Rebirth of Reason

The Free Radical
War for Men's Minds

Fascism Triumphant
by Larry Sechrest

Fascist sentiments and policies motivated the Axis powers - Germany, Italy, and Japan - during the Second World War. And everyone knows that the Allies won the war. Therefore, fascism was soundly defeated and, for all practical purposes, disappeared from the world stage, right? Wrong, tragically wrong. In much of the world, but especially in the two most prominent Western nations, the USA and what I like to call "Mediocre" Britain, fascism seems to have won the day. The Axis clearly lost on the battlefield, on the seas, and in the air. But ultimately of far greater importance than that is the battle for the minds and hearts of men. And on that front, fascism is well on its way toward scoring a stunning but largely unrecognized victory.

One of the reasons why this victory has been little noticed lies in the amorphous nature of fascism itself. Many variants have existed, and even in general terms it can elude identification. For example, during World War II the popular magazine Collier's undertook a survey of Americans to determine if they knew what fascism was. The results were published on December 11, 1943, and are aptly captured by the summary judgment that "[f]rom coast to coast, Americans, in high-income brackets or low, either could not agree on a definition of fascism or had no definition whatever". To this day, most Americans (and many people around the world) seem to think of fascism only in terms of historical concretes, Italy and Germany, with no consideration of abstract attributes. No wonder they fail to identify the political and cultural climate as fascistic.

What, then, are those identifying attributes of a fascist state? Historian Stanley G. Payne says that they include 1) "an authoritarian, charismatic, personal style of command"; 2) "exaltation of youth"; 3) "willingness to use violence" against its own citizens; 4) extreme nationalism; 5) anticommunism; 6) a mixed economy with a high degree of centralized control but nominal private ownership; and, in all matters, 7) mobilisation of the masses for the purpose of achieving collective goals. For Benito Mussolini, who founded the Italian Fascist Party in 1919, another critical characteristic was the political stimulation of industrial development. The nation must learn to move "with the rhythm of machines".

Does the foregoing sound familiar? It should to most readers. And the reason, at least regarding economic issues, is John Maynard Keynes. The macroeconomics of Keynes took the economics world by storm beginning in 1936. By the 1950s, his ideas dominated the textbooks and almost invariably formed the core of all government policies outside the Soviet bloc. Perhaps the most fundamental of these ideas is the dictum that aggregate demand creates its own aggregate supply. In other words, to have greater production and greater incomes, there must be greater spending. And since Keynes believed that the free market was chronically dysfunctional, and private sector spending would often be at an inappropriate level, this meant that in the short run the government should direct the economy via variations in its spending and taxation. Moreover, the most effective stimulation of a sluggish economy allegedly occurs when the Treasury issues debt (IOUs), the central bank purchases this debt, and the Congress spends the proceeds from the sale. Keynes is truly the "father" of deficit spending.

Keynesians would of course vehemently deny any connection between the policies they recommend and fascism. But then they have a serious problem. How can they explain the fact that Keynes himself felt at home with the Nazi version of fascism? It is little known to most economists, but Keynes published a German language edition of his seminal work, The General Theory of Employment, Interest, and Money, in 1936. Addressing his German readers in the Foreword, Keynes confesses that the "theory of aggregate production, which is the point of the following book, nevertheless can be much easier adapted to the conditions of a totalitarian state than the theory of production and distribution of a given production put forth under conditions of free competition and a large degree of laissez-faire." Cited in a book published in 1958, Austrian economist Gottfried Haberler adds that "I still think the Nazi policy can be called Keynesian. Large- scale deficit spending is, after all, the decisive factor".

Keynes has often been portrayed as one who wished to reform capitalism rather than destroy it. If so, then a firing squad is a means of "reforming" the behaviour of convicted murderers. In fact, in the long run Keynes hoped to destroy the capitalists who are the creative heart of the system. How? By "socialising" investment and driving rates of interest to zero. As a result, all income would accrue to labor, and, in Keynes' own words, we would witness "the euthanasia of the cumulative oppressive power of the capitalists to exploit the scarcity-value of capital." This was "the most sensible way of gradually getting rid of many of the objectionable features of capitalism."

If this sounds like typical socialist polemics, one should not be surprised. As political scientist James Gregor has stated, fascism is "Marxist in inspiration, socialist in general character, and syndicalist in immediate origin". No less an authority than Adolf Hitler admitted in February 1941 that "basically National Socialism and Marxism are the same."

Therefore, one must keep in mind that the "anticommunism" of fascists is merely hostility toward a competing totalitarian system, not a contrast of polar opposites.

Both Friedrich A. Hayek and Ayn Rand correctly identified the nature of fascism and argued that the political and cultural trends in America and Britain pointed toward fascism of the German or Italian model, rather than Soviet-style state socialism. Rand focused on the pragmatic quest for power that festers in fascists' hearts and the identifying buzzwords "compromise" and "consensus". Today, what do we hear but endless demands for "bipartisanship" and an end to political "gridlock" ? Those are nothing but demands for an ever-expanding State, one with its slimy tentacles in every orifice of the body politic. As Rand saw so clearly, the only thing that will stop the march toward full-blown fascism is a principled - and intransigent - defense of individual rights.

Recently, the generation that fought World War II has frequently and lovingly been portrayed in print and on film. They have even been called the "greatest generation" in recognition of their bravery, for which they do deserve praise. However, they also are the generation that turned its back on capitalism, individual rights, and liberty. They may have won the war, but they lost the world. For that they should be damned to hell.

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