Why Fascism Instead of Communism?
WE HAVE now given ultimate values and the force factor sufficient consideration to be warranted in assuming that the field is cleared of many of the most confusing and frequently advanced objections and supposed alternatives to national planning and what it necessarily involves. We are therefore ready to engage in some wishful formulation of values for fascist planning for the United States. We shall assume that an ideal fascism for America must provide for maximum economic production and consumption with a steady rise in living standards and a progressive expansion of productive plant, all without either a class or civil war or the expropriation of all private rights in the instruments of production. The alternatives of such a formula seem to be only those of making liberal capitalism work better or accepting communism, the emergence of a triumphant dictatorship of the proletariat from a bloody class war and expropriation of all private property rights in producers goods. It is appropriate at this point in the discussion to undertake some explanation why the fascist formula seems preferable to the communist formula. This explanation is particularly indicated in connection with a statement of the radical ends and means embraced in the fascist plan.
Now the ideals of order and planned abundance are not, as ideals, peculiar to fascism, liberal capitalism, or communism. Many readers will undoubtedly find fault with this book for not being a detailed outline of a fascist utopia and for having too much to say in the abstract about fundamentals, ends and means. The chief reason why so much is said about fascist social philosophy, and so little about an ideal or probable fascist handling of specific problems, is that it is mainly in the discussion of fascist philosophy that this book can be useful. Most socialists and radical would-be reformers within the liberal framework naively assume that the ideals of social order and welfare are peculiar to their philosophy, and they spend a lot of time telling us in glowing detail exactly what they would like to see happen, without conceiving that most people would also like to see these ideals realized. The problem is how to realize these ideals, and that problem is one of social engineering rather than technology. And when you talk social engineering, you must talk social philosophy before you can draw blue prints. The solution involves radical social or political changes rather than technological rationalization. (We are now beginning to make use of the term rationalize in a different sense, in the sense in which industries are said to be rationalized when they are reorganized in the most rational way to make means serve ends.) Industry is highly integrated. It is organized for perfect centralized control. It has no fixed constitution or aversion to daily improvement and readjustment. Indeed, it furnishes for social organization a model of rationality or aptness of means to ends.
Both fascism and communism are, in the technical sense of the term, radical schemes for rationalizing the social machinery, just as the engineers have rationalized the machinery and technology of production. By rationalization we mean, in this connection, organizing and operating productive instruments in the most rational way for the productive ends which they are supposed to serve. Obviously there is no unique scheme of social rationalization. There can be as many schemes of social rationalization as there are schemes of objectives to be sought in the social order.
As for realizing the ideal of maximum production, and raising living standards, we have to guide us as to the technical possibilities a wealth of useful studies and persuasive propaganda. We are not dependent on Marxian communism either for rational exposition or popularization of the ideal of material abundance. To men like Stuart Chase, Veblen, John Dewey, and some of the more serious thinkers associated with movements like the late Senator Long’s Share the Wealth Movement, Father Coughlin’s Social Justice Movement, the La Follette crusades, Technocracy, Major Douglas’ Social Credit Plan, the Farmer Labor Party, the Utopians and the Epic Planners, is due more credit than to the Communists for the familiarization of the American public with the ideal of greater material abundance.
Even many of the orthodox and professional economists are beginning to recognize and proclaim, with due reserves and modesty, the rationality of the ideal of maximum output, as well as to intimate (most guardedly, to be sure) certain radical changes looking to that end. An interesting and important trilogy of current economic studies by the professional economists and statisticians of the Brookings Institution, on America’s Capacity to Produce, America’s Capacity to Consume, and The Formation of Capital, while making no such extravagant claims for our productive capacity as $20,000 a year for every family, such as was made by some of the more exuberant Technocrats, indicate that about twenty per cent of our 1929 potential productive capacity was unused. Had we used only this productive potential and distributed the product to the poorest families, we need not have had any family incomes below $2,000. As it was, in 1929 we had sixteen million families, or fifty-nine per cent of all the families, with incomes under $2,000, twelve million families, or forty-two per cent, with incomes of less than $1,500, and nearly six millions, or more than twenty-one per cent, with incomes of less than $1,000 a year. There is reason to guess, on the basis of many estimates, that our productive plant could be made to furnish every family with an annual income of $5,000 within ten years of reasonable expansion and rationalization of industry. A minimum family income of $2,500 seems a comparatively easy objective for attainment within two or three years. A study, entitled The Chart of Plenty, by Harold Loeb and Associates, a national survey of potential productive capacity carried on under C.W.A. with responsibility to F.E.R.A. and the New York City Tenement House Department, and many other studies of a similar import, afford a fairly well documented basis for many generalizations which, for sake of brevity, will merely be mentioned here to indicate broadly the possibilities of increasing our total production and consumption.
Professional economists have, as a whole, always been agreed that there is no such thing as over-production. And the most orthodox of them will go further and say that just before the collapse of a business boom there is under-production to maintain the capital values then imputed to property. As for overproduction, it can be said that, from a humane viewpoint, up to date there have been both under-production and under-consumption for a satisfactory standard of welfare.
A routine circular (No. 296 of November 1933) of the United States Department of Agriculture on Diets for Four Levels of Nutritive Content, and Cost, studied in combination with official figures of agricultural acreage and production, will establish the conclusion that, if the entire American people enjoyed a liberal diet, we should have to increase our acreage under cultivation by 40 million acres, instead of withdrawing So million acres from production, as Secretary Wallace concluded we should have to do unless tariff reduction enables us to dump abroad about twice as much of our cotton and wheat as present exports allow. If everyone were adequately equipped with clothing, our cotton production of 1929 would have to be increased to supply the domestic demand. In housing, the deficiencies are too apparent to the hurried glance of a traveller through our cities and towns to make any figures or elaborate details necessary to establish the point. In education, the capital outlay in 1934 was only twenty-seven per cent of what it was in 193o. In 1931-34, two thousand rural schools in twenty-four states failed to open, and over two million children missed schooling altogether.
Without piling fact on fact, or figure on figure, to support an obvious generalization, we may say that there can be no question either as to our need or capacity for increased production. The only real problem in this connection is that of mobilizing our productive factors and keeping them active. It is precisely at this point in the quest for planned abundance that fascism imposes itself as the only alternative to communism.
The choices we have are in the development of social machinery to make our material machinery give us the standard of living we desire. A fallacious assumption of all liberal reformism is that if the people can be induced to give, through a decisive majority vote, a mandate to their government to bring about some ideal measure of social justice and economic abundance, and if education and moral indoctrination inculcate the right attitudes, this mandate can be carried out within the framework of existing institutions and ways. To prove this assumption, they pile up irrelevant statistics and talk learnedly in the several jargons of the social and natural sciences. They quite simply do not take account of the fact that a better social order requires, in the field of social institutions, ways, attitudes, and mechanics, not only new objectives but a driving force, a guiding hand, and a coordinated system of control. Utopian wishes do not furnish a driving force. A series of majority votes arrived at by the parliamentary or Congressional methods of majority group pressures, lobbying, and the individual pursuit of reelection by hundreds of office holders, do not constitute a guiding hand. And a political system of checks and balances is not coordinated control.
The driving force of any national undertaking may be called nationalism, patriotism, love of country, consciousness of kind, and loyalty to kind, or by any one of countless other terms or phrases. The reality which unites and animates a group in a feeling of solidarity, and in an enterprise of common interest, is too traditional, too universally felt and manifested, and too inevitable, to call for any attempt at exact definition. Communist Russia operates as a nation, and is driven by the dynamic force of national patriotism, or love of country and loyalty to kind, quite as much as any fascist country, or any liberal country in time of war. Little need be said by way of attempt to explain why and how this force will animate an American fascism. The generative sources of this force are inherent in every nation. It is necessary only to tap them and provide an orderly system through which they can flow. We do not need communism to get the forces of nationalism, and communism cannot provide a substitute for those forces.
Now communism professes to derive its driving force from the will of the workers to overthrow the rule of the owners of property, and substitute that rule with the dictatorship of the proletariat. As a matter of fact, of course, communism in operation has been a series of phenomena whose driving force has been derived from two main sources: First, the personal motivations, too complex always for brief analysis, of the initiating leaders-motivations springing from a sense of frustration under the existing order, feeling that this order was evil, and the love of power common to so many strong men; and, second, Russian patriotism, which was captured and mobilized by these initiating leaders of communism, exactly as French patriotism was captured and mobilized by a Corsican second lieutenant of artillery and soldier of fortune.
The class war, the classical myth of communism, like every other war, has been the war of one crowd against another. There is nothing much to starting or keeping up a war any more than there is to starting and keeping up a fire. It needs only the first spark and then plenty of fuel. The Communist ins, in Russia, have fought, and continue to fight, the outs. The ins of Russia would incite the outs of other countries to espouse the faith of the communist international and fight the ins of their respective countries. All this is simple. But nowhere is there apparent any significant manifestation of the driving force of a proletarian will to fight as proletarians, whether in Russia or anywhere else. Russia presents the spectacle of a national government on the defensive, just as do Britain, Germany, Japan and Italy, not the spectacle of a proletariat on the warpath against the capitalists of the world.
The choice between fascism and communism, then, turns largely around the questions of the inevitability and desirability from some assumed standpoint of the class war myth as a rationalization of what is just a war between two crowds, and, of course, of this war as an event. Here it may be said that the best way to start a revolution or civil war in the United States is not to use the Marxian class war myth. But more important still it may be said that it is not necessary to have a civil war in order to effect a social revolution. These two considerations seem rather effectively to eliminate communism as a desirable choice for any one who has not already been “converted” to communism.
Those who have not been converted to communism will do well to ask themselves these questions: Is such a war a necessary means to the end of a social order which will afford the people as a whole a better average life? Is such a war a necessary means to a good end for me as an individual?
The answer to the second question, of course, depends largely on who I am, or whether I should be among the liquidators or the liquidated. To answer the first question affirmatively, it must be assumed that a proletarian party will have the will to start such a war, the might to win it, and the competence, after they have won it, to run things more efficiently than the leaders or managers of the class they have liquidated could run things. It is the last of these assumptions which is most open to challenge. The assumptions that a proletarian communist party can mobilize enough proletarian wills to fight the Marxian battle on the inspiration of the class war myth, and develop enough might to win the battle in the advanced industrial countries, can plausibly be ridiculed in the light of present indications. But no impregnable argument can be founded on such ridicule, for the wills of the masses can conceivably be changed quickly and galvanized into action for the pursuit of the maddest objectives — witness the Crusades.
It is the assumption that a proletarian party, triumph in the classical Marxian battle could leave enough competent technicians unliquidated to run things in a way to maintain as high a living standard as could be maintained if these managing classes were allowed to function, which is open to the most effective challenge. And on that challenge much of the case for fascism rests.
In this connection it must be remembered that while the Russian communist revolution has liquidated several millions, it did not have to liquidate the same percentage or total number of middle class technicians found in the United States. Moreover, Russian economy was not as dependent on these middle class elements as are our economy and standard of living. And during the Russian communist experiment it has been found necessary to import foreign experts. In the field in which the class war in Russia has effected the most drastic or significant liquidation of people — agriculture — the output is lowest and still below pre-War levels.
Obviously, from the point of view of the interests of the owning and managing classes, there can be no question as to the undesirability of the communist civil war, which will necessarily mean for them liquidation-a euphemism for such experiences as being stood up against a wall and shot. It is from the point of view of the workers in the Marxian definition, or those whose income is not derived mainly from owning and managing productive property for a profit, that, for the sake of any possible argument, it has to be shown that the triumphant Marxian dictatorship will not yield advantages. It is most seductive to some workers to be told that they have a chance under communism to oust the present bosses and themselves become the bosses. Obviously this promise is a lie. For under communism the workers would merely have a different set of bosses. There is no way of running industry without bosses, and there is no way of making every man his own boss. The only question of real interest to the masses is whether they would be better off to liquidate in communist fashion all the present bosses and proceed thereafter with new bosses developed under communism, or to try some social formula which would take advantage of the skills of the present bosses. Once the question is considered in this light, the answer is fairly obvious in countries like the United States, where a communist class war liquidation would deprive the country of some twenty millions of its workers out of a total of fifty million, these twenty millions including some six million farmers, all of whom are on the wrong side of the communist fence.
At this point a word should be said to refute a commonly made communist argument that most of the middle-class executives, experts, white collar workers, farmers and small enterprisers would go over to communism in the course of the class war and thus escape liquidation. This argument runs counter to any expectancy based on experience. When a fight starts, the lines between friend and foe are tightly drawn, and it rarely happens during a war that any significant number of those on one side of the line go over to the other. It is not in the nature of most people, especially most members of the middle classes, to prove turncoats in a fight. The longer and harder the Marxian class war, the greater would be the solidarity of the enemies of the communists. There is, of course, no doubt in any mind which thinks straight on this subject that a large percentage of the non-owning, non-managing, and non-enterprising workers would, in the United States, side in the Marxian war with the owners, managers, and enterprisers from the very start. Most of the American workers would side with the managers and enterprisers because of the force of tradition or attitudes formed by education and long habit and, also, because of the prestige or moral authority which the managing and owning classes deservedly enjoy in the United States where their competence is demonstrably superior to that of the elite of the Czarist regime of Russia.
We may conclude then that, because of the unavoidable liquidation of so many competent experts through a communist victory in the Marxian class struggle, the results would not be as favorable for the people as a whole, or even for the non-owning and non-managing workers, as a regime which required fewer human sacrifices to get started. But the driving force of a consciousness of group solidarity and common group objectives is needed to run the social machinery of any planned economy. If it is not the Marxian class war spirit, it must be some other martial spirit. This force fascism develops by intensifying the national, spirit and putting it behind the enterprises of public welfare and social control.
Here fascism is not introducing a new force but merely intensifying a force inherent in every nation and putting this old force behind new public enterprises.
The unifying principle of national fellowship already exists. Unlike working class or proletarian class consciousness, it is not something which exists only by virtue of a logical classification of men into owners and workers. This Marxian classification is entirely valid for purposes of logic and definition. But it is a classification which no more creates two separate class consciousnesses or class identities for purposes of common thought and action than the division of all mankind into red heads and non-red heads. Obviously, the more inclusive the unifying principle, the more conflict is avoided and the greater cooperation is achieved. Nationalism would be more inclusive in the United States than any formula of unity based on race, religion, profession or tastes. As Americans, we are all of one nationality, though not of one race, religion, profession or set of cultural tastes. Of course, a perfect internationalism would be still more unifying and inclusive. This consideration leads many humane minds to aspire to a social formula or unifying principle which would include all mankind or transcend national limitations. Here, the inevitability of some limitation to the inclusiveness of a formula of social organization and operation is largely a matter of traditional imponderables and problems of sheer administration. If the world were to go one hundred per cent Communist or one hundred per cent Roman Catholic, any attempt at international unity would necessarily founder on the rocks of group traditions and in the complexities of administration, for which neither an international Communism nor an international Christianity would prove a solvent.
It is idle to hazard a speculation as to the possibility of ever effecting a workable formula of international unity in a distant future. It is worse than idle for any one nation to attempt to force on an unwilling world any ideal of international unity. If an international formula by universal assent is ever workable, it will not be necessary for any one nation to force any part of it on any other nation. And surely no one is interested in an international formula imposed and maintained by the might of one nation. Communism, of course, masquerades as an international formula to be made effective by the universal assent of the workers (thus eliminating international war) once the capitalists have been eliminated by the Marxian class war. But communism in action has developed no reasons for supposing that workers are any less Americans, Russians and Englishmen than capitalists. In regard to the guiding hand and the mechanisms of social control necessary to a planned society, we may dispose at once of a great deal of confusion by saying that fascism and communism equally require centralized control. In the larger essentials of social control, so far as problems of technique, mechanism, and means are concerned, fascism and communism have many similarities. It is under this heading of the imperative principles and mechanisms of social control that it seems eminently fitting to compare fascism and communism in respect to private property rights, private initiative in production, profits, and the free market. It is understood, of course, that fascism stands for the maintenance of all these institutions. Here there is a real problem of choice. Fascism regards private property rights, private initiative, and the free market, subject to a proper regime of public interest, as useful institutions useful means to public ends. The difference between fascism and liberalism, in this respect, is that fascism considers these institutions as means to national ends, whereas liberalism makes the nation and national government a means to the ends of private property and the free market.
The instrumental merits of private property and the free market can best be appreciated by analyzing any attempt to dispense entirely with them, such as is being made by communist Russia. Now, communism or socialism sanctions property rights in consumers goods but not producers goods. But, in a large field of property, such as farms and small enterprises, it is impossible to draw a line between producers and consumers goods. One must either accept some measure of private ownership of the instruments of production, or soon one is driven to the extreme of a regime in which everyone will be in the position of unpaid soldiers or pensioners of an institution who have certain things deemed necessary and found available supplied to them, with no money for purchasing, or means of producing, anything else. Russian communism shows definite trends in that direction. As a matter of fact, of course, no professional army today is conducted on the extreme principle of complete rationing of everything. All soldiers are given some small pay with which to make optional purchases of things selected by themselves to suit their tastes.
A socialism which gives the individual a property right only in the clothes on his back and a few simple articles of personal use is fraught with administrative difficulties which can hardly be exaggerated. For such a socialism imposes on government a formidable amount of details or administrative minutiae in matters of directing all production, determining distribution and rewards, and taking care of one hundred per cent of those incapable of earning a living. To whatever extent private ownership and small savings exist, just so many more aged and dependents, as well as persons of difficult social adjustment, are provided with incomes and occupations without engaging State responsibility for the details of taking care of them. Institutional care is indicated for many people, and government ownership is indicated for efficient production in many fields. But ownership of small homes, farms, and productive enterprises are also indicated for many more people and many other types of production.
There is a large field of productive activity in which small enterprise is unquestionably more efficient and satisfactory in every way than large enterprise. Farming, of course, is the best example. Soviet Russia has yet to demonstrate that public administration can operate farms as efficiently or economically through collectivized units as private enterprise. It is doubtful whether government feeding stations will ever equal the culinary achievements of small private kitchens. Small-scale private production is not only more efficient in many fields but it is also fairly safe or free of significant monopoly power and abuse.
Socially significant monopoly does not arise either in agriculture, or in the production of special goods and services of a unique character, where the total volume produced is relatively small and where the article can easily be substituted by another. The monopoly of a unique voice, or talent, or resource may bring a high reward without conferring any power to commit a social abuse. And neither the farmers nor the small enterprisers are ever likely to challenge the public authority or interfere with public administration in the ways that large corporations and financial institutions have frequently done. It is, of course, possible for small owners and enterprisers to constitute a pressure agency through special association, but the State has ample means for dealing with large associations. Besides, an association representing and controlled by a large number of small property owners is not likely to prove the pressure force that a large corporation controlled by a few insiders can exert.
Private ownership of savings, as well as small ownership and management units of productive enterprise, can be socially controlled. The social abuses connected with savings are encountered mainly in the mechanics of investment and financial management by the large banks, savings institutions, and insurance companies which handle savings. It is a relatively easy matter for the State to preserve the present de facto rights and interests of small savers while completely nationalizing the financial institutions which now administer their savings, or while imposing on a private management of such institutions any State dictates. It cannot be repeated too often that what prevents adequate public regulation is liberal norms of law or constitutional guarantees of private rights. There is no need to expropriate private ownership of either savings or small scale enterprise in order to maintain adequate social control. It is necessary only to nationalize large financial institutions and monopolistic industries, as well as all corporations whose services are indispensable but whose management has become completely divorced from ownership, and to discipline adequately all private enterprises.
Wherever ownership and management have become separated, there is no good case to be made out for private ownership or private management. In these cases, ownership is held by an army of stockholders and bondholders, who cannot possibly have any say about the control and management exercised by self perpetuating hierarchies of bankers, directors, and officials on the inside who are virtually irresponsible either to the owners or to the State for the results of their economic policies. Obviously, a governmental bureaucracy is preferable to a corporate bureaucracy, for the governmental bureaucracy can be made more responsible, more disciplined, and better integrated into a national plan. A corporate bureaucracy divorced from the control of owners is just a private army at the service of any pirate captain who may be made chief.
The fascist State can easily convert the great monopolies and bureaucratically-managed large corporations into State-controlled enterprises, the present owners and creditors of which will receive income bonds or shares in a government investment company and never know any practical difference between their present capitalistic relationship to the property and the relationship which a fascist State will define and maintain for them. The corporate bureaucracies, except for a few big shot men at the top, will never know the difference. For there is no real difference between being a yes-man official of a billion dollar bank and being an official of a State bureaucracy, except possibly as to compensation, and government owned or controlled corporations under fascism would allow generous compensation to efficient executives.
So far as considerations of efficiency are involved, almost any rational regime, either of complete government control or some modified government dictation of policies and management left in private managers’ hands, would mean no greater or different administrative and practical difficulties than those already encountered under the bureaucratic management of self-perpetuating bank and corporate dictatorships. Actually, the management of all large corporations is wholly bureaucratic, subject only, as a practical matter, to the modifying dictation of big bankers and financial interests.
Between the hierarchical bureaucracy of a political State and the hierarchical bureaucracy of a large corporation with its permanent dictator and his army of yes-men executives, there are no significant administrative or technical differences. In either case, all the advantages of owner-management are lacking and all the disadvantages of bureaucratic control are present.
The case for leaving owner-management to function where it can do so more efficiently than large scale enterprise (which is necessarily bureaucratic) and, with only two or three exceptions, enterprise where management is divorced from ownership, rests on sound considerations of public policy. In the fascist view, only through a combination of privately-owned and privately-managed small scale enterprise and State-owned or State-managed large scale enterprise can social control be maintained. It seems too obvious to need explanation that many types of production must be conducted on such a large scale that the advantages of owner management must be sacrificed for the greater advantages-in these cases, of mass production by highly integrated trusts. Such types of industry, just as the Panama Canal, are monopoly propositions which indicate public ownership or public administration.
In so far as property rights and private enterprise are concerned, however, the strongest argument for fascism instead of communism may be found in the regulatory functions of an open market. The strongest criticism of any socialism of complete expropriation is that it leaves no free market, no pricing mechanism and no valid basis for economic calculation. Pure socialism is collective ownership and unified central direction of all material instruments of production which, sooner or later, must leave little or no freedom of choice for the individual as to consumption or occupation. These criticisms may be found brought up to date and made relevant to communism in operation in Russia in the symposium of Professors Hayek, Pierson, Barone, Halm and von Mises entitled Collectivist Economic Planning, and the work of Professor Boris Brutzkus entitled Economic Planning in Soviet Russia.
Under a pure communism, the products of all enterprises are poured into a common pot, and all the enterprises are given out of this pot the means for further production. With no market indications to guide them, how can the supreme managers of national socialist production receive directives as to further production, or measure the intensity of social needs? Without a free market there can be no determination of economic values. The labor theory of value breaks down completely as a means of determining rewards for labor or for the use of labor and machinery in production. Marx, of course, recognized that an hour of every man’s labor was not equal owing to differences in skills. But how is the inequality in worth to be measured if not by market demand? Is it to be measured according to the cost of creating a given skill? But many labor skills are natural gifts acquired without any training and with very little effort. Is the value of labor to be measured by the physical output? But what about exactly similar labor expended in working an easy and a difficult mine, or lands which produce unequal quantities of the same material? How would rewards of skilled German and unskilled Russian labor be determined in international communist trade?
At the beginning of 1931 there was a union conference of industrial managers at Moscow. Ordzonikidze, President of Workers and Peasants Inspection, said at that conference: “With us, the State bank pays for everything and the undertaking is materially responsible for nothing at all. Wages are paid without referring to you (the industrial managers). Goods are paid for regardless of quality. People take your products away and distribute them.” “That’s grand,” said the audience. In the publication Za industrializaciu, the organ of the Supreme Economic Council, in its leading article of December 19, 1930, it is said, “Among industrial managers there is a popular notion that however great the financial deficits, the State will always make them good, for finance is not to impose any limits on the expansion of production and the extension of capital construction.” The result of having the State pay all deficits in industrial production is a steady depreciation in the value of the Russian ruble, not that this difficulty alone need prove fatal to communism, for, conceivably, the currency could be inflated to the vanishing point of value for each unit ever so often, and a new currency started after each debacle. The real difficulty is that under such an economic regime the most efficient use of labor and material resources, or the use most satisfactory to the people, cannot possibly be made, for the simple reason that there is no means of measuring value or output in terms of the quantity of satisfaction afforded to consumers.
It is, of course, easy to keep everybody at work and to produce a great deal (much of which, like the output of many Russian factories, may be useless) without any regard for the indications of market value. And this is exactly what communist Russia has been doing. But the results are a great waste of productive effort and the necessity for taking inferior consumers goods with little choice. In a symposium on planning, Miss Van Kleeck argues that a plan requires measurement, that money is an unsafe guide, and that a planned economy “does not make money but makes and distributes goods,” adding that “Obviously the basic common unit of measurement is the man hour.” The trouble with making goods without the controlling indications of market demand and profits for successful producers is that there is no way of knowing the right quantities to make, the right proportions of labor and machinery to use in production, or other right combinations in the productive processes.
The extreme liberal capitalist position that only effective demands made in a free market should be satisfied is equally untenable. There is a large field of economic goods in which production can be conducted by arbitrary assumption and dictation. Police protection, sanitation, public education, arc goods which are already bought and paid for without any reference to market demand. Light and power, transportation, and basic foods and textiles in given but limited quantities, can be assumed necessary at an arbitrarily fixed price, and State intervention can insure the production of an adequate supply of these goods within an arbitrarily fixed price range for the common good. If there is a deficit it can be met by taxation-provided it is not too large. It is well to remember that it will never be possible for the State to have provided as much of everything as may be desired. Hence, there must be selection and rationing where arbitrarily determined production and prices are enforced. For the selection of goods to be produced at given costs, for sale at given prices, and in given quantities, and for the selection and combination of productive factors in producing these goods, the State must have the guidance of prices or values determined by a comparatively free market. It is impossible within the limits of a brief discussion to elaborate the reasons and examples showing why the controls of freely made prices and competitively made profits are essential as guides, whether for State directives or private enterprise directives of production.
Fascism does not accept the liberal dogmas as to the sovereignty of the consumer or trader in the free market. It does not admit that the market ever can or should be entirely free. Least of all does it consider that market freedom, and the opportunity to make competitive profits, are rights of the individual. Some measure of market freedom, competition, private enterprise, and profits and losses for private enterprise, in the view of fascism, must be deemed essential as guides to any measure of social control.
Under fascism, private property, private enterprise, and private choice in the market, have no rights as ends in themselves. They have different measures of social usefulness subject to proper public control. If these institutions and ways are to have social utility to the State, the liberal regime must be ended, the great monopolies nationalized, and all the economic processes subjected to the discipline of a national plan. The ultimate objective is welfare through a strong national State, and neither the dictatorship of the proletarian nor the supremacy of private rights under any given set of rules.