8 of the 10 Points in the Communist Manifesto Have Been Executed by the German Nazis with a Radicalism That Would Have Delighted Marx

Karl Marx turned to socialism at a time when he did not yet know economics and because he did not know it. Later, when the failure of the Revolution of 1848 and 1849 forced him to flee Germany, he went to London. There, in the reading room of the British Museum, he discovered in the ’fifties not, as he boasted, the laws of capitalist evolution, but the writings of British political economy, the reports published by the British Government, and the pamphlets in which earlier British socialists used the theory of value as expounded by classical economics for a moral justification of labor’s claims. These were the materials out of which Marx built his “economic foundations” of socialism.

Before he moved to London Marx had quite naïvely advocated a program of interventionism. In the Communist Manifesto in 1848 he expounded ten measures for imminent action. These points, which are described as “pretty generally applicable in the most advanced countries,” are defined as “despotic inroads on the rights of property and on the conditions of bourgeois methods of production.” Marx and Engels characterize them as “measures, economically unsatisfactory and untenable, but which in the course of events outstrip themselves, necessitate further inroads upon the old social order and are indispensable as a means of entirely revolutionizing the whole mode of production.”  Eight of these ten points have been executed by the German Nazis with a radicalism that would have delighted Marx. The two remaining suggestions (namely, expropriation of private property in land and dedication of all rents of land to public expenditure, and abolition of all right of inheritance) have not yet been fully adopted by the Nazis. However, their methods of taxation, their agricultural planning, and their policies concerning rent restriction are daily approaching the goals determined by Marx. The authors of the Communist Manifesto aimed at a step-by-step realization of socialism by measures of social reform. They were thus recommending procedures which Marx and the Marxians in later years branded as socio-reformist fraud.

—Ludwig von Mises, Omnipotent Government: The Rise of the Total State and Total War, ed. Bettina Bien Greaves (Indianapolis: Liberty Fund, 2011), 171-172.

German Labor Turned toward Nazism because the Nazis Had a Program Dealing with Their Most Urgent Problem—Foreign Trade Barriers. The Other Parties Lacked Such a Program

A riddle that has puzzled nearly all writers dealing with the problems of Nazism is this: There were in Germany many millions organized in the parties of the Social Democrats, of the communists, and of the Catholic Center; they were members of the trade unions affiliated with these parties. How could the Nazis succeed in overthrowing these masses of resolute adversaries and in establishing their totalitarian system? Did these millions change their minds overnight? Or were they cowards, yielding to the terror of the Storm Troopers and waiting for the day of redemption? Are the German workers still Marxians? Or are they sincere supporters of the Nazi system?

There is a fundamental error in posing the problem in this way. People take it for granted that the members of the various party clubs and trade-unions were convinced Social Democrats, communists, or Catholics, and that they fully endorsed the creeds and programs of their leaders. It is not generally realized that party allegiance and trade-union membership were virtually obligatory. Although the closed shop system was not carried to the extreme in Weimar Germany that it is today in Nazi Germany and in some branches of foreign industry, it had gone far enough. In the greater part of Germany and in most of the branches of German production it was practically impossible for a worker to stay outside of all the big trade-union groups. If he wanted a job or did not want to be dismissed, or if he wanted the unemployment dole, he had to join one of these unions. They exercised an economic and political pressure to which every individual had to yield. To join the union became practically a matter of routine for the worker. He did so because everybody did and because it was risky not to. It was not for him to inquire into the Weltanschauung of his union. Nor did the union bureaucrats trouble themselves about the tenets or feelings of the members. Their first aim was to herd as many workers as possible into the ranks of their unions.

These millions of organized workers were forced to pay lip service to the creeds of their parties, to vote for their candidates at the elections for Parliament and for union offices, to subscribe to the party newspapers, and to avoid open criticism of the party’s policy. But daily experience nonetheless brought them the evidence that something was wrong with their parties. Every day they learned about new trade barriers established by foreign nations against German manufactures—that is, against the products of their own toil and trouble. As the trade unions, with few exceptions, were not prepared to agree to wage cuts, every new trade barrier immediately resulted in increased unemployment. The workers lost confidence in the Marxians and in the Center. They became aware that these men did not know how to deal with their problems and that all they did was to indict capitalism. German labor was radically hostile to capitalism, but it found denunciation of capitalism unsatisfactory in this instance. The workers could not expect production to keep up if export sales dropped. They therefore became interested in the Nazi arguments. Such happenings, said the Nazis, are the drawbacks of our unfortunate dependence on foreign markets and the whims of foreign governments. Germany is doomed if it does not succeed in conquering more space and in attaining self-sufficiency. All endeavors to improve the conditions of labor are vain as long as we are compelled to serve as wage slaves for foreign capitalists. Such words impressed the workers. They did not abandon either the trade unions or the party clubs since this would have had very serious consequences for them. They still voted the Social Democrat, the communist, or the Catholic ticket out of fear and inertia. But they became indifferent both to Marxian and to Catholic socialism and began to sympathize with national socialism. Years before 1933 the ranks of German trade-unions were already full of people secretly sympathizing with Nazism. Thus German labor was not greatly disturbed when the Nazis finally forcibly incorporated all trade-union members into their Labor Front. They turned toward Nazism because the Nazis had a program dealing with their most urgent problem—foreign trade barriers. The other parties lacked such a program.

The removal of the unpopular trade-union bureaucrats pleased the workers no less than the humiliations inflicted by the Nazis on the entrepreneurs and executives. The bosses were reduced to the rank of shop managers. They had to bow to the almighty party chiefs. The workers exulted over the misfortunes of their employers. It was their triumph when their boss, foaming with rage, was forced to march in their ranks on state holiday parades. It was balm for their hearts.

Then came the rearmament boom. There were no more unemployed. Very soon there was a shortage of labor. The Nazis succeeded in solving a problem that the Social Democrats had been unable to master. Labor became enthusiastic.

It is highly probable that the workers are now fully aware of the dark side of the picture. They are disillusioned. The Nazis have not led them into the land of milk and honey. In the desert of the ration cards the seeds of communism are thriving. On the day of the defeat the Labor Front will collapse as the Marxian and the Catholic trade unions did in 1933.

—Ludwig von Mises, Omnipotent Government: The Rise of the Total State and Total War, ed. Bettina Bien Greaves (Indianapolis: Liberty Fund, 2011), 245-247.

There Are Two Possibilities for World-Embracing Socialism: the Coexistence of Independent Socialist States or a Unitary World-Embracing Socialist Government

The socialists insist that war is but one of the many mischiefs of capitalism. In the coming paradise of socialism, they hold, there will no longer be any wars. Of course, between us and this peaceful utopia there are still some bloody civil wars to be fought. But with the inevitable triumph of communism all conflicts will disappear.

It is obvious enough that with the conquest of the whole surface of the earth by a single ruler all struggles between states and nations would disappear. If a socialist dictator should succeed in conquering every country there would no longer be external wars, provided that the O.G.P.U. were strong enough to hinder the disintegration of this World State. But the same holds true for any other conqueror. If the Mongol Great Khans had accomplished their ends, they too would have made the world safe for eternal peace. It is too bad that Christian Europe was so obstinate as not to surrender voluntarily to their claims of world supremacy.

However, we are not considering projects for world pacification through universal conquest and enslavement, but how to achieve a world where there are no longer any causes of conflict. Such a possibility was implied in liberalism’s project for the smooth coöperation of democratic nations under capitalism. It failed because the world abandoned both liberalism and capitalism.

There are two possibilities for world-embracing socialism: the coexistence of independent socialist states on the one hand, or the establishment of a unitary world-embracing socialist government on the other.

--Ludwig von Mises, Omnipotent Government: The Rise of the Total State and Total War, ed. Bettina Bien Greaves (Indianapolis: Liberty Fund, 2011), 122.

Only by the Logical Tricks of Polylogism Could Etatism Gain a Hold on the Modern Mind; the "Proletarian Philosopher" Dietzgen Taught Thought Is Determined by the Thinker's Class Position

Marx and the Marxians, foremost among them the "proletarian philosopher" Dietzgen, taught that thought is determined by the thinker's class position. What thinking produces is not truth but "ideologies." This word means, in the context of Marxian philosophy, a disguise of the selfish interest of the social class to which the thinking individual is attached. It is therefore useless to discss anything with people of another social class. Ideologies do not need to be refuted by discursive reasoning; they must be unmasked by denouncing the class position, the social background, of their authors. Thus Marxians do not discuss the merits of physical theories; they merely uncover the "bourgeois" origin of the physicists.

The Marxians have resorted to polylogism because they could not refute by logical methods the theories developed by "bourgeois" economics, or the inferences drawn from these theories demonstrating the impracticability of socialism. As they could not rationally demonstrate the soundness of their own ideas or the unsoundness of their adversaries' ideas, they have denounced the accepted logical methods. The success of this Marxian stratagem was unprecedented. It has rendered proof against any reasonable criticism all the absurdities of Marxian would-be economics and would-be sociology. Only by the logical tricks of polylogism could etatism gain a hold on the modern mind.

--Ludwig von Mises, Omnipotent Government: The Rise of the Total State and Total War, ed. Bettina Bien Greaves (Indianapolis: Liberty Fund, 2011), 163-164.

The Dictators Offer Us another Solution. They Are Planning a “New Order,” a System of World Hegemony of One Nation or of a Group of Nations

The dictators offer us another solution. They are planning a “New Order,” a system of world hegemony of one nation or of a group of nations, supported and safeguarded by the weapons of victorious armies. The privileged few will dominate the immense majority of “inferior” races. This New Order is a very old concept. All conquerors have aimed at it; Genghis Khan and Napoleon were precursors of the Führer. History has witnessed the failure of many endeavors to impose peace by war, coöperation by coercion, unanimity by slaughtering dissidents. Hitler will not succeed better than they. A lasting order cannot be established by bayonets. A minority cannot rule if it is not supported by the consent of those ruled; the rebellion of the oppressed will overthrow it sooner or later, even if it were to succeed for some time. But the Nazis have not even the chance to succeed for a short time. Their assault is doomed.

--Ludwig von Mises, introduction to Omnipotent Government: The Rise of the Total State and Total War, ed. Bettina Bien Greaves (Indianapolis: Liberty Fund, 2011), 7.

The Salesman Thanks the Customer for Patronizing His Shop and Asks Him to come Again. But the Socialists Say: Be Grateful to Hitler, Render Thanks to Stalin; Be Nice and Submissive

The entrepreneur in a capitalist society depends upon the market and upon the consumers. He has to obey the orders which the consumers transmit to him by their buying or failure to buy, and the mandate with which they have charged him can be revoked at any hour. Every entrepreneur and every owner of means of production must daily justify his social function through subservience to the wants of the consumers.

The management of a socialist economy is not under the necessity of adjusting itself to the operation of a market. It has an absolute monopoly. It does not depend on the wants of the consumers. It itself decides what must be done. It does not serve the consumers as the businessman does. It provides for them as the father provides for his children or the headmaster of a school for the students. It is the authority bestowing favors, not a businessman eager to attract customers. The salesman thanks the customer for patronizing his shop and asks him to come again. But the socialists say: Be grateful to Hitler, render thanks to Stalin; be nice and submissive, then the great man will be kind to you later too.

--Ludwig von Mises, Omnipotent Government: The Rise of the Total State and Total War, ed. Bettina Bien Greaves (Indianapolis: Liberty Fund, 2011), 62-63.

The Greater Part of Public Opinion Did Not Suspect at all that Sozialpolitik and Protection Were Closely Linked Together; Instead, They Bitterly Indicted the Greediness of Capitalists; the Marxians Interpreted It As That Concentration of Capital Which Marx Had Predicted

Thus Germany developed its characteristic system of cartels. The cartels charged the domestic consumers high prices and sold cheaper abroad. What the worker gained from labor legislation and union wages was absorbed by higher prices. The government and the trade-union leaders boasted of the apparent success of their policies: the workers received higher money wages. But real wages did not rise more than the marginal productivity of labor.

Only a few observers saw through all this, however. Some economists tried to justify industrial protectionism as a measure for safe-guarding the fruits of Sozialpolitik and of unionism; they advocated social protectionism (den sozialen Schutzzoll). They failed to recognize that the whole process demonstrated the futility of coercive government and union interference with the conditions of labor. The greater part of public opinion did not suspect at all that Sozialpolitik and protection were closely linked together. The trend toward cartels and monopoly was in their opinion one of the many disastrous consequences of capitalism. They bitterly indicted the greediness of capitalists. The Marxians interpreted it as that concentration of capital which Marx had predicted. They purposely ignored the fact that it was not an outcome of the free evolution of capitalism but the result of government interference, of tariffs and—in the case of some branches, like potash and coal—of direct government compulsion. Some of the less shrewd socialists of the chair (Lujo Brentano, for example) went so far in their inconsistency as to advocate at the same time free trade and a more radical pro-labor policy.

--Ludwig von Mises, Omnipotent Government: The Rise of the Total State and Total War, ed. Bettina Bien Greaves (Indianapolis: Liberty Fund, 2011), 88-89.

Marxian Myths Have Succeeded in Surrounding the Problem of Monopoly with Empty Babble; the Common Treatment of the Monopoly Question is Thoroughly Mendacious and Dishonest; No Milder Expression Can Be Used to characterize It

Marxian myths have succeeded in surrounding the problem of monopoly with empty babble. According to the Marxian doctrines of imperialism, there prevails within an unhampered market society a tendency toward the establishment of monopolies. Monopoly, according to these doctrines, is an evil originating from the operation of the forces working in an unhampered capitalism. It is, in the eyes of the reformers, the worst of all drawbacks of the laissez-faire system; its existence is the best justification of interventionism; it must be the foremost aim of government interference with business to fight it. One of the most serious consequences of monopoly is that it begets imperialism and war. . . .

Almost all the monopolies that are assailed by public opinion and against which governments pretend to fight are government made. They are national monopolies created under the shelter of import duties. They would collapse with a regime of free trade.

The common treatment of the monopoly question is thoroughly mendacious and dishonest. No milder expression can be used to characterize it. It is the aim of the government to raise the domestic price of the commodities concerned above the world market level, in order to safeguard in the short run the operation of its pro-labor policies.

--Ludwig von Mises, Omnipotent Government: The Rise of the Total State and Total War, ed. Bettina Bien Greaves (Indianapolis: Liberty Fund, 2011), 81-82.

With regard to These Economic Dogmas, There Is No Difference between Present-Day British Liberals and the British Labor Party and the Nazis

The contemporary criticism of the Nazi program failed to serve the purpose. People were busy dealing with the mere accessories of the Nazi doctrine. They never entered into a full discussion of the essence of National Socialist teachings. The reason is obvious. The fundamental tenets of the Nazi ideology do not differ from the generally accepted social and economic ideologies. The difference concerns only the application of these ideologies to the special problems of Germany.

These are the dogmas of present-day “unorthodox” orthodoxy:

1. Capitalism is an unfair system of exploitation. It injures the immense majority for the benefit of a small minority. Private ownership of the means of production hinders the full utilization of natural resources and of technical improvements. Profits and interest are tributes which the masses are forced to pay to a class of idle parasites. Capitalism is the cause of poverty and must result in war.
2. It is therefore the foremost duty of popular government to substitute government control of business for the management of capitalists and entrepreneurs.
3. Price ceilings and minimum wage rates, whether directly enforced by the administration or indirectly by giving a free hand to trade unions, are an adequate means for improving the lot of the consumers and permanently raising the standard of living of all wage earners. They are steps on the way toward entirely emancipating the masses (by the final establishment of socialism) from the yoke of capital. (We may note incidentally that Marx in his later years violently opposed these propositions. Present-day Marxism, however, endorses them fully.)
4. Easy money policy, i.e., credit expansion, is a useful method of lightening the burdens imposed by capital upon the masses and making a country more prosperous. It has nothing to do with the periodical recurrence of economic depression. Economic crises are an evil inherent in unhampered capitalism.
5. All those who deny the foregoing statements and assert that capitalism best serves the masses and that the only effective method of permanently improving the economic conditions of all strata of society is progressive accumulation of new capital are ill-intentioned and narrow-minded apologists of the selfish class interests of the exploiters. A return to laissez faire, free trade, the gold standard, and economic freedom is out of the question. Mankind will fortunately never go back to the ideas and policies of the nineteenth century and the Victorian age. (Let us note incidentally that both Marxism and trade-unionism have the fairest claim to the epithets “nineteenth-century” and “Victorian.”)
6. The advantage derived from foreign trade lies exclusively in exporting. Imports are bad and should be prevented as much as possible. The happiest situation in which a nation can find itself is where it need not depend on any imports from abroad. (The “progressives,” it is true, are not enthusiastic about this dogma and sometimes even reject it as a nationalist error; however, their political acts are thoroughly dictated by it.)

With regard to these dogmas there is no difference between present-day British liberals and the British labor party on the one hand and the Nazis on the other. It does not matter that the British call these principles an outgrowth of liberalism and economic democracy while the Germans, on better grounds, call them antiliberal and antidemocratic. It is not much more important that in Germany nobody is free to utter dissenting views, while in Great Britain a dissenter is only laughed at as a fool and slighted.

--Ludwig von Mises, Omnipotent Government: The Rise of the Total State and Total War, ed. Bettina Bien Greaves (Indianapolis: Liberty Fund, 2011), 248-249.