Fascism should rightly be called Corporatism, as it is the merger of corporate and government power.
-Benito Mussolini

On Friday Italy approved additional reforms as it continues to hurry and reinvent itself into a nation that can once again be economically self-sufficient. Some of the measures are copies of the same inside-the-box thinking that attempts to generate employment movement and score political points. More railway lines for the south, public housing, and new schools buy the votes of the poor while making their plight much deeper. Sure, it sounds good, and who could be against new housing and schools? But the notion this is going to be an elixir is a lie that should stop. Western nations have a lot of schools and enviable housing.

It is tougher curriculums and reversing waning work ethics that Italy and the rest of the West outside Germany must figure out.

Other than the usual in-case-of-emergency-break-glass measure, Italy is finally taking the axe to antiquated policies that have stifled competition and innovation for decades. Mario Monti, the technocrat that once stopped the merger of GE and Honeywell, has seen the free market light. He is ditching the guild system which has made everyday life extremely expensive. Babysitters have guilds, and taxi drivers have guilds, and notaries have guilds; in all, 28 industries have guilds. These guilds limit membership, training and progress. This makes supply always more limited than demand and means big money for tasks that in America cost pocket change. In defense of this system, the head of the notary guild said only 17% of the industry are blood relatives, and it costs so much more than American services, but there is no robo-scandal.

People of the same trade seldom meet together even for merriment and diversion, but the conversation ends in a conspiracy against the public or some contrivance to raise prices."
-Adam Smith

Guilds in general were a central constant during medieval times in Europe and Adam Smith railed against how badly it harmed economic progress. In fact, economic scholars agree it was the 1,385 guilds that destroyed Italy's economy in the seventeen century. By the end of the eighteenth century, guilds had been abolished. Then came Benito Mussolini. "Il Duce" decided on a scheme that hinted at Marxism in the sense of controlling production, but in this case, it controlled the companies that created production. It was formed from the word fasces, which meant bundle and was represented by the Roman symbol of an axe surrounded by a ring of rods.

In this case, Mussolini would bundle collectivism and power. He blamed capitalism, boom-and-bust cycles, class conflicts, wasteful competition, and profit-orientation. Does any of that sound familiar? It's the same message we've heard from the President and liberals over and over even as we have slogged through the worst post-recession recovery ever. I remember President Obama blasting boom and bust cycles and fretted that if we were to ever find a system that would stop them, let it at least be during a boom part.

Tomorrow night we will hear more about class conflict and suggestions that all hard work should receive the same pay even if it means a blow to profits. Make no mistake the economic aspects of fascism have always been popular with progressives.

FDR paid Mussolini a compliment, calling him and his economic program "honest purpose of restoring Italy," and once the New Deal was announced Mussolini repaid the admiration, calling it "boldly...interventionist in the field of economics." By the late 1930s, several other nations adopted the economic policies of fascism. Guess which nations thought capitalism wasn't good enough? Yes, you've got it: Greece, Spain and Portugal all picked up on the appeal of fascism and only later dumped it for socialism. Now Monti wants to take what's behind the door marked "F" for free markets.

He took his victory lap Friday saying it was the end of the "closed shop" mentality in professions, so now there will be more doctors and lawyers, and petrol station owners can choose who they purchase fuel from.

As one nation exits lingering vestiges of fascism, it appears America is ready to take the next step toward this compromise between socialism and Marxism. Sadly it's the other aspects of fascism that will stop the general media from connecting the dots to the goals of Elizabeth Warren and Nancy Pelosi. Those other aspects include totalitarian rule that focused on a society that bonded based on culture and blood. It promoted discipline through indoctrination and psychical education. Mostly it embraced violence to promote its agenda. Yet make no mistake, the economic goal is where Mussolini thought he would change the world. He died an ugly death, but his agenda lived on to contribute to the slow and ugly death of Italy's economy.

Now we see an administration that seeks to control indirectly through heavy regulations, rules and intimidation corporations. Industries that get the state's stamp of approval live on despite free market rejection. So we spend billions on solar and wind power that create scant jobs and no return on investment (which isn't the right word anyway). One definition of fascism said it was socialism with a capitalist veneer, which explains things like the Volt being pushed through with billions of dollars of taxpayer funds. It's like those public-private partnerships pushed so much at the beginning of the administration. Many were created and just simply became money pots for political bundlers.

I realize it's not in America's DNA, but the non-stop campaign against capitalism is working. In Italy, guilds were tolerated even as it was clear it was hurting the economy and anchoring the nation in a medieval world. Mostly, those that knew better accepted it as a third way between capitalism and socialism. There are those that think there should be something fairer than capitalism, and fascism offers a version of distribution that comes close to making things right. Of course opportunities to earn money are really fair, and jettisoning guilds in Italy was a major step in the right direction.

Letting government control wages through regulations or tax policy will not create opportunities but instead ruin upward mobility and the trail of prosperity it blazes in society.

Comments

How do we educate the large group of young people that will vote for Obama because he is "cute"? This age group is largely uneducated regarding the economics and politics in this country let alone the rest of the world. That, to me, is one of the most frightening aspects of the future of the USA. What the far left is spouting seems to make sense to them as the rhetoric is well chosen and very deceptive. God help us. Connie Helgason on 1/23/2012 10:19:59 AM

This country is designed to be operated by a small group that represent the will of the people. It is a republic. The constitution is dated. It protects us from tyranny but not from ignorance or from selfishness. The government employs 22 million, it contracts work to another 15 million. It sends benefit checks to another 50 million. To mash some metaphors; we have gone past the knee in the curve and are heading down a slippery slope to the point of no return. This Country is a Republic on 1/23/2012 12:39:44 PM

There is no "Free Lunch" for anybody, Anwhere. People just don't get it. Socialism (and it's offshoots) sound good but require tremendous government subsidies....read: TAXES. Most Americans don't understand that Germany has a 20% VAT (Sales tax) and 50% Income Tax bracket. Capitalism requires "Sweat Equity". The choice is "Work Harder" or "Pay more taxes". Make a choice.....but there is no "Free Lunch". The Colonel on 1/23/2012 2:55:57 PM

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