political power. Ayn Rand shows that in a socialist system, the government violates the rights of the most productive people. As a result, the economy suffers.
The title of this chapter employs the terminology of Karl Marx to promote an opposite meaning. Marx, the founder of communism, held that in a capitalist system, the wealthy oppress the poor. Rand, a defender of capitalism, shows that in a socialist or communist system, the government oppresses the productive. This chapter raises the question, "Who — and in which system — exploits whom?" In a purely capitalist system, Rearden and Dagny create superb products and services that benefit customers and provide employment for workers. Rand argues that with pure capitalism, the exploitation Marx describes does not exist. But in a socialist system, the government uses its power to shackle and stifle people like Rearden and Dagny. The socialist politicians, while relying on and benefiting from the great productiveness of Rearden and Dagny, enact legislation and policies that make it impossible for Rearden and Dagny to produce.
