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George shows that he has had a lot of experience working on ranches and sleeping in bunkhouses by the suspicions aroused by his finding a can of insecticide in the box above his bunk. He reads the label to Candy:
"Says 'positively kills lice, roaches and other scourges.' What the hell kind of bed you giving us, anyways? We don't want no pants rabbits."
"Pants rabbits" must have been one of the many slang terms for crab lice. It would not be a slang term for bedbugs because these bugs do not stay on a person's body after biting and sucking his blood. Crab lice usually get on the pelvic hair and are extremely hard to get rid of. They are the only bugs that a man could feel crawling around inside his pants, and they are properly described as a "scourge" because they are so annoying, so tenacious, and so prolific. In fact, they must have acquired the name "pants rabbits" because, like rabbits, they multiply quickly.
George uses another term to describe the suspected crab lice when he asks Candy, "Then how come he got graybacks?" Bedbugs and roaches are very dark-colored. Only crab lice could be described as gray.
Candy is defensive because as the "swamper" it is his job to keep the bunkhouse clean. The big, austere room is certainly not homelike, but it seems to be kept free of bugs and rodents.