Are We Flirting with Fascism?

Folks are loose with 'fascism'. The cops are fascists because they're cops. Bush was a fascist because he blew new life into the military-industrial complex and herded protesters into “free speech zones.” And now, Obama is a fascist for sacking the executive of a private corporation and saying the government will back the warranty for your Yukon Denali. Is this fascist?
Fabio Rojas says no. He says fascists want to control capitalism, “but mainly as a tool for nationalism and clientelism, rather than redistribution.” He goes on:

Instead, we’ve got “quarterback capitalism.” The idea is pretty simple: don’t challenge the major features of capitalism, but opportunistically fix what you can with buy outs, loans, subsidies, and other ad hoc interventions. Reminds me of the great quarterback Randall Cunningham, who could scramble his way out of any mess. The idea behind Bush-Obama policy is that what ever mess you’ve got, you can probably fix with the right hodgepodge of incentives. The Federal government is the nimble quarterback who can get you out of the squeeze.
With regard to GM, Obama didn’t do what the fascists actually did – which was to make everyone dependent on the state so they could engage in militarism. Basically, the current strategy is to do what one can to save the financial and manufacturing infrstructure of United States, but not in ways the challenge the underlying structure. Better regulations for banks; new management for the auto people; a little help for homeowners. For GM, it was pushing out old management in exchange for money, a typical move in the private sector. Whether this is good is certainly for debate, but it certainly isn’t a return to fascism, socialism, or laissez-faire economics.

Sheldon Richman's Concise Encyclopedia of Economics entry says:

Where socialism sought totalitarian control of a society’s economic processes through direct state operation of the means of production, fascism sought that control indirectly, through domination of nominally private owners. Where socialism nationalized property explicitly, fascism did so implicitly, by requiring owners to use their property in the “national interest”—that is, as the autocratic authority conceived it. (Nevertheless, a few industries were operated by the state.) Where socialism abolished all market relations outright, fascism left the appearance of market relations while planning all economic activities. Where socialism abolished money and prices, fascism controlled the monetary system and set all prices and wages politically. In doing all this, fascism denatured the marketplace. Entrepreneurship was abolished. State ministries, rather than consumers, determined what was produced and under what conditions.

If Sheldon's right, it's hard not to see the U.S. moving in a fascist direction. The government is indeed in the business of setting some prices and wages politically, which is troubling. But it's pretty clear that we're still pretty fully in the “mixed economy” mode. As Richman writes:

Fascism is to be distinguished from interventionism, or the mixed economy. Interventionism seeks to guide the market process, not eliminate it, as fascism did. Minimum-wage and antitrust laws, though they regulate the free market, are a far cry from multiyear plans from the Ministry of Economics.

Yet I think it's clear that we are in fact seeing fascism in vitro, though I don't think that's anyone's intention. Nevertheless, we'd better swallow some gunpowder pretty quick. Like Tom Palmer, I find it extremely troubling to see Barack Obama talking like he personally looked over the GM situation and finally made some decisions because that's obviously his job, to be the decider, and because the managers of private corporations can't possibly do the right thing. It's a very, very, very bad precedent. Tom says:

I was so happy to see the back of George W. Bush and his administration, with their disregard for the Constitution, foolish and unnecessary war, attempt to subvert habeas corpus, reckless spending, and overall arrogance and disregard for limits on power. His successor has decided to follow even more carefully the examples set by Benito Mussolini and Vladimir Putin, and has sacked the head of a company. That is a decision for the shareholders of a private firm to make, not for the head of state. What next? Will private firms end up in the hands of friends of the president? Will the White House Chief of Staff serve simultaneously as head of a major state-directed company? Will journalists who criticize the president end up shot in the head in elevators?

I predict that the answer to Tom's three concluding questions will be “no.” That doesn't mean they don't need to be asked. It happens, and it can happen here. Asking these questions helps ensure the answers will be “no”, prepares us to stand up against overweening power. But it ought to make you a bit sick that it has become  necessary to say that, no, the President doesn't run everything. Perhaps we're getting “quarterback capitalism” and not yet “fascism,” but it's still pretty troubling to anyone with a liberal bone in his body.

Author: Will Wilkinson

Vice President for Research at the Niskanen Center