Student Question
Why did Orwell include the forged bank notes passage in Animal Farm?
Quick answer:
The detail of the forged bank notes serves several purposes at once. On the level of allegory, it is a representation of Stalin's non-aggression pact with Nazi Germany and Hitler's later betrayal of that agreement. In addition, it also expresses Napoleon's fallibility in contrast to how his own propaganda presents him. Finally, it further establishes the parallels between the humans and the pigs and the ways in which they are not so fundamentally different from one another.
Authorial decisions can serve multiple different purposes all at once. Such is the case where the incident of Mr. Frederick and the forged bank notes is concerned.
First, there is Animal Farm strictly as read on the level of allegory: in this case, these events actually parallel the history of the twentieth century. In 1939, Hitler and Stalin signed a non-aggression pact, with the intent of dividing up Poland between them. Hitler, of course, had no intention of honoring that agreement, and he later invaded the Soviet Union in 1941, catching the Soviets by surprise. The events from chapter 8 serve as an allegorical representation of that history, with Napoleon entering into a business arrangement with Mr. Frederick (whose farm represents Nazi Germany in the allegory), only to be cheated by the deal. Soon afterwards, Frederick will attack Animal Farm, destroying the windmill, paralleling Nazi Germany's invasion of the...
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Soviet Union.
However, this decision has additional levels of thematic resonance even beyond the strictly allegorical reading. For one thing, the detail of the forgery is important in showing Napoleon's own fallibility, for all his propaganda presents him otherwise. Indeed, the pigs presented Napoleon's negotiations as a great triumph of Napoleon's cunning, but in reality, it was Napoleon himself who was outmaneuvered and outsmarted in this particular instance.
In addition, however, this scene is also important in further characterizing the duplicity of human beings. To a certain degree, the humans do become overshadowed within the book by the greed and exploitation of the pigs. However, here you should remember the parallels Orwell presents between the two: throughout the novella, Orwell presents a picture by which the pigs themselves are becoming more and more human-like, until (by the end), they have become indistinguishable from human beings. The message isn't so much that Napoleon is necessarily worse than the humans, but rather that there is little fundamental difference between the two.
With that in mind, this scene with Frederick further establishes those parallels between the humans and the pigs. Just as the pigs deceive and manipulate the other animals for their own personal interest, so Mr. Frederick deceives and manipulates the pigs, cheating them for his own profit and then attacking the farm itself.