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Bereft of the love of family and friends, a place in the world, and personal dignity, the itinerant worker of the 1930s Great Depression possessed little hope of any future. Steinbeck's setting of Soledad, California, metaphorically expresses the terrible aloneness and alienation of these "bindle stiffs" who wandered throughout the state in search of work. Because this work was seasonal and only temporary, the men learned to plan on nothing, for it was unrealistic to do so.
Lennie, however, is not truly cognizant of the plight in which he and George, exist as itinerant workers. Child-like in his simplicity of thought, Lennie is generally content as he has a good friend with George, who, like a parent, assumes the responsibility of providing for their existence. Therefore, it is not out of character for Lennie to fantasize and to perceive an impratical idea as a real possibility.
While Lennie has George recite the dream, much as one recites a fairy tale over and over for a child, this recitation makes George start to believe in it. But, it is only Lennie's great faith in the dream of a ranch which creates this possibility. Once Lennie, the keeper of the dream dies, so dies the dream for George and the others because they are left only with the reality of their lives since the magic of the dream was only in Lennie's mind.
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