Ostensibly a fairy tale for wised-up tykes and the hapless parents who must keep them entertained, Shrek trades in the self-conscious wit of a Hollywood that’s just about given up on making the kind of children‘s movie in which innocence and imagination amount to more than so much fodder for the cutting retort. Or maybe Shrek’s meta-approach to its storybook material is less studio marketing formula — “a movie for all ages” — than technical necessity. Half the film‘s wonder must be reserved for the digital wizardry that renders its fantastical characters with such plump fleshiness and gives its wide-open vistas such crystal clarity. Either way, Shrek’s first 20 minutes are so devilishly funny that letting go of pure belief doesn‘t seem like such a bad thing.

Based on a book by William Steig, Shrek makes its first assault on romanticism with a rude awakening. The prologue evokes the “Once upon a time” charm of a sleeping princess in her tower as gilt-edged pages turn before us, until the book is revealed as a cantankerous ogre’s outhouse reading and his source of toilet paper. Shrek (voiced by Mike Myers, stripping the phlegm from his Fat Bastard Scottish brogue) is a monster with taste: He sets his table with earwax candles and likes eyeballs in his martinis. Living comfortably in solitude — he makes short work of the occasional torch-wielding village mob — Shrek finds his coveted privacy threatened when a local tyrant, the midget Lord Farquaad (voiced by John Lithgow), designates his swamp as a relocation camp for the fairy-tale figures who wander freely about the land.

Shrek really starts to zing when directors Andrew Adamson and Vicky Jenson cut to Farquaad‘s forced roundup of beloved fable dwellers. In a forest clearing, Pinocchio tries to lie his way out of detention and the Three Bears sit sullenly in chains, while deep in a dungeon the Gingerbread Man crumbles under torture and names names: “Have you heard of the Muffin Man? The Muffin Man?” The film’s crisp catalog of the troubles in fairyland — the Three Little Pigs, the Seven Dwarfs, Tinkerbell and a slew of witches all have cameos — is dizzyingly inventive and twisted. When Shrek — accompanied by his new sidekick, an incessantly yakking donkey (Eddie Murphy) — goes to Farquaad to complain, he finds the would-be king‘s ludicrously oversize castle (“Do you think he’s compensating?”) looking suspiciously like a Disneyland theme park. The veiled reference lends Farquaad‘s orders a touch of corporate decree, as if he’s herding the storybook characters off to some copyright preserve. (Two of the screenwriters, Ted Elliott and Jerry Rossio, were responsible for the equally sly war-toys spoof Small Soldiers.)

After Shrek cuts a deal with the marriage-minded Farquaad to rescue a princess (Cameron Diaz) from a dragon in exchange for getting his swamp back, the movie starts to lose its comic edge. With Princess Fiona suffering from a curse that transforms her into an ogre after sundown, the film inches toward the brand of feel-good moral — true love found, beauty is only skin-deep — it so ruthlessly mocked in the beginning. As the misunderstood monster finds his own place within the exclusive realm of blue-eyed Prince Charmings, the film rejects its own satiric heart and succumbs to a formula we know it doesn‘t really believe in. When Myers’ ogre goes soft and Diaz proves an insuperably flat voice actress, Murphy‘s mouthy donkey is left carrying Shrek into its finale. As the film’s main font of jabbering pop and its most genuinely needy inhabitant, Murphy steals every scene he‘s in with equal parts bounce and warmth.

Throughout, Shrek tries to have its cynicism and keep its daydreams, too. Mixed in with the movie’s irreverent manhandling of childhood‘s fairy icons is enough nostalgic affection to highlight our own abandonment of childish belief — a packing up that, given what Hollywood seems to think its younger audiences want these days, is coming earlier and earlier in the game.

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