We have established that Tolkien was, albeit unconsciously, a socialist. How does this new insight help us understand what is going on at the start of the Hobbit? Lets have a look at the book.
The opening sentence deserves to be included in any list of great opening sentences for a novel. 'In a hole in the ground lived a hobbit.' But before we get any further we get a description of how well appointed and comfortable this hole is. Hobbits are materialistic creatures and are not likely to be fobbed off with any notion of reward in an afterlife for good behaviour in this one. Our hero, Bilbo Baggins is pretty down to earth, quite apart from actually living in a hole in the earth. One of the things we are going to get throughout the book is frequent references back to egg and bacon, and making cups of tea. These are the things that Bilbo misses about home while he is out having his adventure. Simple pleasures.
Bilbo is a very respectable individual. He is very polite and a stickler for manners. In his first conversation with Gandalf you might almost think of him as a bit snobbish. He doesn't have a job and he doesn't employ people. He starts off the book being a bit dull. You can apparently tell what opinion a Baggins will have on any subject without going to the trouble of actually asking him. But his status is such that he is free to go on an adventure if he wants to. The only issue is whether Gandalf the wizard can persuade him to give up his stable life style for something a bit unpredictable. This is by no means easy. Bilbo has several issues that trouble him about the prospect. The one that particularly bothers him is that there is no guarantee of regular meals.
Like Bilbo himself, Gandalf is free of social commitments and can engage in projects that he deems worthwhile. The case in hand is an injustice that needs putting right. A colony of dwarfs have been deprived of their property and livelihood by a dragon. Gandalf is putting together a team to redress this, with some exiled dwarfs providing the bulk of the manpower, or should that be dwarfpower, for the expedition. He has picked out Bilbo as a burglar
Gandalf's first problem is Bilbo's reluctance to consider leaving his comfortable home. To get round this he contrives a bonding session. Bilbo finds that thanks to Gandalf's plotting he has the dwarfs turning up at his hole. This gives him a chance to get to know the dwarfs and decide whether he really wants the burglar gig. The package on offer is reasonably attractive, with a 14th of the treasure payable on completion. Expenses, presumably funeral expenses, will still be payed in the event of the quest failing. We, like Bilbo, get to know a bit about the dwarfs. The leader is Thorin Oakenshield. What, not the Thorin Oakenshield you are probably asking? Yes, him! One of the crafty tricks by which we are drawn into the imaginary world in which the book is set is alluding to things as if we should already have heard about them. It is one of the ways Tolkien achieves the depth of his world the so many people who read his work comment on. So we learn that Thorin is a very famous. Gandalf has artfully tricked Bilbo into providing supper for a not just for any old dwarf, but a celebrity dwarf.
The dwarfs turn out to be a bit of a mixture of calculating opportunists and wild eyed romantics. On the one hand there is little doubt that they are motivated by a desire to regain their property and their treasure, and are prepared to pragmatically hire the expertise they need in the form of a burglar to do so. On the other hand they have a bohemian side. We see this when at one point in the evening they break out their musical instruments for a bit of improvised home entertainment. It is the music that sways Bilbo to overcome his objections and sign up.
They set out the following day - as any time management guru will confirm, the best time to start anything is now. So what have we learned? Bilbo is not the world's likeliest burglar. He has no relevant qualifications or experience. But he has volunteered for the role and is now honour bound to fulfill what is expected of him. The dwarfs are not exactly superheros either. Of the party, only Gandalf seems to have an appropriate skill set.
So it's all very democratic and egalitarian. In the world of the Hobbit you can have an adventure no matter who you are - its an equal opportunities when it comes to quests. And you have the choice of whether to take part or not. There is no government enforcing particular norms of behaviour. Everyone is free to participate, but there is no compulsion. And given this environment, it brings out the best in people. Bilbo could have chosen the safe and easy option, but he signed up and chose to take his chance. In the rest of the book we'll see how his choice came to have a profound effect on the kind of hobbit he would be.