WHEN AMERICA BECAME SOCIALIST: Keywords: American communism, Fascism and Nazism, Woodrow Wilson, Franklin Delano Roosevelt, Barack Obama, Keynes, Harvard and Columbia, Lenin, Stalin, Mussolini, Erhard, Hayek, Friedman, useful idiots, Fabian Socialists, Bernie Sanders, Edward Markey.

ARE WE THERE YET?

 WHEN AMERICA BECAME SOCIALIST

A Meditation about the new Rise of Communism

by Xuan Quen Santos

WHEN DID AMERICA BECOME SOCIALIST?

    During the last two decades, socialists have again come out from the dark corners of the college watering holes. From pretending to be community organizers they have taken their masks off and admit they are political agitators. It is no accident that it coincides with the biggest decline in educational standards at all levels, led by the formerly respectable Ivy League centers of academic snobbery where “grade inflation” is prevalent. The useful idiots are out led by influencers on Tik Tok. To my dismay, they have been able to make a crack, not a dent, on public opinion only because the language used for political discourse has been altered. It is a plan. I use the word “idiots” in the classical Greek ἰδιώτης (idiōtēs) meaning those who participate by voting irresponsibly in total ignorance and may even exchange their votes for a pittance. The adjective “useful” was added by Lenin who used the Russian word for “simpletons” простаки (prostaki). Other communist leaders used the word “innocent” meaning naïve or sucker in American English.

DOUBLE-SPEAK AT PLAY

    Eric Arthur Blair (1903-1950), the Fabian socialist “Father of Double-speak” who himself wore a mask as George Orwell, said it clearly: “Political language is designed to make lies sound truthful and murder respectable, and to give appearance of solidity to pure wind” (Politics and the English Language, 1946). He was “the” expert. He had been an ardent supporter of Soviet communism after WW I until he saw and experienced the violence and brutality of its actual operation. Blair-Orwell was not alone.

    Like the British Fabians, thousands of disenchanted literati around the world withdrew their enthusiasm for Soviet style of revolution, but most remained convinced “socialists at heart” and continued their activism without admitting their true color. The takeover of western culture and the disguise of a “middle-way” became their new strategy. Cultural change implies a change in the basic beliefs and values of the people. It changes slowly through education, formal and informal. It aims at changing the objectives of the institutions that educate: the traditional family, the community controlled schools and universities, the media, the arts and the churches. What is changed through cultural change is the basic conception of how a community provides its needs and how it is kept together; meaning in “college style” words, its economic and political systems.

    Marxism was flawed from the beginning in 1848. It was only an attempt to transform “history” as an academic discipline into a new science. It was based on an erroneous concept of human nature and on the basic errors of what then was just a beginning exploration into the science of economics. Its historic and contemporaneous data were only Euro-centered when they were in the middle of an era during which political and economic ideas and institutions were in flux; the mercantilist-colonial economies and the ancient regimes of the divine rights of monarchs were collapsing.  What was really taking place in the young United States of America as a new political and economic order was assumed to be a clone of Old England’s decaying system. It was not.

    The exceptional qualities of the new nation across the Atlantic were ignored by the European elites, but not by the common people. At the same time Europe was degrading and losing population, the new United States was experiencing annual population growth rates as high as 16% per year and becoming a super-power. After the Civil War, the re-writing of American history under the Marxist lens had begun spreading in academic circles, fitting the selected facts with the new language into the mold of socialist dialectics. From one generation to the next, the Giant Captains of Industry became the Robber Barons. Revolution became a popular mantra, not only in the labor movement, but among students and academics in the leading colleges and universities.

CALL IT WHAT IT IS

    Marx and Engels are usually pointed as the “modern” starting point of socialism after they cleverly added the adjective of “scientific” to their socialist scheme. They were very clear in their proposal. Socialism would emerge out of the economic conflict between the oppressed proletariat and the oppressor capitalist minority. The conflict -the revolution- would spontaneously end triumphantly in a new form of political and economic system called communism. In their scheme, socialism is the path to the end goal which is communism. This was the design. Any other interpretation is an error believed by useful idiots or a deflection made by cunning comrades in disguise.

There is no difference. There has never been.

 Socialism is not a mild form of a welfare society of free people. It is clearly another path to a totalitarian state where a few manage the lives of the many. In the words of a famous refugee from the Soviet Union, “There is no difference between communism and socialism, except in the means of achieving the same end: communism proposes to enslave men by force – socialism by vote. It is merely the difference between murder and suicide”. Her name was Alissa Zinovievna Rosenbaum (1905-1982). The world is more familiar with her pen name, Ayn Rand. Her novels and movies gave birth to the American Libertarian movement and inspired the generation of the Reagan Revolution.

REVOLUTION BECOMES THE BACK DOOR

    When Marxists around the world came to their epiphany after the Soviet terror, two changes took place. Those that still believed in the religion of violent change by revolution as a method had to devise ways to get it started. The spontaneous Marxist revolution would not happen. Instigation of social conflicts, violence and terror, became the way to “create the conditions for the revolution”. They are the true heirs of the French Revolution’s Reign of Terror. The mobs were unleashed. Their work begins with labor agitation and economic demands at the lowest end of the social structure. In their lingo, they are in the stage of “praxis”; it simply means putting the theory into practice, practicing the revolution. The absurdity of a self-fulfilling prophecy.

    The revolutionaries are pariahs in the moderate system. Their visibility represents a danger to the end-goal. To cohabit, the revolutionaries are usually in disguise, in the shadows and the underground; many of their activities are clearly illegal. But they are always there and will act in support of the fake moderates. The fake moderates nurture and protect the mobs that “spontaneously” support their gradual advances in policy with riots and demonstrations, bombings and even assassinations. The moderates cover up for them; they deny their existence as organizations; they bail them out of jail.

ELECTIONS BECOME THE FRONT DOOR

    Those who accepted that revolutions would not happen saw an opportunity opening in the new castrated constitutional monarchies and new experimental electoral republics that appeared all over Europe expanding the voter rolls. Marxists in disguise began to form political parties and participate as candidates in elections. New labels mask their identity with words such as popular or peoples, democratic, social, liberal, republican (as opposed to monarchies), national, workers or labor, and others that are still in use. In some countries, even the label communist appeared. The combination of social and democratic seem to have been favored in its two forms: democratic-socialists, and social-democrats. The electoral path was open. Gradual adoption of policies that expand the role of government (the political system) in the lives of the people (the economic system) promote greater dependency became their platform.  

MODERATES IN APPEARANCE ONLY

    The apparent “moderation” of the socialists is not totally fake. It is in the interest of the individuals that act “socialist”. They became “rent-seekers”, as the new Public Choice Theory of economic behavior of politicians would call it. As they became part of the political establishment, their leaders received some respectability and resources. They couldn’t look too radical to appeal to the average voter that does not like radical changes. Gradualism was their method and the best way they could milk the system until “the conditions for revolution appear”. National emergencies and crises, such as war or a natural disaster, provide these opportunities. Socialists were paid and shared in the benefits of power. They were corrupted by bribes and adulation. It should be no surprise they always deny they are on the path to communism through false promises made to the voting masses. I will just mention the cases of Senators Bernie Sanders and Edward Markey; both have become multimillionaires during their decades-long activities as elected politicians representing the socialist camp of New England.

    Do you remember when ANTIFA was in the news and US Congressman Jerry Nadler (NY) denied their existence? He categorically stated that it does not exist as an organization, but it is only an idea. That was the party line. Jerry Nadler was member of the Democratic Socialist Organizing Committee shortly after college. He continued as an activist once the Democratic Socialists of America were established, which he conveniently withdrew from in 1999 as his seniority in Congress began to weigh in his public visibility as a Democrat. He is now DSA “in pectore”.

    Do you remember that at the same time when US Senator Tim Kaine (VA) was campaigning as the VP candidate of Hilary Clinton, his son Linwood (AKA Woody) Kaine was detained by the Minneapolis police for throwing bombs at a Trump rally. He was part of a group of eight masked men wearing black uniforms. The incident disappeared quickly from public view.  There is history behind. Tim Kaine says his Harvard sabbatical year in Honduras in the 1980s as a volunteer with the Jesuit missions in the northern rural area was a defining moment in his life of service. That area is where the large banana and coffee plantations operate. He says he spent a year teaching carpentry and welding to boys. Dr. Andrés León Araya, a professor of anthropology at the University of Costa Rica, in his 2015 dissertation at CUNY, describes the work of the Jesuits in the Aguan valley of northern Honduras as “…oriented mainly around organizing and supporting peasant cooperatives.”  He adds “These were all priests influenced by Liberation Theology”. “They were particularly active in the area of political training, especially through their radio schools – teaching reading and writing as the basis for political organization.” They were organizing the communist anti-American labor unions.

A NEW MODEL IS IMPOSED

    The most interesting case is what the British socialists/communists did. They changed the language and continued their true nature operating in disguise. Their logo is still “a wolf in sheep’s skin”. I am referring to the Fabian Society, cradle of the disguised “labor” party, home of Lord Keynes and 3^rd Earl Bertrand Russell, and EVERY British Prime Minister of the Labor Party. It has been the hub of propagandist literati like Sidney and Beatrice Webb, H. G. Wells, Bernard Shaw, and of course George Orwell and Harold Laski, that they have taken over “culture”. The Fabians designed the constitutions used as the models for de-colonization. As such India, Pakistan, half of the Middle East and half of Africa were born socialists in disguise. This explains much of their failure to move forward. The main countries of that list created the non-aligned movement, playing for favors between the Soviets and the USA. They still do even if the brands have changed. Another pretended “middle-way”.

    The British socialists had been early supporters of the Soviet revolution, but became disenchanted once Stalin’s policy of terror was impossible to hide. They had supported the German socialists also. The Fabians had promoted “eugenics” and “social-Darwinism”, which became the “scientific” justification to the German national socialists’ racial policies (NAZI party) that resulted in the Holocaust. The British royals are German, and they had to change their names adopting the name of their castle in the first decades of the XX century. King Edward VIII was a known Germanophile, which may have been another contributing factor in his abdication, lasting as a monarch for less than a year in 1936. WW II changed their alliances. The British socialists took distance from the Germans shortly before WW II began, but acted more discreetly with the Soviets when they became allies during WW II, all the way into the Cold War.

    The British scheme reflects their effort to be in the middle of the road between Stalin’s USSR and Hitler’s German nationalistic (anti-Soviet) socialists. To achieve this, they had to redefine political language with a new model. They began to call the nationalist-socialists Axis powers (German and Italian) with the term “fascist” for extreme right. They intentionally omitted their socialist origin and their anti-Soviet internationalism. It was Mussolini who made the Roman Fasces the Italian brand. On the opposite end of the model, the Soviet communists became the extreme left, representing the internationalist socialists. Where did the Fabians place themselves as the British socialists? In the middle. They have claimed to be the “middle-way” and adopted the “moderate” label of social-democrats.

THE NEW MODEL OF LEFT-RIGHT

EXTREME LEFT

    The Soviet Marxist regime, THE COMUNIST INTERNATIONAL-COMINTERN. Now the heads are New Russia and the Chinese state. The state owns and manages the resources, operates production, and distributes what people need. Private property does not exist. Revolution, war and terrorism are not discarded. Elections and the monetary system are staged only for the existing external public opinion. Lenin explained how he destroyed in Russia any trace of capitalism in a few years: intentional hyperinflation. Aims at a new world order.

Stalin and Hitler were partners as long as Hitler went stayed south

THE MIDDLE WAY

    Proposed in England and Germany after the failures of the Soviet Revolution and the National Socialist regime. It rejects revolution and recognizes the benefits of what they called “capitalism”. It was viewed as a gradual and moderate path to communism. It does not seek total state ownership of the means of production and aims at a “democratic” form of government combining the efficiency of a market economy in production with the states total planning and distributing what people need. A center-left version is Democratic Socialism that aims to a more equal and just society managing the economy "democratically" by worker’s self-management.  A center-right version is Social Democracy that has state intervention in the market economy to reduce inequality, promote social welfare, operate public services, and ensure wealth redistribution through progressive taxation. Any of the many versions that have appeared aim at establishing a “welfare state” as an electoral vote buying scheme. The Middle Way eventually can only be financed by monetary expansion. The most famous Fabian Socialist was Baron, Lord John Maynard Keynes who proposed to better manage inflation to stimulate the economy.

EXTREME RIGHT

    Originally the label applied to the National Socialism (NAZI) of Germany and the Italian socialism labeled Fascism by Mussolini. Their key commonality was their rejection of the Soviet plan of a new global communist order governed by Moscow. Thus, ultra-nationalism was a response that marked their independence. Hitler and Mussolini were thrown into wars by the conditions created by the victors of WW I and the Soviet threat. Both countries established authoritarian governments ruled by a dictator. Both created a war-driven economy but without taking ownership of the industrial base; the government co-managed the system with the leaders of industry. In both countries, socialists existed long before and had been governing. The differences from the left were a clear recognition of the failure of the Soviet economy that resulted from the destruction of what they had called capitalism. Both countries veered to “right” as a result of the failed socialist policies that collapsed the Weimar Republic and the chaotic socialist constitutional monarchy of the Italian Risorgimento.

Mussolini first, then Hitler, began as socialist hardliners, until they chose nationalism
 as opposed to Soviet international domination

THE CLUES ARE IN THE DETAILS

    In the case of Germany, much of the welfare state had previously been created during the agonizing constitutional monarchy and the socialist Weimar Republic. Germany had already invented Social Security. Hitler also inherited a destroyed monetary system with one of the highest recorded hyperinflations in history. Mussolini was still fighting the Middle Ages. Italy as a modern state did not exist as a unit until the US left after WW II in 1946. Rome and the central region had been known as The Papal States for a millennium. Its remnant after a pact in 1929 with Mussolini is a much reduced Vatican City. In the south, the influence of the Spanish royals of the House of Bourbon had continued into the XIX century. In the north, the Royal House of Savoy had become the head of a more or less unified Italy just in 1870. By 1880, long before the Soviet Revolution, the government of the constitutional monarchy had been taken over by socialists. In the chaos that followed WW I, Mussolini, who had been a communist guerrilla, fought against the pro-Soviet socialists and launched his own brand, the "Italian Combat Leagues" (Fasci Italiani di Combattimento). He fought the Soviet promoted industrial riots and in 1922 ended up in control of the government appointed by the king. A few years later, he joined at the last minute Hitler’s forces that were about to defeat France under the condition that he would recover for Italy the northern Alpine and Adriatic territories that had been invaded by Austria and taken from Italy.

QUESTIONS THAT NEED ANSWERS

    From this model, several obvious questions immediately appear. Where are all the other ideologies in the model? Where are the traditional monarchists? Where are the conservatives, classical liberals, liberal-democrats, libertarians and free-market entrepreneurs (Labeled capitalist exploiters by socialists)? Do socialists make a distinction between different FORMS of government, such as tribalism, monarchies, federations, republics, dictatorships, etc.? Do the particular forms of government have their pertaining characteristic economic system?

    None of the other non-socialist political ideologies contemporaneous to Marx, Stalin or Hitler are included. THE IDEOLOGIES INCLUDED ARE JUST DIFFERENT INTERPRETATIONS OF SOCIALIST IDEOLOGY. There is a reason: Marx created an erroneous explanation of the causes of history. He was neither historian, economist nor statesman or politician. He was a student of philosophy that became agitator. He never proposed a form of government. The final formula for organizing that Marx and Engels proposed four decades after evading the questions raised by the Communist Manifesto (1848) simply assured socialists around the world that the state would disappear, would vanish, would wither away…! The emphasis of all the Marxist versions of socialism is on controlling the economic system. They are indifferent to the political system in power. They will infiltrate and take control of whatever there is and lead it to its self-destruction. In the cases of Lenin, Hitler and Mussolini, they took over the agonizing constitutional monarchy that was becoming a parliamentary republic. Elections were the vehicle and then a coup d’etat. 

Keynes "New Economics" of inflation paved the way to war
 as a way to promote the economy and increase the power of government

    England, even today, is a constitutional monarchy with a parliamentary government. Monarchy and socialism would seem an oxymoron to anybody. The king is for the tourists and the useful idiots. The parliamentary government is the state. The last two English governments have been led by the Fabian socialist government under the mask of Labor Party.  This is not new. During the emergence of Lenin, Stalin, Hitler and Mussolini, to the end of WW II (1908-1951), Old England had eleven changes of party in government. Of those 43 years, the crucial years from 1908 to 1922 gave rise to the communist USSR and the Socialist Weimar Republic; liberal socialists were in power. During the next crucial years of Hitler and Mussolini consolidating power (1929-1936) the Fabian socialist Labor party was in power. They were also in power during the partition of Europe and the beginning of the Cold War (1945-1951). The socialists Prime Ministers of those periods lasted several years in their role, while numerous Conservatives lasted less than a year in the periods in between. The Brits parade their royal family as a distractor. They really are under the “big tent of ill-defined socialism”. For decades since the interlude of PM Margaret Thatcher, there is no significant difference between conservatives and labor. They all pretend to manage their socialist economy. During the 43 years between 1908 and 1951, socialists governed for the crucial 27.

A MARXIST DIALECTIC SCHEME

    The new model is simple enough to be implanted in political language. Perfect for useful idiots! But there is more. It is a good example of “dialectic-materialism”, the analytic tool Marx applied to how humans respond as a collective to economic conditions. It was derived from F. Hegel’s dialectic method for studying the changes in ideas. You have probably heard about its components: A thesis is contradicted by its antithesis; from solving the conflicts of the opposing ideas, a synthesis is found that will take the discussion to a higher level. Hegel was an idealist.

    Marx, who was a radical Hegelian in college, applied the method to his analysis of historic material conditions, hence, he gave it the name of “dialectic materialism”. Marx described his times as the beginning of the final stage of history when capitalism would implode. The thesis: Capitalists (The Oppressors) become rich by the systemic exploitation of the proletariat laborers (The Oppressed). The anti-thesis: The proletariat will increase in number and in poverty, becoming alienated. The synthesis: 1) Capitalists will become a few monopolies that will continue to lower wages. 2) The proletariats will organize and rise in revolution that will destroy capitalism by taking over the means of production to be administered by a new form of collective organization called socialism. 3) The next stage appears when the state is no longer necessary. Marx and Engels made such promise in Anti-Dühring (1876): “The state power becomes superfluous, and then ceases to exist of itself. The government of people is replaced by the administration of things and the directing of the processes of production. The state is not abolished, it withers away.”  That stage was given the name of communism.

A LENINIST REVISION OF HISTORY

    Lenin was the master at making facts fit a narrative. The EXTREME LEFT-EXTREME RIGHT model promoted by the deceiving British Fabians required a lot “making the facts fit the narrative”. For the Marxist method of opposites synthesizing into a new and improved system, they had to create the opposites. It was easy to place the Soviet regime on the left. To place the antagonists of the Soviets on the right, they had to alter their description. The first erasure was their origin as Socialists/Marxist political movements; it is never mentioned. The terms NAZI and Fascist were always highlighted. As the NAZI atrocities became identified with Jewish and other minorities for reasons of racial supremacy and hate, the nationalist focus (as anti-Soviet internationalism) disappeared. The new narrative: The Soviets were fighting capitalists for the people, while the NAZI and Fascists were fighting against the people with the capitalists. Because the term NAZI became trapped in the anti-Jewish image, fascist was chosen as the generic insult for the extreme right. 

    If you consult the many definitions of “fascism” and “fascists” you will see that they are an effort to create a category that fits a narrative. It is even used to label historic authoritarian dictators that existed long before Mussolini was born. It is also used to tag any authoritarian leader that fights against communism, or even the “middle-way” commonly described as “democracy”. Not surprisingly, Socialists today refuse to tag Putin as a fascist but they don’t use the term communist. He is now described as a “reactionary” leader of “Putinism”!

In the new language, Fascism is just an insult to anyone that opposes communism or socialism

    For the new model of political language to work, the old occupants had to be evicted (erased from history, eliminated from the common mindset, discredited…). Ultra-right capitalism has to be on the right. Prime Minister Margareth Thatcher, President Ronal Reagan and President Donald Trump have been referred to as fascists.

MONARCHS ARE OUT

    In 2026, there are only twelve European states nominally ruled by a monarch.  The six that count for anything are: The United Kingdom, Belgium, the Netherlands, Denmark, Norway, Sweden, and Spain. All are “toothless” decorative constitutional kings or queens, and some oddities. The oddities that appear on some lists include Luxembourg, Lichtenstein, Monaco, Andorra, and the Vatican. There had been about 60 just two centuries before. Conclusion: the age of European Emperors, Kings and Queens has been over for a long time. They all navigate for their survival the “middle-way” socialism, which includes the Popes since Leo XIII, with the exceptions of Popes Walesa and Ratzinger who lived and suffered the terrors of Stalin and Hitler. Monarchies and their conservative parties were clearly on their way out by 1848. Anarchism, terrorism and revolution did spread in Europe in 1848, but Marx had nothing to do with it. At that time, he was a totally unknown young agitator that was learning from the Paris revolts. By 1848, a third revolt was taking place in France, wrongly identified as a revolution. Marx was one of many useful idiots that got caught in the chaos of the Post French Revolution that was the first revolt. Non-Marxist socialists claim the French events of 1789 as their birth, which is just French propaganda. A real revolution had started in 1776 and had outlined the design of a new and different political system, that even many Americans don’t understand.

Mao Zedong resisted the Soviet expansionism and created his own
version of Chinese Socialism. Is Xi Jinping a fascist?

REPUBLICS ARE IN

    When a lady asked Ben Franklin at the end of the Constitutional Convention in 1789, “What kind of government are we going to have”, his answer was, “A republic madam, if we can keep it”. The follow-up question should have been, “What kind?”. Republicanism can be presented as an ideology only as opposed to monarchism of the absolute kind. When kings are out, republicanism as a political ideology is also out. All modern monarchs are really a monarchic constitutional parliamentary republic. Consider also the name of communist China: PRP, the People’s Republic of China; or the original USSR: Union of Soviet Socialists Republics. The United States of America is a federal republic. The Democratic People’s Republic of Korea and the Republic of Korea are different countries. Can you identify what ideology corresponds to each of them? If you go down the list of about 200 countries that exist today, a large majority claim to be republics. If you try to identify their political ideology from their name you will not be successful. Count how many are using the terms democratic, people’s or popular and you will have included the rest of the declared communist states in existence: Algeria, China, Congo, North Korea, Laos, Sri-Lanka, Ethiopia, Bangladesh, Timor and Nepal.

The USSR did little in WW II, but gained much as gift of the western allies.
On what side was the US State Dept?

    For the EXTREME LEFT/EXTREME RIGHT political model to be confirmed, CAPITALISM had to also disappear into the MIDDLE-WAY, just at the Marxist Soviet system had synthesized into “moderate” socialism. The death of capitalism was one of the many predictions of Marx’s "scientific" socialism that never happened, although it was announced around the world at the initiative of the self-serving Fabian socialists of England. The Fabian model concludes that capitalism has also disappeared and blended into the middle. It was said to happen in the USA.

THE PROPHECY OF 1848 FULFILLED IN 1929

    Marxism forecasted the end of capitalism “by its own internal contradictions” in 1848.  The frequent European wars of the second half of the XIX century culminated in WW I. Each war brought its own monetary and economic crisis. Marxists declared it an inevitable crisis caused by “the business cycle”. This obvious lie has spread. Inflation and destruction have consequences that are not the result of productive business activities but the result of flawed governmental policies that businesses and savers fall victim to. The sequels of WWI came not only with the disappearance of powerful nations, empires and kingdoms; their currencies disappeared too. It came also with the disappearance of political ideas and organizations. The royalists, conservative and classical liberal parties went into oblivion. Revolution, democracy and socialism under many names and masks became fashionable. Monetary inflation was abused to finance war and growing entitlements introduced by a growing electorate of manipulated idiotes. The triumphant powers were the Soviet Union with its international reach of terror, and the United States of America with the strong US Dollar and its peculiar federal constitutional republic. The period from 1848 to 1929 can be viewed from the perspective of stability as a death of capitalism from a thousand cuts. The turning point was 1929.

    On Black Monday, October 28, 1929, the New York Stock Exchange listing of the major US corporations dropped 13% percent. The following day, Black Tuesday, it dropped another 12%. By mid-November, the market value of the corporations had been reduced to half. Panic spread. A liquidity crisis became a banking crisis by the inaction of the monetary authorities of the time.  The decline continued through the summer of 1932, when the Dow Index closed at 41, its lowest value of the twentieth century. The Roaring Twenties wild ride of easy money and expansive government programs that accompanied the WW I effort and the rescue of Europe were over.

    The USA emerged victorious from WW I, even if it was not an American war. The war-effort economy was exuberant. For the USA, the war was short (1917-1919) and limited in cost and extent. The USA entered the war as an "associated power" the year in which Russia (Just transformed into the USSR) withdrew from the front. Internally, victory produced unlimited enthusiasm for a promising future; easy credit and erroneous changes in monetary policy followed, leading to over-speculation and over-investment in some areas which resulted in overproduction and a crash of agricultural prices. A boom had been promoted stimulating what turned out to be over-production, such as in agriculture. Prices fell. The late correction created a liquidity crisis, a credit crunch, insolvency and bank failures. The Dust Bowl appeared in the farmland. Because of the new influence of the US Dollar in the international economy, as the European industrial base and their monetary systems were financed with dollars, the crisis spread around the world. The boom of the Roaring Twenties ended in a record bust. The Marxist prophecy seemed fulfilled.

MARXISTS AROUND THE WORLD PROCLAIM THE DEATH OF CAPITALISM

    On March 6, 1930, The Daily Worker newspaper, founded in Chicago by communists, socialists, union members, and other activists in 1924, described the massive demonstrations that took place in 30 major cities of the USA.  It had been called by the Communist International from Moscow and was organized by the communist parties in many affected countries. Labeled “International Unemployment Day”, it took place as unemployment reached over 7,000,000. The Roosevelt administration expanded the Keynesian tricks to manage the economy, in effect impeding the quick recovery that the free market forces would have launched. The editors, among calls for the final revolution, had this vision of the impending future: “The workers of the whole capitalist world will show the capitalist bosses today that their system of capitalist wage slavery, which has already condemned 7,000,000 American workers to unemployment and hunger, will not much longer be tolerated by its millions of victims. Capitalism has no remedy for the breakdown of its own system of pillage, exploitation, murder, and starvation of the useful members of society. Only the working class, by its own revolutionary action against the capitalist class and government, can and will solve this problem”.

KEYNES COMES TO SAVE THE UNITED STATES

    Declaring Keynes the economist that took the world out of the Great Depression, or calling him the savior of capitalism, or of the United States economy, was a common occurrence until the 1980s. He commanded respect, and his opinions developed a cult-like following among economists until recently. Reflecting what many economists and politicians believed, the historian Steven Pressman named him “the pragmatic savior of capitalism” in his book Fifty Major Economists (1999), reflecting what the economics establishment had been reciting for six decades. The iconic historic figure of Keynes needs to be exposed as a fraud.

    Keynes was not a defender of the market economy. As a good socialist, he always used the term “capitalism” coined by Marx as an insult. He came to bury the very free market economy of the United States and transform it into the “middle-way” socialism he really believed in and supported.

    By the time the Great Depression arrived, Keynes was already a celebrity. He had forecasted correctly the failure of the treaties that ended WW I which led to Hitler’s regime, and would lead to another war. He had been feeding the academic circles with bits of a “new theory” that would debunk the assumptions of the Classic economists about money and prosperity, and the failure of Stalin’s and Hitler’s forms of socialism. 

    As a notorious member of the Fabian Society, he was looking for socialist alternatives to Stalin and Hitler in stealth. His ideas and details kept changing and led to many criticisms. At the same time, the economic crisis became bigger, and the establishment economists were at odds and unable to agree on solutions. Keynes offered hope with a different and new method to solve the crisis. In 1931, he was invited to participate in the famous Harris Conferences at the University of Chicago, then the academic center for new economic views. His presentations and discussions received considerable support for his ideas on counter-cyclical public spending, particularly with economists already influenced by socialist ideas.

    In a speech in Dublin in 1931, Keynes presented his sketchy ideas for what he described as fixing the "decadent international but individualistic capitalism". That year was the peak of the Great Depression; a background he used to publish The Means to Prosperity with specific policy proposals for tackling unemployment in what by then had become a global recession. The book contains many ideas supporting public spending and job creation with one of the first mentions of the “multiplier effect”. Copies were sent to many world leaders, among them the recently elected President Franklin D. Roosevelt. In the desperate moment, his proposals received total attention. Keynes personally met with FDR in 1934. The age of “New Economics” was launched. The cult spread quickly among the New England academic admirers and followers. In 1936, he published The General Theory of Employment, Interest and Money, regarded by many as his most important work.

    The Fabian socialist John Maynard Keynes came from England and saved American capitalism. That is the history fabricated to implant the Middle-Way in the United States of America. He gave us the poison pills of socialism: an ever increasing welfare state financed with monetary inflation.

    The “savior of capitalism” never believed in it. Keynes told the truth about his position before he became a celebrity. On the same year The Daily Worker was established in Chicago, Lord Keynes was clear that his ideas were a way to terminate the defective capitalism his generation had described as being on its deathbed. Marxists had labeled it “capitalism” defining capital as originating in stealing the value of labor. Others had described it as “unbridled selfish individualism” with the French phrase “laissez-faire”. In a lecture he first delivered in 1924 titled The End of Laissez-Faire, Keynes gave birth to the idea of a “mixed economy”, part market, part government control. An excerpt follows: “A time may be coming when we shall get clearer than at present as to when we are talking about Capitalism as an efficient or inefficient technique, and when we are talking about it as desirable or objectionable in itself. For my part, I think that Capitalism, wisely managed, can probably be made more efficient for attaining economic ends than any other alternative system yet in sight, but that in itself it is in many ways extremely objectionable…”

Keynes (L) and Keynes (R)
A debate between the Father of Inflationary Socialism and his
nemesis who proposed a return to sound money out of the hands of government

THE ANSWER TO KEYNES AND HIS THURIFERS

    There are simple ideas to cut through the smoke of incense the Keynes cult has used to cover the naked truth of their intentions and errors.There is an essential contradiction in the idea of a mixed economy, where the government is expected to manage the market. Nobel in Economics Friedrich A. Hayek, who became the academic nemesis of Keynes, and was also his friend and colleague, explained the conflict in the 1940s: the more government plans and decides, the less the citizens can plan and decide. Personal freedom can’t exist in that scheme. In the 1980s, Nobel in Economics Milton Friedman who had become the recognized authority on inflation demonstrating the flaws of Keynes ideas, explained the same contradiction to the leaders of Communist China: The market is a decentralized system that works from the bottom up without anybody directing it; your government operates centrally directed from the top down. There is no reconciling.

Milton Friedman and Zhao Ziyang in 1988 discussing
the market economy as opposed to a state managed economy.

WHERE DO THE MIDDLE-WAY SOCIALISTS PLACE THE USA?

    Beginning with the pro-Soviet and League of Nations policies of W. Wilson during WW I, followed by FDR’s New Deal policies during the Great Depression and the Atomic accommodation with Stalin after WW II, and ending by adding the Nobel for Socialism to Obama before he launched the Great Recession, it became obvious to the world that the socialist establishment of Europe was under the impression that the United States of America had already joined the socialist Middle-Way on the path to communism.

What do you think?