the 1930s and early 1940s that Big Business or the business system was primarily responsible for the genesis of fascism in the United States. In the process, I discovered a most striking feature about American fascism—its utterly disguised character. This was clear to Dwight Macdonald in his introduction to Daniel Guerin’s Fascism and Big Business (1939): “Our fascists,” Macdonald wrote, “not only don’t (yet) wear brown shirts; they proclaim themselves ‘anti-fascist’ as well as ‘anti-communist’ and march under the banner of ‘liberty’ and even ‘democracy.’” For Macdonald, here was the real danger:
By spot-lighting the secondary characteristics of European fascism, such as Jew-baiting and book-burning, without exposing its class roots, the false impression is built up that such manifestations are something unparalleled in the history of “civilized nations.” This makes it easy to divert the energy of the American working class and its liberal supporters into a crusade against overseas fascism, while our own ruling class is left in power, undisturbed, biding its time to introduce fascism over here when the situation demands it.2
Macdonald’s was one of many voices warning that fascism would come in the name of anti-fascism; that is, it would be presented as True Americanism. At the same time, he affirmed what his contemporary, the eminent Marxist philosopher and social theorist, Max Horkheimer, said when he declared that “whoever is not prepared to talk about capitalism should also remain silent about fascism.”3
FASCISM AND THE WORLD ECONOMY: THE UNITED STATES AS CAPITALIST EPICENTER
This book builds on the seminal contribution of the sociologist Walter Goldfrank, who employed in 1978 the perspective of world-system theory to argue that fascism was caused primarily by the global economic contraction during the interwar period that accelerated a shift in international relations. Goldfrank reminded his readers that fascism was a unique product of contemporary world history. A global economic crisis had damaged the international order and especially Great Britain, whose domination over the world market was by then nearly eclipsed. What made the capitalist world system less stable was the war of positioning between three rising and competing world powers that challenged Britain’s declining imperial reach: a semi-isolationist United States that had already surpassed Britain as the new hegemon; the Soviet Union, the leader of a global revolutionary-socialist alternative to capitalism and imperialism; and Nazi Germany with its sudden rise and horrific hegemonic designs of its own.4
According to Goldfrank, fascism emerged in the three zones of the world capitalist system—core, semi-periphery, and periphery—in the first half of the twentieth century. Each zone was determined by the level of capital formation, from the highest form in the core nations, to those in the semi-periphery where capitalism was less developed and therefore at times dependent on the core for capital, to poorer countries and colonies in the periphery, which had no capital of their own and depended entirely on the core and semi-periphery. Fascism had emerged for the first time in Italy, which Goldfrank considered part of the European semi-periphery because its capital formation was lower than the dominant core powers of Great Britain and France, its European allies during the First World War. Soon after the war ended, a postwar economic crisis developed in Italy that threatened the political position of its ruling classes, not all of them fully capitalist. For Goldfrank, Mussolini’s coming to power was something of an experiment, the same position taken by a leading communist writer and theorist in the mid-1930s, R. Palme Dutt, who asserted that Italian fascism had “developed only in an experimental stage in a secondary capitalist country.”5 What both said about Italy was striking because it provided another way of thinking about the first fascist regime in history. Italy’s semi-peripheral status in the world capitalist system, which reflected that country’s weak capital formation, certainly played a huge role in determining fascist forms and processes. For one thing, Mussolini and the primarily middle-class movement he led came to power without protracted struggle, in part because Italy’s ruling classes were weak and quickly fell into line. The impotence of the Italian state corresponded to the weakness of Italian capital in relation to the more entrenched landowning class and other traditional elites in the army and the Catholic Church. Capital’s weak hold on Italy explained why the driving force of fascism came from a movement led by a fiery demagogue whose political rise subsumed the power of the ruling classes quickly.
Could the same be said of Germany? Here again, the actual developments during the 1920s confirmed Goldfrank’s assertions. The political turmoil of a fragile economy made shakier by the French occupation of the Ruhr in 1923 and the passive resistance of German industrialists and workers to it, fueled one of the worst inflationary runs in history. Only massive loans by American bankers the following year stabilized the Weimar Republic. For the next few years, American investors provided huge loans to German public credit institutions, local governments, and large corporations.6 As a result, the dependence of German capital on American bankers made it semi-peripheral to the United States. When the Wall Street crash signaled the global crisis, the dependency of German capital on U.S. bankers permanently destabilized the economy and opened the door to a rising middle-class movement, primarily the lower-middle class, led by Hitler. For Germany, the historical circumstances differed from Italy’s only in scale. Capital formation in Germany was far greater than in Italy, thus its fascist development was more advanced. From Goldfrank and Dutt, we understand that fascism came to power in Germany because it had arisen in a dominant capitalist country as a result of the global crisis. Given its greater capitalist strength, parliamentary rule lasted longer in resisting fascism. Once American capital was withdrawn after 1930, Germany’s capitalists could not sustain their class rule without Hitler, who saved them in 1933 when he came to power.
Goldfrank’s approach to fascism established two criteria for comparing different forms of fascism on the world stage in the 1920s and 1930s: first among its various forms in the core, semi-periphery, and periphery, and then within each zone. Here was a way to determine similarities and differences of fascist and non-fascist responses to acute crisis conditions developing in the world capitalist system. The specific forms of fascism that emerged in Italy and Germany reflected their respective levels of capital formation, and how existing conditions and circumstances determined their standing in the capitalist core. What Goldfrank failed to do on the basis of the same logic was to show how the world crisis that began in the United States, the new epicenter of the world system, determined its particular form of fascism.
Goldfrank’s world-system approach provides us with insights into the origins of American fascism. Did the absence of a mass movement in the United States on the level of Germany’s mean there were no fascist processes? Or did they take other forms? Given its position as the epicenter of world capitalism, where the concentration of capital was the greatest, did fascist processes emerge from the needs of U.S. capitalists themselves? To answer these questions required an inquiry beyond descriptive comparisons. Having theorized that fascism in all its forms were products of the world capitalist crisis, Goldfrank omitted the United States, where a number of writers during the 1930s and early 1940s had already made the connection. Having argued that every manifestation of fascism should be examined in relation to the world capitalist system, however, he made no effort to examine how many observers saw its particular form developing in the United States.
Failing to do this, Goldfrank simply submitted to the reigning paradigm that Baran had criticized nearly thirty years earlier, concluding, “If no serious fascist movement had arisen in the twenties, the effects of the Depression were not by themselves so severe as to generate more than echoes and imitations” of those that had developed in Italy and Germany.7 Yet his analysis of fascism as a world-system theorist suggested otherwise. Based on its dominant position in the world-capitalist system, American fascism would differ from Italian and German forms because its level of capital formation was the most advanced, the highest in the world-capitalist system. As my study shows, this was indeed the case. Whatever the shortcomings, Goldfrank’s analysis still validated Horkheimer’s claim in a stimulating and profound way, and confirmed the approach Gregory Meyerson and I would take in 2008 about the plausibility of fascism in the United States.8
A crisis in the world-capitalist system was indeed the efficient cause for the global development of fascism during the interwar period—and beyond.9 Based on what American