The American billionaires who fell in love with fascism are not the first

INVEST IN FASCISM – “The abuse of buying and selling votes crept in and money began to play an important role in the decision of the vote. Later this process of corruption spread into the courts and the army and finally, when even the sword was enslaved by the power of gold, the Republic was subjected to the rule of the emperors.” —Plutarch, Gaius Marcius (Coriolanus)

“The liberty of a democracy is not secure if the people tolerate the growth of private power to the point where it becomes stronger than their democratic state itself. This is in its essence fascism – the control of the government by an individual, group, or other controlling private power.” – Franklin Delano Roosevelt, April 29, 1938 (Message to Congress)

In Adam Tooze’s book The Wages of Destruction: The Making and Breaking of the Nazi Economy, there is a remarkable description of a meeting in February 1933, shortly after Adolf Hitler was elected Chancellor of Germany. It is remarkable because it took place nearly a century ago, a prelude to one of the darkest chapters in world history. It is a time that has been thoroughly historicized; yet there is something eerily familiar and current about it.

The newly installed Nazis summoned the oligarchs of German commerce and industry – Krupp, the heads of IG Farben and the largest steel companies, and others – to Hermann Göring’s estate outside Berlin so that Hitler could “explain his policies.” While the moguls (out of respect for their financial power) expected a dialogue, Hitler arrived late, gave a lengthy speech, and left without answering questions.

The influx of donations from big business was crucial to the Nazi victory in the elections of March 1933, the last competitive elections in Germany for the next twelve years.

The deal, as Hitler’s subordinates explained to those present, was this: he had just promised the oligarchs that he would end parliamentary democracy, smash the Communist Party and destroy independent trade unions. Elections were to be held the following month; the part of the deal the capitalists made was to pay with very large political donations. It was not a question of whether they should pay, but whether they had to pay; what better return on capital could the captains of industry ask for?

And they paid off: in the weeks that followed, millions of Reichsmarks flowed into the coffers of the Nazi Party, which had previously been severely underfunded. Tooze believes that the influx of donations from big business was a decisive factor in the Nazis’ victory in the elections of March 1933, the last contested election in Germany for the next twelve years.

Fast forward to 2024. In April, Donald Trump met with oil executives at his Mar-a-Lago estate in Florida. After hearing one executive complain about allegedly excessive fossil fuel regulations, Trump surprised the group with a blunt proposal: raise a billion dollars and send him to the White House, and the oil industry would get everything it wanted, from repealing emissions regulations to eliminating incentives for electric cars. It would be a “deal” the industry could not pass up.

Press reports on the exchange noted industry executives’ surprise at the blatant transactional nature of Trump’s offer, though it seems odd, if not disingenuous, why they felt it necessary to issue that disclaimer. As a former congressional staffer, I’ve learned one thing: A meeting with a representative of a business interest always comes with an implicit quid pro quo. The reluctance to disclose a cash transaction is merely the lobbyist cloaking his greed with a facade of decency.

Popular opinion has come to associate rich people so much with reactionary or even fascist policies (Mr. Potter in It’s a Wonderful Life is a perennial favorite) that we may no longer understand the reasons for this. The rich themselves, or at least most of them, have long believed that any regime to the left of Dwight Eisenhower could not only ruin the economy but also unleash Bolshevik mobs to storm millionaires’ mansions and murder them in their beds. (Although Robert Welch, the wealthy founder of the John Birch Society, claimed that Ike himself was a “committed, conscious agent of the Communist conspiracy.”)

The contradiction is that several sources say economic growth in the United States has been substantially better under Democratic presidents than under their Republican counterparts. The New York Times estimated in 2021 that average annual GDP growth since 1933 has been 4.6 percent under Democratic administrations and 2.4 percent under Republican ones. That growth rate is almost double—are the rich blind to it? (If so, they are not the only ones: polls consistently show that the public falsely believes the economy is doing better under Republicans than under Democrats.)

An objective view of the facts is as unlikely for the moguls of society as it is for the general public. A tycoon may be a genius at making widgets or vaporware, but that doesn’t mean he understands the workings of the world’s largest economy (although his ego may trick him into thinking he does). Myth-encrusted beliefs like the story of Horatio Alger can trick a wealthy businessman into believing that a booming economy with full employment can inherently undermine the entrepreneurial spirit and drive of the rabble.

Hence the popular economic doctrine among libertarian writers (the champions of the rich) that depressions are a “healthy” correction to excess wealth, especially when it has been achieved through Keynesian economic theory. This was also the policy advice given by billionaire Andrew K. Mellon, Secretary of the Treasury from 1921 to 1932, to President Herbert Hoover at the beginning of the Great Depression: “Liquidate labor, liquidate stocks, liquidate farmers, liquidate real estate. That will wipe the rot out of the system. High costs of living and high standards of living will fall. People will work harder and lead more moral lives. Values ​​will be adjusted and enterprising people will pick up the debris left by less competent people.”

The rich rarely hold back from preaching moralizing to those less fortunate. It helped that, even though his own fortunes might have taken a small hit, Mellon would never stand in a unemployment line or eat at a soup kitchen, just as those who engineered the 2008 financial crisis on Wall Street were far less likely to suffer its consequences than the people they tricked into taking out subprime mortgages. (Mellon, who pushed through huge tax cuts for the rich in the 1920s, was also one of the instigators of the wealth bubble that led to the 1929 financial crisis.)

Like relapsing heroin addicts, the oligarchs are flocking back to their Trump high and their vision of paying no taxes.

We may reasonably assume that those who occupy the highest offices of capital have reasons not to worry too much about the macroeconomic situation. These reasons are based both on ideological (strong individualism and the character-building effect of poverty on others) and on objective circumstances (they are the last to suffer from depression). We might even speculate that their compassion for the oppressed is extremely limited.

The captains of industry and finance typically run their companies like a ship’s captain: a dictatorship. If this model works for them, why not for government? It is the cliche of intellectual laziness that “government should be run like a business.”

This may explain the love affair between American moguls and fascist dictators. Henry Ford’s admiration for Hitler is well known, and that admiration was mutual. Thomas W. Lamont, the JP Morgan banker highly influential in government circles, described himself as “something of a missionary” of Italian fascism and considered the Italian leader “a very decent guy” who had “done a great job in Italy.” In 1938, on the eve of World War II, Fred Koch, father of the Koch brothers, built an oil refinery in Nazi Germany, just when Hitler most needed high-octane fuel for his war machine.

It’s the same today. After January 6, wealthy donors found it politically expedient to distance themselves from Donald Trump and other Republicans who supported the insurrection. But like relapsing heroin addicts, the oligarchs are flocking back to their Trump high and their vision of paying no taxes. Politico’s headline says it all: “Never mind: Wall Street titans put aside their scruples and embrace Trump.”

How fitting, then, that Timothy Mellon, Andrew K.’s grandson, is now in the news. His political views suggest that he is the reincarnation of Old Man Mellon: “In a self-published 2015 autobiography, Mellon referred to the Social Security system as ‘slavery reux,’ adding, ‘For voting in federal elections, they are rewarded with more and more freebies: food stamps, cell phones, WIC payments, Obamacare, and on and on. The largesse is funded by the hard-working people, whose numbers are dwindling and who are too honest or too proud to be allowed to sink into this morass.'”

You can probably guess how this story ends. On May 31, Mellon wired an unprecedented $50 million to a dark money group supporting Trump. The stated date of the donation was one day after Trump’s conviction on 34 counts of fraud. It’s a warning of how wealthy sociopaths intend to bury what’s left of our tattered democracy forever.

(Mike Lofgren is a former Republican congressional staffer who served on both the House Budget Committee and the Senate Budget Committee. His books include The Deep State: The Fall of the Constitution and the Rise of a Shadow Government (2016) and The Party is Over: How Republicans Went Crazy, Democrats Became Useless, and the Middle Class Got Shafted (2013). This article first appeared on CommonDreams.org.)