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This chapter clues us in on why Lord Steyne is the way he is.
So, to make a long-ish story short:
Steyne has a secret set of apartments inside his London mansion where his married friends can bring their mistresses (and where he, we're assuming, has brought his own mistresses). He also makes his serious, proper wife invite some really gross characters to dinner, thus officially sanctioning them socially. He bullies and abuses her. Basically, he's a pretty bad dude.
Steyne comes from a long line of famous aristocrats dating 400 years back, to the reign of King Henry VIII. It's like being able to trace your family back to the Mayflower but way more impressive. Everything was going fine for him at first. His marriage was even a happy-ish one, and his youngest son (George Gaunt) was doing well as a diplomat abroad.
Until he suddenly wasn't. George Gaunt became paranoid, started seeing things, raving, and generally being crazy. Apparently this kind of thing ran in Lady Steyne's family, so she – or at least her gene pool – is to blame. Shmoop is no psychiatrist, and neither was Thackeray, but from the symptoms and late onset, we'd guess George Gaunt had paranoid schizophrenia. Awful stuff, especially back then, with a stigma for the whole family. So they locked George Gaunt up in a private house with a bunch of nurses and told everyone he had moved to Brazil.
So the upshot is that Lady Steyne feels horrible and guilty, and Lord Steyne blames her for what happened to their son. He lives a life of pleasure and debauchery to try to distract himself. He's a horrid man, but still, you kind of feel sorry for him.