DON BELL REPORTS

A WEEKLY COMMENTARY

Year Twenty-Seven ... Number Two ... January 11, 1980

Table of Contents

THE COMING CORPORATIVE SOCIALIST STATE

The first weeks of the new decade seemed to forecast troublous times. More and more people were expressing exasperation and irritation over the government's weak-kneed action in the case of the fifty American prisoners of war still being held by a gang of terrorists posing as Iranian students in Tehran. People were wondering just how serious, to the United States, the Soviet invasion of Afghanistan might become. There was talk of reinstituting the draft, and whether women should be drafted. The right or wrong of Carter's embargo of 17 million tons of grain and 1 million tons of soybeans to Russia became a national issue. Boycott of the summer Olympics in Moscow was threatened. A foretaste of depression was felt when the media finally announced that people were no longer able to buy houses and that the building industry was in a deep slump. There was a panic of gold-buying, and continued and increasing concern over a galloping inflation that was causing unemployment, bankruptcies of business houses, higher and higher prices followed by higher wages for those who still had jobs. In fact, there was so much concern over so many things, few people realized that the United States, once a Republic, and now a Democracy, had taken a sudden giant step into Corporate Socialism.

It had to do with the Chyrsler Corporation, tenth largest in the Nation. Some argument was heard about whether the federal government had the right to use taxpayer's money to bail out a private corporation that was going broke. But, the actual terms of the contract btween the three parties -- a public corporation called the United States of America, a private corporation called Chrysler, and a monopoly corporation called the United Auto Workers -- was not explained by the controlled press.

Chrysler was always first and strongest in its opposition to government interference. There was a constant battle between Chrsyler and the fourth branch of the federal government, the bureaucracy. So, Chrysler was the first to be enrolled in the Corporative State. It had been a free enterprise corporation, subject to the rules of supply and demand, to the laws of competition and customer acceptance or rejection, free to make its own mistakes. Now, Chrysler has lost its freedom -- to make, to buy, to sell, to borrow -- because now, all of its operating plans are subject to scrutiny and control by a newly created federal review board. And Chrysler's competition, Ford, General Motors and American Motors, are also affected because they will be competing against a company that has a labor union president on its board of directors, and which has the federal government insuring its continuation regardless of what profit and loss statements may say.

Here is how Corporate State Socialism, American style, operates: There is the corporation (Chrysler), there is the labor syndicate (UAW), and there is a federal board which makes all the important decisions. This board consists of five members: The Secretary of the Treasury (presently G. William Miller), the chairman of the Federal Reserve Board (now Paul Volcker), the Comptroller General (Elmer Staats), the Secretary of Labor (now Ray Marshall), and the Secretary of Transportation (now Neil Goldschmidt).

"The board has extremely broad powers to decide whether Chrysler's plans are acceptable to the U.S.," writes Helen Kahn, Washington bureau chief of the trade publication Automotive News, of Dec. 31, 1979. "Chrysler, for example, must make the kind of vehicles acceptable to the national policy of reducing American dependence on foreign soil .. The review board will oversee Chrysler's operating and financial plans and collect fees. Chrysler must open its books to complete auditing by the General Accounting Office .. The review board will investigate any allegations of fraud, dishonest, incompetence, misconduct or irregularity on the part of management."

When capital, labor and government form an industrial partnership, and when government runs the business, that is called Corporative Socialism, which is the Fascist system of economy. Because of intramural squabbling the Communists have projected the brainwash that Fascism, politically and economically, is diametrically opposed to Communism. Actually, they are socialist sisters, and the only essential difference lies in the fact that Communism is an internationalist movement, while Fascism, Naziism and Tito's anti-Soviet Communism are nationalist movements. A definition seems needed and, for the sake of brevity we quote from the rather liberal Columbia one-volume encyclopedia page 925:

Now turning to the description of corporative state (page 660), we read:

Chrysler is now an association of employees and employers and is represented (and managed) by a federal board composed of appointed bureaucrats. This is a clear example of corporative socialism. Perhaps more importantly, this is the way the control of the production and distribution of goods is to be melded into the federal bureaucracy and its system of Regional Governance. The federal bureaucracy already has general control over all aspects of health, education, welfare, labor, commerce, agriculture, housing and urban development, environment, energy, transportation, etc. Chrysler represents an example of direct control over one part of a specific industry.

Rep. Danforth Quayle (R-Ind.) is the author of an article entitled "Recent Encounters with the Fourth Branch," in which he says, "Our constitutional form of government, with its three separate but equal branches, has been radically changed with the emergence of the federal bureaucracy, a fourth branch of government more power than the three others. This unelected bureaucracy, which has the power to create regulations with the force of law ... employs a task for of 2.9 million people in civilian capacities. They are responsible for spending $458 billion annually (1979 figures-Ed.) and administering 2,040 domestic programs. This means one out of every six Americans works for the federal government, whereas in 1935 one out of every 204 was employed at the federal level .. The bureaucrats staff 11 major cabinet positions, 59 agencies and more than 1,200 boards and advisory commissions .. our government pays over 84,700 people to do nothing but regulate its citizens. Their job responsibility requires them to study products, situations or conditions which the government wants to control. Then it is the regulator's duty to write legislation to give the bureaucrats the control they desire. Bureaucrats are not interested in money, but only in the power to regulate and control." (unquote).

In this context, Chrysler is a landmark case. Bureaucratic regulators, previously, controlled industries in general; now they control an industrial organization in particular. In our goverment's drive toward total Corporative Socialism, it thus has progressed from the general to the specific.

Rep. Quayle says there once were three branches, now there is a fourth that is more powerful than all the rest. He might have added that there once were three types of government: Federal, State and Local. Now there is a fourth, called Regional Government which is more power than the rest. In order to expand its power to regulate and control, this fourth branch of government has created a fourth type of governance. By dividing the Nation into Ten Federal Regions, each with its own capitol city, these unelected bureaucrats can worm their way into every sphere of human activity to control and regulate. Now, in the case of Chrysler they can also manage, even hire and fire its executives, or force the sale of the entire establishment to a foreign buyer if the Bureaucratic Review Board thinks this desirable!

In a developing Corporative State, control of whole industries is essential. But up to this point, the Bureaucrats have been only partially successful. The Tennessee Valley Authority (TVA) was one of the first attempts to control the output of electricity. There was a great campaign to convert all power plants into "public power" plants. But the utility resisted, successfully in most cases. President Truman tried to "nationalize" the steel industry, almost succeeded. Then came the railroads, where government control has virtually destroyed a once great industry. The same can be said of maritime shipping. The "foot of the camel" got into the tent in the case of the aviation industry when Lockheed was granted an unusual subsidy. Now, with Chrysler, the whole camel has got into the automotive tent.

In this same relation there is the constant reference to the probability that the whole energy crisis syndrome is the result of corporative state collusion between the Subrosa Government and the Seven Sisters oil cartel. There is the charge that independent oil producers are being "controlled or priced" out of existence. The independent local banks could be next. L.T. Patterson points out that when Carter declared a state of emergency and froze Iranian funds in the United States, he did it "pursuant to the International Emergency Powers Act and the National Emergency Act," which gives to the government "control over your financial holdings, including precious metals, bank accounts, retirement assets, pension funds, social security benefits, interest and dividend payments, bonds, stocks, certificates of deposit, Treasury bills and bonds, and all other 'credit entry' assets held by banks, savings and loans, credit unions, etc." This power has not been used, but Carter has the power to use it, when the Money Barons (not your community banker) deem it necessary.

Which brings us to the recent gold panic. Many interpreted this as the death of the dollar, possibly the sure sign of a shooting war soon to come (because, if national economic collapse is feared, war is considered the standard antidote). Jeffrey Hart in the Manchester Union Leader of 12/7/79, believed "there will be a major war between the U.S. and Soviet Union sooner rather than later. It will be focused on the Persian Gulf area. It will be principally a naval and air war. It will be short, violent and expensive, and it need not turn into a world war. At stake will be the economic survival of Western Europe, and the strategic isolation of the U.S." (unquote).

Certainly the Mideast situation could spark a war, one in which Israel would be the only winner, since her enemies would be weakened without herself being directly involved. And, following Iran and Afghanistan, it would seem that Saudi Arabia has been picked as the next trouble spot. Various sources, especially The Ruff Times, cite a series of incidents that have been unreported by the international wire services: 1) Saudi Arabia was threatened by a very serious internal revolt similar to that which occurred in Iran. On August 3rd, 1979, 24 of the top officers at two Saudi Arabian Air Force Bases were arrested, tried overnight and beheaded the next day. 2) on August 4th most all of the Saudi royal family departed, arrived unannounced at the International Hotel in Swizterland where they took over 17 floors and stayed for 7 weeks. 3) In early December the Saudis, in making their monthly announcement of foreign and gold reserves, had an unexplained drop of $7 billion and rumors began flying that there had been steady embezzlement over a number of years, of some $7 to $18 billion, from the royal treasury. 21 Saudi Arabian left-leaning princes were suspected. 4) When the attack on the Mosque in Mecca began, there were simultaneous but unreported coordinated demonstration in the oil fields of Saudi Arabia. 5) At this same time, there was an abortive attempt to launch an attack on Medina, the second holiest city in Saudi Arabia. 6) It developed that the Mecca assault involved not only religious dissidents, but also some Saudi Arabian Army, Air Force and Navy officers. In fact, a renegade National Guard colonel was in charge of the assault. 7) King Khalid had to fly back to Mecca and personally take charge because the military refused to follow the ordres of the Crown Prince; only the King's force of personality was able to rally the troops. 8) When the 63 persons were beheaded for the raid on the Mosque at Mecca, the executions were conducted in eight different cities, as an object lesson to the inhabitants. 9) When the United States turned down offers of airbases in Egypt and Palestine and sought other accomodations, in Somalia, Oman and Kenya, it was not the defense of the Persian Gulf, but the defense of the Saudi Arabian oil fields which the Pentagon had in mind.

But we wonder: will there be any real resistance of any kind on the part of our Trilateralist-controlled government? This same group of One Worlders was in charge of our conduct of World War II. They encouraged the Soviets to take over half of Germany and most of Eastern and Northwestern Europe. The same set of builders of the New World Order helped the Communists take over Mainland China, caused a no-win war in Korea, caused us to surrender Southeast Asia to the Communists. Now, under the code word "restraint," they seem to be permitting the same thing to happen in the Middle East. Communists bases in Ethiopia and Yemen control the outlet of the Red Sea into the Gulf of Aden. The fall of Iran caused the loss of our defenses of the Persian Gulf, the Arabian Sea and outlets into the Indian Ocean. Now comes Afghanistan. Next target is Pakistan, whose neighbor to the east is India where Indira Ghandi -- a friend of the Soviets -- has just been returned to power by an overwhelming vote. And once Pakistan becomes a victim of Russian expansionism and American "restraint," our isolation from that part of the oil-rich world will be complete.

The name changes, but the pattern seems to remain the same. Once they called it "containment." When that word wore thin they changed the name to "coexistence." Then a foreign-born Secretary of State chose a foreign name, called it "detente." And now the code word has become "restraint." How long, Lord, how long will a once proud, independent, God-fearing people, submit to this freedom destroying policy of "restraint"?

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