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From The concise untold history of the United States (Oliver Stone & Peter Kuznick, 2015) pp34-41

The crash ended American loans to Germany. And Germany’s industry collapsed entirely in the winter of 1931-32. Unemployment soared to over 30 percent, putting millions of angry young men in the streets. Capitalists and conservative politicians feared an imminent communist coup, and Hitler, Germany’s most virulent anticommunist, was invited by the ruling classes into the government. Although still representing a radical minority party, in January 1933, Hitler became chancellor of Germany.

In his riveting speeches, Hitler touched a deep chord with many Germans, promising them something they could barely remember — pride.

But disorder followed Hitler’s rise to power when the Reichstag, the National Parliament, mysteriously burned down. Hitler readily blamed the communists and many were thrown in concentration camps.

He quickly began a massive program of rearmament, which he made public in 1935. And once Hjalmar Schacht became his minister of economics, he received vital bank credits from Montagu Norman, who in 1934 told a Morgan partner, “Hitler and Schacht are the bulwarks of civilization in Germany. … They are fighting the war of our system of society against communism.”

Many American bankers agreed, trusting their friend Schacht and hoping that Hitler would repay at least some of the reparations and also crush the German communists.

America was in deep crisis as well. Republican Herbert Hoover struggled ineffectively to quell the Great Depression.

More than twenty thousand, possibly as many as forty thousand, angry American veterans known as the “Bonus Army” descended on Washington, demanding war service bonuses not due to be paid until the year 1945. They set up a tent city on the Anacostia Flats in Washington. They brought their wives and children. They lived by military discipline — with daily parade and a strict “no drinking” rule.

General Smedley Butler arrived to lend moral support. “I know who’s made this country worth livin’ in!” he told them. “Its just you fellas. Look, it makes me so damn mad a whole lot of people speak of you as ‘tramps.’ By God, they didn’t speak of you as tramps in 1917 and 18. Take it from me, this is the greatest demonstration of Americanism we have ever had — pure Americanism.” He was mobbed by veterans wanting to speak to him. Until late that morning, he sat with them in their tents, listening to their tales of lost jobs, distressed families, and old battle wounds.

After demonstrators clashed with District police, President Hoover ordered General Douglas MacArthur to restore order. Convinced that the Bonus Army was the vanguard of a communist coup, MacArthur, not for the only time in his storied career, disobeyed presidential orders and rousted the veterans with tanks, bayonets, and tear gas.

MacArthur, whose aides included future generals Dwight Eisenhower and George Patton, pursued the fleeing veterans across the river and set their makeshift city aflame. It was the first time since the Civil War that American soldiers had knowingly attacked and wounded other American soldiers.

But when the Bonus Army marched again the next year into Washington, there was a new president in the White House, who sent First Lady Eleanor Roosevelt to help serve the veterans three hot meals a day with coffee. One veteran remarked, “Hoover sent the army, Roosevelt sent his wife.” Several days later, the Bonus Army voted to disband. The new president put many of the veterans to work in the Civilian Conservation Corps.

It was in his famous inaugural address in Mar 1933 that Franklin Delano Roosevelt rallied the nation with his declaration “that the only thing we have to fear is fear itself.” It was the signature line of his extraordinary life. In truth, he was facing a disaster. Unemployment stood at 25 percent. The gross national product had fallen 50 percent. Farmers lost 60 percent of their income. Industrial production dropped over 50 percent. Between 1930 and 1932, 20 percent of U.S. banks had failed. Breadlines formed in every town to feed the starving. Homeless walked the streets and slept in vast shanty-towns known as “Hoovervilles.” There was no safety net to assist the desperate. Misery was everywhere.

Roosevelt united Americans around a message of inclusion — the opposite of Hitler’s. “The measure of the restoration,” he said, “lies in the extent to which we apply social values more noble than mere monetary profit.”

In this vein, he called for “strict supervision of all banking and credits and investments” and “an end to speculation with other people’s money.” He proclaimed a New Deal. And although he could have nationalized the banks with hardly a word of protest, he chose a much more conservative course of action. He declared a four-day national bank holiday, conferred with the nation’s top bankers on his first full day in office, and signed the emergency Banking Act, which was written largely by the bankers themselves. The banking system was essentially restored without radical change. And despite being accused of betraying his class, Roosevelt would, ironically, save capitalism from the capitalists themselves. Recognizing the failures of unfettered capitalism, Roosevelt unleashed the powers of the federal government. In his first hundred days in office, he passed legislation that established the Agricultural Adjustment Administration to save farming, the Civilian Conservation Corps to put young men to work in the forests and parks, the Federal Emergency Relief Administration to provide federal assistance to the states, the Public Works Administration to coordinate large-scale public works projects, and the National Recovery Administration (NRA) to promote economic recovery, and he passed the Glass-Steagall Banking Act, which separated investment and commercial banking and instituted federal insurance of bank deposits.

He also repealed Prohibition and stated “now would be a good time to have a beer.”

Roosevelt assembled a team of visionaries. Among them were Harry Hopkins, Roosevelt’s chief aide, National Youth Administrator Aubrey Williams, Rexford Tugwell, Adolf Berle, and Secretary of the Interior Harold Ickes. There was also the formidable Frances Perkins, the U.S. secretary of labor and the first woman ever appointed to the cabinet. They became known as the New Dealers.

Henry A. Wallace, the young lowa geneticist, would become one of their leading lights. He was from a Republican farming clan that had worked the land since frontier days. His father, Harry, had served presidents Warren Harding and Calvin Coolidge as secretary of agriculture.

Roosevelt told Wallace to take whatever actions were necessary to re- pair the nation’s devastated rural sector. His solutions were controversial — to stop overproduction, he paid farmers to destroy 25 percent of the cotton crop that was in the ground. He also ordered the slaughter of 6 million baby pigs. Although he made sure the Agriculture Department distributed much of the pork, lard, and soap to needy Americans, furious farmers attacked him. He took to the radio to defend his program. Calling it “A Declaration of Interdependence,” he laid out his philosophy: “The ungoverned push of rugged individualism perhaps had an economic justification in the days when we had all the West to surge upon and conquer; but this country has filled up now, and grown up. There are no more Indians to fight. … We must blaze new trails in the direction of a controlled economy, common sense, and social decency.”

In the end, Wallace’s plan worked brilliantly. Cotton prices doubled. Farm income jumped 65 percent from 1932 to 1936. Corn, wheat, and pig prices stabilized. And the farmers became Wallace’s staunchest supporters.

For a man who had spent years perfecting a strain of hybrid corn and who believed that abundant food supplies were essential for a peaceful world, Wallace was horrified by the unfortunate message such policies sent: “The plowing under of 10 million acres of cotton and the slaughter of 6 million little pigs in September 1933 were not acts of idealism in any sane society. They were emergency acts made necessary by the almost in- sane lack of world statesmanship during the period from 1920 to 1932.”

The public, which blamed business for causing the Depression, welcomed Roosevelt with great enthusiasm, hoping he could spark a recovery. But he was an enigma, campaigning at times as a big-government liberal spinning out one new government program after another, and at other times as a budget-balancing conservative. Some thought him a socialist in the Eugene Debs/Norman Thomas tradition. Others thought him a fascist or corporatist, supporting the merger of state and corporate power. His industrial recovery program, the NRA, regulated production, competition, and minimum wage rates, some of which smacked of Italian Fascism.

In reality, Roosevelt was more pragmatic than ideological. Nonetheless, he was misunderstood by big business. Openly opposing Wall Street. made for smart politics, but it won the everlasting enmity of conservative Republicans who attacked his inflationary policies as unconstitutional.

“Printing-press money,” they called it. And worse yet, FDR took the U.S. off the gold standard. He sacrificed foreign trade and its profits in order to stimulate domestic recovery. He also took steps to reduce the country’s small 140,000-man army.

In 1934, retired general Smedley Butler re-entered the picture, presenting shocking information to the House Special Committee on Un-American Activities.

Butler charged the anti-Roosevelt oligarchs, including J. P. Morgan’s son Jack and the wealthy du Pont business clan, with trying to recruit him to lead an uprising of desperate veterans to force Roosevelt from office.

The press dismissed it as “The Business Plot” — a paranoid conspiracy. Henry Luce’s Time magazine led the charge. But after hearing the testimony, the House committee, chaired by future Speaker of the House John McCormack of Massachusetts, reported that it had been able to verify all the pertinent statements made by General Butler and concluded that attempts to establish a fascist organization in the United States “were discussed, were planned, and might have been placed in execution when and if the financial backers deemed it expedient.”

The committee, strangely, chose not to call many of those implicated to testify, including failed 1928 presidential candidate Al Smith, Thomas Lamont of Morgan, army general Douglas MacArthur, and various high-placed corporate executives, as well as the former American Legion commander and the head of the NRA. The tumultuous, frightening prospect of a fascist coup was popularized in the best-selling novel by Nobel Prize winner Sinclair Lewis, It Can’t Happen Here, which depicted a series of events similar to those alleged by Butler. And later, a similar plot emerged in the very popular Frank Capra film Meet John Doe.

Al Smith, who became a spokesman for the right-wing American Liberty League, scorched Roosevelt. “There can be only one capital, Washington or Moscow. .. . There can be only the clear, pure, fresh air of free America, or the foul breath of Communistic Russia. There can be only one flag, the Stars and Stripes, or the flag of the godless Union of the Soviets.”

Although the Smedley Butler hearings could be soft-pedaled by the media, the House of Morgan and the four du Pont brothers were actually called to testify at one of the most remarkable congressional hearings in U.S. history — that of the Senate committee investigating the munitions industry under North Dakota’s Gerald Nye, a progressive Republican. The target: war profiteering on an unimaginable scale and collusion with the German enemy in World War I.

Nye, sensing another war was coming, supported nationalizing the arms industry and increasing taxes on incomes over ten thousand dollars to 98 percent on the day a war began. The investigations reached their zenith in early 1936, when the House of Morgan and other Wall Street firms were called in.

Was it true that Morgan and other firms had pushed the U.S. to war in order to recoup the enormous sums they’d lent the Allies? Morgan Jr. along with Thomas Lamont and other partners dismissed this as a fantastic theory, claiming there was no material advantage to having the U.S. enter World War I, because the U.S. businesses were already thriving from supplying the Allies.

One skeptical senator asked the bankers, “Do you think Great Britain would have paid her debts if she had lost the war?” A banker replied, “Yes, even had she lost the war she would have paid.” But we must ask, would a broken and bankrupt Britain really have repaid those debts?

Although Nye and his committee failed to stop war profiteering, they did succeed in educating the public and also raised another disturbing issue that continues to rankle historians—what to say about U.S, business- es’ contributions to German economic and military revitalization.

World War II continues to be one of the most heroic periods in American history and myth. A modern media industry of books, television shows, and movies, like Saving Private Ryan, have applauded America’s contribution to the defeat of Hitler’s Nazi regime. But they ignore, forget, or overlook the fact that many prominent American businessmen and citizens — driven by greed, but sometimes by fascist sympathies — knowingly aided the Third Reich.

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