Lieutenant Henry and Catherine Barkley attend the horse races with Helen Ferguson and Crowell Rodgers, the American soldier wounded when he tried to retrieve a souvenir, as well as Mr. and Mrs. Meyers.
Hemingway here reiterates Catherine Barkley's heroic status; she is distressed by the rigged racetrack betting in which Meyers is involved. "I don't like this crooked racing!" Catherine declares. She suggests to Lieutenant Henry that they bet on a horse they've never heard of, and although it finishes fifth, she feels "so much cleaner." Note that, as the horses pass in the race during which Henry and Catherine have distanced themselves from the crooked betting, they see the mountains in the distance — a very subtle reminder of the author's geographical dichotomy between pure mountains and corrupt plains. Again, while Henry is tolerant of a certain amount of corruption, Catherine demands purity.
This chapter also foreshadows the separate peace that Henry and Catherine will declare later in the novel. After separating from the others and betting on the horse unlikely to win, she asks him if he likes it better when they're alone, explaining "I felt very lonely when they were all there."
San Siro a famous Milan racetrack.
paddock an enclosure at a racetrack, where horses are saddled.
elastic barrier modern starting-gate.
pari-mutuel a system of betting on races in which those backing the winners divide, in proportion to their wagers, the total amount bet, minus a percentage for the track operators, taxes, etc.