SPEAKING
FREELY The real threat of
fascism By Paul Bigioni
Speaking Freely is an Asia
Times Online feature that allows guest writers to
have their say. Please click hereif you are interested in
contributing.
Observing political
and economic discourse in North America since the
1970s leads to an inescapable conclusion: the vast
bulk of legislative activity favors the interests
of large commercial enterprises. Big business is
very well off, and successive Canadian and US
governments, of whatever political stripe, have
made this their primary objective for at least the
last 25 years.
Digging deeper into 20th
century history, one finds this steadfast focus on
the well-being of big business in other times and places.
The
exaltation of big business at the expense of the
citizen was a central characteristic of government
policy in Germany and Italy in the years before
those countries were chewed to bits and spat out
by fascism.
Fascist dictatorships were
borne to power in each of these countries by big
business and they served the interests of big
business with remarkable ferocity. These facts
have been lost to the popular consciousness in
North America. Fascism could therefore return to
us, and we will not even recognize it. Indeed,
Huey Long, one of America's most brilliant and
most corrupt politicians, was once asked if
America would ever see fascism. His answer was,
"Yes, but we will call it anti-fascism."
By exploring the disturbing parallels
between our own time and the era of overt fascism,
I am confident that we can avoid the same hideous
mistakes. At present, we live in a constitutional
democracy. The tools necessary to protect
ourselves from fascism remain in the hands of the
citizen. All the same, I believe that North
America is on a fascist trajectory. We must
recognize this threat for what it is, and we must
change course.
Consider the words of
Thurman Arnold, head of the antitrust division of
the US Department of Justice in 1939: "Germany, of
course, has developed within 15 years from an
industrial autocracy into a dictatorship. Most
people are under the impression that the power of
Hitler was the result of his demagogic
blandishments and appeals to the mob ... Actually,
Hitler holds his power through the final and
inevitable development of the uncontrolled
tendency to combine in restraint of trade."
Arnold made his point even more clearly in
a 1939 address to the American Bar Association:
"Germany presents the logical end of the process
of cartelization. From 1923 to 1935 cartelization
grew in Germany until finally that nation was so
organized that everyone had to belong either to a
squad, a regiment or a brigade in order to
survive. The names given to these squads,
regiments or brigades were cartels, trade
associations, unions and trusts. Such a
distribution system could not adjust its prices.
It needed a general with quasi-military authority
who could order the workers to work and the mills
to produce. Hitler named himself that general. Had
it not been Hitler it would have been someone
else."
I suspect that to most readers,
Arnold's words are bewildering. Most people today
are quite certain that they know what fascism is.
When asked to describe it, however, they will
typically tell you what it was, the assumption
being that it no longer exists. Most people
associate fascism with concentration camps and
rows of stormtroopers, yet they know nothing of
the political and economic processes that led to
these horrible end results.
Before the
rise of fascism, Germany and Italy were liberal
democracies. Fascism did not swoop down on these
nations as if from another planet. To the
contrary, fascist dictatorship was the end result
of political and economic changes these nations
underwent while they were still democratic. In
both these countries, economic power became so
utterly concentrated that the bulk of all economic
activity fell under the control of a handful of
men. Economic power, when sufficiently vast,
becomes by its very nature political power. The
political power of big business supported fascism
in Italy and Germany.
Business tightened
its grip on the state in both Italy and Germany by
means of intricate webs of cartels and business
associations. These associations exercised a very
high degree of control over the businesses of
their members. They frequently controlled pricing,
supply and the licensing of patented technology.
These associations were private, but were entirely
legal. Neither Germany nor Italy had effective
antitrust laws, and the proliferation of business
associations was generally encouraged by
government.
This was an era eerily like
our own, insofar as economists and businessmen
constantly clamored for self-regulation in
business. By the mid 1920's, however,
self-regulation had become self-imposed
regimentation. By means of monopoly and cartel,
the businessmen had wrought for themselves a
"command and control" economy that effectively
replaced the free market. The business
associations of Italy and Germany at this time are
perhaps history's most perfect illustration of
18th century economist and philosopher Adam
Smith's famous dictum, "People of the same trade
seldom meet together, even for merriment and
diversion, but the conversation ends in a
conspiracy against the public, or in some
contrivance to raise prices."
How could
the German government not be influenced by Fritz
Thyssen, the man who controlled most of Germany's
coal production? How could it ignore the demands
of the great I G Farben industrial trust,
controlling as it did most of that nation's
chemical production? Indeed, the German nation was
bent to the will of these powerful industrial
interests. Hitler attended to reduction of certain
taxes applicable to large businesses, while
simultaneously increasing the same taxes as they
related to small business.
Previous
decrees establishing price ceilings were repealed
such that the cost of living for the average
family was increased. Hitler's economic policies
hastened the destruction of Germany's middle class
by decimating small business. Ironically, Hitler
pandered to the middle class and they provided
some of his most enthusiastically violent
supporters. The fact that he did this while
simultaneously destroying them was a terrible
achievement of Nazi propaganda.
Hitler
also destroyed organized labor by making strikes
illegal. Notwithstanding the socialist terms in
which he appealed to the masses, Hitler's labor
policy was the dream come true of the industrial
cartels that supported him. Nazi law gave total
control over wages and working conditions to the
employer. Compulsory (slave) labor was the
crowning achievement of Nazi labor relations.
Along with millions of people, organized labor
died in the concentration camps. The camps were
not only the most depraved of all human
achievements, they were a part and parcel of Nazi
economic policy.
Hitler's
untermenschen (sub-humans), largely Jews,
Poles and Russians, supplied slave labor to German
industry. Surely this was a capitalist bonanza. In
another bitter irony, the gates over many of the
camps bore a sign that read "Arbeit Macht
Frei" (work shall set you free). I do not know
if this was black humor or propaganda, but it is
emblematic of the deception that lies at the heart
of fascism.
The same economic reality
existed in Italy between the two world wars. In
that country, nearly all industrial activity was
owned or controlled by a few corporate giants,
Fiat and the Ansaldo shipping concern being the
chief examples. Land ownership in Italy was also
highly concentrated and jealously guarded. Vast
tracts of farmland were owned by a few
latifundisti (estate owners). The actual
farming was carried out by a landless peasantry
who were locked into a role essentially the same
as that of the sharecropper of the US deep south.
As in Germany, the few owners of the nation's
capital assets had immense influence over
government.
As a young man, Mussolini had
been a strident socialist, and he, like Hitler,
used socialist language to lure the people to
fascism. Mussolini spoke of a "corporate" society
wherein the energy of the people would not be
wasted on class struggle. The entire economy was
to be divided into industry specific
"corporazioni", bodies composed of both
labor and management representatives. The
corporazioni would resolve all
labor/management disputes, and if they failed to
do so, the fascist state would intervene.
Unfortunately, as in Germany, there laid
at the heart of this plan a swindle. The
corporazioni, to the extent that they were
actually put in place, were controlled by the
employers. Together with Mussolini's ban on
strikes, these measures reduced the Italian
laborer to the status of peasant.
Mussolini, the one-time socialist, went on
to abolish the inheritance tax, a measure which
favored the wealthy. He decreed a series of
massive subsidies to Italy's largest industrial
businesses and repeatedly ordered wage reductions.
Italy's poor were forced to subsidize the wealthy.
In real terms, wages and living standards for the
average Italian dropped precipitously under
fascism.
Even this brief historical sketch
shows how fascism did the bidding of big business.
The fact that Hitler called his party the
"National Socialist Party" did not change the
reactionary nature of his policies. The connection
between the fascist dictatorships and monopoly
capital was obvious to the US Department of
Justice in 1939. As of 2005, however, it is all
but forgotten.
It is always dangerous to
forget the lessons of history. It is particularly
perilous to forget about the economic origins of
fascism in our modern era of deregulation. Most
Western liberal democracies are currently held in
the thrall of what some call market
fundamentalism. Few nowadays question the flawed
assumption that state intervention in the
marketplace is inherently bad. As in Italy and
Germany in the 1920s and 1930s, business
associations clamor for more deregulation and
deeper tax cuts.
The gradual erosion of
antitrust legislation, especially in the United
States, has encouraged consolidation in many
sectors of the economy by way of mergers and
acquisitions. The North American economy has
become more monopolistic than at any time in the
post-World War II period. (By way of example, US
census data from 1997 show that the largest four
companies in the food, motor vehicle and aerospace
industries control 53.4%, 87.3% and 55.6% of their
respective markets. More than 20% of commercial
banking in the US is controlled by the four
largest financial institutions, with the largest
50 controlling more than 60%.
Even these
numbers underestimate the scope of concentration,
since they do not account for the myriad
interconnections between firms by means of debt
instruments and multiple directorships, which
further reduce the extent of competition. Actual
levels of US commercial concentration have been
difficult to measure since the 1970s, when strong
corporate opposition put an end to the Federal
Trade Commission's efforts to collect the
necessary information.)
Fewer, larger
competitors dominate all economic activity, and
their political will is expressed with the
millions of dollars they spend lobbying
politicians and funding policy formulation in the
many right-wing institutes that now limit public
discourse to the question of how best to serve the
interests of business. The consolidation of the
economy, and the resulting perversion of public
policy are themselves fascistic. I am quite
certain, however, that president Bill Clinton was
not worrying about fascism when he repealed
federal antitrust laws that had been enacted in
the 1930's.
The Canadian Council of Chief
Executives is similarly unworried about fascism
when it lobbies the Canadian government to water
down our Federal Competition Act. (The 1985 act
regulates monopolies, among other things, and
itself represents a watering down of Canada's
previous antitrust laws. It was essentially
written by industry and handed to the Brian
Mulroney government to be enacted.)
At
present, monopolies are regulated on purely
economic grounds to ensure the efficient
allocation of goods. If we are to protect
ourselves from the growing political influence of
big business, then our antitrust laws must be
reconceived in a way that recognizes the political
danger of monopolistic conditions. Antitrust laws
do not just protect the marketplace, they protect
democracy.
It might be argued that North
America's democratic political systems are so
entrenched that we needn't fear fascism's return.
The democracies of Italy and Germany in the 1920's
were in many respects fledgling and weak. Our
systems will surely react at the first whiff of
dictatorship. Or will they? This argument denies
the reality that the fascist dictatorships were
preceded by years of reactionary politics, the
kind of politics that are playing out today.
Further, it is based on the conceit that whatever
our own governments do is democracy.
Canada still clings to a quaint, 19th
century "first past the post" electoral system in
which a minority of the popular vote can and has
resulted in majority control of parliament. In the
US, millions still question the legality of the
sitting president's first election victory, and
the power to declare war has effectively become
his personal prerogative.
Assuming that we
have enough democracy to protect us is exactly the
kind of complacency that allows our systems to be
quietly and slowly perverted. On paper, Italy and
Germany had constitutional, democratic systems.
What they lacked was the eternal vigilance
necessary to sustain them. That vigilance is also
lacking today.
Our collective
forgetfulness about the economic nature of fascism
is also dangerous at a more philosophical level.
As contradictory as it may seem, fascist
dictatorship was made possible because of the
flawed notion of freedom that held sway during the
era of laissez-faire capitalism in the early
twentieth century. It was the liberals of that era
that clamored for unfettered personal and economic
freedom, no matter what the cost to society.
Such untrammeled freedom is not suitable
to civilized humans. It is the freedom of the
jungle. In other words, the strong have more of it
than the weak. It is a notion of freedom that is
inherently violent, because it is enjoyed at the
expense of others. Such a notion of freedom
legitimizes each and every increase in the wealth
and power of those who are already powerful,
regardless of the misery that will be suffered by
others as a result.
The use of the state
to limit such "freedom" was denounced by the
laissez-faire liberals of the early twentieth
century. The use of the state to protect such
"freedom" was fascism. Just as monopoly is the
ruin of the free market, fascism is the ultimate
degradation of liberal capitalism.
In the
post-war period, this flawed notion of freedom has
been perpetuated by the neo-liberal school of
thought. The neo-liberals denounce any regulation
of the marketplace. In so doing, they mimic the
posture of big business in the pre-fascist period.
Under the sway of neo-liberalism, Thatcher,
Reagan, Mulroney and George W Bush have decimated
labor and exalted capital. (Currently, only 7.8%
of workers in the US private sector are unionized
- about the same percentage as in the early
1900s.)
Neo-liberals call relentlessly for
tax cuts which, in a previously progressive
system, disproportionately favor the wealthy.
Regarding the distribution of wealth, the
neo-liberals have nothing to say. In the result,
the rich get richer and the poor get poorer. As in
Weimar Germany, the function of the state is being
reduced to that of a steward for the interests of
the moneyed elite. All that would be required now
for a more rapid descent into fascism are a few
reasons for the average person to forget that he
is being ripped off. The racist hatred of Arabs,
fundamentalist Christianity or an illusory sense
of perpetual war may well be taking the place of
Hitler's hatred for communists and Jews.
Neo-liberal intellectuals often recognize
the need for violence to protect what they regard
as freedom. Thomas Freidman of the New York Times
has written enthusiastically that "the hidden hand
of the market will never work without a hidden
fist", and that "McDonald's cannot flourish
without McDonnell Douglas, the designer of the US
Air Force F-15 ... ".
As in pre-fascist
Germany and Italy, the laissez-faire businessmen
call for the state to do their bidding even as
they insist that the state should stay out of the
marketplace. Put plainly, neo-liberals advocate
the use of the state's military force for the sake
of private gain. Their view of the state's role in
society is identical to that of the businessmen
and intellectuals who supported Hitler and
Mussolini. There is no fear of the big state here.
There is only the desire to wield its power.
Neo-liberalism is thus fertile soil for fascism to
grow again into an outright threat to our
democracy.
Having said that fascism is the
result of a flawed notion of freedom, I
respectfully suggest that we must re-examine what
we mean when we throw around the word "freedom".
We must conceive of freedom in a more enlightened
way. Indeed, it was the thinkers of the
Enlightenment who imagined a balanced and
civilized freedom that did not impinge upon the
freedom of one's neighbor. Put in the simplest
terms, my right to life means that you must give
up your freedom to kill me. This may seem terribly
obvious to decent people. Unfortunately, in our
neo-liberal era, this civilized sense of freedom
has, like the dangers of fascism, been all but
forgotten.
Paul Bigioni is a
lawyer practicing in Markham, Ontario. He is a
commentator on trade and political issues. This
article is drawn from his work on a book about the
persistence of fascism.
(Copyright
2005 Paul Bigioni)
Speaking Freely
is an Asia Times Online feature that allows guest
writers to have their say. Please click hereif you are interested in
contributing.
