In the early 1930s, a secret collection of prosperous men are said to have assembled in New York City to discuss the dissolution of America’s democracy. As a consequence of the Great Depression, the countryside was littered with unemployed, and the world’s wealthy were watching as their fortunes deflated and their investments evaporated. As men of action, the well-financed New York group sought to eliminate what they reasoned to be the crux of the catastrophe: the United States government.
To assist them in their diabolical scheme, the resourceful plotters recruited the assistance of Major General Smedley Darlington Butler, a venerated, highly decorated, and considerably jaded former Marine. It was the conspirators’ earnest hope that their army of 500,000 Great War veterans, under the leadership of General Butler, could overpower the US’ feeble peacetime military and reconstitute the government as a more economical fascist dictatorship.
General Smedley Darlington Butler’s long military career was packed with conspicuous gallantry, and owing to his bravery and brilliance he was highly respected throughout the ranks. During his service he was awarded the Distinguished Service Medal of both the Army and the Navy; he was one of only twenty people in history to receive the Marine Corps Brevet Medal; and he was one of only a handful of men to twice receive the Congressional Medal of Honor. Despite his intrepid leadership in multiple conflicts, Smedley “the Fighting Quaker” Butler gradually cultivated some resentment towards the frequent misuse of the military as a corporate cudgel.
In July 1930, when the Commandant of the Marine Corps Wendell C. Neville died unexpectedly, it was widely assumed that the responsibility would pass to the most senior major general on the active list, General Smedley Butler. But his candid comments regarding military misapplication had won him many political enemies, including President Hoover, and he was consequently denied the appointment. His irritation increased when he was threatened with a court-martial due to an uncomplimentary comment regarding Italian dictator Benito Mussolini. At his own request, Butler retired from active duty soon thereafter.
About six months later, he stood before a sea of exasperated World War 1 veterans which surrounded Washington DC’s Capitol Hill. The mass of over twenty thousand men— all unemployed by the Great Depression— were assembled to urge the early payout of their Service Certificates; a pension which had been granted to them in 1924, but was not scheduled to be paid for another thirteen years. General Smedley “Old Gimlet Eye” Butler addressed the marchers amidst a storm of applause, describing the event as “the greatest demonstration of Americanism we’ve ever had.” Three days later, two cavalry regiments descended upon the veterans’ encampment. Calamity ensued. Brandishing rifles, bayonets, and tear gas, the soldiers scattered the so-called Bonus Army and set their shanty town ablaze.
The incident, combined with the economic breakdown it represented, led many citizens to suspect that the liberal democracy of America was hopelessly broken. Revolutionary rumblings were afoot, and some of the nation’s wealthiest men began to seriously contemplate taking matters into their own hands. Such sentiments were cemented following the election of Franklin Delano Roosevelt and his promised New Deal, a series of reforms which decoupled American currency from the gold standard and erected a tall stack of corporate regulations. Convinced that the program would produce cataclysmic economic effects, the cabal of capitalist conspirators allegedly set their plan into motion.
On the 1st of July 1933, Smedley Butler was visited by a pair of gentlemen who had come to urge him to run for the office of National Commander of the American Legion, an influential organization of veterans. Though Butler declined the invitation, one of the men— Gerald MacGuire— made several subsequent visits during which he disclosed additional details. He claimed to represent The Committee for a Sound Dollar, whose primary purpose was to pressure the president to reinstate the gold standard. He implied that his organization had the support of several political leaders, and the financial backing of some of the country’s most affluent individuals and successful corporations.
The credibility of MacGuire’s claims was reinforced when he produced evidence of considerable cash resources and made some eerily accurate predictions regarding personnel changes in the White House. He also accurately described the still-secret but soon-to-be-announced American Liberty League, a high-profile group whose stated purpose was to “defend and uphold the Constitution.” The League’s principal players were wealthy Americans, including the leaders of DuPont, JP Morgan, US Steel, General Motors, Standard Oil, Colgate, Heinz Foods, Chase National Bank, and Goodyear Tire. There are some who claim that Prescott Bush— father to the 41st US President and grandfather to the 43rd— was also entangled in the scheme.
On 22 August 1934, upon his return from a fact-finding trip to Europe, Gerald MacGuire dropped all pretense when he met with General Butler at an empty hotel restaurant. He indicated that his financial backers aimed to assemble an army of half a million disgruntled veterans, sown from the seeds of the original Bonus Army. He also stated that the group would like Butler to be the leader of this force. “We’ve got three million [dollars] to start with on the line,” MacGuire claimed, “and we can get three hundred million if we need it.”
According to MacGuire, the League’s members could easily manipulate the media to provide public approval. He went on to suggest that the League planned to protect the country from communism by mimicking the methods of Benito Mussolini, a dictator who had risen to power a decade earlier with the support of a veteran militia. Mussolini’s fascist government had successfully restored Italy’s industrial viability, so it was deemed as an ideal model for repairing America’s impoverished economy. According to the plan, Roosevelt and other existing US leadership would be allowed to remain as figureheads, while the true policy-making power would fall to a new cabinet position which Smedley Butler would occupy: The Secretary for General Affairs.
“Old Gimlet Eye” seemed to show some enthusiasm for the arrangement, and invited an associate named Paul Comly French to join the discussions. “Roosevelt hasn’t got the real solution to the unemployment situation,” MacGuire allegedly told French, “but we’ll put across a plan that will be really effective. All unemployed men would be put in military barracks, under forced labor, as Hitler does, and that would soon solve that problem. Another thing we would do immediately would be to register all persons in the United States, as they do in Europe. That would stop a lot of Communist agitators wandering around loose.” He also hinted that weapons would be furnished by the Remington Arms company, in which the DuPont family owned a controlling interest.
The American Liberty League’s strategy seemed bold, but not implausible. At that time much of the public held the president in low regard, and the League members had considerable control over the nation’s news outlets. Furthermore, the US armed forces were at decreased peacetime levels. With the Fighting Quaker to galvanize the 500,000 armed revolutionaries, it was quite possible that such a coup d’état could be successful.
In the autumn of 1934, General Smedley “Old Duckboard” Butler finally sprang into action. A crowd of journalists surrounded him as he addressed the nation in a press conference. But the General did not demand the surrender of the United States government. Instead, he related to the reporters the details of the secret pro-fascist plot, and described the principal players. “The upshot of the whole thing,” he explained, “was that I was supposed to lead an organization of five hundred thousand men which would be able to take over the functions of government.” The Old Gimlet Eye, it turned out, had been playing along with Gerald MacGuire in order to glean information about the plot. Though Smedley Butler had indeed grown weary of being a government-sponsored “gangster for capitalism,” he was still a true patriot. Butler’s associate— Paul Comly French— was in actuality an undercover reporter for the Philadelphia Record and New York Evening Post. The two men testified before the House Committee on Un-American Activities (HUAC), delighted to disclose all they had gathered from MacGuire. Veterans of Foreign Wars National Commander James Van Zandt also testified, stating that he had likewise been approached to lead such a march on Washington.
MacGuire and the wealthy men he allegedly represented all denied involvement in any such plot, referring to such suggestions as “a joke, a publicity stunt.” They even publicly questioned the sanity of General Butler. But MacGuire’s self-contradicting testimony was crippling to his credibility. Ultimately the investigative HUAC committee concluded that there was indeed compelling evidence of a plot, as outlined in their report:
“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…. There is no question but 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 Major General 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.”
The press was quick to pick up the story, referring to the conspiracy as a “plot without plotters”, which “failed to emerge in any alarming proportion.” A handful of papers took the story seriously, but most newsmen ridiculed the notion that their bosses’ close acquaintances would participate in such rabble-rousing.
The government’s inaction was also swift and decisive. Criminal charges were brought against no one, and the collection of prominent men implicated in the plot were immediately excused from testifying; in fact, all mention of their names was scrubbed from the committee’s public report. The document stated that “the Committee has ordered stricken therefrom certain immaterial and incompetent evidence, or evidence which was not pertinent to the inquiry.” The omitted bits of the report were later published by John L. Spivak when he was mistakenly furnished with a full transcript of the hearings, but the public accepted the additional information with indifference. Even a 1936 letter to Roosevelt from William Dodd, the US Ambassador to Germany, failed to prompt any action:
“A clique of U.S. industrialists is hell-bent to bring a fascist state to supplant our democratic government and is working closely with the fascist regime in Germany and Italy. I have had plenty of opportunity in my post in Berlin to witness how close some of our American ruling families are to the Nazi regime…. A prominent executive of one of the largest corporations, told me point blank that he would be ready to take definite action to bring fascism into America if President Roosevelt continued his progressive policies.”
Theories regarding the government’s apparent apathy are plentiful. Foremost is the fact that there were still relatively few laws to address such conspiracies during peacetime, so it was unclear what charges could be made with so little evidence. In addition, the plot was replete with political figures and the social elite, turning any journey towards justice into a minefield for all involved. Moreover, one month after the report was issued, Gerald MacGuire died of natural causes at the age of thirty-seven, eliminating the only witness with insight into the shadowy cabal.
Smedley Darlington Butler, still popular among veterans, continued to speak and write regarding what he referred to as the “racket of war.” Though he was officially a Republican, he spoke openly to publications of any party affiliation, as evidenced by his oft-quoted remarks in a 1935 issue of the socialist magazine Common Sense:
“I helped make Mexico and especially Tampico safe for American oil interests in 1914. I helped make Haiti and Cuba a decent place for the National City Bank boys to collect revenues in. I helped in the raping of half a dozen Central American republics for the benefit of Wall Street. The record of racketeering is long. I helped purify Nicaragua for the international banking house of Brown Brothers in 1909-12. I brought light to the Dominican Republic for American sugar interests in 1916. I helped make Honduras “right” for American fruit companies in 1903. In China in 1927 I helped see to it that Standard Oil went its way unmolested…. Looking back on it, I felt I might have given Al Capone a few hints. The best he could do was to operate his racket in three city districts. We Marines operated on three continents.”
In the same year he wrote the short book War is a Racket wherein he advocated the transition of the military into a powerful defense-only force. His dream was to eliminate military gangsterism by restricting the American navy to within 200 miles of the US coast, to limit armed aircraft to within 500 miles, and to prohibit the army from even setting foot off of the US mainland.
In the decades since the Business Plot was brought to light, many historians have suggested that the treachery was exaggerated by Butler, or that Gerald MacGuire overstated the resources at the conspirators’ disposal. There is much evidence, however, to suggest that not only was such a fascist-friendly conspiracy afoot, but that its underwriters had the will— and very nearly had the resources— to bring their un-American ideas to fruition. Were it not for the uncompromising patriotism of Retired Major General Smedley Old-Gimlet-Eye Duckboard Fighting-Quaker Butler, the outcome of that turbulent time might have been profoundly different, indeed.