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I would say that Kazan's film does reflect that loyalty is not always a positive character trait. The configuration that Kazan offers is one where individuals must speak out against that which is wrong or unjust. Essentially, the problem that Terry has is to speak out against a system that is wrong. If he does not speak out, then he is complicit with it and a part of it. The movie constructs a setting whereby one cannot stand loyal, cannot play "D and D," when one knows that in doing so, there is an allowance for evil to transpire. Certainly, the setting that is offered up in the film in terms of how the mob uses force and intimidation to control the waterfront is one where individuals have to stand up and take action against that which is wrong. Father Barry believes in this, and there is a deliberate attempt to use this idea of how loyalty to that which is wrong is in itself wrong. The film constructs a reality where loyalty out of silence stands in direct opposition in doing that which is right. It is for this reason that loyalty is shown as something that is not always a positive character trait in the film.
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