In Chapter 2, Carlson tells Candy he should shoot the dog because the dog stinks. He adds that the dog is too old to be of use and is suffering. But Candy can not bring himself to do such a thing. He says, "No, I couldn’t do that. I had ‘im too long." Candy adds that the dog used to be "the best damn sheep dog I ever seen." Carlson keeps bugging him about killing the dog. Candy repeats that he is so used to the dog. He cannot, or doesn't want to, think about life without the dog. (Candy's loyalty to the dog parallels George's loyalty to Lennie. This notion of doing what's "best" for the dog will also play a parallel role with Lennie later in the story.)
Candy tries to change the subject of the conversation, but Carlson keeps hammering his point home. Eventually, Candy lets him end the dog's life. Candy becomes silent and does not answer Slim's offer of taking one of the new pups. His silence illustrates his sadness and loyalty to the dog. He also shows his loyalty by refusing to acknowledge the idea of having a new pup:
Slim said, “Candy, you can have any one of them pups you want.” Candy did not answer. The silence fell on the room again. It came out of the night and invaded the room.
Candy also identifies with the dog. The dog was old and not much use on the ranch. Candy is also older and he only has one hand as a result of an injury on the ranch. He is afraid that he will become obsolete just as his dog did. This is why he is so intent on teaming up with George and Lennie on their farm. He says:
You seen what they done to my dog tonight? They says he wasn’t no good to himself nor nobody else. When they can me here I wisht somebody’d shoot me. But they won’t do nothing like that. I won’t have no place to go, an’ I can’t get no more jobs. I’ll have thirty dollars more comin’, time you guys is ready to quit.