Why is the Valley of Ashes important to chapter three of The Great Gatsby?

The Valley of Ashes provides a counterpoint to the lavishness of East Egg and West Egg. The Valley of Ashes represents extreme poverty and hopelessness. Those who inhabit the valley are condemned to live their lives there—they do not have the financial means to escape, and their potential is suppressed by the rich who encircle their valley. In the text, Fitzgerald describes the valley as

"a fantastic farm where ashes grow like wheat into ridges and hills and grotesque gardens; where ashes take the forms of houses and chimneys and rising smoke and, finally, with a transcendent effort, of ash-grey men, who move dimly and already crumbling through the powdery air." (26)

The way Fitzgerald describes it evokes an image of a crumbling reality, one that is temporary and one that a slight breeze might disperse into the air, like ashes from a fire. This is a stark contrast to the lavish lifestyles of the nearby rich in East Egg and West Egg. The only way those rich folks see the valley is when they are forced to drive or ride the train through it. The valley represents the decay of the American Dream, the middle class, and the moral and social decay of America post–World War I. Greed and excess are encouraged through the industrialization of America at the expense of the poor and middle classes. The ashes dumped into the valley represent the byproduct of American capitalism—the burning up and away of the people who make up the base of the American economy in order to support the rich and ultra-rich. For all of these reasons, the Valley of Ashes remains one of Fitzgerald's most striking literary symbols.