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It's been two years since we last saw Mallow, and the role of mayor is turning out to be tricky. Plus, he has a war with Korell to contend with.
Jael is now the Minister of Education and Propaganda (odd combo, no?), and he suggests Mallow's pacifist move is the wrong one. Why trade with Korell for three years only to not full-on fight when war comes a-knocking? It doesn't make sense.
Sutt arrives, and Mallow and he get down to their last compromise session. Mallow says he would like Sutt's help, but it's hardly necessary in the grand scheme of things.
Sutt will only help if Mallow returns to a policy of trade in connection with the spread of the Foundation's spiritual power.
Well, that's not going to happen. Here's why:
When Mallow first landed on Korell, he bribed his way into the factories by giving Sutt trade in trinkets. Then he sold them factory machines and the nuclear power to run them.
Result? Korell's entire economy now depends almost exclusively on Foundation tech.
So, what will happen when that tech starts to break down? First, the housewives will complain that their dryers and dishwashers don't work. Then factory owners will protests that their machines won't do the work.
Hello, economic snowball on a hot summer day.
But Sutt wonders why the Commdor can't get the Empire to supply him the nuclear power he'll need.
Since he visited Siwenna, Mallow knows that that the Empire can't make vital scientific advancements. It can only hang on to what it's got, and it won't be long before even that's impossible.
In sum, economic depression will defeat Korell in two or three years, and the Foundation doesn't need to do anything.
Sutt refuses to work with Mallow, claiming the man can't be trusted.
Obviously, Mallow then arrests Sutt.
Jael warns Mallow that he may have made an already dangerous enemy even more so, but Mallow doesn't think so. Sutt's anger has removed his judgment. He's done for.
Besides, religion is played out; it can no longer be the solution to the Seldon crisis.
Where Sutt attempts religious propaganda, Mallow will force trade and prosperity to die.
Trade is the new solution, the change the Foundation needed.
And what about Mallow's new plutocracy? Well, Mallow doesn't much care about the future. No doubt Seldon has seen the next crisis, but that's a problem for his successors.
Encyclopedia Galactica: This entry states Korell surrendered after three years of the least-fought war in history. And Mallow's name joined the likes of Seldon and Hardin in Foundation history.