- Ben is in "agony" over the "degradation" of his people. That's probably because being forced to salute black soldiers is equivalent to being violently imprisoned, abused, and forced to work. Yup.
- He spies two white kids as they hide under bedsheets and scare away a group of black children. This, the caption reads, becomes the "inspiration."
- Thus begins the Ku Klux Klan, which the film claims "saved the South from the anarchy of black rule." We just can't make this stuff up, folks. This is what happens in this movie.
- And now we see some Klansmen on horses as they "terrorize" (that's the film's exact words) a black man.
- Lynch's crew scores the "first blood" in this conflict, however, shooting two Klansmen as they ride away.
- Lynch returns to the North and show Stoneman the Klan's little cosplay outfits. Stoneman looks angry. He says that he will crush the white South "under the heel" of the black South.
- Elsie rushes in excitedly and Stoneman shows her the hood. He says that Ben is part of their group.
- Elsie looks disturbed. She breaks off her engagement with Ben (apparently that happened), but promises not to rat him out.
- Ben shows his family his little costume all proud-like. He makes them promise not to say anything.
- Ben's youngest sister heads outside alone to get some water from the spring. As she does, Gus creeps up on her from a distance.
- Ben leaves the house and follows his sister's path.
- Gus continues following Little Sis. Finally, he reaches her and tells her that he wants to get married. She hits him and runs away.
- With Ben in hot pursuit, Gus chases the Cameron sister through the woods.
- She ends up at the top of the cliff and starts walking closer to the edge, telling Gus that she'll jump if gets any closer.
- And then…she does. Welp.
- Ben reaches the cliff and sees his sister's body. She's dead.
- Everyone is horrified. The movie is careful to show the Camerons' black servants crying too, because that makes racism just perfectly acceptable.
- Phil shows his father the news in an attempt to change his mind about his tactics.
- Gus hides in a saloon while Ben assembles a group of his Klan buddies. They want to give him a trial within the "Invisible Empire."
- One of the Klansmen enters the saloon and brawls with the patrons. He literally picks up one dude and throws him at the rest of the group.
- The Klansman grabs Gus and pulls him outside, but is shot immediately. Gus leaps onto a horse and runs away, guns blazing.
- Ben and his buddies grab Gus and pull him away. They bring him to a secret Klan trial, which is intercut with scenes of the Camerons looking at Little Sis's body.
- Surprise: Gus is found guilty.
- The Klansmen drop his dead body at the door of Lynch's house.
- Lynch discovers the body the following morning. He orders a militia of black men to march through the streets.
- The Klan hosts a meeting to organize their own troops. Ben uses a "fiery cross" as a symbol of their inability to be conquered...and, obviously, a symbol of their insane-o levels of racism.