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The small troubles that initially plagued Billy now have all but disappeared. The master-at-arms Claggart greets him warmly when he sees him.
Billy fails to notice how Claggart's eyes are occasionally "suffused with incipient feverish tears" (17.2). The narrator suggests that, if he could control it, Claggart might even love Billy.
The physical manifestations of Claggart's dislike of Billy go completely unnoticed by him. Even a man unsophisticated as Billy might naturally sense someone else's ill-will toward him in the same way that an unsophisticated man can tell certain food is disgusting.
But this all passes right under Billy's nose. As the narrator says, "his innocence was his blunder" (17.4).
An armorer and a captain of the hold occasionally throw mean glances at Billy, likely due to the fact that they are known to eat with Claggart.
For the most part, though, everyone shows nothing but good will toward Billy. The afterguard, for example, is nothing but kind to him and it seems as if Billy's good nature has defeated his cunning.
A shrewd man might think that Billy has already failed by not reporting the afterguard or looking further into the matter of the impressed men (those threatening mutiny). The narrator thinks, though, that you need more than shrewdness to understand a man like Billy.
As for Claggart, his single-minded desire to injure Billy "like a subterranean fire, was eating its way deeper and deeper in him. Something decisive must come of it" (17.10).