How does Johnny Dorset demonstrate the power of the human imagination?

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Like many young children, Johnny Dorset lives primarily in a world of his own creation. Play is his central occupation. During the period about which O. Henry writes, children in the United States often played at “cowboys and Indians.” Johnny has assumed the role of an indigenous leader whom he calls “Red Chief.” The fact that he has been kidnapped is apparently not sufficient to derail him from the centrality of play. Instead, he tries to draw the adults into his fantasy world. One main mistake that the adults make is to believe that they are in control of the situation. Johnny does not subscribe to this view. If he cannot make the adults play with him, they are of limited value.

The challenge that O. Henry poses in making this a humorous story is to convince the reader that the child is not truly in danger. Although the author makes “play” the central action, he also hints that Johnny does have an inclination of the seriousness of the situation. He takes a risk when he sneaks up on the sleeping adult man and approaches him with a knife. This bold action make it seem that the boy has been paying close attention to the adults' behavior and personalities: he does not believe that the adult will injure him. In this respect, O. Henry achieves a balance between imagination and observation, showing the child’s intelligence and skill that balance his imagination. His father’s reaction when confronted with the ransom demand indicates that he understands his son well enough not to fear for his safety.

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The key to answering your question, I think, is to note the intensity of Johnny Dorsett's imagination. For Dorsett, these games extend far beyond typical childhood pretending. When he is pretending to be Red Chief, he speaks about scalping his captives, and later, one of the two kidnappers wakes up to find the child standing over him, knife in hand, attempting to actually scalp him. Johnny Dorsett shows, to say the least, remarkable dedication to his pretend life, well beyond a reasonable limit.

In addition, I'd add that Johnny Dorsett is actually in a very precarious position: he's been kidnapped, and is being held for ransom by two criminals, and yet he treats the entire encounter as a game (and proceeds to terrorize these two criminals in the process). That's not what I'd consider a normal reaction—there's a kind of fearlessness here, to the point that he doesn't seem to even recognize the danger of his situation because he's so caught up in the games he wants to play.

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O. Henry's "The Ransom of Red Chief" is an early example of what Hollywood calls a "busted caper" story. In such a story, some crooks plan to commit a crime that should yield a lot of money; but, usually because of poor planning, they run into serious problems and the job, or "caper," ends in disaster. A good fairly recent example of a busted caper movie is the very excellent Fargo, in which a man named Jerry Lundegaard, played to perfection by William H. Macy, hires a couple of hoods to kidnap his own wife. His idea is to get a million dollars from her wealthy father to pay the ransom money but to keep most of the money himself. Both his wife and her father end up dead and Jerry will go to prison for life. In "The Ransom of Red Chief" the biggest mistake made by the two crooks is in planning to kidnap a little boy without knowing anything about little boys. The main thing the crooks do not understand about children in general is that fantasies can be very real for some. Johnny Dorset is not just pretending to be a wild Indian named Red Chief. He really is a wild Indian named Red Chief. It is the intensity of the boy's imagination that moves the story forward and creates disaster. The crooks think that they can just pretend along with Johnny, but they are progressively disillusioned.

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