industrialized country fall first into Communism. But to the sceptic only one thing in the Marxian prophecy is important. He says that in the later stages of Capitalism, it will become incompetent; it will not be able to handle the tools of production and distribution; and suddenly or gradually, it will change into a new system. (According to Marx, this new system will be Communism.)

There were moments under the grim eyes of Mr. Hoover when all the parts of this prophecy seemed to have been fulfilled. There are apparently some Americans who wish that the New Deal had not interposed itself between the Gold Standard and the Red Flag.

These are the great leaders (silenced now by war) who might have studied Marx before flirting with the fascists. For even the rudimentary analysis above shows that Capitalism cannot grow into fascism; fascism moves backward from democratic capitalism, it moves into the system which democracy destroyed—the feudal system. The capitalist system may be headed for slow or sudden death if it goes on as it is; it may have a long life if it can adapt itself to the world it has itself created; but in every sense of the words, capitalism has no future if it goes back to the past. And fascism is the discarded past of capitalism.

We think we know this now because the fasci-feudal states have declared war on us. Now we see how natural is the alliance between the European states who wish to restore feudalism and the Asiatic state which never abandoned it. Now we recognize the Nazi or Fascist party as the equivalent of feudal nobles and in "labor battalions" we see the outlines of serfs cringing from their masters. But we do not yet see that a feudal state cannot live in the same world as a free state—and that we are as committed to destroy fascism as Hitler is to destroy democracy.

We strike back at Japan because Japan attacked us, and fight Germany and Italy because they declared war on us; but we will not win the war until we understand that the Axis had to attack us and that we must destroy the system which made the attack inevitable.

Walled Town and Open Door

At first glance, the feudal nature of fascism seems unimportant. In pure logic, maybe, feudal and democratic systems cannot co-exist, but in fact, feudal Japan did exist in 1830 and the United States was enjoying Jacksonian democracy. There must be something more than abstract hostility between the two systems.

There is. Feudalism is a walled town; democracy is a ship at sea and a covered wagon. The capitalist pioneer gaps every wall in his path and his path is everywhere. The defender of the wall must destroy the invader before he comes near. In commercial terms, the fascists must conquer us in order to eliminate us as competitors for world trade. We can understand the method if we compare fascism at peace with democracy at war.

In the first days of the war we abandoned several essential freedoms: speech and press and radio and assembly as far as they might affect the conduct of the war; and then, with more of a struggle, we gave up the right to manufacture motor cars, the right to buy or sell tires; we accepted an allotment of sugar; we abandoned the right to go into the business of manufacturing radio sets; we allowed the government to limit our installment buying; we neither got nor gave credit as freely as before; we gave up, in short, the system of civil liberty and free business enterprise—in order to win the war.

Six hundred years ago, all over Europe the economy of peace was exactly our economy of war. In the Middle Ages, the right to become a watchmaker did not exist; the guild of watchmakers accepted or rejected an applicant. By this limitation, the total number of watches produced was roughly governed; the price was also established (and overcharging was a grave offense in the Middle Ages). Foreign competition was excluded; credit was for financiers, and the installment system had not been invented.

The feudalism of six hundred years ago is the peace-time fascism of six years ago. The fascist version of feudalism is State control of production. In Nazi Germany the liberty to work at a trade, to manufacture a given article, to stop working, to change professions, were all seriously limited. The supply of materials was regulated by the State, the number of radios to be exported was set by the State in connection with the purchase of strategic imports; the State could encourage or prevent the importation of coffee or helium or silk stockings; it could and did force men and women to raise crops, to make fuses, to learn flying, to stop reading. It created a feudal state far more benighted than any in the actual Middle Ages; it was in peace totally coordinated for production—far more so than we are now, at war.

The purpose of our sacrifice of liberty is to make things a thousand times faster than before; to save raw materials we abolish the cuff on our trousers and we use agate pots instead of aluminum; we work longer hours and work harder; we keep machines going twenty-four hours a day, seven days a week—all for the single purpose of maximum output.

For the same purpose, the fascist state is organized at peace—to out-produce and under-sell its competitors.

The harried German people gave up their freedom in order to recover prosperity. They became a nation of war-workers in an economic war. A vast amount of their production went into tanks and Stukas; another segment went into export goods to be traded for strategic materials; and only a small amount went for food and the comforts of life. Almost nothing went into luxuries.

Burning Books—and Underselling

That is why the internal affairs of Germany became of surpassing importance to us. Whether we knew it or not, we were in competition with the labor battalions. When we denounced the Nazi suppression of free speech, the jailing of religious leaders, the silencing of Catholics, the persecution of Jews, we were as correct economically as we were ethically; the destruction of liberty had to be accomplished in Germany as the comfort level fell, to prevent criticism and conflict. Because liberals were tortured and books burned and Jews and Catholics given over to satisfy a frightful appetite for hatred, the people of Germany were kept longer at their work, and got less and less butter, and made more and more steel to undersell us in Soviet Russia or the Argentine; they made also more and more submarines to sink our ships if we ever came to war. Every liberty erased by Hitler was an economic attack on us, it made slave labor a more effective competitor to our free labor. The concentration camp and the blackguards on the streets were all part of an economic policy, to create a feudal serfdom in the place of free labor. If the policy succeeds, we will have to break down our standard of living and give up entirely our habits of freedom, in order to meet the competition of slave labor.

It means today that we will not have cheap motor cars and presently it may mean that we will not have high test steel or meat every day. Victory for the Axis system means that we work for the Germans and the Japanese, literally, actually, on their terms, in factories bossed by their local representatives; and anything less than complete victory for us means that we work harder and longer for less and less, paying for defeat by accepting a mean standard of living, not daring to fight our way into the markets of the world which fascism has closed to us.

Readers of You Can't Do Business With Hitler will not need to be convinced again that the two systems—his and ours—are mutually incompatible. Fortunately for us, they are also mutually destructive.