[ p. 87 ]
FREE enterprise, individualist and capitalist, was wrecked on the rock of nationalism. In the abstract, its principles, as propounded by Adam Smith, David Ricardo and John Stuart Mill, are as correct today as they were at the beginning of industrialism. We see now that such a system of absolute economic freedom [ p. 88 ] never existed—nor could ever exist—except within relatively wide national boundaries, at an early stage of industrial expansion and then only for a short time. It was tried in England at the beginning of the nineteenth century, but its free development was soon obstructed by the United States, Germany and other countries whose nationalism induced them to establish tariff barriers to create a national industry for their home markets and to enable themselves to compete with British industry on the world market
From the very moment the first tariff barriers were imposed on industrial products, we could no longer speak of a system of free enterprise and free economy. Since that time, now more than a century ago, economic principles and economic necessities have been clashing with our political beliefs and fighting a losing batde. No matter how rational were the classic arguments of liberal economists, their doctrines were powerless in the face of irrational and transcendental nationalist passions. To national governments—and to the great majority of the peoples—it seemed more important to build up and maintain national industries, no matter how uneconomically they functioned, than to allow their people access to the best and cheapest commodities on the market.
For a certain time tariff barriers did help certain nations to increase their wealth and raise their living standards. Large national compartments, the United States, the British Empire, even the French and German Empires, progressed rapidly and nationalist advocates of tariff barriers were perfecly justified in [ p. 89 ] pointing out that this progress was the result of the protective walls erected around their nation-states.
Within a few decades a point was reached at which there was hardly a country whose economy could develop further hased entirely on national territories and populations. The greatest industrial powers lacked raw materials, which they were forced to purchase abroad, and were unable to consume their entire production at home. Once this saturation point in the internal development of national economies was reached and interchange with the economies of other closed national systems became inevitable, the ensuing conflict between political and economic interests threw the entire economy of the world out of gear.
Unemployment surged up and the nation-states, after having intervened in the free movement of goods and services, were now forced to interfere with the free movement of peoples, with migration. This solved no problem at all. The social schism resulting from the so-called system of free enterprise—which nationstates never allowed to be free—began to dominate the political scene and socialism was born.
Although Marx and Engels made the socialist parties international, strangely enough, “nationalization,” and not “internationalization” of the means of production was pursued. Obviously, the “internationalism” of the Socialist Internationale was only a tactical move, a mere label. The actual programs of the socialist parties have always been national. They advocated national solutions of the economic problem through transfer of ownership from private individuals to the nation-states.
[ p. 90 ]
The evolution of Western civilization in the past hundred years is best characterized by this struggle between the liberal and conservative elements upholding the ideals of free enterprise and private ownership of took and means of production, and the socialist and Communist elements working toward state ownership of instruments of production.
Today it is clear to all—the First, Second and Third Internationales notwithstanding—that the outlook of both groups has always been and still is national. Both believe solutions of the economic and social problems to be possible and desirable on a national basis within the framework of the present nation-state structure as established in the eighteenth century, before the birth of industrialism.
Today we can survey with some degree of historical perspective the growth of both systems: the individualist system of free enterprise in Western states and the socialist-Communist system of collectivism in the Soviet Union. In both, such observation reveals the same trend toward ever-increasing nationalist state machinery and ever-growing pressure on the individual by control, regulation and infringement of his personal liberty.
In all capitalist countries the conflict between industrialism and nationalism led to higher and higher tariffs, to more and more government control of production and distribution by means of export and import regulations, quotas, taxation, supervision, direct control and active direction. Growing tension resulting from demographic pressure and economic necessity led more and more of the industrial countries to [ p. 91 ] embark upon a policy of expansion, first by the conquest of foreign markets through dumping and other artificial export subventions, then by open military aggression.
The incredibly rapid development of world communications brought all the industrial powers in contact with each other, making conflicts insoluble and wars inevitable. This constant danger of attack from outside forces tremendously accelerated the already existing tendency to concentrate more and more power in the hands of centralized national governments.
Within the nation-states the conflict between eighteenth century doctrines of political democracy and early nineteenth century doctrines of free economic enterprise became even more acute after the first World War, which left all the underlying problems unsolved. In some countries where the pressure was greatest, it led to open repudiation of democratic and liberal political principles and to the establishment of a new creed, which made of necessity a virtue and proclaimed the state as the highest ultimate goal of human society, in absolute denial of the eighteenth century democratic conceptions.
The fact that the conclusions of abstract reasoning and the results of empirical observation coincide is of great help in the correct diagnosis and interpretation of the present world crisis, its causes and its symptoms.
We have seen the irresistible sequence of events which, during the past decades, has led all industrial countries, both capitalist and Communist, toward the all-powerful nation-state, in almost total contradiction to their proclaimed principles.
[ p. 92 ]
Developments during the first part of the twentieth century demonstrate conclusively the fallacy of the Marxist belief that capitalism is bound automatically to be transformed into Communism, that Communism is the natural product and the final result of capitalism.
During the critical twenty-five years between 1917 and 1942, not one single democratic capitalist country has become Communist nor has one adopted government ownership of all means of production. Not one single event has occurred to prove this Marxist doctrine, despite the tremendous efforts of Communist parties all over the world to conquer power and despite the deadly fears of the capitalists that they would do so.
Only in Russia has the Communist system been established, by means of revolution. Now Russia had never been a capitalist, democratic society. It had always been feudal, agricultural, illiterate, a backward conglomeration of peoples ruled by an autocratic dynasty. From the very moment of the Communist revolution—which was in complete opposition to the scientific previsions of Marx, who said Communism would grow out of capitalism and be established first in the most highly industrialized countries—from that very moment the same phenomena occurred as in capitalist countries, the same development, the same transformation, the same irresistible drive .toward centralized bureaucratic state administration.
During those very same twenty-five years, however, about two dozen capitalist, democratic countries became—Fascist
Empirical observation would indicate that the “natural [ p. 93 ] product” of capitalism is not Communism but Fascism. And it seems equally clear that Communism, under certain circumstances now prevailing, moves in the same direction.
The alternative therefore appears not to be “Communism or Fascism,” as was popularly believed between 1920 and 1940. Historical events during those twenty years and political facts irrefutably demonstrate that:
Not one capitalist, democratic country became Communist.
A number of capitalist, democratic countries evolved through parallel processes, toward Fascism.
The only existing Communist country was dominated by the same forces and also evolved into a totalitarian, Fascist state.
History will not describe socialism as having replaced or followed capitalism. Most certainly both will be recorded as parallel phenomena, expressions of one and the same era.
Socialism could not establish itself until capitalism had first begun closely to resemble socialism, until socialism itself had begun to look a good deal like capitalism. It was the transformation of capitalism into a system of economic planning, of cartels, trusts, tariffs, subsidies and other regulations, and of interference by the central political authority that paved the way for socialism. And it was the transformation of socialism from a rigid, egalitarian doctrine into an hierarchical conception with differentiations of functions and income [ p. 94 ] that made socialism a workable reality. Today it is useless to contrast the two systems, as there are many socialist features in the most capitalist countries, just as there are many capitalist features in the most socialist country.
The only conclusion we can draw from these facts is that capitalism and socialism are parallel phenomena intimately blended everywhere; that Communism does not grow out of capitalism; that it can establish itself only by revolution; that within the existing nation-state structure both have a tendency—at the present stage of industrialism—to develop into centralized, bureaucratic and totalitarian regimes.
Simultaneously with this development, a new political philosophy and movement arose—Fascism—proclaiming as an ideal, as a positive aim of policy, the very social order toward which all countries were actually developing. This new Fascist movement, so diametrically opposed to all the fundamental principles of Christianity, socialism and democracy, spread like wildfire around the whole globe.
What is the historic meaning of Fascism?
We cannot answer this question without freeing ourselves from emotional prejudice. It makes for hopeless confusion to allow the terms applied to the major forces of our time to degenerate into fetish words with which to slur each other. We shall get nowhere by calling anyone who is not himself an enterpriser and who expresses doubts as to the wisdom of the political, economic and financial policies of the capitalist countries a Communist; or by calling anyone who dares to remark that Soviet Russia is not quite a [ p. 95 ] perfect Garden of Eden, or that Stalin and his government may not always and in all cases be a hundred per cent right—a Fascist. Emotional outbursts and name-calling cannot help in an effort to analyze and discuss the dominating currents of our time.
We must stop believing that Fascism is the political instrument of a few gangsters lusting for power.
It is also impossible to explain Fascism by social cleavage alone, by class warfare. The liberals say that Fascism is the result of socialism, that socialist doctrines regarding economic planning, public control of production, distribution, etc., lead straight to state domination, totalitarian dictatorship, Fascism.
But there must be a difference between socialism and Fascism. Otherwise Fascist governments, after assuming power, would not immediately dissolve trade unions and labor parties, destroy all the liberties of the workers and persecute all who called themselves socialists or who desire to advance the interests of the working class.
Socialists say that Fascism is an instrument of capitalism, that it is the highest form of capitalism, that its purpose is to oppress the working classes and to prevent their emancipation through labor unions and socialism.
This is an equally shallow point of view. The socialists cannot deny that of their own free will millions of factory workers supported and voted for Hitler, Mussolini and other Fascist dictators, that many trade unions and syndicates joined Fascist regimes and that many socialist leaders became members of Fascist governments. In face of Fascism the cleavage [ p. 96 ] in proletariat ranks is just as wide as in any otter section of society.
Certainly elements of both capitalism and socialism are to be found in Fascism. But its historical and sociological meaning are altogether different and much more significant.
If we try to determine the meaning of democracy, socialism and Fascism, it becomes apparent that under the pressure resulting from the nation-state structure of the world and because of the ravaging wars inherent in this structure, both the democracies and the Soviet Union axe bound to evolve toward Fascism.
Among the three great powers opposing the Fascist camp in this second World War, the Soviet Union, of course, most closely approaches the ideal of totalitarianism, the ideal of a Fascist state, although Soviet citizens would vigorously deny such an allegation. But this confusion of terms is merely the result of a lack of definition. It is a game of words. There is a story about Huey Long which, whether true or not, is extremely symptomatic of our age. When the Louisiana demagogue was asked whether he believed that the United States would become Fascist, he answered: “Surely. But we shall call it anti-Fascism.”
In spite of the innumerable speeches and treatises attempting to define the phenomenon of Fascism—more exactly totalitarianism—it is, even after it has conquered half the world, a nebulous notion, a rather mystical conception. The best definition of Fascism is still the article “Fascismo” written by Benito Mussolini in the Encyclopedia Italiana.
The ideology and the doctrinal foundation of [ p. 97 ] Fascism are admittedly a reaction to developments of the past two centuries. According to Mussolini: "“Fascism is a spiritual conception, born of the general reaction of this century against the sluggish and materialist positivism of the eighteenth century.”
It is also a reaction to the age of reason in the political field. “Fascism is a religious conception in which man appears in his inherent relationship to a superior law, to an objective Will, which transcends the particular individual and elevates him as a conscious member of a spiritual society .”
To induce man—confused and disillusioned by the insecurity resulting from the bankruptcy of democratic individualism in an age of conflicting nation-states—to renounce his individuality and accept complete subordination to the state in exchange for security, Mussolini surrounded the Fascist idea with a great deal of mysticism and sophism.
“The world in the sense of Fascism is not the materialistic world it superficially appears to be, in which rnan is an individual distinct from all the others, standing alone, governed by a law of nature which instinctively makes him live a life of egoistic and momentary self-satisfaction. The man of Fascism is an individual who is the expression of nation and country, the expression of the moral law that binds together the people and generations in one tradition and in one mission, which does away with the instinct of a narrow life of short-lived pleasure, to establish a sense of duty toward a superior life, free from the limits of time and space: a life in which the individual, through self-abnegation, through sacrifice of his [ p. 98 ] own particular interests, even through death, realizes all that spiritual existence in which lies his value as a man.”
And to justify complete political and economic enslavement of the individual, he proclaims: “The individual in the Fascist State is not nullified, rather he is multiplied, just as in a regiment one soldier is not diminished but multiplied by the number of his comrades . . . Outside history, man is non-existent. For that reason, fascism is against all the individualist abstractions based on eighteenth century materialism; it is also against all Utopias and Jacobin innovations. Fascism does not believe in the possibility of ‘happiness’ on earth, as was the desire expressed in the economic literature of the 1700’s. . . .”
But underlying all this dialectic and emotional justification, Fascism has one single purpose, one single thesis, one single philosophy, which is mirrored throughout Mussolini’s long expose defining the doctrine of Fascism.
“Liberalism denied the state in the interest of the individual; Fascism reaffirms the state as the true embodiment of the individual . . .”
“Anti-individualist, the Fascist conception is for the state. It is for the individual only insofar as he coincides with the state, that is with the consciousness and universal will of man in his historical existence…”
There can be … “no individuals outside the state, nor any groups (political parties, associations, trade unions, classes) . . .”
“For the Fascist, everything is in the state, nothing [ p. 99 ] human or spiritual exists, and even less anything of value exists outside the state. In this sense, Fascism is totalitarian, and the Fascist state, the synthesis and unity of all values, interprets, develops and lends potency to the whole life of the people. . .”
“It is not the nation which creates the state. . . . On the contrary, the nation is created by the state, which gives the people, conscious of their own moral unity, a will, and therefore a real existence . . .”
“For Fascism the state is an absolute, before which individuals and groups are relative. Individuals and groups are ‘thinkable’ only insofar as they are within the state . . .”
“The state, in fact, as the universal ethical will is the creator of right . . .”
These categoric declarations make it clear that Fascism is not an economic conception. It is essentially a politico-social doctrine. Its aim is the absolute, untrammeled, totalitarian domination of the nationstate with complete regulation of individual life, the reduction of the individual to serfdom.
But this totalitarian, Fascist state can operate in principle just as well in capitalist economy, with private enterprise and private ownership of capital, as it can function in a socialist system of economy with centralized state planning and state ownership of capital.
Fascism is not a reaction to capitalism nor is it a reaction to socialism.
It is a reaction to democratic individualism, in no matter what economic form, under certain specific political conditions.
[ p. 100 ]
Totalitarian Fascism clearly represents a suppression of the social and economic conflict within the nation-states by bestowing absolute supremacy on the nation-state—the real cause of the crisis—to the detriment of free industrial development—which alone could remedy it.
The strait-jacket of nationalism and the nationstate tends to paralyze political liberty and economic freedom. In the gradual disintegration we have witnessed during the first half of the twentieth century, within one nation-state after the other, a stage was reached in which it appeared imperative for survival of the state to throw overboard the already challenged and distrusted ideals of individualism and democracy, and to establish a clear-cut dictatorship, on the pretext that complete state domination was the only solution to internal chaos and political fratricide.
The real conflict of our age is not between individualism and collectivism, nor between capitalism and Communism, but between industrialism and nationalism.
In recent history and in our own lifetime we have seen that both capitalism and socialism lead to state domination—to totalitarian Fascism. From this empirical phenomenon, we must draw the conclusions we should have reached a long time ago by rational analysis, that Fascism has nothing to do with the form of the economic system—capitalism or socialism—but with its content: industrialism.
We cannot maintain industrial progress within the nation-state structure without arriving at complete state domination and the destruction of political [ p. 101 ] democracy and individual liberty—without arriving at Fascism.
To what purpose is all this mistrust, hatred and fighting between socialists and capitalists, accusing each other of totalitarianism, oppression and exploitation?
The truth is that both are becoming Fascist and totalitarian. It is high time to realize this and to start the common fight for human liberty and welfare, against the common and real enemy—the nation-state.
Both camps are more or less hypnotized by the Fascist reasoning that there can be no individual freedom without “freedom” of the state. Consequently, since the democratic machinery created to express the sovereignty of the people gets out of control as a result of internal crises within the nationstates and government becomes unstable, the view is advanced that the sovereignty of the people is best expressed by the totalitarian state. Indeed, according to Fascist theory, the power of the state is the only criterion of national sovereignty. In this conception, the needs of modern industrialism are completely subjugated to the dictates of an all-powerful nationalism.
Many people have thought, and still believe, that Fascism is the antithesis of or a reaction to Communism. Many democracies on their road to dictatorship have passionately debated whether they were heading toward Communism or Fascism.
People in democracies, who are trying to mate up their minds whether the danger lies in Communism or in Fascism are dreaming of a freedom of decision [ p. 102 ] they do not possess. There is no choice. We are moving straight toward Fascism. To a large extent, we are already there. Even should a Communist revolution succeed in one country or another, it would change nothing in our progress toward totalitarianism. The Communist countries, should there be more of them, would soon join the throng led by the irresistible Pied Piper: the sovereign nation-state.
Prevailing theories about the antagonism of Communism and Fascism are utterly fallacious.
As fallacious is the point of view that Fascism is the antithesis of or reaction to democratic capitalism.
The truth is that neither individualist capitalism nor collective socialism can work within the nationstate structure. Both are marching straight toward totalitarian Fascism. Both are creating Fascism under certain specific conditions, conditions which are activated by nationalism and the nation-state.
If we limit ourselves to a choice between national capitalism, national socialism or national Communism, it matters little which we choose. If it is to be “national” it will in any case be totalitarian Fascism.
In the last analysis, modern Fascism would seem therefore, to be the inescapable result of the conflict between industrialism and nationalism at their saturation point within the framework of a sovereign nation-state, irrespective of whether the economic system is capitalist or socialist.