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The economics of fascism, called by some theorists economic fascism (aka fascist economy), is the set of economic practices and characteristics common to fascist regimes in the 1920's and 1930's, with the most often cited characteristic being the presence of private or quasi-private ownership of the means of production that was heavily coordinated by government. In Italy and Germany, the State instituted a planned economy that was held to be in the best interest of the nation rather than allowing an economy to self-organize without centralized coordination. The system included government-mandated business and government partnerships (see corporatism) and mercantilist practices. Economic fascism has also been called fascist political economy, fascist economy, political economy of fascism, planned capitalism, and autarchic capitalism.

Economic fascism as a "third way"

Economic fascism constrasts with capitalism where the means of production are privately owned and privately controlled. It also contrasts with socialism where the means of production are owned collectively by communities or, in some definitions, the state. The common view on private property in economic fascism is, as Thomas R. Eddlem puts it, " simply heavy government regulation and control of what is only nominally private property." Some scholars, however, some dispute the extent of this regulation. Christoph Buchheim and Jonas Scherner argue that the common view that private property in the Nazi economy existed in name only is incorrect. They say that while there was substantial central planning of private industry, the severity of the restrictions did not arise to the level of rendering private property a mere formality. Buchheim and Scherner describe the system as a "state-directed private ownership economy." Michael Coren, in writing of distributivism, an economic theory which underlay the support by some for fascist political economy in the 1930's, said that "economic fascism both capitalism and socialism." Thus, economic fascism is often referred to as a 'third way' whose proponents advocated it as a solution to avoid the perceived inegalitarian dangers of too strong of an enforcement of private property rights while at the same time avoiding the total abolition of private ownership of the means of production or outright communism. In fact, Mussolini referred to his economic system as a "third way," noting it to be distinct from both socialism and capitalism.

However, while a signifant amount of control over private property is a characteristic is essential to economic fascism, some others note additional aspects they believe to be essential to fascist economies. For example, author and journalist John T. Flynn, notes 3 elements: "1) The institution of planned consumption of the spending-borrowing government. 2) The planned economy 3) Militarism as an economic institution" . However, some believe militarism is not necessary for a fascist economy. Lawrence Dennis, in his 1936 book The Coming American Fascism promotes what he called a non-militaristic "fascist" economic system for the U.S.; he argues that in the absence of war that laissez-faire cannot satisfy the needs of the masses.

Government and business collusion

While some see the populace as the beneficieries of a fascist political economy, others see the corporativist aspect of economic fascism as being a source of exploitation of the citizenry, where policies are not made in the best interest in the nation as a whole but in the profit interests of privileged elites in the business-government complex. Geatano Salvemini said in 1936: "In actual fact, it is the State, i.e., the taxpayer who has become responsible to private enterprise. In Fascist Italy the State pays for the blunders of private enterprise... Profit is private and individual. Loss is public and social." Likewise, Jutta Schmitt, a lecturer in Political Science at the University de Los Andes in Venezuela says that "profit production depends on a considerable degree on State-guaranteed profit and the growing interaction and 'melting' of economic monopolies with their political representation in the State apparatus" and that "the main objective of economic fascism is the elevation of the profit rate in times of economic recession to the detriment of the working class." Schmitt, a socialist, notes that economic fascism has been referred to as "planned capitalism." Anthony Gregory, says that economic fascism is designed for government and business's "mutual benefit: profits for the corporate interests, expanded tax revenue, and augmented central planning powers for the state."

Economic fascism outside of fascist Italy and Germany

Economic fascism was practiced in Italy under Mussolini and Germany under Hitler. Some argue that economic fascism was attempted in the U.S. under Franklin Roosevelt with the implentation of the New Deal. Ronald Reagan said, in 1976, "Fascism was really the basis for the New Deal. It was Mussolini's success in Italy, with his government-directed economy, that led the early New Dealers to say 'But Mussolini keeps the trains running on time." Richard Ebeling argues that the U.S. Supreme Court stopped economic fascism from being implemented in the U.S. when it struck down significant parts of the New Deal, such as the NRA and AAA, as being unconstitutional.

References

1. Eddlem, Thomas R. Introduction. And Not a Shot is Fired by Jan Kozak, Appleton, WI: Robert Welch University Press, 1999.
2. Buchheim, Christoph and Scherner, Jonas. The Role of Private Property in the Nazi Economy: The Case of Industry University of Mannheim, Germany
3. Coren, Michael Gilbert: The Man Who Was G.K. Chesterton Reed Business Information, Inc, 1990.
4. Richman, Sheldon Fascism Concise Encyclopedia of Economics 1993, 2002.
5. Flynn, John T. As We Go Marching 1944.
6. Dennis, Larence. The Coming American Fascism 1936.
7. Slavemini, Geatano. Under the Axe of Fascism 1936.
8. Anthony, Gregory Why the Supreme Court Should Have Just Shut Up 2005.
9. Ebeling, Richard M. When the Supreme Court Stopped Economic Fascism in America

Footnotes

1. Capitalism is defined by the Merriam-Webster Dictionary (unabridged) as "an economic system characterized by private or corporation ownership of capital goods, by investments that are determined by private decision rather than by state control, and by prices, production, and the distribution of goods that are determined mainly in a free market."

2. Socialism is defined by the Merriam-Webster Dictionary (unabridged) as "any of various theories or social and political movements advocating or aiming at collective or governmental ownership and administration of the means of production and control of the distribution of goods."

External links

• The Role of Private Property in the Nazi Economy: The Case of Industry (pdf) by Christoph Buchheim and Jonas Scherner
• Economic Fascism by Thomas DiLorenzo
• When the Supreme Court Stopped Economic Fascism in America by Richard M. Ebeling
• Fascism by Sheldon Richman - discusses economic fascism
• The Coming American Fascism by Lawrence Dennis - advocates a non-militaristic economic fascism for the U.S. for the benefit of the working class
• The ‘Political Economy of Fascism’: Myth or Reality: or Myth and Reality? by David Baker