Catherine Halsey is a victim of Ellsworth Toohey and a perfect example of Toohey's ghastly method of power-seeking. Early in the story, Katie is a sincere, good-natured girl, genuinely in love with Peter Keating. Though she had not been a great high school student, she planned on going to college, a goal supported by Keating but not by Toohey, her uncle. She is wishy-washy regarding this dream and allows Toohey to talk her out of it.
The one consuming passion of Katie's life is her love for Keating. But her uncle works hard to convince Keating to woo Dominique, not Katie, knowing that if his scheme succeeds, he will have reached two goals at once: He will have emptied Keating's soul of its last personal value and deprived Katie's soul of its only value. The lives of both will then be devoid of meaning, love, and passion. Both will be internally empty vessels, lost at sea and floundering, existing in painful misery, crying for a leader to guide them. This is exactly what happens. Keating loves Katie but abandons her for a showcase wife in the person of Dominique Francon. Keating's betrayal is a crushing blow to Katie. Toohey succeeds in conquering both of their souls. Katie, in empty despair, turns to the altruistic creed of her uncle, becoming, in effect, a miniature version of Toohey, seeking spiritual power over the poor individuals to whom she ministers as a social worker.
When Keating meets Katie by chance on the streets of New York, years after his abandonment of her, she is a bustling Washington bureaucrat, who exists to give orders, "not big orders or cruel orders; just mean little ones — about plumbing and disinfectants." She is neither angry, hurt, nor embarrassed at their meeting. She simply takes unstrained control of their time together, tells him what he will eat, and listens in amused tolerance to his heartbreaking admission that marrying her was the only thing he had ever wanted to do. Katie is Toohey writ small: She possesses no values or personal loves — she considers them "selfish" — only a desire to control small matters in the lives of weak people who are either unable or unwilling to control their own lives. As a consequence of possessing a soul devoid of personal values, she is an unfeeling automaton who bustles through her days in cold controlling efficiency.
As a chilling victim of Toohey's power lust, Katie serves to illustrate an important aspect of Ayn Rand's philosophy. Her sweetness, innocence, and good nature are inadequate to protect her from Toohey's evil. She was a conventional person, dutifully following her family and her uncle, not too ambitious, not committed to living by her own judgment or pursuing her own dreams. Her lack of independence — her unwillingness to bear the responsibility of sustained, self-initiated thought — costs her the loss of her soul. An uncritical emotional sweetness of disposition is insufficient to gain a person happiness or to protect her against evil. She needs to use her own mind to think for herself. A lack of independent thinking is what dooms Katie's attempt to gain love and happiness.