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The Specter of Centrally Planned Economic Fascism Continues to Hover over the United States

The Specter of Centrally Planned Economic Fascism Continues to Hover over the United States

During World War II, the U.S. government created and operated a system of fascist central planning. (I have described this system in my books Crisis and Leviathan and Depression, War, and Cold War.) After the war, much of this system was abandoned, but it was revived in large part during the Korean War, and it was retained afterward in the form of statutory authority for its reinstatement whenever the president might so order under the authority of the Defense Production Act of 1950, as amended. As I wrote in Crisis and Leviathan (p. 246), after the Korean War “[t]he wartime wage-price and production controls lapsed, although the authority to reinstate the production controls remained”—that is, the Defense Production Act was never repealed, and it has been in force continuously since its initial passage, though amended from time to time. Under this statute, the president has lawful authority to control virtually the whole of the U.S. economy whenever he chooses to do so and states that the national defense requires such a government takeover.

The latest executive order to stipulate in detail how the president will exercise these standing powers over energy, transportation, human resources, raw materials, and so forth—stating in particular the subordinates to whom he will delegate various specific powers, among other things—was issued last Friday, March 16, 2012. It shows plainly that private control of economic life in the United States, to the extent that it survives, exists solely at the president’s pleasure and sufferance. Whenever he chooses to put into effect a full-fledged operational fascist economy, controlled from his office, he has the statutory power to do so; all he has to do is to murmur the words “national defense” and give the orders. In this regard, as Paul Begala’s infamous saying puts it, “stroke of the pen, law of the land, kinda cool.”

Robert Higgs is Senior Fellow in Political Economy at the Independent Institute, author or editor of over fourteen Independent books, and Editor at Large of Independent’s quarterly journal The Independent Review.
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