More than simply criticizing the dwarf race, Tolkien’s depiction of the dwarves’ insensitivity also serves as a warning against the destructive power of greed, which has turned those who were once friends—the dwarves under the mountain and the men of Dale—into enemies. Humans, dwarves, and elves who are all “Good People” ought to be on the same side in Middle-Earth, and their common enemy ought to be evil creatures, such as the goblins. Such was the case while the dragon was alive, but now that Smaug is out of the way, lust for gold blurs the proper lines between good and evil.
In a sense, Bilbo’s desire for peace and his generous desire to share the treasure is another mark of The Hobbit’s swerving between the modern and ancient epic traits that shape his character. Bard’s slaying of the dragon is thoroughly drawn from epic literature, but Bilbo’s desire for a peaceful outcome to the conflict would be hard to find in Anglo-Saxon literature. In ancient Anglo-Saxon and Scandinavian epics, gold and treasure were treated with the same seriousness and reverence that is exhibited by the dwarves. Though the source of The Hobbit’s characters’ reverence for gold is different—gold in epic literature is valuable as much for its ability to create social stability as for its purchasing power—the strife that treasure creates mirrors the conflict found in epics like Beowulf. Bilbo’s desire for understanding and sharing is a sign that, having explored epic heroism both in Bilbo’s past actions and in Bard’s slaying of Smaug, Tolkien is also interested in exploring a more modern notion of heroism, which connects courage to sympathy and understanding.