Character Analysis
The thing about the Wizard of Oz is…he isn't a wizard at all. He's just some dude from Nebraska. Much like Dorothy, he came to Oz by accident. But instead of trying to get back home, he stayed and fooled people—and now those bad choices are finally catching up with him.
Part of the reason he's been able to stay in power for so long is he carefully cultivates an air of mystery. He rarely lets people into his throne room to minimize the chances of getting found out. For a time, this strategy works. On the way to Oz, one person tells Dorothy that "I [do not] know of any living person who has seen him" (10.22). Nor does anyone seem to know what he looks like. "He's a great Wizard, and can take on any form he wishes.... Who the real Oz is, when he is in his own form, no living person can tell" (10.27). Oz himself reinforces this sense of mystery when he appears in different forms to Dorothy and each of her friends.
The Grift…
When the gang returns from killing the Wicked Witch of the West, the Wizard is exposed as a "humbug" (15.46), which is an old-fashioned word for a fraud. Bottom line, he never had any magical powers whatsoever. "I'm really a very good man; but I'm a very bad Wizard, I must admit" (15.76), he tells the gang. Well, the "bad wizard" part seems right, anyway.
Since he's been found out, the Wizard decides to walk the gang through his grift. When his hot-air balloon was accidentally blown into Oz, everyone thought he was magic, and he just went with it. He's been ruling ever since, and he keeps the illusion of his power alive through tricks he picked up during his circus days. Though he has riches galore, he has been living in fear of being found out. (He was especially afraid of the wicked witches, who have real magic.) And now that his nightmare has finally come to pass, he's going to blow out of town in his balloon instead of facing the music.
…and the Gifts
Though the wizard isn't magical, he's astute. He instantly diagnoses the Scarecrow, the Tin Woodman, and the Lion as having self-esteem problems (instead of a lack of intelligence, compassion, or courage). But since the fellows have their hearts set on the rewards they were promised, and the Wizard is a fraud anyway, he decides to indulge them. He gives them a fake brain, a fake heart, and fake courage, respectively, and his gifts instantly do the trick. "How can I help being a humbug," he says, "when all these people make me do things that everybody knows can't be done" (16.49)? His words suggest that, while Oz was guilty of tricking the people of Oz, the people themselves bear some of the blame.