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America, Monopoly Capital, and Advanced Industrialism

Toward a Definition of Fascism

by NORMAN POLLACK

Definitions matter, especially in structural and/or systemic typologies, because imprecision leads to carelessness, obfuscation of repression, lack of support when it is merited, and the clarity necessary both to an acute and active political consciousness and the development of a moral sensibility.  The term “fascism” has been bandied about, to the point of losing its sting, its cutting edge, and becoming instead the catch-all for reactionary social movements and political antics of individuals, allowing the more dangerous causal factors, e.g., capitalism, militarism, etc., to remain in shadow or otherwise assumed (and therefore neglected).  Fascism comes in many forms; one size does not fit all, tempting as such an analysis might be.  Nor is there an historical line drawn in the sand, the crossing of which acts to confirm the genuine article.  This is not to set up unnecessary hurdles, but merely, to warn against the construction of simplistic models.  Indeed, models are a waste of energy; history is a better guide for us.

Fascism’s many guises—Mussolini’s Italy, Franco’s Spain, Hitler’s Germany; all are relevant, and perhaps even constituting a unified sequential historical phase.  But that isn’t good enough, at least to account for the historical forces post-1945, although certainly beginning earlier, which define fascism in modern times.  The concentration camp is no longer a sure-fire indicator, not when techniques of surveillance are being perfected and mass manipulation, particularly via consumerism and political propaganda from all quarters, has taken its place in softening the body politic and inducing conformity and complacence.  Today fascism speaks with a mellow voice (except when ruling groups are, or perceive themselves to be, threatened) and dons softened gloves, the better to achieve the regimentation of thought and opinion heretofore reliant on force.  Force is externalized, propelled forward to maintain hegemonic aspirations and, on the side, enlist the populace at home into the display of fervent patriotic support, without which the total formation might stagnate, fall backward, or actually crumble.  Fascism represents sustainment of the existing structure of wealth and power whilst the political economy itself bounds ahead—that is, the conservation of the Old Order under the conditions of modern industrialism.

The old order need not have been feudalism (although a few writers on occasion, Ghent in the US, and more perceptively, if obliquely, Thorstein Veblen, in his book, Imperial Germany, have viewed monopoly capitalism as industrial feudalism, and were not terribly wide of the mark), but I maintain that fascism, in a meaningful definition faithful to historical-structural development, would transform capitalism into a permanent Old Order, not to be attacked or dismantled, but modernized, so as to make possible an advanced industrial system with all else frozen—i.e., any impetus to democratization which might be ascribed to technology utterly nullified—and the class structure contained in equilibrium to the same end, prevention of change so long as stratification reflects power at the top and social discipline at the bottom.  Fascism = modern industrialism within an hierarchical societal framework.  To make such an arrangement work requires bread and circuses, standing behind which is the mailed fist, impersonalized through large military budgets, the martial spirit promoted in sport, ethnocentrism, the engendering of fear, as presently, saturation of the public environment through a political culture of counterterrorism and anti-immigrant sentiment.

The forces of production (I speak of technological change via innovation, not as a mechanistic formula, but as carried historically forward by real people in real social systems) are inherently dynamic, even when the progression is not smooth but punctuated by spurts, and although not invariably the vehicles of social, political, economic democratization, these forces outpace the institutional framework in which they are embedded.  Ownership, state protection of that status, ideological rationales if not formulated by, then sanctioned and transmitted by, ruling groups, all play a vital part in muting the thrust of their impact on institutions and culture to enlarge consumption (capitalism, as Marx knew, thrives on a state of underconsumption, and consequent deprivation of working people through a primordial stage of capital accumulation founded on their impoverishment) and lessen class differentiations.  Industrialism, as a pure construct, is not exactly the enemy of capitalism, but it must be brought under control if it is to be advantageous to, and thereby strengthen the conventional markers of, capitalism, from unimpeded wealth-accumulation and ownership-concentration to a disciplined, nonthreatening labor class whose members are in competition with each other for available work at depressed wages.  If not brought under control, it may even lead to another societal formation when under more rational management (from the standpoint of public well-being), i.e., the transformation from capitalism to socialism, that which must be resisted at all costs, else the demise of capitalism itself.  In this context, especially, fascism saves capitalism from itself, raising it to a condition of political stabilization by which, relying on the State to absorb its negativity (whether potential labor militancy or exposure to the outside threat of alternative models of historical-economic development), it is free to pursue the logic of its own internal motion.  Stated perhaps too simplistically, fascism is the final stage of capitalism, requiring advanced-industrial growth to reach and remain on that plateau, but always, by that point, industrialism as the toothless tiger, summoned at the command of the ruling groups in society.

Fascism, too, in the world of international commercial reality, facilitates the emphasis on a militarized political economy and domestically regimented populace.  Capitalism no longer could take for granted the pacific consequences of trade per se, when, following World War II, the world system itself was becoming unrecognizable to a Smithian perspective, in light of decolonialism, raw-materials scarcity, the root fact of intracapitalist rivalry for the successful trade-penetration of the markets of the world, along with the equally significant need for profitable investment outlets, lest capital be choked in place.  For these and other reasons, we find the militarization of capitalism as representing a qualitative change of organization and direction in which power becomes an end in itself, ideology turns from the prevention of internal dissent to a global posture of counterrevolution (without neglecting the former), and fascism, as the totalized reactive societal formation, is verily multitasked: in order to preserve capitalism it must neutralize industrialism, ensuring it does not interfere with capitalist integuments of class dominance that allow the system to function on behalf of, and as designed by, its ruling groups; it must also place capitalism on a permanent war-footing, not so much for the sake of military Keynesianism (defense industries spelling the margin of difference between stagnation and recovery, between dangerous unemployment and acceptable levels of the same—always as determined, not by a public commitment to full employment, but by capitalism-serving economists who see advantages in a slightly depressed labor market), and instead for the sake of keeping solidly planted on the escalator of hegemonic certitude, over as against other powers within capitalism which have made rapid industrial advances in the last half-century and are competing for the same markets, raw materials, and investment outlets, as well as testing hegemony as against noncapitalist (I have trouble calling them socialist as such) political economies  taking the somewhat adventitious form of ideological conflict, the Cold War, now resumed, if it ever ended with Russia, with China, to the mutual advantage of both sides in keeping their peoples under control.

Fascism did not spontaneously arise out of a magical bottle with, for example, Mussolini’s Italy in the 1920s.  Fascistic-appearing practices have been seen earlier, as noted in Barrington Moore’s superb essay, “Totalitarian Elements in Pre-Industrial Societies,” in his Political Power and Social Theory, but such requisite practices, from Red Scares, to political thuggery, to ideological force-feeding, whether earlier, or more recently, in nonindustrial settings, such as Spain and Portugal, have lacked what was exhibited on the structural level, first, in Italy, and then, Germany: the more rigorous organization of the business system, politically inspired and executed through government in collaboration with leading segments of the industrial and financial communities—a State formation the better to serve business needs in its particulars, but more basic the treatment of capitalism as a systemic consideration, its problems, societal tensions, means of self-propagation on increasingly more monopolistic lines, all with the context of international politics and economic always in mind.  This is the level on which fascism as a meaningful construct operates, not the hate-rantings of a KKK klavern or a Kiwanis luncheon club.  That may seem obvious, but in practice we underestimate the foci of power in modern society, what I shall term presently the interpenetration of business and government, and go after, rather, the kooks, who, although not harmless, are, whether or not they realize, the shock troops of an advanced capitalism in need of a climate of fear both to prosecute wars and unload surplus production onto narcotized consumers.  Under fascism both in Italy and Germany the rigorous organization of business takes the form of so-called “fronts,” in fact a totalitarian organization of society into both business “fronts” and labor “fronts,” the better to ensure close supervision, but more practically, to provide the former a greater cohesiveness taking cartel-like form and leading to monopolistic or oligopolistic clustering, and to provide the latter a means of expressing cooperation with business in the spirit of gratitude to those above (aka, victimization through a trickle-down framework of economics and class-stratification).

In the US there was marked interest (as well as considerable investment) in what was transpiring in Italy and Germany under fascist governments, particularly because American business was undergoing the parallel development—but without official government sanction—of supra-organization through trade associations and even what could be called peak associations (incorporating the former), also, like their fascist counterparts overseas, mindful of the need for stability, security, and the self-protecting arm of government.  All that was lacking was the formalization of the relationship to make it correspond to fascism.  But in thought, if not in deed, the US was not far behind.  Corporatism in Europe found its counterpart in 1920s America in the Chamber of Commerce and National Association of Manufacturers’ propagation of the doctrine of the commonwealth of business, signifying business had become the inner polity beholden only to itself rather than to the nation which provided it security.  It also signified much more , the organic nature of society, on which was applied, or rather, imposed, the hierarchical ordering of classes and, with government protection, a solipsistic view of privilege.  This was not Winstanley’s commonwealth but Hoover’s.  Here the work of Columbia economist Robert A. Brady merits attention because he placed side-by-side the official writings of the Nazi fronts, using parallel columns, with that of statements from the NAM and US Chamber of Commerce, an eye-opening exercise demonstrating at times almost identical wording staking out similar areas of interest and concern, the ideological themes of power, property, and hierarchy, in his book, The Spirit and Structure of German Fascism, along with his magnificent, and cogent for our purposes, further study, Business as a System of Power, together, as I see it, ranking with Franz Neumann’s Behemoth, in advancing the argument that business is inceptively fascistic (perhaps, I surmise, because of the need to render static the labor-capital relationship, including wage-determination above and a docile, accepting working class below), to which, I speculate further, advanced capitalism, its monopoly capital stage, its continued expansion no longer assured, is integrally, not inceptively, fascistic—the quest for stabilization, achieved through political means, in the face of potential and ever-looming senescence.

Whether we speak of business inceptively fascistic, or capitalism integrally so (because the systemic concerns take precedence of those of the individual firm), there is in both a structural and ideological predisposition to fascism, based on hierarchical organization, the political environment of business-government interpenetration, economic purpose and direction, as in the trend toward monopolism, and the psychological introjection common to business and society of the leadership principle, a pecking order of command and obedience running through and unifying the class system.  By capitalism’s own assessment (i.e., its leadership-structure, not an impersonal or deterministic process) the State performs a crucial role in the system’s development, even when Laissez-Faire and the Open Door were put forth as legitimating myths.  This dependence–actually a mutual dependence, in which a consolidated base of monopoly capital translates into greater, more effective military prowess and creates the need to show and employ  it–becomes increasingly clear with capitalism’s further advancement, as remedies have to be sought for the volatile nature of the business cycle and the prevention of the severe consequences and subsequent disruptions earlier experienced in the Great Depression, avoidance of which fuels the drive for Executive Power and the free hand (although the opposite should be true) accorded business.

One does not need Marx to recognize (the recent financial crisis is testimony enough) that capitalism is an inherently unstable system.  That is where government comes in, the more extreme the recuperative measures needed for stability and the resumption of profit-taking, the closer the combined interrelated synthesis of business and government approaches to fascism.  Today, the fashion is austerity, yet fully worked out, austerity, like counterterrorism, because saying one thing, and meaning substantively quite a bit more, reveals, as in fact does the other (for at a deeper level of analysis they work in tandem), the impetus toward conservation of the established order.  Austerity involves the political-fiscal assault on the social safety net, while counterterrorism has the dual function, all in the name of fighting terrorism, of mounting an assault on social dissidence at home and implicitly fulfilling counterrevolutionary goals abroad, whether opposition to radical social forces or Third World industrialization.  In execution, it is about everything but terrorism, as massive surveillance attests, with its chilling effect on opposition to the government.

Yet to say that capitalism is inherently unstable does not obligate one to pursue the vulgarization of Marx.  The notion of inherent contradictions has always troubled me.  It is too structurally impersonal.  Consistent with an historical reading of dialectical materialism, one can suggest rather that what passes for “contradictions” are in fact conscious efforts and decisions to maximize profits—eminently rational behavior in an admittedly irrational system—and its correlative practices, such as maintain class power and seek out opportunities for market expansion,  no matter the obstacles, so that even in the failure of the system, there are no guarantees of social transformation, and, if anything, class dominance remains intact, as does ideology, and the cycle is resumed, usually to the further displacement and degradation of working people.  If, however, resumption is not a foregone conclusion, which happens as capitalism begins to atrophy, and as social tensions begin to mount, fascism, here the power and authority of the State, becomes thinkable and, again through conscious action, not some form of determinism, becomes also obtainable.  But obtainable, because of an already well-advanced interpenetration, on behalf of business, the State its shield and protector.  One doesn’t need a Reichstag fire to bring out the troops (who in any case made an example of the Bonus Marchers in America in 1932), the only contradiction in all of this being that capitalists themselves, while surviving as a class, ignored the warning signs of their own self-indulgent and selfish conduct, thereby bringing the system temporarily into question.  (For the uninitiated, one might state, neither hardship alone nor structural fracturing makes a revolution, people do, and they, unlike automatons, have to will their actions, dependent in turn on the degree of clarity and conviction of their political consciousness.)  My conclusion: “contradictions” are in reality the flash point of profitability in the system; government is not intended for removing them, but rather, for ensuring they work to the benefit of capitalists themselves, and ensuring good order until upper groups have restored their position (which, in any case, they still enjoyed in proportional terms).

Capitalism requires a class-state.  Its fascistic constituent comes into play in either of two ways: when capitalism requires the services of the State, whether or not interpenetration has proceeded sufficiently far, if it finds itself, real or imagined, to be besieged by forces hostile to its purposes and direction (labor or, the worship of competition notwithstanding, monopolistic and oligopolistic firms or sectors feeling the pressures of competitors threatening their position in the economy, in which case, government, in the name of responsible corporate character, sets up, in the name of competition, an anti-competitive framework; the second way, government-business interpenetration has reached solidification to the degree that each element, now conjoined for all practical purposes, integrates through combined power a societal framework that makes possible foreign aggression and internal pacification: a militarization of capitalism which is consonant with the system’s final stage of preservation–not subject to domestic interference or disaffection—by force.

Where does America come in?  Interpenetration, beginning with Theodore Roosevelt (as shown in Gabriel Kolko’s seminal work, Triumph of Conservatism), building on the assumption that economic power—a strong monopolistic base—translates into military power, advances the process through his Bureau of Corporations and détente with the House of Morgan, both pointing to a tighter economic structure with government seeking to curb internecine competition in favor of the largest firms.  In both cases, Morgan and the investment bankers leading the Bureau, the détente is essentially a gentlemen’s affair, men whom Roosevelt trusted because they were members of his class and shared his vision of a powerful America resting on an economic foundation of consolidated wealth and a geopolitical program of achieving great-power status, as in the Battleship Navy, for global market penetration.  (Anyone who sees Roosevelt as a trust buster, particularly after Kolko, a half-century ago, indulges in wishful thinking.)  In the next step, Woodrow Wilson, with the Federal Reserve System, the Federal Trade Commission, and a vigorous export-orientation, carries interpenetration beyond Roosevelt’s more informal phase, to the institutionalization of the détente, which qualifies by this point as more fully realized interpenetration.  Here Wilsonian liberalism, I speak only of domestic policy, is as removed from laissez-faire as is Roosevelt’s from trust busting.  What he did, with respect to banking and corporate growth, is to turn something of a semantic trick: he constructed the regulatory framework to promote self-regulation—in both banking and corporate business.  Self-regulation may sound like classical liberalism of the Smithian vintage; in reality, it uses government to legitimize private decision-making, and more, implement the decisions against mavericks and troublesome competitors who refuse to accept the ground-rules laid down by the giants in each sector.  Self-regulation possessing the aura of regulation is interpenetration at its poetic best.  Consider the situation today—regulatory agencies the spokespersons, in effect, for those purportedly subject to regulation.  Toss in the revolving door, or even personnel who remain in the government service but drawn directly from the affected interests, and you have the non sequitur of public regulation disserving the public welfare.

The three administrations prior to the New Deal continued the trend in more halting fashion, which, for Harding and Coolidge, meant the era of trade association activities if not supplanting then at least acting as independent forces in the expansion and stabilization of capitalism, and Hoover, however caricatured then and later, did represent a more or less straightline projection from Wilson—not fascistic, but keeping alive elements of business organization that, given post-World War II conditions, constituted a strengthened partner in the march of interpenetration.  Franklin Roosevelt and the New Deal, as might be expected, represent a complex tugging-and-hauling between government and business, regulation genuine and self-regulation, all in the context of securing the rights of labor, separating commercial and investment banking, creating a vast program of public works, in sum, permitting, through the National Recovery Administration, among the most powerful stimuli to monopolization and, through the “code authorities,” in organization, not that unlike the Nazi business “fronts,” yet, balanced by the liberation of social forces and ideological themes, not least encouraging the dignity of the unemployed and securing jobs across the board, white and blue collar, that, despite the survival of capitalism—which was really at stake here—and the green light to concentration, one cannot view the interpenetration existing, as the prelude to fascism.  That might come later.  Conceivably, if there had been a configuration of social forces that historically held for the balance FDR managed to achieve, capitalism, while unquestionably ascendant among the different elements of society, would not have “progressed” to a higher stage, and with it, the emphasis on military support for capitalism as a world system or, specifically looking inward, for US market penetration and leadership of international financial and trade organizations.  This was still an inequitable system, but hardly fascist, which, had it been, would have used class polarization to compel deference from working people and subscription to the purposes of foreign expansion.  FDR  remains an historic figure pointing toward a managed capitalism never achieved in America, perhaps because capitalism would in time, wherever it exists, throw off the shackles of the public interest and the rights of labor.  Within capitalism, he fought the good fight, only to have his work nullified within a few years after his death.

Despite protofascist currents, as in the mindset favoring the extermination of radicals, anarchists, even the foreign-born in general in the period centered around the First World War (TR’s attitude toward the IWW, as an example), I sense, having come of age at the time, that post-1945 continuing forward represents a qualitative change in the American psyche, cause and consequence initially of the Cold War, but really, all of the poisons, racism, antiradicalism, antilabor attitudes and policies, etc., boiling up from below the surface—something neither the New Deal nor the Second World War could eradicate (and probably exacerbated, for those already disposed to hate)—and thus creating an irreducible structural-psychological landscape which allowed capitalism in America to exploit if not, possibly, manufacture the suspicions and fears of government, socialism, the Welfare State, as though internal subversion lurked everywhere, and warranted pre-emptive responses designed and intended to eradicate dissent as by definition unpatriotic.  Still, McCarthyism is no more than inchoate fascism, although with the execution of the Rosenbergs, we were already coming pretty damn close.  More significant, in studying or plotting the societal direction, was the simultaneous growth of income inequality, business consolidation, the prominence within the economic structure of mega-financial institutions, matched stride for stride with a foreign policy of anticommunism that not only allowed the domestic business system a free pass (along with the curtailment of labor rights), but gave intervention a respectability not seen before.  More than McCarthy, consider Kennedy’s Bay of Pigs, which paved the way for Vietnam, which, if not already, paved the way for the CIA as the legitimate arm of violence, and on and on—a record of deceit, invasion, swelling armaments, a National-Security State in-the-making, until we come to the present.  Surveillance, secrecy, targeted assassination, indefinite detention, the state-secrets doctrine, the list truly has no end to what can be considered fascistic-inclined policies and practices, overt, covert, national, international, always in lockstep with a political economy dependent on the selfsame policy-context for internal security (against a labor class that has lost its identity in the fiction of the great, subsuming Middle Class) and the unimpeded rationalization of its global operating environment.

Is this fascism?  I leave that for the reader to decide, provided, however, he or she does not focus on Tea Partiers, Fox News, Republican intransigence, but rather, probes systemic wrongs, of which those cases are secondary to the structure of power, the integration of the military into the governing system of political-corporate elites.  Look to Obama, the Democrats, present-day centrists and progressives, for there lies sophisticated corporatism itself, capable of an international policy of confrontation with China and a domestic policy which adds to the militarization of capitalism also its financialization, together as perhaps a New Autarky as the rest of the world has second thoughts about American leadership.  In terms of analysis, one’s definition of fascism might turn from Nazi Germany as the archetype to one resembling more the phase of US capitalist development in the last century:  dynamism of productive forces (although this is lessening), nonbudging capitalist internal structure—industrial growth encased in the Old Order.  That is exactly the situation of postwar Japan, where interpenetration has proceeded so far as to indicate the very structural characteristics of hierarchy and class stratification, the Old Order, as departure point for monopolistic industry and banking.  All that is lacking is militarism and exorbitant defense outlays—and, if America is any indication, that may change as advanced capitalism progresses further.  I recall here the phrase of the respected Japanese political scientist Masao Maruyama, when he described Japan’s version of interpenetration (which also disturbed him about its implications for the future).   He termed the business-government relationship the “close-embrace” system.  Following the usage of Barrington Moore in his brilliant comparative history of the principal political-economic modes of development, now specifically with relation to Japan, which he termed “Asian Fascism,” I note, from his Social Origins of Dictatorship and Democracy a phrase which best captures the definition of fascism I have been seeking: “modernization from above.”

Norman Pollack is the author of “The Populist Response to Industrial America” (Harvard) and “The Just Polity” (Illinois), Guggenheim Fellow, and professor of history emeritus, Michigan State University. His new book, Eichmann on the Potomac, will be published by CounterPunch/AK Press in the fall of 2013.