The play opens on an early summer morning in 1912 in the crowded back room of Harry Hope's saloon. The majority of the customers sleep slumped over their tables. Rocky, the night bartender, sneaks Larry Slade, a former Syndicalist-Anarchist, a drink of whiskey. Larry notes how their group has a "touching credulity" concerning tomorrows: the pipe dream gives life to the "misbegotten lot." He, on the other hand, has buried his pipe dreams, retiring to the "grandstand of philosophical detachment" to await his death.

Parritt, a young ex-Anarchist, enters. His cohorts were recently arrested for a bombing on the Coast, and he has come to Larry for help, since years ago, Larry had an affair with his mother. Willie tells of his days at Harvard Law School and the ruin of his industrialist father. A chorus of each guest's fond reminiscences and pipe dreams follows. Hope has not left the bar for twenty years ago. He is sure, however, that he will venture out tomorrow. Wetjoen and Lewis jocularly recall their wartime days and imagine their happy return home. Jimmy joins them and pledges to get his old newspaper job back tomorrow. Joe remembers his gambling house and dreams of a new venture. Mosher announces his plans to return to the circus. McGloin speaks of his imminent reinstatement with the police. Margie and Pearl, Rocky's "tarts," then appear. They chat about their friends Cora, another tart, and her pimp Chuck, who have long nursed a pipe dream about getting married and buying a farm. Hickey, a salesman, makes a grand entrance and is sober. The residents receive him warily.

In Act II, the residents of the bar are irritated and apprehensive, and they are getting ready for a celebration. Hickey is certain that Larry is the only one who can help Parritt. Parritt needs punishment so he can forgive himself. Hickey begins the festivities, and the crowd half-heartedly follows. Hope enters and rails at the crowd, and Hickey begins preaching anew. Larry tauntingly asks whether Hickey's wife finally end up with the iceman. Hickey announces simply that his wife Evelyn is dead.

Act III opens in the barroom on the morning of Hope's birthday. Larry defiantly insists that Hickey has nothing on him. Parritt admits that lied earlier about his patriotism; he ratted on the group for some money to blow on a whore. Larry notes he has not explained Evelyn's death—it would little surprise if she committed suicide. The members of the party gradually appear, weakly putting up fronts of self-assurance and almost coming to blows when the others deride their intentions. Hickey appears and prods the condemned men out of the saloon. Hope returns and pleadingly insists that an automobile almost ran him over. Bitterly Larry condemns Hickey: he has brought them the peace of death. For the first time Hickey loses his temper and insists that the shock is only temporary—peace will follow. Hickey quietly informs him that she did not kill herself: she was murdered.

Act IV begins half past one the next morning in the saloon. The group has returned and sit like wax figures benumbing themselves to the world. As he speaks, Hickey appears at the doorway and denounces Larry angrily. The crowd shrinks away. Hickey begs his friends not to persist in their depression if they are trying to spite him. They have killed their tomorrows and should rejoice. He was living in hell himself until he found a way to free Evelyn from her pipe dream of his possible reformation. Two policemen, Moran and Lieb enter from the rear; Hickey has called to turn himself in.

Suddenly Hickey explodes, insisting that he must tell his story, and he confesses that he murdered his wife in her sleep to put her out of her own misery. A relieved Parritt makes his own confession and says that he betrayed Mother because he hated her. Hickey earnestly begs for the electric chair as the cops take him out—he has not got a pipe dream left and wants to die.

With Hickey gone, Parritt begins begging Larry anew for help. He too thought of vengeance in his treason. Larry commands him to his suicide. Parritt thanks him with simple gratitude. Jubilantly Hope starts the festivities anew. Hesistantly, the group comes to revive their pipe dreams. A crunching thud is heard, and Larry hides his face in his hands.

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