Introduction
The concept of "fascism" typically conjures up the authoritarian and nationalistic regimes of Mussolini's Italy and Hitler's Germany. However, fascism also includes a significant economic ideology: corporatism. This model, focusing on the coordination and integration of economic sectors within the state, significantly influenced the interwar economies of both Italy and Germany. Despite criticisms of the coercive tactics employed under fascist regimes, corporatist ideas have impacted various economic systems worldwide, including the U.S. economy, evident in President Franklin D. Roosevelt's New Deal, which aimed to address The Great Depression.
The New Deal's establishment of government programs and institutions to revitalize the economy shares similarities with corporatist ideals, even as it pursued democratic and reformist objectives. Senator Bernie Sanders' economic policies have revived debates on the government's role in the economy. Sanders, often linked with democratic socialism, pushes for greater government engagement in promoting social welfare and mitigating economic disparity. While his approach diverges from the corporatism of fascist regimes, it aligns with the New Deal in advocating for state involvement in economic security and public welfare. Sanders' “Democratic Socialist” initiatives, such as universal healthcare, tuition-free public colleges, and robust climate measures, is more accurately known as Social Democracy, the Nordic Model, or Social-Corporatism. This situates him in the Social Democratic political tradition, which, while supportive of social welfare policies, still largely operates within a capitalistic framework.
Why Sander’s is a Social Democrat
The Connections and Similarities to Corporatism
In the 1930s, the economic doctrines of fascism entranced some thinkers in the U.S. and Europe. Personalities like U.S. Ambassador to Italy, Richard Washburn Child, and Winston Churchill in the pre-WWII era, admired elements of Mussolini's governance. Domestically, Lawrence Dennis championed an American-adapted fascism, critiquing liberalism's focus on individual rights as a barrier to societal progress. In the UK, figures like George Bernard Shaw and Sir Oswald Mosley supported fascism, with Shaw finding common ground between his communist beliefs and Mussolini's policies, while Mosley advocated for a British variant of fascism. Mussolini's Italy elevated the state as central to individual and collective life, directly challenging the classical liberal value of individual rights. Modern American discourse often revisits this conflict between state oversight and individual freedom, scrutinizing the role of government agencies, the prospect of compulsory national service, and the scope of regulatory powers, assessing if such state actions impinge on freedoms the U.S. Constitution seeks to protect.
“As a red hot Communist, I am in favour of fascism. The only drawback to Sir Oswald's movement is that it is not quite British enough.”
— George Bernard Shaw quoted in Socialism and Superior Brains: The Political Thought of Bernard Shaw by Gareth Griffith
British fascist Oswald Mosley hanging out with Roosevelt
Fascist corporatism under Mussolini called for extensive state involvement in the economy. This level of state intervention, including government-led economic planning, exceeds the scope of social democracy endorsed by figures like Senator Sanders. Although Sanders advocates for heightened government activity in economic management to bolster social welfare and reduce inequity, his proposals are less invasive than fascist corporatism. Sanders promotes broadening the social safety net and enhancing economic prospects within a democratic context that respects individual liberties and the role of market dynamics, contrary to the fascist corporatist state that heavily regulated economic sectors to align with state objectives, often sidelining market operations. The corporatist economic framework in Mussolini's Italy demanded organized state participation in economic affairs, with the state devising an overarching economic policy. This historical model resembles current proposals in the U.S. for a national strategic economic plan, championed by liberals like Robert Reich and Ira Magaziner, where public-private partnerships—central to economic corporatism—involve significant state sway over private ventures.
During Italy's Fascist period, the economy was marked by substantial state command and structuring. Businesses were consolidated into state-sanctioned syndicates, such as the "National Fascist Confederation of Commerce," and became part of an extensive corporatist regulatory system. This corporatist network, governed by the "National Council of Corporations," held considerable regulatory authority. The system aimed to encourage state-guided cooperation among various sectors of production, reinforcing the state's goal of a cohesive economic policy. In this setup, the private sector's role was contingent upon its alignment with the state's definition of the "national interest."
A diagram of the Fascist economic structure
In assessing the degree of state involvement in economic affairs, a comparison with the economic policies of the New Deal reveals a more tempered application of government influence. The New Deal, crafted as an urgent response to the economic turmoil of the Great Depression, instituted an array of government initiatives, infrastructure projects, monetary reforms, and regulatory frameworks. In contrast with the corporatist economic model of Fascist Italy, which enforced the subordination of private enterprise to state directives, the New Deal's aim was to rejuvenate and fortify the American economy through actions that, although interventionist, maintained the bedrock principles of democracy and the market economy.
Regulatory entities instituted by the New Deal, such as the SEC and FDIC, were designed to ensure market oversight and continuity, but they refrained from asserting full governmental dominion over the private sector. Public works initiatives generated employment and propelled economic activity, but this did not equate to the government's direct operation of economic sectors. In essence, the New Deal represented a diluted adaptation of corporatist economics, one that employed government intervention as a tool to reinvigorate and reform the market apparatus rather than to completely reengineer it in the interest of the state.
Current debates about the role of government in industry in the U.S. reflect the idea of state-led collaboration with the private sector. Figures like Reich and Magaziner have called for increased central coordination in public-private partnerships to meet industrial objectives. Echoing this, the AFL-CIO has recommended forming a National Industrialization Board comprising labor, business, and government to jointly craft economic policies. Similarly, the Center for National Policy in Washington, D.C., has promoted a report by business leaders endorsing this collaborative model. Although the Department of Labor, endorsed by figures such as Reich and Sanders, is sometimes critiqued as an instrument of economic fascism, it is fundamentally aimed at safeguarding capitalism while ensuring fair work standards.
Sanders has championed the idea of more democratic workplaces by supporting employee ownership through cooperatives and advocating for worker representation on corporate boards, as well as pushing for laws to increase worker input in company decisions. Interestingly, the Fascist economic system in Italy also engaged in what appeared to be a democratization of the workplace, involving a complex network of syndicates and corporations overseen by the National Council of Corporations and regulated by the state through the Institute for Industrial Reconstruction. In 1922, the National League of Cooperatives and Mutual Aid, demanded official recognition from Mussolini, which was granted once they excluded communist participants. Following these adjustments, the cooperatives flourished under Fascist rule. Thus, while there was Fascist support for worker cooperatives in the 1920s, the ultimate control still lay with state supervision.
“Ideologically the Italian cooperatives benefited from Fascist propaganda. Mussolini pointed to them as examples of the ideals of corporatism. They embodied worker participation, non-conflict relations between labor and management, and the withering away of class identification.”
— Sharryn Kasmir, The Myth of Mondragon
The "Rebuild America" initiative, influenced by thinkers including Reich, calls for increased cooperation among government, industry, and academia. This initiative imagines a framework where the government establishes "national goals and targets" to guide investments toward achieving strategic national priorities. When considering partnerships with the private sector, it is important to critically examine the true motivations behind these collaborations. The language of "national collaboration" and the emphasis on broader national interests can occasionally conceal underlying protectionist.
The concept of Gleichschaltung, entrenched in German electrical jargon for unifying control through a single mechanism, was first introduced by Franz Gürtner. It refers to the processes of alignment and uniformity, symbolizing the comprehensive organization of all societal facets in line with governmental directives, while quelling any resistance. This notion entailed the restructuring of German institutions to function in lockstep under the tenets of Nazi ideology, fostering a society that functioned in concert with the state. Similarly, the economic structure of Nazi Germany reflected aspects of the Italian model, with thinkers like Paul Lensch advocating for a collectivist strategy over individualistic pursuits. National Socialist philosophy demanded individual aspirations be subordinated to the collective welfare, prioritizing communal responsibilities above personal liberties. The state mandated a system of collaboration between enterprises, government entities, and labor, structured through local economic chambers and governed by a central economic command.
A diagram of the Nazi economic structure
In a 1935 issue, The Economist offered a critique of Italy's corporatist system under fascist governance, characterizing it as an overly bureaucratic network that tended to advantage large industrial enterprises, fostering monopolistic conditions. However, Mussolini's ambitions for Italian fascism were even more radical than simply distorting competition. The ultimate objective was the thorough subordination and eventual eradication of the private sector, transforming it into a fully state-managed economy to eliminate capitalist elements and achieve national self-reliance. Mussolini openly recognized the dependency of certain Italian industries on state aid, admitting that many were sustained by government subsidies, effectively functioning as conduits for corporate welfare. This tactic was part of a progressive transition toward the full socialization of the economy, as the fascist government aimed to consolidate all facets of production and distribution under state oversight, with the ultimate goal of creating an autarkic economy detached from capitalist dependencies. This strategy involved making most enterprises dependent on a handful of government-owned cartels, while also subjecting them to the control of a corporatist syndical framework.
“The Fascist State directs and controls the entrepreneurs, whether it be in our fisheries or in our heavy industry in the Val d'Aosta. There the State actually owns the mines and carries on transport, for the railways are state property. So are many of the factories… We term it state intervention… If anything fails to work properly, the State intervenes. The capitalists will go on doing what they are told, down to the very end. They have no option and cannot put up any fight. Capital is not God; it is only a means to an end.”
— Benito Mussolini quoted in Talks With Mussolini by Emil Ludwig
This historical scenario is markedly distinct from government-supported economic actions in the United States, such as agricultural subsidies, Export-Import Bank assistance, and corporate rescues. Although these interventions impose a fiscal impact on American taxpayers and can alter market dynamics, they operate within a capitalist context that upholds private ownership of the means of production and maintains the essence of a market-driven economy. Contrary to the comprehensive and revolutionary agenda of Italian Fascism, these contemporary U.S. policies do not represent a systematic dismantling of capitalism; instead, they are targeted interventions meant to stabilize or bolster particular industries within the overarching capitalist structure.
The New Deal in the United States brought about a heightened level of collaboration between the government and the private sector to tackle the economic downturn. This increased interaction did not lead to the complete merging of state and corporate entities as witnessed in the fascist regime of Italy, but it did create a closer bond that sometimes allowed individuals to switch between public service and private sector employment, a process known as the "revolving door." This phenomenon is concerning to some, as it may lead to a conflation of public and private interests, with public servants potentially making decisions that favor future or past employers in the private sector.
The structure of the NRA
A 1930s illustration depicting the corporatist elements of the New Deal period, prior to the NRA being declared unconstitutional
This trend was particularly evident in areas with substantial regulation or government contracts, such as the defense industry, prompting speculation about whether decisions made by these individuals truly served national interests or were swayed by industry agendas. The New Deal's policies, designed to combat the economic challenges of the Great Depression, resulted in a government-industry relationship that raised familiar concerns about the potential for conflicts of interest. Fascist economic thought diverges markedly from capitalism, advocating for a state-centric approach that includes protectionism and nationalization. In this system, the populace is expected to serve the state's aims, contrasting with the capitalist belief in the state's service to its citizens. Fascism centralizes control over resources, opposing the decentralized competition inherent in free markets. Advocates like Lawrence Dennis have critiqued the liberal capitalist model, which emphasizes market autonomy and competition, suggesting instead that the state should manage the economy for national goals.
“Thus we shall see what fascism has to do to make a system of private ownership and management workable, so far as arrangements involving capital income or reward are concerned. The ruling principle must be that capital and management reward must be kept in continuous and flexible adjustment with economic possibilities, and that legal and institutional arrangements — like loan contracts, bonds, legal concepts of just compensation, due process of law, and confiscation — must not obstruct executive action of government to maintain this adjustment otherwise than by the present devices of bankruptcy, foreclosures, reorganization, and cycles of booms and depressions.”
— Lawrence Dennis, The Coming American Fascism
Sanders, who has voiced criticisms of certain capitalist practices, stands apart from the economic approaches of fascism. His approach to democratic “socialism” is centered on correcting the disparities that exist within capitalism, preferring to reform the system rather than overhaul it in favor of a state-dominated economy. Instead, Sanders supports a form of capitalism that is infused with social policies designed to ensure fairness and provide protection for those at risk, thereby striving to create a more just economic landscape. Consequently, Sanders is better characterized as a proponent of progressive reform within capitalism, rather than an advocate for the wholesale economic overhaul that was characteristic of fascist regimes.
The economic platform of the Nazi party in 1925 advocated for significant state involvement in the economy to ensure that individual corporate interests were subordinated to the wider public good. Their policies called for the end of unearned income, the nationalization of land, and the establishment of an extensive state welfare system. They also supported profit-sharing within enterprises to better align workers' interests with national prosperity. While Sanders also endorses state intervention and regulation, the principles and ends he pursues are distinctly different.
The labor reforms carried out under Mussolini's and Hitler's regimes aimed to enhance workers' lives, introducing measures such as labor courts, standardized employment contracts, and consistent wages. Additionally, both regimes created social and recreational programs—Italy's Dopolavoro and Germany's Strength Through Joy — to organize leisure activities for workers. They also implemented versions of socialized healthcare to ensure a robust working population. These German and Italian policies were even considered by members of Roosevelt's administration as potential improvements upon the perceived deficiencies of the New Deal.
In the modern context, Sanders, from a democratic perspective, champions goals that resonate with improving worker welfare, reminiscent of the spirit behind those historical policies. His push for a higher minimum wage, stronger labor unions, and broader healthcare access mirrors the welfare orientation of past policies. Sanders also advocates for paid vacation time, a concept that aligns with past leisure initiatives. However, it's important to note that Sanders' approach and intentions are firmly based on democratic principles and processes, distinguishing them from the fascist context.
“Formally, indeed, the organization of social services is impressive. All workers are entitled to insurance benefits in the event of industrial diseases and accidents, to old-age and invalidity pensions, and to insurance against tuberculosis. A substantial number are insured against unemployment. Small supplements to the wages of laborers with large families have also been introduced. Women workers are entitled to maternity benefits. Voluntary sickness funds have been set up by business firms and the syndical organizations. Furthermore, the Government has fostered a number of social-welfare institutions. The most important of these is the Dopolavoro, or Leisure-Time Institute, which provides its members with admirable opportunities for education, sport, and recreation. By 1938 it had more than 3,000,000 members. Fascist youth, maternity, and infancy organizations are said also to have made material additions to the well-being of workers.”
— Carl Schmidt, The Corporate State In Action
“Few Germans could afford to travel prior to Hitler’s chancellorship. In 1933, just 18 percent of employed persons did so. All were people with above-average salaries. The KdF began sponsoring low-cost excursions the following year, partly subsidized by the DAF, that were affordable for lower income families. Package deals covered the cost of transportation, lodging, meals and tours. Options included outings to swimming or mountain resorts, health retreats, popular attractions in cities and provinces, hiking and camping trips. In 1934, 2,120,751 people took short vacation tours. The number grew annually, with 7,080,934 participating in 1938. KdF “Wanderings"-- backpacking excursions in scenic areas— drew 60,000 the first year. In 1938 there were 1,223,362 Germans on the trails. The influx of visitors boosted commerce in economically depressed resort towns…
In its endeavors to fully integrate labor into German society, the KdF introduced cultural activities as well. Its 70 music schools offered basic instruction in playing musical instruments for members of working class families. The KdF arranged theater productions and classical concerts for labor throughout the country. The 1938 Bayreuth Festspiel, the summer season of Richard Wagner operas, gave performances of Tristan und Isolde and Parsifal for laborers and their families. The KdF also established traveling theaters and concert tours to visit rural towns in Germany where cultural events seldom took place.”
— Richard Tedor, Hitler’s Revolution
Mussolini offered praise for Roosevelt's Looking Forward, identifying elements of fascism in its advocacy for state involvement in the economy. In a separate critique of Henry Wallace's New Frontiers, he recognized similarities between the agricultural strategies outlined and his own approach to corporatism. Mussolini intrigued Roosevelt. In a private conversation, Roosevelt disclosed to a journalist from the White House that he was in regular communication with the esteemed Italian leader. Rexford Tugwell, a prominent advisor to Roosevelt, struggled to hide his admiration for the efficiency and modernization efforts of Mussolini's Italy, declaring it the most impeccably managed social system he had ever witnessed, one that even stoked his envy. Certainly, there appears to be a direct line of continuity between the two systems?
“You want to know what fascism is like? It is like your New Deal!”
— Benito Mussolini quoted in Mussolini In Mr. New York: The Autobiography of Grover A. Whalen by Grover Aloysius Whalen
During the 1930s, facing the Great Depression, Italy, Germany, and the United States each launched ambitious public works and stimulus programs to rejuvenate their economies. Mussolini's Fascist Italy set the precedent, embarking on grand projects like draining marshes and building new cities to symbolize a fascist rebirth and stimulate employment. Nazi Germany, drawing inspiration from Italy, initiated large-scale works like the Autobahn through the Reichsarbeitsdienst, tying economic stimulation to militaristic aims. The United States, observing these international trends, enacted Roosevelt's New Deal, which included job-creating agencies such as the WPA and PWA and undertakings like the TVA for both economic and infrastructural improvement. These programs were not only practical responses to economic crisis but also reflected a mutual influence as each country observed and adapted strategies that appeared successful elsewhere, showcasing a complex web of economic and ideological exchanges. Sanders, has even been a long-time proponent of large-scale public works programs similar in spirit to the New Deal.
An American film on the economic improvements of Italy under Fascism
On the Nazi economic miracle
The initial perception of fascism was not marred by the negative connotations it carries today. Key figures like Rexford Tugwell, an FDR advisor, saw merit in Mussolini's early efforts, and Lorena Hickok, close to Eleanor Roosevelt, even toyed with the idea of a fascist movement in the U.S. Unsurprisingly, Roosevelt appointed the retired military officer Hugh Johnson, a West Point alumnus with a career that culminated in a general's rank, to oversee the NRA program. Admiring the corporatist approach of Italian Fascism, Johnson circulated The Italian Corporative State, a book written by one of Mussolini's preferred economists Fausto Pitigliani, even handing a copy to Labor Secretary Frances Perkins to share with other Cabinet members. The Nazi press celebrated Roosevelt's policies for their likeness to National Socialist doctrine, favoring the collective over the individual.
“The Reich chancellor requests Mr. Dodd to present his greetings to President Roosevelt. He congratulates the president upon his heroic effort in the interest of the American people. The president’s successful struggle against economic distress is being followed by the entire German people with interest and admiration. The Reich chancellor is in accord with the president that the virtues of sense of duty, readiness for sacrifice, and discipline must be the supreme rule of the whole nation. This moral demand, which the president is addressing to every single citizen, is only the quintessence of German philosophy of the state, expressed in the motto ‘The public weal before the private gain.’”
— Adolf Hitler letter to U.S. Ambassador Thomas Dodd on March 14, 1934
From Ward Price's interview with Dr. Joseph Goebbels on April 7, 1933. The English voice-over was created with AI technology
During the 1930s, critics of Roosevelt's NRA likened it to the growing fascist movements in Europe, suggesting it mirrored authoritarian tendencies. However, Roosevelt made a point to publicly disassociate himself from fascist ideologies in 1938. In contrast, fascists initially did not express antagonism toward Roosevelt until it became evident that he planned to extend understated support to the Allies in the realm of international politics. For those interested in delving into the similarities between Roosevelt's New Deal, Mussolini's fascist regime, and Hitler's National Socialism more, Wolfgang Schivelbusch's book Three New Deals: Reflections on Roosevelt’s America, Mussolini’s Italy, & Hitler’s Germany, 1933-1939 comes highly recommended as a resource.
“Along with currency manipulation, the New Deal introduced to Americans the spectacle of Fascist dictation to business, labor, and agriculture.”
— Herbert Hoover, Memoirs: The Great Depression 1929-1941
Besides the critique from former Republican president Hoover, the American left voiced its own concerns about Roosevelt's policies. Following his inauguration, the Communist party USA quickly denounced Roosevelt's government as fascist. In newspaper advertisements on May Day 1933, they preemptively attacked Roosevelt's New Deal, suggesting it was a step towards fascism and war, even going so far as to label him a "fascist dictator." They highlighted the implementation of "forced labor for the unemployed" and the forceful quelling of agricultural labor strikes in California as proof. Historian Richard Hofstadter noted that other leftist critics drew parallels between the NRA and Mussolini's corporatist model. Left-leaning publications like The Nation and The New Republic voiced fears that the Civilian Conservation Corps (CCC), with its military structure, could push the United States toward fascism. To alleviate these fears, the Roosevelt administration emphasized the CCC's civilian character and voluntary participation, in stark contrast to compulsory youth programs in Nazi Germany. Norman Thomas, the Socialist party leader, did not label Roosevelt as a fascist but observed similarities in economic policy; European fascist leaders had adopted corporatism, a system he believed Roosevelt was mirroring with his own policies.
Adding to this, the Soviet concept of “Social Fascism,” which posited that social democracy or moderate socialism could serve as a stepping stone to fascism by stabilizing capitalist systems in crisis. From the Soviet perspective, Roosevelt's reforms could be seen as an embodiment of Social Fascism, as he attempted to salvage capitalism by introducing state intervention and welfare measures, delaying the inevitable proletarian revolution and inadvertently setting the stage for more oppressive forms of governance. The Soviet view interpreted Roosevelt's policies as an inadvertent alignment with the very fascistic principles he sought to avoid.
“Social-Democracy is objectively the moderate wing of fascism.”
— Joseph Stalin, Concerning The International Situation
Sanders' economic policies, though anchored in progressive egalitarian values, is the very notion of Social Fascism, levied by the Soviets in the time of FDR that aimed to reshape capitalism to forestall its failure, thereby possibly impeding more profound systemic transformation. His policy outlook contains elements of nationalism, which is evident in several of his proposals. For example, Sanders advocates for a more robust immigration system intended to shield American workers from the potential economic disruption due to unchecked migration of labor.
In a discussion with Vox, Bernie articulated that:
“Open borders is a Koch Brother’s policy…That’s a right wing policy that says essentially there is no United States… it gets rid of the concept of a Nation-State.”
— Bernie Sanders quoted in Democrats Have Lost Their Way on Immigration
Bernie Sanders, diverging from many liberal viewpoints, believes that there is a core American population that requires safeguarding. His approach to trade is in line with this belief, as he has been a vocal opponent of free trade agreements. Sanders argues that such agreements, although potentially beneficial for the global economy, often come at the expense of American workers. He has criticized NAFTA, TPP, and PNTR, suggesting that they harm domestic labor. His perspective has an interesting historical echo; his emphasis on economic nationalism and the significance of nations beyond mere economic units recalls the protective stances of past movements. Indeed, Sanders' economic nationalism struck a chord with a part of his base, evidenced by the 12% of his primary voters who swung their support to Trump's nationalist campaign in 2016, attracted by Trump's similar nationalist-populist discourse.
Nazi Germany and Fascist Italy aimed for economic self-reliance, implementing autarky and protectionist strategies to shield their economies from foreign uncertainties and to minimize reliance on potential foes, especially in preparation for war. Their economic model relied heavily on imposing high tariffs and setting import limits. This approach was in line with a severe anti-immigration policy, marked by a xenophobic and racist outlook. They enacted stringent immigration laws, claiming to protect local jobs, which reflected their wider goal of economic and racial self-isolation. Since July 2018, there has been no employment growth for native-born Americans. All new jobs created in the last four years have been filled by immigrants. This reflects issues akin to those raised by Mussolini and Hitler, possibly giving some weight to the anti-immigration sentiments advocated by Sanders followed by Trump.
Conclusions
In modern economic discussions, we find renewed interest in interventionist policies reminiscent of the 1930s, albeit less extreme. Today's U.S. policies echo the NRA’s balanced regulatory framework, which merges market functionality with social support programs. Critics, particularly from communist circles, draw parallels between current policy proposals, by Sanders, and a moderate form of fascism. Sanders advocates for more government intervention but not for a full-scale market revolution. There's a growing faction of younger Democrats pushing for deeper socialist reforms, advocating for collective ownership and a greater emphasis on public welfare—principles rooted in socialism, sharing many commonalities with the corporatism found in fascist ideology.
While Sanders points to America's historical choice of progressivism over fascism, his proposals today represent a cautious reform of capitalism, perhaps to crush a working-class Revolution? Yet, his use of “Woke” rhetoric has sparked division among workers, and there are concerns that his policies may not fully tackle the underlying causes of social disparities, potentially leading to greater discord. Sanders' shift from earlier nationalist stances reflects the Democratic party's move away from its previous associations with patriotism and exclusionary policies, into a position that is seen by some as anti-American. Despite not being a communist, Sanders faces such labels from some party members, raising questions about the establishment Democrats perception of both his agenda and more radical ideologies like fascism and actual communism.
The Democrat Bloomberg labeling Sanders a communist
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