Misplaced Pages

This is an old revision of this page, as edited by Vision Thing (talk | contribs) at 08:57, 21 March 2006 (→General characteristics of Fascist economies=: rv). The present address (URL) is a permanent link to this revision, which may differ significantly from the current revision.

Economics of fascism refers to the economic policies of fascist regimes. Cited aspects include capitalism, war economies, economic interventionism, central economic coordination, mercantilism, economic nationalism, corporativism, protectionism, a welfare state, and militarism as an economic institution.

These characteristics are sometimes cited to support claims that economic policies under non-fascist governments are either inspired by, or share common values with, fascist regimes. Usually, this is done by opponents of those policies.

General characteristics of Fascist economies=

The political ideology of fascism dictates that all aspect of national life are subjected to the national interest, sometimes to a totalitarian degree. Fascist leaders referred to their economic system as a "third way," noting it to be distinct from both socialism and capitalism. Mussolini, for instance, said that "fascism has taken up an attitude of complete opposition to the doctrines of Liberalism, both in the political field and in the field of economics." .

While fascist states generally allowed private property at least in name, many libertarian economists see similarities between the state intervention in fascist economies and that of socialist or even communist nations. Some economists like the Objectivist George Reisman argue that the Nazi economy was "de facto socialism" due to extensive governmental control over nominal private property, noting especially the presence of wage and price controls. - - According to libertarian John T. Flynn, the three key elements of economic fascism are: "1) The institution of planned consumption of the spending-borrowing government. 2) The planned economy 3) Militarism as an economic institution" . Lawrence Dennis, argued that militarism was not a necessary ingredient, in his 1936 book The Coming American Fascism promoting 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.

The status of property

Journalist Thomas R. Eddlem's view on private property in a fascist economy is "simply heavy government regulation and control of what is only nominally private property." Christoph Buchheim and Jonas Scherner, however, argue that the view that private property in the Nazi economy existed in name only is incorrect. They hold 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." Economist Thomas DiLorenzo says that "private property and business ownership are permitted, but are in reality controlled by government through a business-government 'partnership'."

As a solution to the perceived problems of laissez-faire

Those who have promoted fascism have done so with the stated mission of correcting what they perceive to be the problem of disorganization occurring in a laissez-faire economy. Mussolini said that government planning would "introduce order in the economic field." Likewise, the America Lawrence Dennis, in his 1936 book advocating "fascism" for America, claimed that "history and present day experience are full of demonstrations that the more there is of what is commonly called laissez-faire, economic freedom, democracy or parliamentary government, the more economic maladjustments there will be, and the more difficult of readjustment they will prove." Fascist economic planning seeks to coordinate the economy to serve the what is held to be in the interests of the "common good" rather than allowing "private initiative" seek its own course.

Government and business in partnership

Richman explains how fascism replaced a laissez-faire system in Italy: "From 1922 to 1925, Mussolini's regime pursued a laissez-faire economic policy under the liberal finance minister Alberto De Stefani. De Stefani reduced taxes, regulations, and trade restrictions and allowed businesses to compete with one another. But his opposition to protectionism and business subsidies alienated some industrial leaders, and De Stefani was eventually forced to resign." The view of many is that business and government collude to profit by engaging in economic intervention. Socialist historian Gaetano 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 notes that the economy in fascism has been referred to as "planned capitalism." Anarcho-capitalist polemicist 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." Lawrence Britt suggests that protection of corporate power is an essential part of fascism.

Political economy of Nazi Germany

Adolf Hitler said in a 1931 interview: "I want everyone to keep the property he has acquired for himself according to the principle: benefit to the community precedes benefit to the individual. But the state should retain supervision and each property owner should consider himself appointed by the state. It is his duty not to use his property against the interests of others among his own people. This is the crucial matter. The Third Reich will always retain its right to control the owners of property."

Hitler's government of Germany used a variety of means to achieve its objectives of remilitarisation. In the pre-war period, Germany embarked on a programme of public works and rearmament funded by deficit spending, overseen by Hjalmar Schacht. This period saw a considerable reduction in unemployment, while price controls prevented the recurrence of inflation. A number of economists, starting with Michal Kalecki, have seen this as an example of military Keynesiansm.

However, Germany's economic policy went far beyond normal Keynesian intervention. DiLorenzo notes that the Nazis in Germany demanded in their economic program, among other things, "abolition of interest; a government-operated social security system: the ability of government to confiscate land without compensation; a government monopoly in education; and a general assault on private-sector entrepreneurship..."

Another point was the expropriation of property owned by Jews. While this had a small (though noteworthy) impact on the economy, it was a vital exhibition of the Nazi's anti-semitic policy.

From 1939 onward, the control of the military on the German economy increased. By the end of the war, a significant component of the labour force of the Third Reich was made up of slave labour. This practice started from the early days of labour camps or colonies of undesirables (German:unzuverlässige Elemente) such as the homeless, homosexual and criminals as well as political dissidents, Jews and anyone that the regime wanted ou of the way. Slave labour use became much more prevalent during World War II with hundreds of thousands if not millions of Jews, Slavs and other conquered peoples used by German corporations such as Thyssen, Krupp, IG Farben and even Fordwerke - a subsidiary of the Ford Motor Company.

In his book Economy and Class Structure of German Fascism, Alfred Sohn-Rethel, the independent Marxist, used class analysis in his assessment of the fascist economy in Germany. This was built upon years of experience secretly working in the offices of the Mitteleuropäischer Wirtschaftstag or MWT - the headquarters of the German big business association. Sohn-Rethel argued fascist rule in Germany as part of the reconsolidation of bourgeois rule with the political triumph of financially unsound and unstable groups of big and small business (the Harzburg Front) over parts of the economy that were well adapted to the financial conditions of the time. However he argues than it is a mistake to see the "Nazis as the direct agents of a monopoly capital in command of capital in command of profits..." and that "profit-making itself had gone into the red before the Nazis could exploit the now unresolvable contradictions and get the better of finance capital." The strengthened state took over the entrepreneurial, managerial functions but capital remains in private hands even though the state sets prices, profit margins and the allocation of raw materials. This was part and parcel of the suspension of normative legal environs (both social and financial) in Germany.

Sohn-Rethel continues: "Capital is only in possession of its private initiative to dispose freely over its means of production while it keeps to the market rules. But only if one sees the crisis as an economic catastrophe which shatters all these rules can one get the measure of its immense dangers. In this case capitalism can survive in the paradoxical shape of the 'corporate state' in which the contridiction between the social character of production and the private appropriation of capital assumes the form of a state-run economy on private account". The bourgeoisie needed the defeat of the worker's class solidarity and further the depreciation in overall working conditions. This was in order to increase in the rate of surplus value and profit from wage freezes. The drive in the increased exploitation of the proletariat was greatly assisted by anti-semitism and resurgence of the war economy that reached fruition with the Nazi party's capture of power during the early 1930's. As Sohn-Rethel puts it: "the (world) capitalist was lifted off the rocks of stagnation only by means of the arms race forced upon the world powers through the initiative of German fascism preparing for world war."

Political economy of Fascist Italy

Benito Mussolini said: "For if the nineteenth century was a century of individualism (Liberalism always signifying individualism) it may be expected that this will be the century of collectivism, and hence the century of the State."

Sheldon Richman explains how fascism replaced a laissez-faire system in Italy: "From 1922 to 1925, Mussolini's regime pursued a laissez-faire economic policy under the liberal finance minister Alberto De Stefani. De Stefani reduced taxes, regulations, and trade restrictions and allowed businesses to compete with one another. But his opposition to protectionism and business subsidies alienated some industrial leaders, and De Stefani was eventually forced to resign."

Maria Sophia Quine, in Italy's Social Revolution, discusses the rise of a welfare state with the development of fascism in Italy. She says in the introduction of the book that it is discussed "how Italian governments from liberalism to fascism attempted to build a welfare state atop a charitable foundation that was fast set in the Middle Ages." No longer was charity relied upon, but citizens were taxed to care for those perceived to be in need. Systems such as a national healthcare system and employment insurance were set up.

Political economy of Franco's Spain

In 1933, Jose Antonio Primo de Rivera, son of the former authoritarian Prime Minister, founded a political movement known as the Falange, or "phalanx." The Falange was not successful in the elections of 1936, elections that resulted in the creation of a Popular Front government.

When conservative elements of Spanish society supported Francisco Franco and the military in his war against the Popular Front, the Falange became associated with Franco's side in that war, and the government that arose from Franco's successes appropriated the ideas and some of the terminology of the Falange, including a nostalgia for the interventionism of Miguel Primo de Rivera.

One falangist theorist, Federico de Utturia, described the goal of the movement as "to kill the old soul of the liberal, decadent, masonic, materialist and frenchified nineteenth century."

See a work by Stanley G. Payne, Falange. A History of Spanish Fascism Stanford University Press (1961).

Criticism of the National Recovery Administration as fascist economics

When Franklin Delano Roosevelt became President of the United States, he expressly adopted a variety of measures to see which would work; including several which their proponents felt would be inconsistent with each other. One of these programs was the National Recovery Administration, which, with its codes and industry organizations, bore a certain resemblance, as an economic institution, to Mussolini's syndicalism. This was a commonplace comparison at the time, and not necessarily a critical one; even Winston Churchill had moderately praised Mussolini. In partisan or eccentric moments, this might be extended to political likeness. When the NRA was found unconstitutional, many within the New Deal, including Adolf Berle and Harold Ickes, did not regret its passing. In the 1960s historians generally maintained that the NRA was a composite based on input from only Americans--it was modeled after the 1917 War Industries Board of Woodrow Wilson; Hawley found no European models whatever. (Ellis Hawley, The New Deal and the Problem of Monopoly 1966, ch 1) However, an American named Hugh Johnson was involved in the War Industries Board, and was accused by his bitter foe Frances Perkins of looking at Fascist corporatism as a kind of model." Johnson helped draft the NRA and was named its head, but he vehemently denied any Italian inspiration. Donald Richberg, the second head of NRA told a Senate committee, "A nationally planned economy is the only salvation of our present situation and the only hope for the future."

Historian Benjamin Alpers concludes :

A second major source of the decline of dictatorial rhetoric following the spring of 1933 was the disenchantment of American business with the Italian economic model. Much conservative business support for a dictator or a "semi-dictator" had been related to the idea of establishing a corporative state in the United States..... The last gasp of support for Mussolini's solution to the problems of labor and management may have been the publication of Fortune magazine's special issue on the fascist state in July 1934. Business approval of government intervention in capital-labor relations had begun to wear off as the business community began to actually experience it under the NRA; it discovered that such an arrangement, at least in its American incarnation, meant state involvement in business, not self-government by wealth....After 1935, business journals began to equate fascism with communism, denouncing both the Italian system and the NRA as "state socialism." At exactly the same moment liberal supporters of Roosevelt began to deny the similarity between the NRA and fascism.

Some Austrian School economists have since made similar claims about other aspects of the New Deal; for example, Sheldon Richman's sentence on the AAA This line of argument has also been adopted by supporters of later authoritarian regimes, such as the former Bosnian Serb spokesman and historian, Srđa Trifković who says that "Roosevelt and his "Brain Trust," the architects of the New Deal, were fascinated by Italy’s fascism — a term which was not pejorative at the time. In America, it was seen as a form of economic nationalism built around consensus planning by the established elites in government, business, and labor." Historians who have analyzed the origins of the AAA in depth have discovered no inspiration from Europe. (Theodore Saloutos, The American Farmer and the New Deal (1982)].

Critics of New Deal policies who make the comparison with fascism do not always argue that these policies acquired their roots in European fascism but held significant economic prefrences shared by European fascism. This comparison view, however, does not mean that such policies are fascist, but only that these policies share common prefrences.

References

Scholarly Studies

• Adler, Les K., and Thomas G. Patterson. "Red Fascism: The Merger of Nazi Germany and Soviet Russia in the American Image of Totalitarianism." American Historical Review 75 (April 1970): 1046-64. in JSTOR
• Benjamin L. Alpers; Dictators, Democracy, and American Public Culture: Envisioning the Totalitarian Enemy, 1920s-1950s. University of North Carolina Press. 2003
• George P. Blum; The Rise of Fascism in Europe Greenwood Press, 1998
• Brady, Robert A. The Spirit and Structure of German Fascism 1937.
• Brady, Robert A. Business as a System of Power. New York: Columbia University Press, 1943, argues National Association of Manufacturers (NAM) as well as NRA were proto-fascist
• Brinkley, Alan. The End of Reform: New Deal Liberalism in Recession and War. Vintage, 1995.
• Burnham, James. The Managerial Revolution: What Is Happening in the World 1941.
• Philip Cannistraro (ed.) Historical Dictionary of Fascist Italy, Greenwood Press, 1982
• Diggins, John P. Mussolini and Fascism: The View from America. Princeton University Press, 1972.
• Feuer, Lewis S. "American Travelers to the Soviet Union 1917-1932: The Formation of a Component of New Deal Ideology." American Quarterly 14 (June 1962): 119-49. in JSTOR
• Roger Griffin. The Nature of Fascism London, Routledge, 1993
• Ian Kershaw. The Nazi Dictatorship. Problems and Perspectives of Interpretation, London, Arnold, 3rd edn, 1993,
• Maddux, Thomas R. "Red Fascism, Brown Bolshevism: The American Image of Totalitarianism in the 1930s." Historian' 40 (November 1977): 85-103.
• Philip Morgan; Fascism in Europe, 1919-1945 Routledge. 2002
• Stanley G. Payne; A History of Fascism, 1914-1945 1995
• Pells, Richard H. Radical Visions and American Dreams: Culture and Thought in the Depressions Years. Harper and Row, 1973.
• Rosenof, Theodore. Economics in the Long Run: New Deal Theorists and Their Legacies, 1933-1993. University of North Carolina Press, 1997.
• Skotheim, Robert Allen. Totalitarianism and American Social Thought. Holt, Rinehart, and Winston, 1971.
• Swedberg, Richard. Schumpeter: A Biography Princeton University Press, 1991.

Notes

1. Mussolini, Benito Fascism: Doctrines and Institutions 1935.
2. Reisman, George Why Nazism Was Socialism and Socialism Is Totalitarianism
3. Flynn, John T. As We Go Marching 1944.
4. Dennis, Larence. The Coming American Fascism 1936.
5. Eddlem, Thomas R. Introduction. And Not a Shot is Fired by Jan Kozak, Appleton, WI: Robert Welch University Press, 1999.
6. Buchheim, Christoph and Scherner, Jonas. The Role of Private Property in the Nazi Economy: The Case of Industry University of Mannheim, Germany
7. DiLorenzo, Thomas J. Economic Fascism, 1994.
8. Mussolini, Benito Fascism
9. Salvemini, Gaetano. Under the Axe of Fascism 1936.
10. Anthony, Gregory Why the Supreme Court Should Have Just Shut Up 2005.
11. Britt, Lawrence, 'The 14 characteristics of fascism', Free Inquiry, Spring 2003, p. 20.
12. Quine, Maria Sophia Italy's Social Revolution, Palgrave (2002).
13. Barkai, Avraham, Nazi Economics: Ideology, Theory, and Policy, Oxford Berg Publishers, 1990.
14. Sohn-Rethel, Alfred Economy and Class Structure of German Fascism, CSE Books, 1978 ISBN 0906336015
15. Beevor, Antony. The Spanish Civil War (1982).
16. For example, Reply to Press Inquiry, Palo Alto May 15, 1935
17. See, inter alia, Harold L. Ickes Autobiography of a Curmudgeon 1943
18. Payne, Stanley, History of Fascism (1995) p 230
19. {{note|Leuchtenburg} Leuchtenburg, William E Franklin D. Roosevelt and the New Deal New York: Harper & Row, 1963, p. 58
20. Richman, Sheldon Fascism Concise Encyclopedia of Economics 1993, 2002.
21. Trifkovic, Srdja. FDR and Mussolini Chronicles magazine, August 2000.

See also

• Economic nationalism
• Fascism and ideology
• Fascism
• Collectivism
• Mercantilism
• Protectionism
• Planned economy
• Statism
• War Corporatism
• war economy
• Military-industrial complex

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
• Audio and Video files from various theorists recorded from the Economics of Fascism conference at the Ludwig von Mises Institute Oct 7-8, 2005
• Wiesen, S. Jonathan German Industry and the Third Reich Dimensions: A Journal of Holocaust Studies Vol. 13, No. 2

• Fascism
• Economic ideologies