The Gilded Putsch

5 mins read

By Nick Bell

I’m not an economist.

I started this with the idea of writing about the Business Plot of 1933 and from that seed I began a long road of research and synthesis with some of my background knowledge about the time period that has taken me to places far reaching and diverse in thinking about the Business Plot- the facts of the matter are pretty straightforward.

In 1934 retired Marine Corps Major General Smedley Butler, at one time the most decorated Marine in U.S. history, testified before the House of Representatives Special Committee on Un-American Activities that he had been approached the previous year by Gerald MacGuire to lead a group of 500,000 veterans in a march on Washington to unseat President Franklin Roosevelt and install General Butler as the dictator of the United States.

This idea, in a vacuum should be unsettling to you, the modern reader, without any need for context, because as you probably know, the United States was founded on the idea that at least some of the citizenry should be able to decide the government for the whole of the citizenry, and in 1932 they had elected Franklin Roosevelt as president, not Smedley Butler.

No events exist in a vacuum, however, and with additional context, your unease will only grow, because this was a sinister plot by anti-democratic forces interested in consolidating political power in the wealthiest part of our society permanently. I’m going to jump into some hard and fast history here and it’s okay, I’ll try to provide as much necessary background information as I can.

World War I was fought from 1914-1918. It destroyed the order of the world before and the United States re-emerged as the great power on the world stage. The victorious Allies had borrowed heavily from the United States and in 1920 the U.S. Government demanded payment of these loans, some of which were extracted from Germany in the form of punishing reparations payments. But Germany had no money either, their economy was destroyed and they had lost the war, so the United States loaned Germany the money to pay the war reparations to countries like Britain and France to pay back some of their loans to the United States. Britain didn’t finish paying the debts incurred during the first world war until 2015. An astute reader might notice that in such an ouroboros1-like economy, a crash would seem almost inevitable. But that comes later.

With the end of the war, the United States saw over 25% of its male population aged 18-31, half of whom had served overseas, come home. The government did not provide health benefits or vocational training or tuition for veterans for another 25 years after this. Veterans from the first world war simply came home to soaring unemployment and $30 a month minus the cost of their field expenses, kit, etc, for their months of wartime service. Adjusted for inflation to today’s dollars, it is $500/month which is less than half of today’s minimum wage. Half the men who served in the army during the war were conscripts, and 116,708 of them died. This vast swath of the population was understandably upset by the bad deal the government gave them. America let them down. But with President Warren G Harding’s election in 1920 promising the country a return to normalcy, the economy experienced a boom of investing in heavy industries while farmers struggled as their produce dropped in value by up to 80% while land prices rose.

In 1924, 5 years after the war ended and under immense pressure from the public and veteran’s groups, Congress overrode President Coolidge’s veto and authorized additional combat pay- but in the form of Certificates of Service. These were like bonds. They promised payment 20 years later with compounded interest on the initial face value of the bond, which was determined by the veteran’s length of service. But they could only by redeemed when they matured in 1945.

This economic house of cards came tumbling down with the Wall Street’s crash of 1929, which ushered in the Great Depression. By 1933, unemployment in the United States had hit 25%. It was probably higher among veterans. The year before, 25,000 Pennsylvanians marched on Washington, demanding new public works to create employment, and by June 1933, 43,000 people had camped on the Anacostia Flats across the river from the Federal Government. That column of veterans, known as the Bonus Army, was demanding reform of the military’s practice of combat bonus pay because they had been abandoned by the government.

In July, police officers shot and killed two of the marchers and congress voted to deny early redemption of the veterans’ certificates which were ten years old by now and would not mature for ten more years. Butler arrived and gave a speech to the veterans group, praising them and their service, and a week later President Hoover ordered General Douglas MacArthur to disperse the camps with bullets and tear gas, which he did, killing protesters and burning the camp to the ground.

President Franklin Roosevelt defeated Hoover that year and when the Bonus Army returned in 1933 to protest, he sent his wife to meet with the demonstrators and ordered that they be offered new jobs in the Civilian Conservation Corps, which most of the group accepted. The CCC was established in 1933 as part of Roosevelt’s New Deal to curb unemployment and provide manual labor jobs related to conservation and development of natural resources.

Roosevelt’s New Deal

I really cannot stress how bad the Great Depression was. I can’t explain all its root causes, though unfettered capitalism has a well-documented cyclical nature. They weren’t cycling out of the Depression though, by 1933 it hadn’t even hit its worst levels as Roosevelt’s new administration had to right a ship that was upside down and split in half. One of the most important parts of the New Deal was monetary reform and the suspension of the gold standard. This meant that the dollar’s value could fluctuate on the foreign exchange market with other currencies depending on its dynamic value, rather than the value be set by what the government would pay for an ounce of gold, the system that left the British Empire indebted to Wall Street after the ruinous expenses it incurred in the first world war. Leaving the gold standard was also important in curbing deflation, which was making the Great Depression last longer. Roosevelt through unprecedented executive order forced all Americans to convert their gold into U.S. dollars as he took us off the gold standard in 1933. Conservatives at the time lost their minds- the world had been on the gold standard since 5000BCE.

All of this is important-

In Smedley Butler’s sworn testimony before the House Un-American Activities Committee (HUAC), he alleged that he had been approached by Gerald MacGuire, a representative of a group called The Committee for a Sound Dollar, an anti-monetary reform NGO financed by wealthy elites worried that their vast fortunes would be devalued by the move away from the gold standard. Butler alleged that MacGuire introduced him to one of the ringleaders of the impending coup, an inheritor of the Singer Sewing Machine Company fortune, who was willing to spend $15 million (Roughly $300,000,000 today) to support the coup. MacGuire went on to explain that he had connections with Mussolini’s Blackshirts and Hitler’s Brownshirts and that these would serve to be the model for the corps that would support their takeover.

Gerald MacGuire alone was called to testify before HUAC and he denied everything. He had no recollection of any conversations between Butler, himself and the ringleader and only vaguely recalled introducing them. The whole idea was absurd he said. No one was ever prosecuted and the ringleaders’ children and grandchildren walk among us today, some not even knowing that their parents, scared that their infinite money might be worth less infinity, were willing to debase themselves by trying to corrupt a war hero into enshrining Fascism in the oval office at the end of a gun.

“I am willing to spend half of the 30 million to save the other half,”

            – Fascist attemped-coup ringleader and Inheritor of 30 million Robert Clark

Cover Photo: nickbellworks

Nick Bell studied video production and received his bachelor’s from Drexel University. His education continues these days outside school on the ground with several microbudget sustainable technology startups. He is a big fan of eating hot food, playing tabletop games with his friends, and taking his cat on walks.

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