of social wealth, to increase the mass of human beings exploited by him, and thus to extend both the direct and the indirect sway of the capitalist.”43
In the decline and decay of monopoly-finance capitalism and imperialism, the highest and final stage of capitalism, as Lenin had argued, is where we find the germ of fascism in American capitalism during the period between the two world wars. From the standpoint of the present crisis of American and world capitalism, it is now evident that fascist processes aimed at the domination of capital over labor were embedded in capitalist production, in what Corey observed as “the perpetual struggle between the forces of expansion and decline.” As Corey says, “Accumulation tends to outstrip itself and limit the means of profitably investing capital, which results in a periodical overproduction of capital goods.”44 Since profits depend on the ability of capitalists to enlarge their markets to absorb the rising output of consumption goods, the failure to sustain this movement eventually compels capitalists to cut back on the production of capital goods.
Overproduction of capital goods reveals why capitalism is utterly contradictory at its core and inherently prone to crisis. This, Corey states, is “the real element” of capitalist decline:
Capitalist production tends to exhaust the long-time factors of expansion and to limit, at first relatively, then absolutely, the possibilities of economic advance. Capitalist production must yield profits and these profits must be converted into capital by means of an increasing output and absorption of capital goods. This is the accumulation of capital.45
The contradiction of supply outstripping demand is only made greater with economic growth and the concomitant advance of concentrated wealth and power—monopoly—which ultimately gives way to breakdown, crisis, and the threat of declining profits. “Monopoly answers the threat with control of markets, higher prices, limitation of output, and relative or absolute restriction of progress in technological efficiency.” For Corey, “this is an element of decline, as it emphasizes the incapacity to develop fully all the forces of production and consumption.” Instead of fluidity in the movement of capital required for further accumulation, monopoly instead becomes more rigid in the face of mounting contradictions in production and exchange, imposing greater controls over the domestic economy while seeking to counter the forces of decline with the export of capital abroad—in a word, imperialism.46 Throughout, capital strives to exercise greater control over all aspects of social and political life. These efforts, which are ultimately grounded in the fundamental contradiction between capital and labor, generate fascist processes aimed at the domination of the former over the latter.
From its very beginning, American fascism reveals in embryo the basic contradiction between capital and labor in the context of an unprecedented empire that defined the epoch of monopoly-finance capitalism and the contemporary world experience. In the U.S. epicenter during the 1920s, fascist processes inhered in the expansion and complexities of production and exchange, creating greater wealth and poverty at once and thus at every turn requiring mechanisms of repression at home and the ability to deliver militaristic clout whenever necessary in its imperial designs. To that end, the expansion of the means of production in the domestic economy also brought growing displacement of labor. This required capitalists to rely on the powers of government to defend their interests by disciplining and punishing the political forces of labor by whatever means necessary, while pioneering ways to persuade and manipulate mass consciousness through advertising, public relations, and propaganda.
Indeed, the global crisis of the 1930s brought fascism to power in its most brutal form in Germany. But political economy reveals fascist processes deep in U.S. capitalism a decade before Hitler’s rise, in the intensification of irreconcilable contradictions between capital and labor that also signaled the coming of the American Behemoth now fully upon us today. Fascism inheres in the processes of monopoly-finance capitalism that inevitably create a general crisis of the system, and from it the plausibility for a crisis of class rule that ends in a revolutionary reconstitution of society, socialism, or the savagery that is fascism, which leads to the common ruin of the whole society. This is a tragic hallmark of capitalism in the contemporary world.
3—The Spectacle of Prosperity and Necessity of Spin
THE GREAT BOOM of the 1920s created a spectacle of prosperity based on America’s extraordinary capacities as the epicenter of the world capitalist system. Economic growth between 1922 and 1929 was unprecedented, at times breathtaking, and incessantly transformative. Much of what remained of traditional nineteenth-century American society was swept aside in a whirlwind of change. The once vital role of the petty-bourgeois merchant and small family farmer was fading into history. Capitalist innovation in the means of production seemed to ensure the promise of endless prosperity in the New Era. Mass production, urbanization, and the impact of the automobile and the radio were redoing the physical and mental landscape. Socially mobile Americans, especially those in the rising boomtowns, found pleasure in the swirl of products that seemingly made life more exciting and vivid. The dazzle of it all was reflected in a new obsession with fashions, sports, movies, music, and booze. The businessman was the new American hero, even Christ-like. There was so much ado in the constant movement of things and people that one could be easily lured by the mysterious powers of the commodity. As Marx and Engels first described the sweeping powers of industrial capitalism:
Modern bourgeois society with its relations of production, of exchange and of property, a society that had conjured up such gigantic means of production and of exchange, is like the sorcerer, who is no longer able to control the powers of the nether world whom he has called up by his spells.1
In 1920s America, the capitalist spell had become so intoxicating that millions of Americans believed they were living as individuals never had before. Many more held out the hope that their turn would come. Indeed, a new, more enjoyable lifestyle was enough to convince some that capitalism had changed in a revolutionary way by becoming what it was always supposed to be: democratic.
But to sustain the boom required just the opposite. The First World War had turned the capitalist road into a highway. The partnership of government, business, and labor required for wartime production had expanded the force field within which capital could accumulate. State intervention into the private economy was welcomed by Big Business, making both even stronger in the postwar decade as a more powerful form of capitalist rule emerged. The requirements of capitalist accumulation only furthered the concentration of wealth and centralization of Big Business, its power expanding over the rest of society in ever-totalizing forms. From a capitalist state compelled to raise production and productivity to construct the war machine while still providing maximum profits to capitalists, the U.S. government became the manager for plutocracy that was making business all-powerful in its own right. The conscious aim of three Republican presidents was to promote a policy of laissez-faire in domestic and foreign policies that belied the potential might of a capitalist empire on the rise.
The Great Boom established the basis for a belief in the possibility of abundance, endless prosperity, and the promise of a qualitative advance in material comfort for all Americans. Delivering it was another matter. The extraordinary development of technology and innovation in management caused the fixed component of constant capital, machinery, to rise at the expense of its variable constituent, labor. This meant that production would inevitably deliver far more goods than the mass of people could consume. Without any consideration of this and other contradictions, capitalist leadership quickly became convinced that prosperity required the selling of ideas as well as things. In the marketplace of the New Era, it became as important to constantly remind the consumer that he or she needed a new car, radio, household appliance, or mouthwash as it was to make any of them. While the creation of material abundance on a hitherto unknown scale was indeed a remarkable feat, the more enduring achievement of the American capitalists was the genesis of marketing as an industry unto
