To utterly mangle a famous Bob Dylan lyric, “history doesn’t rhyme, it swears”.
In April 1938, in a speech to the American Congress, Franklin Roosevelt said that “unhappy events abroad” (meaning Europe) had imparted two “simple truths”.
The first was that democratic government was threatened by the “growth of private power to a point where it becomes stronger than [the] democratic state itself”. That, in essence, was Fascism, he said.
The second was that the “liberty of a democracy is not safe if its business system does not …. produce and distribute goods in such a way as to sustain an acceptable standard of living”.
“Both lessons,” said Roosevelt, “hit home”.
The Hubris of Wealth
Sadly, 88 years on, they are hitting home again. Though our situation is probably more perilous in that the American president is the “essence” of the problem, rather than the one stating its existence.
A general myopia regarding the situation also makes combating it far more difficult. Many understand Roosevelt’s second “truth” – that falling or stagnating living standards provide fertile ground for far right and Fascist parties. Anything from high rents, to failing public services, to a callous ‘welfare’ system are blamed on immigrants or lazy freeloaders, or both.
But the first “truth” – interestingly Roosevelt placed it first so as to emphasise it – is less appreciated. But, as part one I hope demonstrated, “the concentration of private power without equal in history” is now actually worse than it was in the 1930s. And its producing similar effects.
So while Fascism is incubated by social conditions that affect the mass of people and unsolved and misunderstood economic afflictions, it also has a corollary at the top of society.
As Roosvelt noted at a time when Nazism thought it would last a thousand years, economic concentration and the growth of corporate power leads to a hubris among rich capitalists that they can discard democracy and institute a government seamlessly suited to their profit-maximising needs. This allies with the Fascist impulse at the bottom of society to produce a low-tax, deregulatory political project that, on its reverse side, constantly seeks scapegoats to blame for problems that are never addressed.
First on the Fascist ‘To Do’ List
We can see this in the actions of classical Fascism – the political environment that Roosevelt was confronting. The absolute first priority of the Hitler regime in Germany, as befitting its bankrolling by wealthy industrialists, was to repress the Left and puts its activists in concentration camps like Dachau. This started with the Communists in February 1933, and then within weeks extended to the Social Democrats and the trade unions. Only after this had been done, did the Nazis turn their attention to Jews, initially through a boycott of Jewish businesses. “There were relatively few Jews among these early prisoners of the Third Reich,” writes historian Arno Mayer in Why did the Heavens not Darken? “and all of them were arrested for being left-wing politicians, lawyers, or literati.”
The original Fascist regime, Mussolini’s in Italy, ceded a lot of power to a coterie of mainly non-Fascist economic advisers. As shown by Clara Mattai in The Capital Order, they instituted a system of brutal austerity and privatisation, which seamlessly dovetailed with Il Duce’s physical smashing of the workers’ movement, and coincidentally caused a massive, though far from unwelcome, slump in living standards.
Roosevelt, in keeping with someone who didn’t consider himself a socialist, thought the intrinsic problem with Fascism was that it rested on a particular type of capitalism. This was the cartel system – groups of companies that become so powerful they can fix prices, distort markets and take over governments so their interests are tended to.
And it is true that, contrary to the contemporary Right’s absurd portrayal of it as socialistic, Nazism had a private profit-making impulse at its core. As Hannah Arendt relates in Eichmann in Jerusalem (p 40), IG Farben, Krupp and Siemens all had plants in the vicinity of Auschwitz and made a pot of money by ‘employing’ its inmates as slave labour.
Nazism and Cartels
As the Rooseveltian moment reached its zenith – i.e. before the Cold War took root and the US started installing and supporting right-wing military dictatorships across the world – the cartel system was blamed for Nazism. The chairman of the US Senate’s Subcommittee on War Mobilization stated that the cartel system was “in great measure” responsible for the Hitler regime. Roosevelt himself wanted the German cartels eradicated and a “Decartelization” team was dispatched to post-war Germany to do just that (with the exception of IG Farben unsuccessfully).
But as shown by the fact that the German cartels existed prior to Nazism, and in fact were instrumental in helping Hitler into power, cartelisation is always an inherent possibility with capitalism. This is especially the case when – as they have been since the Great Depression –economic downturns are nipped in the bud by government intervention and a widespread destruction of capital is not permitted to happen.
In 2012, two American Marxian economists, in a book called The Endless Crisis said that economic concentration, though frequently denied, was greater than it had ever been in the past. They cited another economist who found 22 “barriers to entry” used by firms to exclude rivals, prima facie evidence of a cartel system. And given what has happened in the interim, including a spate of mergers and acquisitions in the wake of Covid, economic concentration has almost certainly become more extreme.
In such circumstances, the temptation to wield the power of market influence and wealth can become irresistible.
Last year, the anti-monopoly group the Balanced Economy Project and the NGO Global Justice Now, urged an investigation of three pharmaceutical giants who had paused investments worth £1.5 billion as prelude to negotiations with the government over drug purchases by the NHS. This, they said, “showed signs of cartel-like behaviour”.
As it turned out, the Competition and Markets Authority, permeated with the Starmer (read now Burnham) government’s growth mantra and horror of seeming to impair business ‘confidence’ refused to investigate. The subsequent talks, carried out under the shadow of threats to withdraw investments, saw the NHS promise to double spending on new drugs at a cost of £64 billion.
Billionaires and the Far Right
It is not hard to see an echo of the German cartels’ role in the rise of Nazism, and participation in its horrors, with billionaire sponsorship of the far-right today. Elon Musk pays Tommy Robinson’s legal costs, calls for the British government to be overthrown and supports Restore Britain. Palantir founder Peter Thiel thinks freedom and democracy are incompatible, while backing Donald Trump and the far-right. Trump’s immigrant detention centres are built and operated by private corporations.
Conveniently, those supported by these techno-billionaires (or trillionaires in the case of Musk) promise to tear down regulations banish abominations like a wealth tax. According to Facebook whistleblower, Sarah Wyn-Williams, offering electoral campaign tools to the far-right Alternative fur Deutschland and the Front National in France was seen as a way of “getting close to these political parties and helping them into government” so as to “stop government from regulating Facebook”.
Famed economist Daron Acemoglu (co-author of the noted book Why Nations Fail) has even suggested that what he calls “the capitalist state” may be prompted, by growing automation and an ever-rising stock of capital, to launch a “coup against democracy” and institute “repression”. He hypothesizes that for quite rational reasons – the desire to maximise profit – “democratic decision-making will become less and less attractive to capitalists”.
The Questionable Allure of Fascism
But a counter-question can be posed. For most corporations – as opposed to some idiosyncratic ultra-wealthy individuals thrown up by this age of mammoth inequality – is backing Fascism is really necessary or even desirable? As alluded to above, Clara Mattei in The Capital Order showed that in the 1920s, both Britain and Italy imposed brutal austerity – in the form of spending cuts, high interest rates and repression of trade unions. But while the latter became Fascist and abolished elections, the former didn’t. In fact, Britain instituted its recession-inducing austerity policies in the same decade that it experienced universal suffrage for the first time.
The Anti-Trump Corporation
It’s also true that for some corporations, elements of the modern Fascist script stick in the craw, primarily because they alienate senior staff members. Disney, for example, perhaps the archetypical American corporation, publicly criticised a Florida law which restricted teaching about sexuality and gender identity in schools, a kind of American version of Thatcher’s Section 28. This was even at the cost of a two-year long legal battle with the Trumpite state governor.
But though it personified corporate opposition, Disney was far from alone. Altogether 337 corporations, including famous names like Apple, Pepsi, Pfizer, Facebook, Mastercard, Citibank and Amazon signed a statement bemoaning similar state bills across the country that “single out LGBTQ+” people and “have a negative effect on our employees, our customers, our competitiveness, and state and national economies.”
Some American corporations have also retained their DEI policies in the face of threats from the Trump administration. Clearly the ogre of the woke corporation, invoked by the MAGA movement a few years ago, still exists under the surface. It’s a phenomenon that simply didn’t exist the last time Fascism bestrode the world. The late David Graeber brilliantly diagnosed a “culture of resentment” that hones in on a corporate Left elite of HR managers and administrators who police language and acceptable behaviour. “The mainstream Left largely controls the production of humans,” he wrote, “The mainstream Right largely controls the production of things”.
Despite Trump and Elon Musk and crypto-billionaire funded Nigel Farage and Rupert Lowe and Tommy Robinson, this division within the corporate world is very real. But although sections of the corporate elite may passionately hate contemporary Fascism, they are no more predisposed to “democratic decision-making” than the Right. They may be dissenters in the culture war but in the economic war they are resolutely on-message. In fact, though universal suffrage is an unadorned fact, few powerful people actually like it. As seen by their reaction to losing control of the UK Labour party a decade ago, centrists loathe democracy too.
Be that as it may, in the absence of a serious working-class left-wing revolt, an alliance between the corporate Left and the corporate Right, though they both detest Marxism and view democracy with visceral distaste, seems unlikely.
The surreally limited vision of ‘democracy’ of Margaret Thatcher’s mentor Friedrich Hayek – representatives serving 15-year terms with electors only able to vote for them once in their lifetimes – may be appealing to right-wing libertarians like Peter Thiel but the schisms run too deep for it to become a charter for corporate freedom.
Acemoglu’s “capitalist state” launching a “coup against democracy” presupposes a unity of purpose that was only achieved sporadically in the 1920s and ’30s and would be even harder to cement today. In any case, the dangerous beast of democracy has been suitably tamed in the last few decades by methods such as austerity, debt and the judgement of financial markets. If all else fails, Machiavellian techniques can be employed to see off insurgencies like those of Corbyn or Saunders.
The Shifting Battlefield
Though this last may facilitate the rise of the far right by channelling grievances in that direction, that too has a function for the corporate elite even if these parties do not attain power. The pressure of right-wing opponents promising a bonfire of regulations and more austerity results in establishment parties, even ostensibly ‘left-wing’ ones, committing themselves to similar, though maybe not quite as extreme, policies. Labour Chancellor John Healey, for example, wants further deregulation of the finance sector, accompanied by “fiscal discipline” (read austerity), while the Tories and Reform scream ‘not enough’. Thus, the battle lines are drawn, while the battlefield itself moves inexorably to the Right.
In 1931, American philosopher John Dewey called politics “the shadow cast on society by big business”. Four decades later the Deweyite Noam Chomsky said that corporations were, “in political terms fascist.” Organisationally, there is “tight control at the top and strict obedience has to be established at every level”. The corporation cannot help but shape democracy in its image. At root the problem is corporate power. While it exists, democracy will always be mutilated. It just depends how badly it is mauled.
