Man waving the Corporate America Flag at Occupy San Fransisco in 2011 Photo: Glenn Halog

The corporate roots of early 20th century American fascism

  • April 26, 2019

Capitalism & Crisis

A new book looks at the origins of fascism in the US, resurrecting an old Marxian conception that centers on the fusion of big business with politics.

Fascism is usually thought of as a quintessentially and almost exclusively European phenomenon, as having begun with Mussolini, culminated with Hitler, and been largely eradicated in World War II. The US, in particular, is thought to have been generally immune to it, given the absence of mass movements similar to Nazism or Italian Fascism.

But there exists a different narrative, or at least there did in the 1930s, before it was buried under an avalanche of patriotic American propaganda and liberal historiography. According to this alternative understanding, the US was falling victim to fascism already in the 1920s — though a different sort of fascism than in Europe.

Long-forgotten Marxist journals such as The Communist, The New Masses, and Labor Notes (unrelated to the current publication of the same name), and newspapers like the Daily Worker and the Industrial Worker, analyzed with great insight the nature of this distinctive American fascism, until the struggle against the Nazis shifted their priorities to supporting a more liberal and “patriotic” Popular Front.

In a new book entitled The Coming of the American Behemoth: The Origins of Fascism in the United States, 1920–1940, Michael Joseph Roberto has resurrected the old Marxian conception. Aside from its interest as a work of history, the book is also quite relevant to the present, as the old structures of American fascism have deepened in the last generation and colonized much of the world.

The essence of fascism

Roberto’s project, in brief, is to reconstruct the arguments given in such pioneering — albeit now ignored — works as Lewis Corey’s The Decline of American Capitalism, Mauritz Hallgren’s Seeds of Revolt, Robert Brady’s The Spirit and Structure of German Fascism and Business as a System of Power, Carmen Haider’s Do We Want Fascism?, and A. B. Magil and Henry Stevens’ The Peril of Fascism, all published in the 1930s or early ’40s.

These authors and others, whose insights were not taken up by generations of liberal scholarship, understood that fascism was not uniquely European, that it could easily happen in the United States. In fact, they understood it was happening: as Brady noted in 1938, “business is going political as it never has before, and it has learned to funnel its funds and pressures through highly centralized, interest-conscious, informed and exceedingly well-manned, united front organizations.”

Evidently these writers had a different concept of fascism than most of us do today. As Paul Baran wrote in 1952, according to the liberal understanding, for a political system to qualify as fascist “it has to display the German or Italian characteristics of fascism. It must be based on a fascist mass movement anchored primarily in para-military formations of brown shirts or black shirts. It must be a one-party regime, with the party headed by a Führer or a Duce… It must be violently nationalist, racist, anti-Semitic…”

While it is perfectly reasonable to consider such a phenomenon as one manifestation of fascism, the analysis tends toward superficiality insofar as it obscures the class roots and class functions of the regime. The Marxist approach, which looks beneath the surface, is more penetrating, resulting in a “dynamic definition of fascism,” Roberto summarizes, “as an inherent function of monopoly-capitalist production and relations whose telos was and remains the totalitarian rule of capitalist dictatorship.”

Incidentally, this was not only a Marxist notion. It was widespread in the 1930s, including in the very centers of power. “Many persons strategically placed in American business,” Brady wrote, “confidentially argue that [fascism] is already here in both spirit and intent.”

Harold Ickes, Franklin Roosevelt’s Secretary of the Interior, gave a speech in 1937 arguing that “fascist-minded men” had “a common interest in seizing more power and greater riches for themselves, and ability and willingness to turn the concentrated wealth of America against the welfare of America. It is these men who, pretending that they would save us from dreadful communism, would superimpose upon America an equally dreadful fascism.”

Other Roosevelt advisers trumpeted the same message. And finally Roosevelt himself broadcast the “Marxist” idea, when he announced in a speech in 1938 that “I am greatly in favor of decentralization, and yet the tendency is, every time we have [a recession] in private industry, to concentrate it all the more in New York. Now that is, ultimately, fascism.”

It was widely understood, then, that the essence of fascism was, in Carmen Haider’s pithy formulation, the “attempt to introduce a collective form of capitalism in the place of individualism.” It was the fusion of big business with politics, the war on democracy by a public relations industry in the service of capital, the myth-making and “business evangelism” that is so integral to the propaganda industries of monopoly capitalism (and so reminiscent of the myth-making central to Fascism and Nazism). Whether the classic seizure of power through middle-class support was present was ancillary to the dictatorial rule of capital.

The New Deal’s corporatism

Roberto tells the history of the American political economy in the 1920s and ’30s through this lens, exploring how the fascist structures of our own day were forged between the two world wars. Much of his book, in particular the long expositions of Marxian economics, will be familiar to readers versed in left-wing literature. He devotes a chapter to the ideologists of fascism, or business rule, in the conservative 1920s, notably Thomas Nixon Carver, Harvard professor of economics, and Charles Norman Fay, vice-president of the National Association of Manufacturers and author of Business in Politics.

Inevitably, we encounter Edward Bernays, father of public relations and believer in the necessity of “regimenting the public mind every bit as much as an army regiments the bodies of its soldiers.” These were the prophets and soothsayers, the heralds of the New Era of untrammeled capitalism.

But by 1930, the fascist millennium had succumbed to its economic contradictions, with the Great Depression. It turns out that when all the money goes to the top, the people on the bottom do not have enough money to keep the economy growing. What was the way out of this dilemma? Well, according to the leaders of business and politics — more fascism.

Many of them pined for a Mussolini, and even liberal newspapers like the New York Times advocated “some sort of Council of State” that could rule by decree. In the end, the oligopolists only partially got their way, with the establishment of Roosevelt’s National Recovery Administration in 1933.

It may seem absurd now, but in the mid-1930s it was usual for Marxists and socialists to argue that the New Deal was simply a higher stage of fascism. In fact, they had a point. “Conceived as a means to create common ground between government and industry,” Roberto writes, “the NRA marked a decisive move toward state monopoly capitalism in the United States.” The real power was left in the hands of big business, which wrote hundreds of “codes” to regulate prices, wages, work hours, etc., all to restore profits and eliminate overproduction.

It was a move towards a planned, state capitalist economy, of which big business was the sole beneficiary. Small businesses suffered, workers were not really empowered, income was not redistributed, and the economy remained sluggish. But the profits of big business recovered.

The early New Deal “bore strong resemblances,” Roberto notes, “to the corporatist state established in Italy in its approach to reconciling the antagonism between capital and labor. Both Mussolini and Roosevelt had made clear their commitment to maintain and strengthen capitalism in their respective nations. Consequently, the fascist character of the New Deal could not be easily dismissed…”

Roosevelt himself admired Mussolini: “I don’t mind telling you in confidence,” he wrote a friend, “that I am keeping in fairly close touch with the admirable Italian gentleman.” It’s ironic that a few years later Roosevelt was denouncing fascist tendencies in the US.

Huey Long and Charles Coughlin

Roberto is on shakier ground in his chapter on the “small-fry fascisti” who populated America’s political landscape during the Depression, particularly in his argument that Huey Long and the “radio priest” Father Charles Coughlin were reactionaries and fascists. Long was a famously progressive, albeit dictatorial, governor of Louisiana in the early 1930s who later became a US senator, from which perch he criticized the New Deal for its conservatism and proposed his own wildly popular “Share Our Wealth” program. Had he not been assassinated in 1935, he might have posed a serious challenge to Roosevelt’s reelection.

Coughlin, on the other hand, was never a political leader, though through his radio broadcasts he was a political force in his own right. He, too, became intensely critical of the New Deal for its conservatism — although, like Long, he denounced Marxism and communism as well.

My own research on the subject led me to conclude that, despite what some historians (including Roberto) have argued, they were more left-wing than right-wing, at least until Coughlin in later years turned decisively toward anti-Semitism. The two men certainly were politically ambiguous, and had Long become president, it is impossible to know how he would have governed.

But it’s inarguable that their massive following was due to the far-left character of their rhetoric — as may be judged by the Principles Coughlin laid out for the National Union of Social Justice, the political organization he founded. He went so far as to condemn the economic system itself: “Capitalism is doomed and not worth trying to save.”

The reason I cavil with Roberto on this point is not that I care much about defending Long or Coughlin. Rather, I disagree with his characterization of the millions of “petty bourgeois” who were attracted to the two figures:

Angry at the ruling class for robbing it of livelihood and status, [the petty-bourgeoisie] also stood fast against the masses that they believed threatened them more. Amid the swirl of change, dislocation, and anxiety about the present and fears for the future, they made up the great wave of political reaction during the mid-1930s… Not understanding how and why those above them were responsible for the crisis that threatened them, they blamed most of it on the enemies lurking below, the Negroes, Jews, Catholics, Mexicans, anarchists, socialists, and, of course, the communists — all enemies of True Americanism.

This is a facile interpretation for which, in effect, no evidence is given. In its over-generalizing it reeks of the lazy old Marxist condescension towards the middle classes. I cannot go into much detail here, but elsewhere I have argued that there was no “great wave of political reaction” in the mid-1930s except among big business, that the middle and lower classes were generally far to the left of Roosevelt—and pushed him to the left in 1935, with the so-called Second New Deal that partially repudiated the fascist tendencies of the first.

Long and Coughlin themselves played an important part in this swing to the left, since Roosevelt’s popularity was waning in 1934 under the barrage of left-populist criticism. As a result, in 1935 he supported the Wagner Act, the Social Security Act (which was, however, more conservative than most Americans wanted), and the establishment of the Works Progress Administration. And in 1936 he ensured his overwhelming reelection by taking a page from Long’s book and denouncing “economic royalists” who were callous to the suffering of Americans.

The truth, then, is that Long and Coughlin, together with the influential Communist Party and other leftist organizations, helped save the New Deal from becoming genuinely fascist, from devolving into the dictatorial rule of big business. The pressures towards fascism remained, as they always will in the context of corporate capitalism, and reactionary sectors of business began to have significant victories against the Second New Deal starting in the late 1930s.

But the genuine power that organized labor had achieved by then kept the US from sliding into all-out fascism (in the Marxist sense) in the following decades, during the Cold War.

The struggle to come

The Coming of the American Behemoth is an interesting book with lessons for the present, as we confront a polarized and oligarchical political economy so redolent of that which precipitated the Depression. All the debate about whether Donald Trump is fascist, or whether society is in danger of succumbing to fascism, can be seen, from one perspective, as missing the point.

Fascism in the materialist sense has been increasingly with us, especially — though not only — with Americans, for the last forty years, as the political economy has returned to something like its state in the 1920s. It is here now, already, and would be here even if Hillary Clinton had won the presidency.

The danger is not so much that “paramilitary formations of brown shirts or black shirts” will take over society as that we will fail to overturn the class foundations of fascism that are at this moment racing to destroy life on Earth. Roberto is right to emphasize this deeper structural reality.

In short, while the American Behemoth was rising in the 1920s and ’30s, in the 21st century “the beast is at full strength.” It will take a revolutionary struggle of the working masses to destroy it.

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