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"Babylon Revisited" begins with Charlie Wales, an American expatriate who has returned in 1930 to Paris, the site of much drinking and partying on his part during the 1920s. Since the stock market crash of 1929, Charlie has sobered up and now looks with a combination of amazement and disgust at the extravagant lifestyle he lived.
Charlie's first visit in Paris is to the Ritz bar he used to frequent in his wild days. He asks after many of his former party-friends but finds that Paris is largely empty compared to several years earlier. He leaves an address with the barman to give to friend named Duncan Schaeffer. Since Charlie hasn't settled on a hotel yet, he leaves the address of his brother-in-law's house. He then wanders through Paris and sees all the hotspots he used to frequent during the extravagant days of the twenties. Everything looks different to him now that he's sober and doesn't have the money he used to.
As the story progresses, we learn that Charlie is back in town to try to regain custody of his daughter Honoria, who is currently staying with his sister-in-law and her husband. Charlie's deceased wife Helen died a little over a year ago from heart trouble. At the time, Charlie was in a sanatorium having suffered a collapse. Though we don't get all the details, we see that Charlie was, perhaps among other things, recovering from alcoholism. Now he only has one drink per day, so that the idea of alcohol doesn't get too big in his mind.
We learn that Charlie has a pretty bad relationship with his sister-in-law, Marion Peters, who blames him for her sister Helen's death. She is resistant to the idea of allowing him to take Honoria home with him, but Charlie eventually wins her over with his patience and insistence that he is reformed. They make plans for him to leave shortly with Honoria.
Meanwhile, two of Charlie's old party friends, Duncan Schaeffer and Lorraine Quarrles, who are still living the drunken lifestyle, have been trying to get him to go out drinking with them. Charlie resists, as he's left behind the wild days of running around Paris drunk. On the night when Charlie is at the Peters' finalizing plans to take Honoria home, Lorraine and Duncan show up, drunk, begging him to come out with them. Marion sees that Charlie is still associating with the party crowd, and so she goes back on her offer to let him take his daughter back. Charlie is baffled as to how Duncan and Lorraine found him, and either doesn't remember or refuses to acknowledge that he left the Peters' address for Duncan at the Ritz bar.
Charlie leaves the Peters' house and returns to the Ritz bar, where he has his one drink for the day and refuses to have a second one. He plans to try and get Honoria back again, perhaps six months from now when Marion has calmed down. He wonders how long he'll have to pay for the destructive lifestyle he used to live.