All Commentary
Saturday, September 1, 1973

The Limits of Credulity

Mr. Donway, a recent graduate of Brown University, continues to deal as a free lance student and writer with the social implications of certain philosophical issues.

Twenty years ago, most people would probably have identified the following quotations as descriptions of the Soviet Union: “a vast power that requires total world integration not on the basis of equality but of domination” “pursuing a policy that had now become a denial of the spirit of man” “taking its place as one of the great and hated oppressor nations.” But of course these are not descriptions of the Soviet Union; they are supposed to be descriptions of the United States. Nor are they taken from Albanian tabloids; they are from popular college texts, written by scholars, published by reputable houses.

These are the revisionist historians, and they have succeeded where their students failed: they have brought home the war, both Vietnam and its Cold War context. Our enemies (before we declared them friends) used to say that America was compelled by economic necessity to move abroad as an imperial power, dominating, subjugating, repressing. Today, that is the going word at American colleges.

… during the postwar era the government and key sectors of private capital adopted a common, complementary strategy that led to state aid to American capitalism not only to maintain and extend its prosperity into the postwar era, but not the least also to preserve the larger global political-economic structure within which long-term capitalist interests and power might function.

So say the revisionists Joyce and Gabriel Kolko, who obviously revise history more easily than they revise their sentences.

Collectors of Bright New Ideas will recognize the imprint of the Antique Left everywhere on these fresh-thinking historians: the Kolkos’ indictment is a particularization of an argument pushed sixty years ago by the Marxists; in The Roots of War, Richard J. Barnet rehearses the Lenin-Kautsky debate to determine the degree of necessity in capitalist imperialism; William Appleman. Williams, sometimes called the dean of this historical school, asserts that America’s foreign policy has proved Marx correct; David Horowitz, an editor of Ramparts, published excerpts of his book Corporations and the Cold War with Paul Sweezy, among the oldest of the old, old guard, a self-proclaimed Marxist, and the Sweezy of Sweezy v. New Hampshire fame; Sweezy’s magazine, Monthly Review, also ran a ten page puff of Gabriel Kolko’s Roots of American Foreign Policy and Politics of War; We Can Be Friends, often cited as the beginning of cold-war revisionism, was written by Carl Marzani, convicted in 1947 for denying prewar affiliations with the Communist Party; Rexford Tugwell is included in the ranks for his book A Chronicle of Jeopardy; and so on. When Norman Mailer asked Dotson Rader where the New Leftists would end, Rader said in despair “We are going to end like Gus Hall.” In originality, at least, they already are Gus Hall, and so are their academic compradors.

Not that there is anything wrong with old ideas. They just are not new ideas. It would be more honest if the Left admitted, what seems to be true, that it perseveres like the Church, saying what it has always said. There is, after all, a kind of nobility in standing by traditional notions, just as there is a kind of boldness in advancing outrageous hypotheses. But for the Left to trot out seedy cliches as the latest in daring suggestions is simply hypocritical. Whatever else, the staunchest defender of the Apostle’s Creed never called himself innovative for reciting it.

Revisionism Like Inflation —Always More

This wave-of-the-future image probably reached its limit with Walter LaFeber’s flight into apocalyptic literature. In “The Impact of Revisionism,” LaFeber went beyond past and present to shew unto his servants things which must shortly come to pass.

And finally this historiography will move into and beyond revisionism as present middle-of-the-roaders accept revisionism in many of its parts, thus allowing the present revisionists… to become more revisionist in their view of history.

Unfortunately, LaFeber may be correct. In The New York Times Magazine (April 29, 1973), Gaddis Smith portrayed an early revisionist, D. F. Fleming, as having set forth the new moderate position, “a vast improvement over the closed-minded chauvinism of the orthodox position.” To be sure, Smith contrasts Fleming’s view with the more recent, excessive left-revisionism of Kolko, but that was to be expected on LaFeber’s analysis: the liberals will always come a discreet three steps behind (twelve years, in this case), but they will come: they must be “with it,” even when it means revolution; they must “swing,” even when it means the gibbet.

To take another case: in a 1966 letter to the New York Review of Books, Arthur Schlesinger, Jr., said “Surely the time has come to blow the whistle before the current outburst of revisionism regarding the origins of the Cold War goes much further.” But only a year later, he put together the following sentence: “For revisionism is an essential part of the process by which history, through the posing of new problems, and the investigation of new possibilities, enlarges its perspectives and enriches its insights.” Such liberal reappraisals are a telling victory for revisionism, which in point of fact breaks about as much fresh ground as the Council of Trent. (Revisionist doctrines on imperialism go back, through the Marxists, to J. A. Hobson’s Imperialism, A Study, published in 1902. Or they may be said to go back a bit further: in a burst of historical appropriateness, Hobson got many of his economic ideas from an acquaintance named Mummery.)

A Generation Gap

With liberal backing, the dogma of capitalist imperialism, though it is not getting any younger, is getting some of the young; not entirely to the pleasure of older, or more orthodox, advocates. After decades of shelving their under-consumed ideas, these uncompromising ideological retailers had perhaps begun to think of themselves more as curators; they look askance at their brash parvenu customers, so lacking in an appreciation of well-made theories.

Writing in Social Policy, Harry Magdoff grumbled that “… some popularizers on the Left formulate the issue purely in terms of ‘economic necessity’ — as if every political and military action were in response to an immediate economic need, or a telephone call from a corporation executive.” Mr. Magdoff is criticizing the heresy of replacing class analysis with elitist analysis, an old bane.

The young, generally less rigorous, seem drawn to elitist theories, whether revisionist, liberal, or ultramontane. Perhaps it is because elitist analyses can serve as a surrogate for soap operas and fan magazines; they carry the same catharsis of shock and indignation, the same formula of who -was – seen-doing-what-with -whom. C. Wright Mills made a discreet attempt at slaking this desire with The Power Elite (and was chided for it by Paul Sweezy.) But it is the new reporter-historians who bode to make a true genre of elitism. Academic analyses of presidential politics were left in the library dust by Theodore White’s The Making of the President. David Halberstam’s The Best and the Brightest showed a similar flare for the insider’s anecdote that tells while it sells. And in the Spring, 1973, issue of Foreign Policy, Godfrey Hodgson published an article called “The Establishment,” which threatens to reduce even the tone of the enterprise to the level of the gossip column, with lines like “When I talked to him recently in the Ford Foundation’s strangely Piranesian headquarters on 42nd Street…”

People and Plots

Proper revisionists, of course, are supposed to shun such superficial historiography. Writers who stress personal associations give the impression that the world is run to suit the whims of a small group of men, whether the favored group is the Council on Foreign Relations, the defense complex, or the prestigious New York law firms. And the more personally entwined they picture their ruling clique, the more its own eccentric assumptions appear to replace objective forces as the basis for action. That is why Sweezy characterizes elitist theories as “historical voluntarism.” By the time one reaches David Halberstam’s Great Groton Conspiracy, talk of necessity in America’s foreign policy is completely implausible; it’s all the fault of that damned school motto.

Revisionists reject such tight little-world views. “… the impressions of old school days wear off,” says Kolko, “and the responsibilities of men are measured in the present rather than the past.” After all, the anti-determinism of elitist analyses might tempt one to the clearly counter-revolutionary notion that “all” we need is a group of leaders with different ideas.

It is this illusion of the “accidental” quality of the role of the United States in Vietnam and elsewhere that has led over the past years to a kind of specious liberalism which believes one simply replaces individuals in office with other men, such as a Kennedy or McCarthy…

A leftist who was that soft on determinism might find himself denounced as a meliorist like Karl Kautsky, or even as a hired coolie of the pen.

Ideological Coordination

The “proper” theory of historical causality is less direct, almost Malebranchian. Washington, we are told, does not take orders from Wall Street, and certainly Wall Street does not take orders from Washington. “There is no conflict of interest because the welfare of government and business is, in the largest sense, identical.” The harmony of business and politics results from ideological coordination, not personal subordination. Association is the product, not the cause, of their harmony. The head of the octopus is not a capitalist, but capitalism itself; businessmen and politicians are, to steal a phrase from Ogden Nash, simply the arms that do the legwork.

But despite this sensitivity to elitist voluntarism, the revisionists insist on calling themselves a school of ant-determinists. In his introduction to The Origins of the Cold War, Thomas Paterson says “Most revisionists deny that the Cold War was inevitable, and stress alternatives.” This is paradoxical, but easily proved. The Cold War resulted largely from the class-serving desires of American leaders; had they sought other ends, things would have been otherwise; for instance, had they sought an accommodation with Russia, they could have had an accommodation with Russia. What we are not reminded of, in this context, is the revisionists’ belief that, given its social structure, America could not have had leaders who would have willed another course. The leaders’ desires were given by the nature of the economy.

The theory, then, is rather analogous to Jonathan Edwards’s theory of determinism. Edwards’s dictum was that we can do what we will, but we cannot will what we will; only grace can change the nature of our desires. Similarly, revisionists seem to hold that America’s postwar leaders could have done whatever they wanted, but they could not want whatever they wanted, at least as a class. The counterpart of Edwards’s dictum may be Lenin’s cryptic remark that a capitalist country could be non-imperialist only if it were not capitalist. A nation’s objectives can be changed only by the converting grace of revolution or radical alteration, “by depriving [the existing system] of access to power and levers for controlling society,” in Kolko’s words.

With that as the professorial note, it is not surprising that the cry from the ranks is “Ecrasez l’infame,” now enunciated with that cocksure whine that is the laryngeal affliction of the New Left. But they have jumped to their conclusion. All we have been told so far is that the leaders of the social system are those who agree with its principles, which is surely one of sociology’s minor surprises. That these leaders should attempt to preserve the system is also less than startling. The connection that must be made is: how did the goal of preserving a capitalist society lead to imperialism? Few listeners, it seems, stay to question or even notice the arguments offered on this central point. In better days, they would have been beneath notice.

The Economics of Trade

As it turns out, this whole grotesquerie of America’s need for expansion hangs on two slender lines of argument, dealing with the economics of importing and exporting. Of these, the argument from imports is probably the less persuasive today. We are in no mood to hear about the sins of the buyer. We can admit that a total embargo on raw materials would plunge the quality of American life — what would one do without one’s morning coffee — but after all we do pay for the stuff (twenty cents a cup; no refills), and if the bean does not get its cut, well, that is the bean’s lookout.

The argument from exports better symbolizes the revisionists’ “cosmic inversion,” (to use Hilaire Belloc’s phrase), for here they take what appears to be charity and convert it into imperialism. The argument begins by observing that (1) America was booming at the end of the war. In 1945, our industrial plant was 65 per cent larger than it had been in 1939, and our gross national product was 100 per cent larger, in constant dollars. Revisionists conclude that the productive capacity of the United States had grown unproductively large, and consequently, in the postwar years, that institutionalized form of misery which is capitalism would pour forth more than it knew what to do with.

Then (2) exports had been and would be essential to maintaining this boom. After all, a fair amount of this growth had come in response to economic demand from foreign governments involved in the war; the home market might not be able to purchase all the goods that they had bought. There were, yes, the extra savings that Americans had accumulated during the war when there was little better to do with money, but this would not long take up the slack. The only solution was to sell abroad. (Often cited as the postwar goal was the 1944 figure of 14 billion dollars in exports, more than four times the 1939 figure. Less often cited is the 11 billion dollar chunk of that 14 billion which was shipped under Lend-Lease. Since most Lend-Lease was never repaid, this casts some doubt on the truly foreign origins of the wartime demand.)

Prime revisionist text on exports comes from Will Clayton, Assistant Secretary of State for Economic Affairs, and, we are reminded with arched eyebrows, a millionaire. He declared, at a Foreign Trade Convention, no less: “We need markets — big markets — around the world in which to buy and sell.” A somewhat Chamber-of-Commerce remark, one might think, especially under the circumstances, but with elocutionary training, it can be given an air of rapacity. The more commonsense interpretation was given to it by Clayton’s Deputy, Professor Edward S. Mason of Harvard, when I talked to him recently at his strangely unpiranesian office in Cambridge: “Certainly, the U.S. wanted to re-establish trading relationships. But I never heard that we needed desperately to have the European market for our exports.”

International Pump-Priming

If one did assume the necessity for exports, though, one faced the fact that (3) foreign countries by themselves could not afford to buy American goods. Until their economies were rebuilt, they would have little to offer us in trade. The answer conceived was (4) the United States had to loan these governments money. Thus in the first stage, they would buy American capital goods and agricultural commodities; and once restored they would produce goods to trade for ours, and so maintain our exports on the long run.

As the heart of an argument designed to show the imperialist tendencies of capitalism, steps (3) and (4) have rather missed their calling. Quite simply, the loans constituted an international pump-priming scheme; they were a bit of inflation designed to link up America’s surplus capital goods with Europe’s idle labor. Apart from any dispute over the usefulness of pump-priming, we can at least agree that it is not capitalist. Indeed, the attempt is made to pin opposition to pump-priming on capitalists as a badge of their simple-mindedness. In a Playboy interview (June, 1968), Professor

Galbraith said that Henry Hazlitt, a leading capitalist economist, had overlooked “the very elementary point” that pump-priming is carried out in a situation of idle capital and idle labor. For the record, Mr. Hazlitt considers pump-priming under exactly these conditions in his book The Failure of the “New Economics.” He finds it unnecessary, uncertain, dangerous, and unjust.

But capitalist or no, this scenario for international pump-priming contained a further condition: the United States had to be assured that once it gave foreigners the ability to buy our goods, their governments would give them permission to buy our goods. Cost was no object in developing trade, so long as trade did develop, but we were not about to cast our seed money on the ground. In other words, (5) the scheme would work only if debtor governments moved toward a laissez-faire, or at least pro-American, stance; and to this end our diplomacy was directed.

Thus far the argument can be put together from statements made by members of the Truman Administration. (Though the importance of the plan has been disputed by Alfred E. Eckes, Jr., in The Journal of American History, March, 1973.) For the rest, revisionists merely point out that since we urgently needed countries to move to the right, (6) America had to oppose the assumption of power by leftist elements; in Containment and Change, Carl Oglesby says we needed “access and no revolution in order to have high production.” This meant encouraging rightist governments to suppress leftist movements, and thus were we forced by the capitalist system to play a repressive role, directly or through surrogates. Finally, in order to make this politically palatable, we had to push the fiction that the left was not popular and democratic, but Russian-inspired and totalitarian. This posture naturally exacerbated relations with the Soviet Union and the European Left generally.

Like the old Marxist argument, the essential reasoning of the six points can be analyzed in a basic two-step: does the capitalist system produce general surpluses; and what does the capitalist system do when confronted with a surplus?

On the first point, revisionists seem little inclined to argue; they prefer to quote testimony or make assertions. For instance, W. A. Williams cites Dean Acheson’s remark: “You don’t have a problem of production…. The important thing is markets. We have got to see that what the country produces is used and sold.” Even less willing to offer evidence, Carl Oglesby says “Our economic system functions in a state of disequilibrium. The better it works, the greater the surplus.”

Capitalist Over-Production

To find a genuine argument connecting capitalism and excess production, one must turn to the hard, ingenuous Left, which argues as follows: Since a capitalist’s status depends on the amount of capital under his control, he engages in production without reference to the possibility of finding a market. Paul Sweezy says:

Here, then, we can see the elements of what Marx in one place calls “the fundamental contradiction” of capitalism: production entirely lacks an objective unless it is directed towards a definite goal in consumption, but capitalism attempts to expand production without any reference to the consumption which alone can give it meaning.

Obviously, this is not an argument one would want to trot out unless absolutely required to do so; in fact, it is simply an assertion of mania, not worth discussing.

It appears, therefore, that the postwar situation is a special gift to the revisionists. The large expansion in investment was not the product of irrationality in the business community; it was the product of our effort to win the war. It could hardly be called malinvestment, but the plant developed (revisionists say) would produce more than available markets could consume. It looks as if the revisionists can get their first premise, of an investment beyond demand, without resorting to foolish psychological theories about the business mentality.

As often happens, though, the evidence adduced by the revisionists (more testimony) proves exactly the opposite of the conclusion they want. When Vinson, Clayton, Wallace, and so on, went before committees to support the so-called British loan, they did indeed tell Congressmen that they were looking at the loan’s effect on the economy, were much interested in it, never let it out of sight. But the effect they were looking at was not the alleviation of surplus; it was the exacerbation of scarcity. When they actually confronted the swollen wartime plant, the problem was that it was not big enough for peacetime demand.

A few, but very few, fields were mentioned at that time as having surplus, and even these references seem blatantly political. When Secretary Vinson mentioned cotton as being among the goods Britain would want, Senator Bankhead of Alabama asked narrowly if he meant cotton goods or raw cotton. Another question as to what Britain would buy drew the answer “You could be sure of some tobacco,” which sounds much like “You could be sure of some pork-barrel.” When used honestly the argument from over-production was based on expectations about the economy, which puts us right back to the argument about the biases of capitalism.

Since revisionists have little heart for arguing that point, there remains only the second question: what, under capitalism, would one do with a surplus? The revisionists’ answer, that the government would force it down the throats of unwilling consumers, is simply not economics; it is pandering: I dreamed of oppression in my black pajamas. I presume that the capitalist answer is well known: if a businessman produces more of a good than he can sell (say an Edsel), the capitalist response is to point out that he has produced more of the good than he can sell. He can try to increase his sales by advertising to high Heaven; he can try to sell abroad; he can take a loss and cut production; all thatis capitalist. One thing he cannot do is involve the government in restructuring his market. That is just typical liberal interventionism. Revisionists may reply that it happens in America, which is true, but if it happened in William Graham Sumner’s home town the point would be irrelevant. Others, such as Richard J. Barnet, may try to call it “state capitalism,” but the phrase conveys little, since it is a contradiction in terms.

This is the pattern: on the rare occasions that revisionists do descry an evil, they are not looking at capitalism; they are staring straight at the denaturing elements of our mixed economy. The evil is blamed on capitalism (it’s a capitalist system isn’t it); the solution is more intervention, leading to more evils. And the momentum develops. Which is per, haps the element of truth in La Feber’s analysis: if a liberal will not rethink, he must revise, more and more. If he does rethink, he must rethink his leitmotif “We cannot go back;” he may even have to discover the historical irony, that when we went past capitalism we were going in reverse. 

  • Roger Donway is a freelance writer and editor whose work focuses on philosophy, economics, and history. In addition to heading up the Business Rights Center, Donway is assisting author Robert Bradley, Jr. with his forthcoming book Edison to Enron: Energy Markets and Political Strategies, the second volume in Bradley's trilogy, Political Capitalism (M&M Scrivener Press). Donway performed editing and research for Bradley's first book in the trilogy, Capitalism at Work: Business, Government, and Energy.