A small army of men from Lake-Town, led by Bard, the bowman who slew Smaug; accompanied by a larger group of elves from Mirkwood, led by the Elvenking; arrive at the foot of the Lonely Mountain. They are surprised to find Thorin and Company waiting for them; they had assumed that Smaug ate them all before proceeding to Lake-town. But finding them there, Bard advances to speak with Thorin.
Smaug's hoard consists not only of the old treasure of the dwarves; it also contains wealth which the Dragon looted from the Kingdom of Dale. As a descendant on Girion, king of Dale, Bard has a claim on a part of Smaug's gold. Bard also speaks for the men of Lake-town, whose Master he still serves, and who had assisted Thorin when he and his company had arrived there penniless. The men of Lake-town had supplied food and ponies to the dwarves to aid them on the last stage of their journey to the Lonely Mountain; and they had suffered grievously in the Dragon's attack on their town. Bard presents his case before Thorin with words which are proud and grimly-spoken; but Bilbo thinks the request seems fair.
But ... he did not reckon with the power that gold has upon which a dragon has long brooded, nor with dwarvish hearts. Long hours in the past days Thorin had spent in the treasury and the lust of it was heavy on him. Though he had hunted chiefly for the Arkenstone, yet he had an eye for many another wonderful thing that was lying there, about which were wound old memories of the labours and the sorrows of his race.Dwarves are naturally possessive and jealous of their rights under the best of circumstances; and this is exacerbated by the malign influence of the Dragon. In Western lore, dragons are the living embodiment of avarice, and the gold upon which dragons have nested tends to transmit that greed like a contagion.
Thorin rejects Bard's demands.
"I will not parley... with armed men at my gate. Not at all with the people of Elvenking, whom I remember with small kindness. In this debate they have no place. Begone now ere our arrows fly!"And he actually does shoot an arrow at one of Bard's messengers. Bard announces that he will besiege the mountain until Thorin is willing to speak reasonably. He figures that with winter fast approaching and the dwarves' food dwindling, he won't have long to wait. Bilbo knows better. Thorin would rather starve than back down now; but he is also expecting his cousin Dain from the Iron Mountains to arrive any day now to break the seige. This can't end well. But Bilbo has been working on a plan of his own.
One night he creeps out of the dwarves' redoubt, concealed by his magic ring, and sneaks across no-man's-land to Bard's camp. He gives Bard the Arkenstone, which he found in Smaug's hoard and which he has been guiltily hiding from Thorin. "The heart of the Mountain, and it is also the heart of Thorin. He values it over a river of gold." Bilbo hopes that with the Arkenstone as a bargaining chip, Bard will be able to negotiate an end to the stalemate short of battle.
The elvenking is impressed by Bilbo's action. "You are more worthy to wear the armor of elf princes than many who have looked more comely in it." But he warns Bilbo that Thorin will surely be angered at the theft and suggests that Bilbo might be safer remaining with him and Bard. Bilbo declines the elf-king's offer. "I don't think I ought to leave my friends like this, after all we have gon through together."
As Bilbo leaves the camp to return to the dwarves, he unexpectedly runs into Gandalf. The wizard always seems to disappear when he is most wanted, and reappear again when he is most needed. Gandalf praises Bilbo for his generous act of burglary, but warns that a difficult time is coming quickly and there is news brewing of which even the ravens have not heard.
The next morning Bard comes to the dwarves' fortifications again to parley, but this time he has the Arkenstone, which he offers to ransom to Thorin in exchange for a share of the treasure.
"How came you by it?" shouted Thorin in gathering rage.
"I gave it them!" squeaked Bilbo, who was peeping over the wall, by now in a dreadful fright.
"You! You!" cried Thorin, turning upon him and grasping him with both hands. "You miserable hobbit! You undersized -- burglar!" he shouted at a loss for words, and he shook poor Bilbo like a rabbit.Bilbo is frightened, but he reminds Thorin that he was promised a fourteenth share of the treasure. "Perhaps I took it too literally -- I have been told that dwarves are sometimes politer in word than in deed. The time was, all the same, when you seemed to think that I had been of some service.... Take it that I have disposed of my share as I wished and let it go at that!"
Grimly, Thorin agrees to send one fourteenth of the gold and silver -- "the promised share of the traitor" -- to redeem the Arkenstone. He casts Bilbo out from his walls. "Take him, if you wish him to live; and no friendship of mine goes with him."
As for the payment, that will have to wait. "That shall follow after, as can be arranged," Thorin says; but in the back of his mind he is thinking of Dain and his army, due any time now. He might be able to recapture the Arkenstone without paying a nickel.
Dain does arrive the next day, with five hundred seasoned veterans of the dwarf and goblin wars. For the moment, the army of Bard and the elvenking can prevent them from joining up with Thorin, but the moment of crisis has come. How big a crisis, only Gandalf knows.
Just as battle is about to be joined, the sky is darkened by a swarm of bats heralding the arrival of a goblin army riding on wolves. "Dread has come upon you all!" Gandalf cires. "The goblins are upon you! Bolg of the North is coming, O Dain! whose father you slew in Moria." This is a reference to the great war between the goblins and the dwarves which had been alluded to before. Tolkien expands on it a bit in the Appendices of Lord of the Rings. Suffice it to say that the goblins have also heard about the Dragon's hoard; and they are looking for payback.
Dwarves may be generally unpopular, but everybody hates goblins. The rival factions quickly set aside their differences to face this new threat.
Thus begins the Battle of the Five Armies, pitting the elves, men and dwarves on one side against the goblins and the wargs on the other. Bilbo does his very best to stay out of it. His magic ring may be very useful to avoid being seen by an enemy combatant, but it is no help in avoiding being trod upon or hit by a stray arrow.
It was a terrible battle. The most dreadful of all Bilbo's experiences, and the one which at the time he hated most -- which is to say it was the one he was most proud of, and most fond of recalling long afterwards, although he was quite unimportant in it.Bilbo observes the battle from the hilltop where the elves have taken up a defensive position. The battle is going against his friends; the goblins are overwhelming them with superior numbers. Then, when all looks hopeless...
The clouds were torn by the wind, and a red sunset slashed the West. Seeing the sudden gleam in the gloom Bilbo looked round. He gave a great cry: he had seen a sight that made his heart leap, dark shapes small yet majestic against the distant glow."The Eagles! The Eagles!" he shouted. "The Eagles are coming!"Tolkien was very fond of this passage, and felt that it was his most successful evoking of something he called eucatastrophe, or "good catastrophe"; a turn of events which upends everything which came before, but which brings about joy rather than sorrow. It's the Cavalry coming over the hill; Jack Worthing discovering that he really is named Earnest; the Millennium Falcon coming out of nowhere to take out the TIE fighters on Luke's tail; it's the look on the villain's face when he realizes that all his diabolical plans have only given the hero the chance to triumph; it is Victory snatched from the jaws of Defeat, the sudden Reversal of Fortune which makes the Happy Ending possible. A devout Catholic, Tolkien regarded the story of the Resurrection as the ultimate eucatastrophe.
We've seen smaller eucatastrophes scattered about in The Hobbit previously: the trolls petrified by the rising sun; the previous appearance of the eagles rescuing the dwarves from the goblins in the fir grove. Here is the climactic catastrophe of the book, in which the tide of battle turns leading to ultimate victory. Tolkien liked the scene so much that he invoked it again in Lord of the Rings during the climactic battle at the Black Gates of Mordor. Pippen hears someone shouting "The Eagles are coming" and thinks, "No, that's Bilbo's story."
Bilbo does not witness this victory. A stray stone flung from above hits his helm and knocks him unconscious. He doesn't get to see the goblins routed or the last-minute appearance of Beorn in the form of a gigantic bear smashing through the goblin ranks. By the time he wakes up and has the presence of mind to remove his magic ring, the battle is over. (If he hadn't been invisible, he probably would have been taken to much more comfortable quarters by now.)
He learns that of his companions only ten remain. Fili and Kili were slain, defending Thorin. They were the youngest of Thorin's company and his nephews. Here we have some of Tolkien's own somber experiences of war creeping into the tale. It is always the young who perish in wartime. Thorin has also been fatally wounded and lies near death. He has asked to see Bilbo one last time.
"Farewell, good thief," he said. "I go now to the halls of waiting to sit beside my fathers, until the world is renewed. Since I leave now all gold and silver, and go where it is of little worth, I wish to part in friendship from you, and I would take back my words and deeds at the Gate. ... If more of us valued food and cheer and song above hoarded gold, it would be a merrier world. But sad or merry, I must leave it now. Farewell!"Thorin is buried under the Mountain, with the Arkenstone on his breast. His cousin Dain assumes leadership of the dwarves and honors the agreement to give a fourteenth share of the treasure to Bard, to use in rebuilding the Lake-town and re-establish the kingdom of Dale. Dain also offers to give a share to Bilbo in reward for all he has done; but the little hobbit will accept no more than what a pony can carry. He figures that any more that that would be more bother to carry home than it would be worth.
Accompanied by Gandalf, Bilbo takes a more leisurely trip back home. One by one, he bids farewell to his friends, both old and new: the dwarves, the elvenking, Beorn, Elrond. A year has passed since he ran out the door of Bag-End without his handkerchief and arrives back home to find one last joke played upon him. Because of his long absence, he's been declared legally dead and he returns in the middle of an auction selling off his belongings.
His remarkable adventure has ruined his reputation as a solid, respectable hobbit. Most of his neighbors now regard him as 'queer'. But he has the honor of elves, wizards and dwarves, which is something. He spends the dragon's gold he received on presents, which perhaps is the best way to break a dragon's curse. He takes to writing poetry and visiting elves, and confounds his proper relations by being remarkably happy to the end of his days.