The End of Economic Man

The Origins of Totalitarianism

Peter Drucker

• Publisher: Routledge
• Year: 2017
• ISBN:
  9781351304221
• Edition: 1
• Topic: Business
• Subtopic: Business General
• Index: Business

In The End of Economic Man, long recognized as a cornerstone work, Peter F. Drucker explains and interprets fascism and Nazism as fundamental revolutions. In some ways, this book anticipated by more than a decade the existentialism that came to dominate the European political mood in the postwar period. Drucker provides a special addition to the massive literature on existentialism and alienation since World War II. The End of Economic Man is a social and political effort to explain the subjective consequences of the social upheavals caused by warfare.

Drucker concentrates on one specific historical event: the breakdown of the social and political structure of Europe which culminated in the rise of Nazi totalitarianism to mastery over Europe. He explains the tragedy of Europe as the loss of political faith, resulting from the political alienation of the European masses. The End of Economic Man is a book of great social import. It shows not only what might have helped the older generation avert the catastrophe of Nazism, but also how today's generation can prevent another such catastrophe. This work will be of special interest to political scientists, intellectual historians, and sociologists.

The book was singled out for praise on both sides of the Atlantic, and is considered by the author to be his most prescient effort in social theory.

CHAPTER SIX

FASCIST NONECONOMIC SOCIETY

THE most fundamental, though least publicized, feature of totalitarianism in Italy and Germany is the attempt to substitute noneconomic for economic satisfactions, rewards, and considerations as the basis for the rank, function, and position of the individual in industrial society.

The noneconomic industrial society constitutes fascism’s social miracle, which makes possible and sensible the maintenance of the industrial, and therefore necessarily economically unequal, system of production. This was at the same time the most urgent task, at least in Germany. By 1932 it had become obviously impossible to continue the capitalist system of production. It was equally impossible to replace it by something else. At the height of the depression the Communists, who alone of all parties preached the abolition of the capitalist system—the German Socialists had accepted capitalism for years—polled less than 15 per cent of the votes. Even they were split into a left revolutionary and a right trade-unionist wing. Yet the great majority of the German people, though they had lost their postwar faith in socialism, equally despaired of the capitalist system. They wanted neither capitalist recovery nor socialist revolution. In their despair they almost hoped for chaos. Above all, they had become highly conscious of the futility of the inevitable but deadlocked war of each class against all others.

Mussolini did not find himself confronted with this problem until 1934, although there had been a “totalitarian” faction in his party ever since 1925, when the storm over the murder of Matteoti, the leader of the Socialist opposition, almost overthrew the Fascist regime. Since 1934, however, Italy, like Germany, has had to find a formula which maintains the forms and production methods of industrial society while eliminating the economic as its basis.

The answer to several of the most hotly disputed questions regarding the nature and function of fascism follows from the nature of this task.

It becomes clear, in the first place, that it is pointless to ask which class put fascism into power. No single class can have put fascism into power. That a gang of ruthless industrialists backed Hitler and Mussolini is as far from, and as near to, the truth as that the great toiling masses backed them. Both were necessarily supported by a minority of all classes.

Mussolini had more capitalist support than Hitler; yet for many years he had to fight the most powerful combination of Italian capitalists, headed by Toeplitz of the dominant Banca Commerciale and comprising the large industrial corporations affiliated with that bank.

Hitler had the great majority of industrialists and bankers against him until late in 1932, when his success seemed practically assured. From that time onward it became a matter of prudence to contribute to his funds, in the same way in which industry had contributed to Socialist funds in the early twenties without ever “supporting” the Socialists. But the support of a handful of individually powerful industrialists like Thyssen or Kirdorf, which Hitler enjoyed after 1929, contributed to some extent to his success, though their importance was much smaller than is generally believed, and infinitely smaller than that of the majority of industrialists who opposed Nazism. But the really decisive backing came from sections of the lower middle classes, the farmers, and the working class, who were hardest hit by the demonic nature and by the irrationality of society. As far as the Nazi party is concerned, there is good reason to believe that at least three-quarters of its funds, even after 1930, came from the weekly dues, paid especially by the unemployed and by farmers, and from the entrance fees to the mass meetings from which members of the upper classes were always conspicuously absent.

Secondly, it is a moot question whether totalitarianism is capitalist or socialist. It is, of course, neither. Having found both invalid, fascism seeks a society beyond socialism and capitalism that is not based upon economic considerations. Its only economic interest is to keep the machinery of industrial production in good working order. At whose expense and for whose benefit is a subsidiary question; for economic consequences are entirely incidental to the main social task. The apparent contradiction of simultaneous hostility to the capitalist supremacy of private profit as well as to socialism, is, though muddleheaded, a consistent expression of fascism’s genuine intentions. Fascism and Nazism are social revolutions but not socialist; they maintain the industrial system but they are not capitalist.

Mussolini and Hitler, like so many revolutionary leaders before them, probably neither understand the nature of their revolutions nor ever intended to go beyond denouncing the “abuses” of either side. But, as already explained, social necessity forced them to invent new noneconomic satisfactions and distinctions and, finally, to embark upon a social policy which aims at constructing a comprehensive noneconomic society side by side with, and within, an industrial system of production.

The first step in this direction was to offer the underprivileged lower classes some of the noneconomic paraphernalia of economic privilege. These attempts are largely organized in the fascist organizations of the leisure hours of the workers: “Dopo Lavoro” (“after work”) in Italy, “Kraft durch Freude” (“strength through joy”) in Germany. Of course, these compulsory organizations are primarily designed as means of political control of a potentially dangerous and hostile class. They are honeycombed with police spies and propagandists, whose duty it is to prevent any meeting of workers except under proper supervision. The attractions offered by these organizations are intended as bribes for the workers. But—and this is their important feature—they do not attempt to offer economic rewards as bribes, although this is the traditional form which has proved effective, from the Romans to the communist regime in Russia. Though economic bribes would probably have been cheaper financially, the fascist organizations of the workers’ leisure offer, besides propaganda and the usual program of political and technical education, satisfactions in the form of theater, opera, and concert tickets, holiday trips to the Alps and to foreign countries, Mediterranean and African cruises in winter, cruises to the North Cape in summer, etc. In other words, they offer the typical noneconomic “conspicuous waste” of a leisure class of economic wealth and privilege. These satisfactions have in themselves no economic value at all, but they are powerful symbols of social position. They are intended to suggest a measure of social equality as compensation for continued economic inequality. They are accepted as such by a large part of the working class, especially in Germany where even the most confirmed Marxists regarded cultural satisfactions as something higher, more important, and more valuable than many economic rewards. The leisure-time organizations fulfill, therefore, a definite and highly important function in the solution of the fascist task. They make the existing economic inequality appear far less intolerable than before.

They cannot, however, make it appear purposeful and sensible. They can ease the problem, but they cannot solve it nor spirit it away. For the different classes still have unequal social functions and unequal social standing in the community. This is the reason for the re-emergence of the organic theory of society, which proclaims the social harmony of the economically unequal and warring classes. Of course, the use of a theory that portrays the different classes as equally important and indispensable members of one social organism is one of the oldest devices for the prevention of class war. It was used to dissuade the Roman plebeians from a revolutionary sit-down strike. In substance, however, the organic theory of the Fascists is as radically different from that of the Romans as from that of the nineteenth-century Romantic Movement. The comparison of the body politic to a human body always served to stress the equal economic function and equal economic importance of the various classes in order to justify an existing noneconomic social inequality. Fascism, on the other hand, uses the organic theory to create an equality of noneconomic social importance, status, and function in order to balance the economic inequality of the classes.

This is all the more striking inasmuch as fascism originally intended to take over unchanged the old theory, as a proof of the actual existence of economic harmony. The economic “estates” into which totalitarian theory divides society were conceived as economic units which should supplement each other in the traditional way. In the political and social reality of the totalitarian states, however, the “estates” have become social units which claim social distinctions, social functions, and social equality of their own, entirely independent of their economic functions, economic contributions, and indispensability. The German “peasant estate” is accorded a unique position as the “biological backbone of the race” which entitles it to complete social equality and even to definite, though one-sided and intangible, social superiority. The peasant occupies this position regardless of the value of his contribution to the national economy; it is frankly admitted that he is an economic liability. But, just because the economic utility of the small farmer is very doubtful and because his economic existence is threatened by the imminent industrial revolution in agriculture, it is all the more important from a national point of view to fortify his social position. Not only is the peasant estate protected by special laws and continuously extolled in speeches, pageants, and symbolic celebrations, but it is impressively emphasized by the regulations which require every town-bred boy and girl to spend a certain time as a worker on a farm under the command of a farmer. The economic advantage which the farmer derives from this supply of unpaid labor as well as from various other economic subsidies is not inconsiderable; but it is by no means sufficient compensation for the deterioration of his economic status through compulsory crop control. His social standing, however, has supposedly become independent of the economic status. And it is, according to the fascist theory, the social standing which really determines the position and function of the peasant in society.

Similar attempts have been made to sever the connection between the social and economic status of the other classes and to found their social position upon considerations outside the realm of economics. The social prominence, indispensability, and equality of the working class is given symbolic expression in the conversion of the socialist May-Day into a festival of Labor and in its elevation to the most important holiday of Nazism. If the peasant is the biological backbone of the nation, the worker is its spiritual one. He determines the new human concept which fascism strives to develop—the Heroic Man, with his preparedness to sacrifice himself, his self-discipline, his self-abnegation, and his “inner equality”—all independent of his economic status. Just as compulsory agricultural work is the symbol of the social superiority of the peasant over the urban population, the labor service which all adolescents, regardless of their economic position, are compelled to undergo, symbolizes the social superiority of the worker over the propertied classes.

The middle class has been distinguished by still another noneconomic claim to equal and indispensable social position. It has been declared the “standard-bearer of national culture.” The “Fuehrer Prinzip,” the heroic principle of personal leadership, confirms the class of industrialist entrepreneurs in their social position. This principle also claims to be based upon entirely noneconomic distinctions. The leader does not owe his social function and position to his economic function and wealth. The thesis that a leader must prove his qualifications in the spiritual field and that he must be deprived of his economic position if he fails on this score, is taken absolutely seriously by its inventors—and by many others.

The semimilitary formations, the Fascist Militia, the Storm Troops, and the Elite Guards, the Hitler Youth, and the women’s organizations serve the same noneconomic ends. The military value of these formations and organizations is extremely dubious. In Germany the idea of using them as auxiliary army corps was given up a long time ago. But to the extent to which the military value of these organizations decreased, their social importance increased. Their purpose is frankly to give the underprivileged classes an important sphere of life in which they command while the economically privileged classes obey. In the Nazi Storm Troops as well as in the Fascist Militia the greatest care is taken to make promotion entirely independent of class distinction. Units are socially mixed. The son of the “boss” or the boss himself is intentionally put under one of the unskilled laborers who has been longer in the party. The same principle is applied in the organizations of children and adolescents. It is rumored in Germany that no rich man’s son will be admitted to the “Ordensburgen,” the Nazi academies in which the future elite is to be trained, although officially the selection is made according to fitness and reliability alone. A wealthy German industrialist of high standing in the Nazi party and an Italian banker who had backed Mussolini before the March on Rome, told me independently and without knowing each other, that they had decided to send their small sons to a military academy, since otherwise they would certainly suffer from the carefully cultivated social envy and from the studied insults of their commanders and comrades in the compulsory youth organizations.

The use of a military form to give the individual compensation for economic inequality is especially evident in the German women’s organizations. As these organizations have no real military purpose, the principle according to which they have to satisfy economic envy can be applied without any restraint. Local branch organizations go obviously even further than headquarters desire, for the high command of the Nazi Women’s Bund has repeatedly had to forbid the penalizing of members of the propertied classes solely on account of their economic privileges. Nevertheless there are constant reports that “communist provocateurs” abuse their positions of leadership and confidence in order to persecute wealthy members. In Italy developments have been very similar, although at a much slower rate.

These attempts to satisfy the social envy of all classes and to give to each a definite noneconomic superiority in one sphere, have been far more successful than can be gauged from the point of view of the capitalist or socialist creeds. They have certainly gone a long way toward creating a genuine feeling of social equality among the lower classes. This is stronger in the lower middle class than among the workers with their tradition of class-consciousness. It is more general among women than among men. It is more valued by young people who do not yet have to earn their living than among adults. But it is effective to some extent in all classes, all age groups, and both sexes. The only class which remains definitely unconvinced and which is unwilling to substitute the new noneconomic social superiority for its economically determined position, is the class of entrepreneurs and industrialists. They sense in the new noneconomic basis an attempt to deprive them of their economic substance, leaving them with an empty though honored title. They are the only group which still believes in the society of Economic Man, since they benefited from it both in economic and social positions. But the other classes, who believe that they can only gain through a divorce of social from economic position, are far more ready to let themselves be persuaded.

Yet at best these attempts are a poor substitute for the real thing. They compensate for economic inequality but do not remove it as a factor of social distinction. They are effective in the same way in which an insurance payment may be considered adequate compensation by a man who has lost a leg in an automobile accident; yet no insurance payment will ever give him a new leg. Even the complete success of these attempts would therefore not be enough. They might theoretically give all classes an equality in social fundamentals, sufficient to compensate them for their inevitable rigid economic inequality. But they cannot provide a clear-cut, constructive principle of social organization which would give the individual rank and function in a noneconomic society under a noneconomic order of values. Their failure to provide such a new principle is clearly shown in the declining influence of the semimilitary organizations in spite of their steadily increasing numerical strength and their growing emphasis upon the satisfaction of social envy. The place of the “radicals” who built up these organizations and who were mostly killed in the “Roehm purge” of 1934 has been taken by even more revolutionary “radicals.” But these new extremists do not content themselves with a noneconomic compensation for economic inequality. Side by side with the continuing unequal, economically determined industrial society, they try to build a completely new society on a noneconomic basis, to which they want to accord supremacy.

The attempts to build a new noneconomic society go back to the war and the immediate postwar years. Then small informal and unorganized groups of men were formed spontaneously on the basis of the common war experience which had transgressed all economic barriers. Even before the war the German Youth Movement had tended to produce similar associations out of the common experience and enthusiasm of youthful romanticism. There the revolt against frozen conventions was used as a noneconomic basis of social organization which, it was hoped, would permeate, reform, and revitalize all society. The experience which the Nazis had with the semimilitary organizations which tried to base themselves unsuccessfully upon the same principle showed, however, that society cannot be built upon a purely romantic concept. Though the “Maennerbund” (“the men’s association”) still plays a large part in fascist phraseology, it completely failed to be socially effective. Yet it pointed toward the sphere in which a realistic noneconomic basis was to be found: the nation in arms. For a modern army, raised by general conscription, is the only organism in modern society apart from the churches in which function, rank, and distinction are not by necessity based upon economic position.

Totalitarian Wehrwirtschaft—the organization of the entire economic and social life upon military lines—serves therefore the vital social purpose of supplying a noneconomic basis of society while leaving unchanged the façade of industrial society. At the same time it serves the no less important purpose of creating full employment and thereby banishing the demon of unemployment. This does not mean that the Italian and German armament drives do not serve military ends. Even if their ultimate purpose is conceived as purely social, the very pressure of such enormous war machines would make their eventual use inevitable. But there is no such thing as a “purely military end” of military organization. All military organization is not only constructed upon the same principle as the peacetime society which it mirrors, but it also serves the same social ends and ideas. The armies of Napoleon served certainly the most tangible military purposes. Yet their organization did mirror faithfully the new society of the French Revolution in their formal equality—the equal chance for a marshal’s baton. They also served a vital social purpose as the one field in which formal equality was real equality. The volunteer armies of Prussia and Austria which rose against Napoleon served as much the social purpose of freeing the Prussian and Austrian middle classes as the military purpose of fighting the French. Similarly, conscription in England during the World War, though enacted for purely military reasons, destroyed or at least seriously weakened the privileged position of the aristocracy. And the drafting of women into war work brought female suffrage. How much more prominent must be the social purpose in a type of military organization which aims at making everybody at all times a soldier!

Moreover, in Germany as well as in Italy military considerations have been subordinated wherever they conflicted with the paramount social purpose of noneconomic organization. The well-known opposition of the army leaders to the fascist and Nazi radicals might be put down as the jealousy of an aristocratic caste against upstarts. But long before the Nazis came to power the German General Staff had decided not to return to a conscripted mass army which they considered a serious military drawback and entirely unsuitable for modern warfare. Their ideal ever since the war has been a small, highly trained and privileged force comprising long-term professional officers and technicians and supplemented by a conscripted militia on the Swiss model which would only be trained for a few weeks or months. In their opinion such a militia would be sufficient to hold the frontiers and to consolidate whatever gains the small, highly mechanized and mobile fighting units would make. And the repetition of the World War mis...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Dedication
• Table of Contents
• INTRODUCTION TO THE TRANSACTION EDITION
• PREFACE
• FOREWORD
• THE ANTI-FASCIST ILLUSION
• THE DESPAIR OF THE MASSES
• THE RETURN OF THE DEMONS
• THE FAILURE OF THE CHRISTIAN CHURCHES
• THE TOTALITARIAN MIRACLE
• FASCIST NONECONOMIC SOCIETY
• MIRACLE OR MIRAGE?
• THE FUTURE: EAST AGAINST WEST?
• APPENDIX