The current society that Equality 7-2521 lives in, everyone is split into different houses determined by the head house, the Council. Under this government, no one is allowed to step out of place and is confined to living under their house. Along with this there are curfews in which every person must return to their houses or face punishment. This structure creates an environment where everybody must live not as individuals, but people who represent their house as a whole. There is absolutely no freedom to think for yourself and no way to explore the world outside of your society. Everything is manipulated by the Council even reproduction and social status.
Ayn Rand purposely writes the flaws found in this collectivist society because she believes that it is the terrible society to live in and rational egoism is a better alternative. I do believe that rational egoism is the better alternative because it boasts the idea that every person is free to think. No one is forced into a sphere that is determined by a group of people who most definitely do not know what is best for me. With rational egoism, I get to determine what is best for me and in turn allow other people to decide what is best for them. This very concept of "I" is so powerful that even Equality 7-2521 recognized its power. He used this very concept to disobey the council with every chance he had such as hiding in the tunnel to write out his own thoughts and even discovering how to harness the power of electricity even though scholars were the only ones allowed to make discoveries.
However, as great as rational egoism sounds opposed to collectivism, it is not exactly ironclad. With the idea that everything I do is for my greatest benefit means that anyone who opposes me must be eliminated. This means it is inevitable that I will have enemies who will think the same way I do and seek to eliminate me if I opposed them. It is possible that we can compromise, but this won't hold for long if one of us is not full satisfied with the results. Enemies are not the only problems that can arise from rational egoism. Society would have no need for laws anymore if rational egoism were to reign. It would make no sense for me or anyone else to obey a law that did not produce maximum benefits. Without laws, we would be plunged into anarchy and anyone who believes they are fit to be a supreme ruler will do everything in their power to reach that state. Being under the rule of one person does not seem any different that being under the rule of a group which brings us back to square one.
In the end, I think Ayn Rand did a great job of exposing the problems to a collectivist society and offered rational egoism as its alternative. However, creating a perfect society is not an easy task and even a promising alternative such as rational egoism is not flawless. I guess this goes to show that we as a society are nowhere near perfect, but it does not mean we cannot try our hardest to improve.