McCormack–Dickstein Committee

Another video on the same topic British account. Notice the difference between today’s style of dumb-down journalism, and the older which put instructing the audience first.

More on the plot, setting up a Hitler type state http://www.youtube.com/watch?v=hkojpgNZD9I&feature=related

Mike Thompson commentator and investigative reporter, his BBB program on the business plot of 1933, Part 1 http://www.youtube.com/watch?v=UXGUgFXoRu4 ,

http://www.youtube.com/watch?v=UGPb6ulVEK0&feature=related part 2

http://www.youtube.com/watch?NR=1&v=Mav69K2zkgw part 3

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The tone of the Wikipedia article (below) is quite different from the history channel’s piecing together the events which relies on experts, the events. The History Channels program is confirmed 3 decades later by Mike Thompson’s investigation of the plot for the BBC. Wikipedia’s contributor is relying on revisionist historian who are hiding an embarrassment.

Smedley Darlington Butler (July 30, 1881 – June 21, 1940), nicknamed "The Fighting Quaker" and "Old Gimlet Eye", was a Major General in the U.S. Marine Corps , and at the time of his death the most decorated Marine in U.S. history. During his 34-year career as a Marine, he participated in military actions in the Philippines, China, in Central America and the Caribbean during the Banana Wars , and France in World War I . By the end of his career he had received 16 medals, five of which were for heroism. He is one of 19 people to twice receive the Medal of Honor , one of three to be awarded both the Marine Corps Brevet Medal and the Medal of Honor, and the only person to be awarded the Brevet Medal and two Medals of Honor, all for separate actions.

The funeral was held at his home, attended by friends and family as well as several politicians, members of the Philadelphia police force and officers of the Marine Corps. [66] He was buried at Oaklands Cemetery in West Chester, Pennsylvania . [67] Since his death in 1940, his family has maintained his home as it was when he died, including a large amount of memorabilia he had collected throughout his varied career. [66]

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The Business Plot (also the Plot Against FDR and the White House Putsch) was an alleged political conspiracy in 1933. Retired Marine Corps Major General Smedley Butler claimed that wealthy businessmen were plotting to create a fascist veterans' organization and use it in a coup d’état to overthrow United States President Franklin D. Roosevelt , with Butler as leader of that organization. In 1934 Butler testified to the McCormack–Dickstein Congressional committee on these claims. [1] In the opinion of the committee, these allegations were credible. [2]

[10

Reaction to Roosevelt

The election of Roosevelt was upsetting for many conservative businessmen of the time, his "campaign promise that the government would provide jobs for all the unemployed had the perverse effect of creating a new wave of unemployment by businessmen frightened by fears of socialism and reckless government spending." [11]

The Hoover administration had steadfastly defended the gold standard even when Britain abandoned it in September 1931. With a devalued currency British manufactured goods became cheaper than American counterparts, resulting in more economic hardship for American industry. Roosevelt's campaign had promised to re-evaluate America's commitment to the gold standard, and through a series of actions from March 6 to April 18, 1933 abandoned it.

Conservative businessmen and other supporters of the gold standard were dismayed. Hoover who had championed the standard wrote that its abandonment was the first step toward "communism, fascism, socialism, statism, planned economy." [11] He argued that the standard was needed to stop governments from "confiscating the savings of the people by manipulation of inflation and deflation....We have gold because we cannot trust Governments." [11]

Roosevelt also dissolved any "gold clause" within contracts public or private that guaranteed payment in gold. This clause was part of every government bond and most corporate bonds, "It was a standard feature of mortgage agreements and other contracts. For creditors, it offered protection against inflation or congressional tinkering with the currency." For debtors though it was dangerous as "The gold dollar, before Roosevelt reduced it, was $1.69. This meant that a bank, for example, could suddenly require a farmer to make mortgage payments in gold coin-transferring a $10,000 mortgage into one worth $16,900, raising the farmer's debt burden by nearly 70 percent." [12] Likewise the U.S treasury could be required to pay the bearer of a $10,000 Liberty Bond $16,900 in gold coins. [12] (The constitutionality of this Roosevelt policy was later challenged before the Supreme Court in the Gold Clause Cases .)

With the end of the gold standard "conservative financiers were horrified. They viewed a currency not solidly backed by gold as inflationary, undermining both private and business fortunes and leading to national bankruptcy. Roosevelt was damned as a socialist or Communist out to destroy private enterprise by sapping the gold backing of wealth in order to subsidize the poor." [13]

Ending the gold standard allowed the country to escape the cycle of deflation , but the shift was not painless, "Since higher prices were not yet accompanied by higher wages, inflation meant lower [real] incomes for those fortunate enough to be employed. Until the effects of increased investment spending ramified through the economy, there was little reason for investment incomes and hence consumption to rise dramatically. Industrial production remained volatile". [14] The problem was a lack of any measures for stimulus to accompany the new policy, there was no increased provision of money and credit.

To encourage foreign investment Roosevelt had the Reconstruction Finance Corporation purchase gold with dollars thereby driving up the price of gold and reducing the value of the dollar. Still this did not immediately affect the balance of trade. Those considering buying American goods anticipated that there would be a further depreciation which would allow their own currency further purchasing power and therefore greater profits, so they held back their orders. At the same time Americans fearing additional depreciation purchased more foreign commodities in fear they would lose purchasing power in the future; "The volume of U.S. imports rose by 10 percent between 1932 and 1933. In contrast, exports stagnated. The consequence was a deteriorating balance of trade." [14]

Another Roosevelt policy also had an unanticipated effect on the recovery, the National Industrial Recovery Act of June 16, 1933 provided established minimum wages of 40 cents an hour and revised upward the entire wage structure of many of the industries it covered, this placed upward pressure on labor costs.

The sustained recovery of industrial production "had to await stabilization of the dollar in 1934, along with the concomitant growth of commodity exports and capital imports." [14]

McCormack–Dickstein Committee

The Committee began examining evidence on November 20, 1934. On November 24 the committee released a statement detailing the testimony it had heard about the plot and its preliminary findings. On February 15, 1935, the committee submitted its final report to the House of Representatives. [15]

During the McCormack–Dickstein Committee hearings, Butler testified that MacGuire [16] attempted to recruit him to lead a coup, promising him an army of 500,000 men for a march on Washington, D.C. , and financial backing. [17] Butler testified that the pretext for the coup would be that the president's health was failing. [18]

Despite Butler's support for Roosevelt in the election, [9] and his reputation as a strong critic of capitalism, [19] Butler said the plotters felt his good reputation and popularity were vital in attracting support amongst the general public, and saw him as easier to manipulate than others.

Though Butler had never spoken to them, Butler implicated several prominent businessmen, including chemical industrialist Irénée du Pont , and veteran leaders as backers of the plot. The committee chose not to publish these allegations because they were hearsay . [20] [21]

Given a successful coup, Butler said that the plan was for him to have held near-absolute power in the newly created position of "Secretary of General Affairs," while Roosevelt would have assumed a figurehead role.

Those implicated in the plot by Butler all denied any involvement. MacGuire was the only figure identified by Butler who testified before the committee. Others Butler accused were not called to appear to testify because the "committee has had no evidence before it that would in the slightest degree warrant calling before it such men... The committee will not take cognizance of names brought into testimony which constitute mere hearsay ." [20]

In response, Butler said that the committee had deliberately edited out of its published findings the leading business people whom he had named in connection with the plot. [22] He said on February 17, 1935 on Radio WCAU, "Like most committees it has slaughtered the little and allowed the big to escape. The big shots weren't even called to testify. They were all mentioned in the testimony. Why was all mention of these names suppressed from the testimony?" [22]

On the final day of the committee, [23] January 29, 1935, John L. Spivak published the first of two articles in the Communist magazine New Masses , revealing portions of the Congressional committee testimony that had been redacted as hearsay . Spivak argued that the plot was part of a Fascist conspiracy of financiers and Jews to take over the U.S. government. [15] [24]

Butler's testimony in detail

1933

On July 1, 1933, Butler met with {Gen.} MacGuire and Doyle for the first time. Gerald C. MacGuire was a $100 a week bond salesman for Murphy & Company, [25] [26] and member of the Connecticut American Legion. [27] [28] Bill Doyle was commander of the Massachusetts American Legion. [29] Butler stated he was asked to run for National Commander of the American Legion . [30]

On July 3 or 4, Butler held a second meeting with MacGuire and Doyle. He stated they offered to get hundreds of supporters at the American Legion convention to ask for a speech. [31] MacGuire left a typewritten speech with Butler that they proposed he read at the convention "It urged the American Legion convention to adopt a resolution calling for the United States to return to the gold standard, so that when veterans were paid the bonus promised to them, the money they received would not be worthless paper." [13] The inclusion of this demand further increased Butler's suspicion.

Around August 1 MacGuire visited Butler alone. Butler stated that MacGuire told him Col. Murphy underwrote the formation of the American Legion in New York, and Butler told MacGuire that the American Legion was "nothing but a strike breaking outfit." [32] Butler never saw Doyle again.

On September 24, [33] [34] MacGuire visited Butler's hotel room in Newark . [35] In late-September Butler met with Robert Sterling Clark . [36] Clark was an art collector and an heir to the Singer Corporation fortune. [37] [38] MacGuire had known Robert S. Clark when he was a second lieutenant in China during the Boxer Rebellion . Clark had been nicknamed "the millionaire lieutenant. [38]

1934

During the first half of 1934 MacGuire traveled to Europe, and mailed post cards to Butler. [39] On March 6, MacGuire wrote Clark and Clark's attorney a letter describing the Croix-de-Feu . [40]

On August 22, Butler met MacGuire at a hotel, the last time Butler met MacGuire. [41] [42] According to Butler's account, it was on this occasion that MacGuire asked Butler to run a new veterans organization and lead a coup attempt against the President.

On September 13, Paul Comly French , a reporter who had once been Butler's personal secretary, [43] met MacGuire in his office. [44] In late September, Butler told Van Zandt that co-conspirators would be meeting him at an upcoming Veterans of Foreign Wars convention.

On November 20, the Committee began examining evidence. Journalist Paul Comly French broke the story in the Philadelphia Record and New York Post on November 21. [45] On November 22, The New York Times wrote its first article on the story and described it as a "gigantic hoax."

Other testimony

Some parts of Gen. Butler's story were supported by the statements of others. Paul Comly French, a reporter for the Philadelphia Record and the New York Evening Post, testified to the same effect. [46]

Committee reports

The Congressional committee preliminary report said:

This committee has had no evidence before it that would in the slightest degree warrant calling before it such men as John W. Davis , Gen. Hugh Johnson , General Harbord , Thomas W. Lamont , Admiral Sims , or Hanford MacNider .

The committee will not take cognizance of names brought into the testimony which constitute mere hearsay.

This committee is not concerned with premature newspaper accounts especially when given and published prior to the taking of the testimony.

As the result of information which has been in possession of this committee for some time, it was decided to hear the story of Maj. Gen. Smedley D. Butler and such others as might have knowledge germane to the issue. ...

The Congressional committee final report said:

In the last few weeks of the committee's official life it received evidence showing that certain persons had made an attempt to establish a fascist organization in this country. No evidence was presented and this committee had none to show a connection between this effort and any fascist activity of any European country. There is no question that these attempts were discussed, were planned, and might have been placed in execution when and if the financial backers deemed it expedient.

This committee received evidence from Maj. Gen Smedley D. Butler (retired), twice decorated by the Congress of the United States. He testified before the committee as to conversations with one Gerald C. MacGuire in which the latter is alleged to have suggested the formation of a fascist army under the leadership of General Butler.

MacGuire denied these allegations under oath, but your committee was able to verify all the pertinent statements made by General Butler, with the exception of the direct statement suggesting the creation of the organization. This, however, was corroborated in the correspondence of MacGuire with his principal, Robert Sterling Clark, of New York City, while MacGuire was abroad studying the various forms of veterans organizations of Fascist character. [47]

Other commentators

The BBC's online précis for its documentary program The White House Coup, said "The coup was aimed at toppling President Franklin D. Roosevelt with the help of half-a-million war veterans." [22] In that documentary, author and conspiracy theorist [52] John Buchanan said, "The investigations mysteriously turned to vapor when it comes time to call them to testify. FDR's main interest was getting the New Deal passed, and so he struck a deal in which it was agreed that the plotters would walk free if Wall Street would back off of their opposition to the New Deal and let FDR do what he wanted". [22] The program connected major companies to the American Liberty League , formed by Al Smith , who, the program asserted, was to be the fascist ruler. [53]

#53 http://www.archive.org/details/TheWhitehouseCoup a radio version of the program --- looks like a very interesting & useful site

More on the Fascist leanings of the rich, and their control of the economy.

A reading about the New Deal is a good primer on responsible (populist) government and a flavor of the dire state of affairs and Roosevelt’s drastic changes. http://en.wikipedia.org/wiki/New_Deal

The US economy by 1937 as measured by GDP had climbed out of the Great Depression.

The Roosevelt Administration was under assault during FDR's second term, which presided over a new dip in the Great Depression in the fall of 1937 that continued until most of 1938. Production and profits declined sharply. Unemployment jumped from 14.3% in 1937 to 19.0% in 1938. The downturn was perhaps due to nothing more than the familiar rhythms of the business cycle. But until 1937 Roosevelt had claimed responsibility for the excellent economic performance. That backfired in the recession and the heated political atmosphere of 1937. [96] ,,,, Keynesian economists stated that the recession of 1937 was a result of a premature effort to curb government spending and balance the budget. [100]

Roosevelt had been cautious not to run large deficits. In 1937 he actually achieved a balanced budget. Therefore he did not fully utilize deficit spending . [101] Between 1933 and 1941 the average federal budget deficit was 3% per year. [102] [More proof that the war preparations did not lift the economy out of the depression, if there was such preparations, the budget wouldn’t have been balanced.] In November 1937 Roosevelt decided that big business was trying to ruin the New Deal by causing another depression that voters would react against by voting Republican. [103] It was a "capital strike" said Roosevelt, and he ordered the Federal Bureau of Investigation to look for a criminal conspiracy (they found none). Roosevelt moved left and unleashed a rhetorical campaign against monopoly power, which was cast as the cause of the new crisis. Ickes attacked automaker Henry Ford , steelmaker Tom Girdler , and the super-rich " Sixty Families " who supposedly comprised "the living center of the modern industrial oligarchy which dominates the United States". [104]

Left unchecked, Ickes warned, they would create "big-business Fascist America—an enslaved America". The President appointed Robert Jackson as the aggressive new director of the antitrust division of the Justice Department , but this effort lost its effectiveness once World War II began and big business was urgently needed to produce war supplies. But the Administration's other response to the 1937 dip that stalled recovery from of the Great Depression had more tangible results. [105]