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This chapter begins in the bitter winter with the animals trying their best to rebuild the windmill, but the cold and their hunger dampen their spirits. It is only Boxer's never-failing cry of "I will work harder" that inspires them to continue. January brings a true food shortage, and they often have nothing to eat but chaff.
Napoleon hides the bitter reality that exists on the farm. He instructs the sheep to talk about an increase in rations when Mr. Whymper is in hearing distance. He orders empty bins to be filled to the brim with sand and then covered at the top with grain, in order to deceive Mr.Whymper, who would then report to the outside world about 'no shortage' on Animal Farm.
As the situation worsens, Napoleon hardly makes an appearance. The weekly work orders for the animals are now given through the pigs. Squealer's announcement that the hens should surrender their eggs, at least 400 per week, brings forth a terrible outcry, but the hens must obey. The dogs see to it that Napoleon's orders are carried out, for the eggs need to be sold in order to survive until spring.
Snowball continues to serve as Napoleon's scapegoat and is blamed for everything that goes wrong on the farm. Napoleon goes so far as to claim that Snowball "was in league with Jones and was his secret agent". It is difficult for the animals to accept this explanation, and even Boxer questions it. Squealer, of course, quiets them with propaganda.
One day Napoleon calls a meeting and emerges wearing medals, which he has awarded to himself. He arrives, escorted by his nine guard dogs. After surveying the crowd of animals, he gives a high-pitched whimper, and the dogs attack the crowd. They try unsuccessfully to attack Boxer, who holds one of them under his hoof. After the tumult, the dogs appear before Napoleon with the four pigs that had earlier raised their voices against his policies. Napoleon then orders the four pigs to confess that they had been contriving with Snowball to destroy the Windmill and that they had entered into a truce with him to hand over Animal Farm to Mr. Frederick.
When Napoleon demands further confessions about Snowball, the hens say that he appeared in their dreams and instigated them to disobey. As a result, Napoleon orders the hens to be slaughtered. The goose confesses to having stolen and eaten six ears of corn during last year's harvest at Snowballs' urging; he is murdered. The sheep confess to urinating in the drinking pool and murdering an old ram and blame their actions on Snowball; they are all killed instantly. By the end of the confessions, there is a pile of corpses lying before Napoleon's feet. His reign of terror has truly begun. Frightened and shattered, the animals start singing 'Beasts of England'. This anthem, which seems to inspire the animals, is soon forbidden by Napoleon. It is replaced by Minimus's new song, which is bland and nationalistic.
Orwell seems to have written this chapter with Russian history in mind. The food problems of the animals in the book parallel Russia's economic problems in the 1920's and the famine thereafter. In August, 1936, the Communist Party under Stalin tried, accused, and executed many high ranking officials on a charge that they were Trotskyists, just as Napoleon executes the animals for being influenced by Snowball. Trotsky himself was earlier expelled from Russia, just as Snowball is expelled from the farm.
Napoleon has become just like Stalin or any other dictator. He hides the ugly truth from the outside world. He makes Whymper believe that their supplies are plentiful and all is going well on the farm. He refuses to allow any animal to question his power and uses the dogs to keep his subjects under control. He separates himself from the masses and appears only ceremoniously, almost like a god. He threatens his subjects with the return of Snowball and Jones, whom he has made into totally fearful beings. He shows his strength by publicly executing those who betray him. The only release that the animals have is to throw themselves more fully into their work.
The substitution of the nostalgic song of rebellion by Minimus's mild new song is grudgingly accepted by the animals, just as they have learned to accept their plight in life. Their dream of equality, freedom, and democracy is shattered; in its place, they find terror, deprivation, and totalitarianism.