As Scene 3 begins, Yang Sun, described as "a young man in rags," is contemplating hanging himself in a park. He is an unemployed pilot. An old whore and the niece of the family whom Shui Ta had to turn away from Shen Te's tobacco shop are walking through the park; they see Shen Te coming and the old whore comments resentfully about how she was able to get rich with her tobacco shop. Shen Te confirms to them that she is on her way to meet a widower whom she is going to marry.
Yang Sun tells the women to continue walking, and Shen Te notices that he is about to hang himself with a rope. It starts to rain, and Shen Te takes shelter under the tree with him. He describes to her how he is a mail pilot but there is no work for him, and now he feels useless. Shen Te bursts into tears and he scolds her and helps her wipe her face. She tells him that he probably only wanted to kill himself because it's a rainy day.
Shen Te describes to Yang Sun how she used to be a prostitute, but then she got a "gift from the gods" and was able to shun that profession. They continue talking and it turns into flirting; Yang Sun strokes Shen Te's cheek but then chastises her for being "easily satisfied." She describes to him what she understands kindness to be, and he responds, "You make it sound easy." It begins to rain.
Wong enters, singing about how he cannot sell water when it's raining. Shen Te runs out to greet him and purchases some water from him, because she recognizes the worth of "the water that you carried all this way." She says she needs it for Yang Sun, but when she returns to him with the cup he has fallen asleep under the tree. She laughs about it.
In Scene 3a, Wong is again asleep in the sewer pipe where he lives. The gods appear to him and he reports that he has seen Shen Te and that she is still good; she proved it to him when she bought his water even though it was raining. He tells the gods that Shen Te loves someone (presumably Yang Sun) and that she is "doing good deeds all the time."
The gods ask for more details, so Wong describes all the "good" things Shen Te is doing. She is giving away her tobacco if a customer can't pay for it, she is putting up a family of eight in the tobacco shop, and she hands out rice every morning to anyone who asks for it. That disappoints the first god a bit, since he recognizes how unsustainable this kind of "goodness" is.
When Wong tells the gods that Shen Te's cousin, Shui Ta, paid the carpenter less than what he demanded for the job of installing the shelves, the gods get angry. The second god declares, "One pays what one owes!" and demands that Shui Ta must never "cross her threshold" again, since he is clearly a negative influence.
The line between morality and economics is further blurred in Chapter 3. Yang Sun is seriously contemplating hanging himself because he can no longer work as a pilot and, as he tells She Te, because "I haven't a penny... I'm a mail pilot with no mail." Yang Sun equates his economic uselessness with the overall uselessness of his life, so he has decided to end the latter.
Brecht uses the technique of analogy when Yang Sun describes to Shen Te how it feels not to be able to fly anymore. He tells her that when he was younger, he took care of a crane with a broken wing. Usually the crane was "very good-natured about our jokes," but he got restless when the cranes that were able to fly did so over his village in the spring and autumn. His analogy makes Shen Te cry, because she realizes that he is talking about himself.
The theme of goodness is revisited, this time from Shen Te's perspective as she describes it to Yang Sun under the tree. While Yang Sun is looking away from her, she says, "But to be without hope, they say, is to be without goodness!" There is a pause, and Yang Sun replies, "Go on talking. A voice is a voice." He is demonstrating his indifference to her description of what it means to be good; this is important character development and foreshadowing, since it is later revealed that Yang Sun is dishonest and easily betrays Shen Te, who loves him.
The problem of the economy is addressed in Wong's song, "The Song of the Water Seller in the Rain." It is ironic to be selling water when it is raining, and it represents the futility of being in a profession that supplies something for which there is no demand. The lyrics, What are lawns and hedges thinking? / What are fields and forests saying? / "At the cloud's breast we are drinking! / And we've no idea who's paying!", draw attention to the tension between nature, which appreciates what it receives in plenty, and humankind, which does not want that of which there is a surplus.
After telling Yang Sun that he only wanted to kill himself because it's a rainy day, Shen Te sings to the audience, breaking the imaginary fourth wall that exists between characters in a play and the audience watching them. She sings "In our country..." and Yang Sun does not acknowledge it, as if the song is not heard by him but exists only in Shen Te's mind and as a commentary for the audience. It happens again as she describes to him why she won't be a prostitute anymore ("I'm rich now, I said..."), but this time Yang Sun recognizes it and responds to the words.