as never before while going deeper into debt and being made to think that it was normal to do so. If monopoly-finance capitalism thrived on its capacity to create a more acquisitive society, America’s capitalists broke new ground to facilitate it.
Unprecedented prosperity brought equally daunting challenges. Even more than their immediate predecessors who had elevated America to the status of a world power, the captains of industry and finance could not rest on their laurels. Simply put, the tremendous leap in production during the 1920s raised the bar on its mandate to sustain profitability. To that end, capitalists needed to find new outlets for productive investment by making more of the same goods for expanding markets, or newer goods to replace older ones in existing markets—or both, ideally. Every goal reached in the production and sale of goods became a new starting point, and failure to reach beyond it would bring overproduction, declining wages, underconsumption, and, consequently, declining profits. This was the sine qua non of monopoly-finance capitalist enterprise: do whatever is necessary to drive further capital accumulation or face the onset of a crisis.
Consequently, all the nation’s leading industrialists agreed that the public had to keep buying. But not all recognized the new market imperatives that accompanied the success of expansive and profitable production. Though the Ford Motor Company had mastered production methods and processes from start to finish, Henry Ford was adamant that most of it go into the making of a single car, the Model T, so he could sell it for the lowest possible price. In 1908, its first year in production, the car sold for $845. When Ford himself drove home the last of the line in May 1927, more than 15 million had been made and the selling price had dropped to less than $300.32 Ford had built the world’s greatest integrated production plant, on the Rouge River in Dearborn, Michigan. To make cars, he had bought up whole forests for wood and coal fields for the power he needed. He also built a steel plant as part of the Rouge River complex. Ford’s success was astounding. The company produced 1,250,000 cars in 1920, one every 60 seconds. Five years later on a single day, one Model T rolled off the assembly line every 10 seconds.33 To ensure continued success, Ford did everything possible to increase production and lower costs. He hired experts in scientific management to determine how much movement to allow workers on the assembly lines and rammed cars down the throats of dealers regardless of their inventories. Ford even paid his workers higher wages in the belief that they would buy products like his for the cheapest possible price. By 1927, there were more Model T’s on the roads than all other cars combined.
But for all his success, Ford had resisted two key requirements for sustaining profit in the booming 1920s—installment credit and customer satisfaction. According to historian Geoffrey Perrett, Ford opposed the first because he hated debt of any kind, the second because the puritan in him could not see beyond simple utility. Fiercely independent and ever the mechanic he had been in his youth, Ford’s actions in the face of rising competition seemed like those of a man who believed he could solve all the challenges of capitalist production and exchange in his own head. Eventually, he would lose ground to General Motors, which had created its own financing company in 1919 and committed itself to making improvements and variations that consumers came to demand during the 1920s. Only in 1927, when sales dropped significantly, did Ford give up on the Model T by shutting down operations in the spring, laying off 40,000 workers until the new Model A was ready for marketing by the end of the year. Then, quite uncharacteristically for Henry Ford, the new car was unveiled amid great clamor in Madison Square Garden on December 1.34
Ironically, the man who had pioneered mass production of the decade’s most important durable commodity came late to an understanding of the market conditions of the New Era. The imperatives of capitalist enterprise were expanding in relation to the volatility of the market. The war had created unprecedented growth and contributed to greater concentration of wealth and political power. Now, given the challenge of adjusting to peacetime, competition among leading capitalists compelled them to go beyond their predecessors and develop even greater control over the market. Their approach to this challenge took two distinct forms that marked the onset of fascist processes in the U.S. epicenter of the world capitalist system.
TERRORIST AND NON-TERRORIST FASCIST PROCESSES
In a qualitatively new way, state power defended the capitalist class from the surge of working-class upheaval in 1919 and 1920. By 1922, the Harding administration had finished the job of taming American labor. Business-friendly Republicans in government at all levels had done this by often resorting to violence, sometimes paying vigilante citizens’ groups to do their dirty work against strikers, union organizers, and radicals. The combination of brute force, use of the legal system, and the ideological push by the NAM, the Chamber of Commerce, and other trade associations crippled labor for much of the decade, though periodically powerful strikes did occur. These were among the mechanisms of repression or terrorist processes created by monopoly-finance capitalism between 1919 and 1929.
It was also during the seven-year period of the Great Boom that the U.S. bourgeoisie advanced capital’s control over society through persuasion and manipulation. These were the non-terrorist processes that were most advanced in the capitalist epicenter.35 Mass production and consumption on a hitherto massive scale required more than the political coercion of labor. Capitalist rule over the market and society, which depended on the circuit of capital operating at successively higher levels of investment, distribution, profit, and reinvestment, could no longer rest on the use of force alone. Though the means of deploying the latter was always present to capitalists and their managers of state power, the need to do so once the boom got underway was minimal. More important, the drive for capital accumulation and profit expanded the properties of commodity production and exchange, in accordance with the explosive growth of the market and demands to maintain it. Mass production on a level never before attained now required mass consumption to follow.
Clearly, the spectacle of abundance created in the boom helped to make this possible. The appearance of so many new and tantalizing consumer goods, and the belief that they could be acquired and enjoyed by everyone, constituted the material basis for an ideological justification that was crucial to the success of the boom. A revolution was occurring in capitalism, its ideological proponents declared, but only in the United States where they convinced millions of Americans to believe that the great promise of universal prosperity was at hand because the boom-bust cycles were a thing of the past. This went along with the creed of 100 percent Americanism whereby everyone who worked hard to fulfill his God-ordained mission on earth could become a capitalist. The main task of the capitalist class and their able assistants was to convince enough Americans that the New Era would eventually create universal wealth. All their efforts had one thing in common: to remove all resistance to the drive for capitalist accumulation. This made their objective the total domination of capital over society and the individual.
For these reasons, American capitalists turned to advertising, “the sword arm of business,” as it became known in the 1920s. “Thanks to advertising,” wrote the journalist and author Silas Bent in 1927, “a penny’s worth of germicidal value in a nationally known antiseptic is marketed for $95; flimsy wood is sold as good furniture; and six-dollar shoes are sold at twelve dollars.” But the sword itself was double-edged, especially in newspapers where there were two kinds of news, one that disseminated useful information about events or circumstances on the basis of a “natural demand” for it, the other the result of sheer salesmanship.36 For Bent, the gathering and packaging of 90 percent of the news by the ever-growing centralized ownership of newspapers and magazines was based on its “pecuniary advantage” in some form or another.37 Thus the mission of the newspaper business was above all to advance readership on the basis of understanding how to package and sell news. Moreover, it relied on public opinion experts like Walter Lippmann, who argued that it was necessary for elites to “manufacture consent” for a public that could neither see nor understand the world clearly.38 As a result, news stories increasingly came to depend on ways to hold the reader’s attention. The need to captivate, entertain, sensationalize, and titillate the reader was similar to the approach used by advertisers to promote their commodities. As Bent explained, “The merchandiser of manufactured commodities uses methods quite similar to the merchandiser of news.”39 Here was one kind of ballyhoo that made capitalism functional and kept the Great Boom