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Business Plot

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The Business Plot or The Plot Against FDR or The White House Putsch was a conspiracy of moneyed interests intended to overthrow President Franklin D. Roosevelt during the early years of the Great Depression. The allegations of the plot came to light when Marine Corps General Smedley Butler testified to the existence of the plot before the McCormack-Dickstein Committee in 1933[1]. In this testimony, Butler claimed that a group of several men had approached him as part of a plot to overthrow Roosevelt in a fascist military coup. In their final report, the Congressional committee supported Butler's allegations on the existence of the plot[2], but no prosecutions or further investigations followed, and the matter was mostly forgotten.

The Butler Affair

According to Butler, the conspirators attempted to recruit Marine Corps General Smedley Butler to lead the coup, promising him an army of 500,000 men for a march on Washington, D.C., unlimited financial backing, and generous media spin control. Despite Butler's sworn loyalty to Roosevelt, 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.

Butler was approached by Gerald MacGuire. MacGuire was a bond salesman for Robert Clark One of Wall Street's richest bankers and stockbrokers. Gerald MacGuire was a former commander of the Connecticut American Legion. [3]

In attempting to recruit Butler, MacGuire is said to have played on the general's passionate loyalty toward his fellow veterans and soldiers. Knowing of an upcoming bonus in 1945 for World War I Veterans, Butler said MacGuire told him, "We want to see the soldiers' bonus paid in gold. We do not want the soldier to have rubber money or paper money." Although such names as Al Smith, Roosevelt's political foe and former governor of New York; Irene DuPont, a chemical industrialist; and Grayson Murphy, director of Goodyear, Bethlehem Steel and a group of J.P. Morgan banks, were said to be the financial and organizational backbone of the plot, hard evidence has never surfaced.[4] Butler stated that once the conspirators were in power, they would protect Roosevelt from other plotters.[5]

Given a successful coup, Butler would have held near-absolute power in the newly created position of "Secretary of General Affairs," while Roosevelt would have assumed a figurehead role. Butler would then have implemented fascist measures to combat the Depression, as some conservatives at the time felt that such steps were necessary to ward off communist influence while preventing drastic changes in the economic structure.

Butler testified to the existence of such a plot before the McCormack-Dickstein Committee in 1933. Reaction to Butler's testimony by the media and business elite was lukewarm, even hostile. The majority of media outlets, including The New York Times, Philadelphia Record, and Time Magazine ridiculed or downplayed his claims, saying they lacked evidence. After the committee concluded the New York Times and Time Magazine downplayed the conclusions of the committee.[6]

The House Un-American Activities deleted extensive excerpts from the report relating to Wall Street financiers including Guaranty Trust director Grayson Murphy, J.P. Morgan, the Du Pont interests, Remington Arms, and others allegedly involved in the plot attempt. As of 1975, a full transcript of the hearings had not be traced.[7]

Those accused of the plotting by Butler all professed innocence. MacGuire was the only figure identified by Butler who testified before the committee.

Portions of Butler's story was corroborated by several others including:

  • Veterans of Foreign Wars commander James Van Zandt, who testified that he had been approached to lead the 500,000-man march on Washington.[8]
  • Captain Samuel Glazier—testifying under oath about plans of a plot to install a dictatorship in the United States. [9][10]
  • Reporter Paul Comly French, reporter for the Philadelphia Record and the New York Evening Post.[11]

Historical Treatment

Those who hold with the existence of the conspiracy propose several scenarios in explaining why the affair did not become a cause celebre, among which are:

  • The story was an embarrassment to people of influence, and it was best to sweep it under the rug as quickly as possible.
  • In 1934, newspapers were controlled by a relatively small elite — according to then-Interior Secretary Harold L. Ickes, 82% of all dailies had monopolies in their communities. Proponents of the theory thus suggest that the media downplayed Butler's testimony based on the interests of their advertisers and owners.
  • Some of Roosevelt's advisors were in on the plot, and downplayed it when it was exposed to prevent their dirty laundry from being aired in public.

Those who doubt Butler's testimony claim that it simply lacked evidence.

Historian Clayton Cramer in a 1995 History Today article, reminds readers that Roosevelt's first term was characterized by fierce political fighting between conservatives and liberal proponents of the New Deal; FDR's advisors could have fabricated the plot in order to discredit conservatives opposed to his program.[12]

Cramer also recalls that the devastation of the Great Depression had caused many Americans to question the foundations of liberal democracy. Several liberals flirted with socialism and communism, while several conservatives viewed countries such as Mussolini's Italy as examples of how fascism could return stability and prosperity to countries ravaged by the Depression. Thus, it is not inconceivable that American business leaders could have viewed fascism as a viable system to both preserve their interests and end the economic woes of the Depression.

Historian Robert F. Burk: "At their core, the accusations probably consisted of a mixture of actual attempts at influence peddling by a small core of financiers with ties to veterans organizations and the self-serving accusations of Butler against the enemies the enemies of his pacifist and populist causes."[13]

Historian Hans Schmidt: "...Butler was telling the truth, as there seems little reason to doubt..."[14]

Historian Arthur M. Schlesinger Jr.: "Most people agreed with Mayor La Guardia of New York in dismissing it as a "cocktail putsch...No doubt MacGuire did have some wild scheme in mind, though the gap between contemplation and execution was considerable and it can hardly be supposed that the republic was in much danger."[15]

Historian James E. Sargent reviewing "The Plot to Seize the White House" by Jules Archer: "Thus, Butler (and Archer) assumer that the existence of a financially backed plot meant that fascism was imminent and that the planners represented a wide speared and coherent group, having both the intent and the capacity to execute their ideas. So when his testimony was criticized and even ridiculed in the media and ignored in Washington, Butler saw (and Archer sees) conspiracy everywhere. Instead, it is plausible to conclude that the honest and straightforward, but intellectually and politically unsophisticated, Butler perceived in simplistic terms what were in fact complex trends and events. Thus he leaped to the simplistic conclusion that the President and the Republic were in mortal danger. In essence, Archer swallowed his hero whole."[16]

Denouement

The Congressional committee report confirmed Butler's testimony. This report was published in the 1973 book The Plot to Seize the White House, by Jules Archer:

In the last few weeks of the committee's life it received evidence showing that certain persons had attempted to establish a fascist organization in this country...

There is no question that these attempts were discussed, were planned, and might have been placed in execution if the financial backers deemed it expedient...

MacGuire denied [Butler's] allegations under oath, but your committee was able to verify all the pertinent statements made to 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 form of veterans' organizations of Fascist character.(Excerpt from "The Plot to Seize the White House.")[17]

Notes

  1. ^ . ISBN 0618340874. {{cite book}}: Missing or empty |title= (help); Unknown parameter |Author= ignored (|author= suggested) (help); Unknown parameter |Publisher= ignored (|publisher= suggested) (help); Unknown parameter |Title= ignored (|title= suggested) (help); Unknown parameter |Year= ignored (|year= suggested) (help) p. 85 "As for the House committee, headed by John McCormack of Massachusetts, it declared itself "able to verify all the pertinent statments made by General Butler" except for MacGuire's direct proposal to him, and it considered this more or less confirmed by MacGuire's European reports."
  2. ^ Schlesinger, p. 85 "In March 1934, the House of Representatives authorized an investigation into "un-American" activities by a special committee headed by John W. McCormack of Massachusetts and Samuel Dickstein of New York. In the following months the McCormack-Dickstein Committee inquired into Nazi operations in America, exposed William Dudley Pelley and the Silver Shirts, looked into Smedley Butler's allegations, and called the Communist leaders up for testimony. Its manner of investigation commanded special respect. McCormack used competent investigators and employed as committee counsel a former Georgia senator with a good record on civil liberties. Most of the examination of witnesses was carried on in executive sessions. In public sessions, witnesses were free to consult counsel. Throughout, McCormack was eager to avoid hit-and-run accusation and unsubstantiated testimony. The result was an almost uniquely scrupulous investigation in a highly sensitive area."
  3. ^ Template:Journal reference
  4. ^ Template:Journal reference; McCormack-Dickstein Committee In his congressional testimony, Butler described Clark as being "known as the "millionaire lieutenant" and was sort of batty, sort of queer, did all sorts of extravagant things. He used to go exploring around China and wrote a book on it, on explorations. He was never taken seriously by anybody. But he had a lot of money." "Clark was certainly eccentric. One of the reasons he sited his fantastic art collection away from New York or Boston was that he feared it might be destroyed by a Soviet bomber attack during the Cold War..."(Clark) was pointed out to me during a trip to Paris," says one on his grandnieces. "He was known to be pro-fascist and on the enemy side. Nobody ever spoke to him.""
  5. ^ Template:Journal reference; Template:Journal reference; Template:Journal reference; Philadelphia Record, November 21 and 22, 1934;Time Magazine, 25 February 1935: "Also last week the House Committee on Un-American Activities purported to report that a two-month investigation had convinced it that General Butler's story of a Fascist march on Washington was alarmingly true."; New York Times February 16, 1935. p. 1, Asks Laws To Curb Foreign Agitators; Committee In Report To House Attacks Nazis As The Chief Propagandists In Nation. State Department Acts Checks Activities Of An Italian Consul -- Plan For March On Capital Is Held Proved. Asks Laws To Curb Foreign Agitators, "Plan for “March” Recalled. It also alleged that definite proof had been found that the much publicized Fascist march on Washington, which was to have been led by Major. Gen. Smedley D. Butler, retired, according to testimony at a hearing, was actually contemplated. The committee recalled testimony by General Butler, saying he had testified that Gerald C. MacGuire had tired to persuade him to accept the leadership of a Fascist army."
  6. ^ Chapter 10, FDR; Man on the White Horse of . ISBN 089968324X. {{cite book}}: Missing or empty |title= (help); Unknown parameter |Author= ignored (|author= suggested) (help); Unknown parameter |Publisher= ignored (|publisher= suggested) (help); Unknown parameter |Title= ignored (|title= suggested) (help); Unknown parameter |Year= ignored (|year= suggested) (help) Full book online.
  7. ^ Schlesinger, p 85. "But James E. Van Zandt, national commander of the Veterans of Foreign Wars and subsequently a Republican congressman , corroborated Butler's story and said that he, too, had been approached by "agents of Wall Street."
  8. ^ . ISBN 0674172728. {{cite book}}: Missing or empty |title= (help); Unknown parameter |Author= ignored (|author= suggested) (help); Unknown parameter |Publisher= ignored (|publisher= suggested) (help); Unknown parameter |Title= ignored (|title= suggested) (help); Unknown parameter |Year= ignored (|year= suggested) (help)
  9. ^ . ISBN 0813109574. {{cite book}}: Missing or empty |title= (help); Unknown parameter |Author= ignored (|author= suggested) (help); Unknown parameter |Publisher= ignored (|publisher= suggested) (help); Unknown parameter |Title= ignored (|title= suggested) (help); Unknown parameter |Year= ignored (|year= suggested) (help)
  10. ^ For a very critical review of this book see, Template:Journal reference
  11. ^ Schlesinger, p. 83
  12. ^ Schmidt, p. 245: "Journalist John L. Spivak, researching Nazism and anti-Semitism for New Masses magazine, got permission from Dickstein to examine HUAC's public documents and was (it seems unwittingly) given the unexpurgated testimony amid stacks of other papers. Spivak's two-part feature "Wall Street's Fascist Conspiracy" appeared in early 1935, a month after the hearings closed. He cogently developed a case for taking the suppressed testimony seriously. But this relevant material was embellished with overblown aspersions against "Jewish financiers working with fascist groups"-a mishmash of guilt by association that connected Morgan interests with Jewish financier Felix Warburg, HUAC, and certain members of the American Jewish Committee. Spivak was intent upon grinding his own axes, and elucidation of the plot was obscured. The suppressed Butler-MacGuire conversations could hardly support all this. Moreover New Masses was left-wing with a limited readership; the scoop was stigmatized as "red" propaganda and generally not cited elsewhere."

Futher Reading

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