There was a great and immediate controversy when a congressional committee was formed to investigate the recent attempt by the powerful and wealthy to manipulate populist discontent and foment a coup against the United States government. Still fresh in the memory of the public mind were the indelible images of the marchers on Washington, DC, the “rioters,” as they were called, a motley army of them, who were also called “insurrectionists,” indicating their intention to overthrow the American democratic order, amassing on the lawn of the U.S. Capitol building as the representatives within conducted a certain business in which these marchers wanted to intervene. Many wondered what might have resulted had that ragtag army of thousands not been foiled in their undertakings, and during the later House Committee investigation, they heard what may have happened. For it came out in committee hearings that there had been an overt and credible conspiracy to incite a popular uprising for the purpose of supplanting the power of the duly elected President, and raising an explicitly Fascist dictatorship in place of our representative democracy. Especially inflammatory were the allegations that it was those in high places, men of great wealth, privilege, and political power who had been behind the plot overthrow the U.S. government. The findings of the committee were not universally believed, but many saw the truth in them, knowing that our populace had been subjected to foreign propaganda for years and that many among the elite believed a dictatorship more friendly to their interests would enable them to retain and grow their fortunes. However, many others viewed the committee as a witch hunt and believed those implicated in the plot when they denied everything even in the face of clear evidence. In the press, however, the committee’s findings were roundly mocked, with the New York Times saying “The whole story sounds like a gigantic hoax” and that “[i]t does not merit serious discussion.” Perhaps this was because newspaper magnates were themselves implicated as conspirators, or perhaps it was because the populist insurrection being discussed in the House committee was completely unrelated to the very real march on Washington that had recently taken place and in this case had only been proposed and never actually occurred. Sorry, you seem confused. What do you mean the New York Times hasn’t viewed the Capitol Insurrection skeptically? What newspaper magnates are implicated? I’m referring to William Randolph Hearst. Oh… I see the confusion. You think I’m talking about the controversy surrounding the findings of the House Select Committee to Investigate the January 6th Attack on the United States Capitol. No, no, no, I’m describing the proceedings of the 1934 House Committee on Un-American Activities, which convened in the years after one controversial march on Washington to investigate the claims of an alleged conspiracy by Wall Street fat cats to astroturf another march in an attempt to seize control of the reins of government. But actually, now that you mention it, I suppose I can see the similarities.

Constant readers will realize that I discussed the Business Plot, or Wall Street Putsch, in my post “The Perils of American Democracy,” but I gave it terribly short shrift there with only about half a paragraph, and it has been a topic that I have greatly wanted to explore in more depth for a number of reasons. One is, of course, the anniversary of the January 6th insurrection. Last year, on the first anniversary, I wrote a two-part post that drew parallels between January 6th and the Wilmington insurrection of 1898. I think that my examination of that incident showed a strong parallel between the use of fake news propaganda in galvanizing such insurrections and gaslighting the larger public to misrepresent the true nature of the situation, and I think it’s lessons about white supremacy and institutional racism remain vital. Go and read the Coup on Cape Fear parts 1 and 2 if you haven’t. But I find the story of the Business Plot perhaps even more instructive when it comes to contextualizing January 6th. We are talking about a nation in economic crisis, inundated by foreign propaganda, which drove a cabal of wealthy and influential titans of industry to orchestrate a martial uprising against the seat of American government in imitation of a more organic and well-intentioned but much-maligned protest movement, all of which is clearly revealed by congressional investigators whose findings are thereafter widely disbelieved and dismissed, leading to no real justice for those who enacted the plot. As I wrote and recorded this episode, the Department of Justice had charged nearly a thousand people in connection with the Capitol Attacks, most of them rank and file participants, and only a few with actual charges of seditious conspiracy. The DOJ has maintained an impressive 99.8% conviction rate in these cases, but it can be argued that they haven’t held the ringleaders, the congresspeople and executive cabinet members who incited the attack, to account. On Monday, December 19th, the January 6th panel did refer charges against former president Donald Trump to the DoJ, including one charge of “inciting an insurrection.” However, it remains to be seen whether Merrick Garland’s DoJ will indict him, what defense he may make, and what the outcome of that indictment might be. Furthermore, the fact that his indictment and trial won’t prevent his concurrent campaign to regain the presidency further complicates matters. If he were both reelected and convicted and an attempt was made to bar him from taking his elected office, one can certainly see the current partisan Supreme Court bench considering this constitutional crisis and inevitably finding in his favor, and the fact remains that any sitting president, be it Biden or some other 2024 challenger, has the power to pardon him. So clearly the resolution of the January 6th insurrection remains up in the air, and I believe the story of how the Business Plot shook out in the end to be supremely educational and sadly, perhaps prophetic. Lastly, I was inspired to produce this series by the fantastic 8-part series Rachel Maddow Presents: Ultra. I don’t care what your opinions are of Maddow or MSNBC; this was a well-researched, lucid, fascinating, and astonishing account of a time when sitting members of congress were complicit in both a Nazi propaganda scheme and a conspiracy to overthrow the U.S. government, leading to the largest sedition trial in American history. You can consider this 2-part series a kind of unauthorized prequel to Ultra, which I hope you’ll listen to at your earliest convenience. This isn’t a paid endorsement; I just think that it’s a very important podcast that everyone should hear.

Just as the story of the January 6th insurrection must be seen in the context of the recession resulting from necessary Covid restrictions and the widespread racial justice protests of 2020, with which the Capitol Insurrection is frequently and speciously compared, so too the Business Plot must be placed in the context of the Great Depression and the march of the Bonus Expeditionary Forces on Washington, DC. It began with a crash. Rebounding from a previous economic depression, the value of stocks had inflated beyond their worth between 1921 and 1929, prompting the Federal Reserve to raise interest rates in order to slow the inflation—something we saw them doing again just last year. The resulting plummeting of stock prices in October 1929 led to the panicked sell off known as the Great Crash. But the Wall Street crash did not at first worry many or greatly affect the overall economy, since only a wealthy fraction of the populace invested in the stock market. However, a severe drought across the Great Plains, which would later come to be known as the Dust Bowl, soon led to America’s farmers facing major challenges, and a series of bank panics in the autumn of 1930 led to the “crisis of confidence” that then-President Herbert Hoover identified as the true culprit of the Great Depression. President Hoover had himself contributed to this crisis of confidence, as he had signed an international tariff act against the advice of economists that further strained the global economy and banks, especially those that provided loans to struggling farmers. All of this is a very simplistic description of the triggers of the Great Depression, but the result was that gold, upon which our currency was still based, began to leave the American economy as it was withdrawn from banks and hoarded or sent overseas by the wealthy. The very real consequence of this loss of capital was the closure of banks, the failure of businesses, mass unemployment, and hunger. Thus we get the immortal symbols of the Depression: men, women, and children, destitute, walking American roads and highways barefoot with no refuge. Soon, these symbols took on the name of the man seen as directly responsible for this catastrophe, President Herbert Hoover, who was ironically known for great humanitarian efforts overseas but remained staunchly against what he called the dole, or government assistance paid out to those in need, here at home, believing it made people lazy. Thus the carts that these Depression homeless pulled all their belongings in were dubbed Hooverwagons, and their encampments famously called Hoovervilles. Many of those affected were U.S. military veterans who had served their country bravely overseas and now could not survive in the broken economy at home. An idea arose, a lifeline for these desperate and starving veterans, that if they could just be paid their bonus early, it would mean the difference between life and death. Back in 1924, with the passage of the Bonus Act, these veterans had been promised a substantial payment for lost wages in the Great War, but in 1931, in the depths of the Depression, that bonus wasn’t to be paid for another 14 years. Veterans argued that it should be called the Tombstone Bonus, then, for most would not live to receive it.

When Hoover vetoed the immediate payout of the bonus, veterans’ organizations like the American Legion and the Veterans of Foreign Wars helped to mobilize destitute veterans all over the country into a massive protest movement. Calling itself the Bonus Expeditionary Forces, or the Bonus Army, they marched on Washington, DC, and tried to bring a petition to the White House, where they were barred at the gate. Leaving without incident, the Bonus Army would return in even greater numbers the following summer of 1932 to camp out on the lawn of the Capitol building when another bill authorizing early payment of their bonus that had been passed by the House of Representatives was being voted on by the Senate. When debate on the bill was tabled until the following year, many expected violence from the Bonus Army, but they merely sang “America the Beautiful” as they returned to the massive Hooverville that they had constructed from garbage across the river, within view of Capitol Hill. Most of the demonstrators left the city after that, but more than 8,000 of them stayed in their shantytown, the largest such Hooverville in the country. The following month, they were visited by a retired Major General who will be very important to this story. Smedley Darlington Butler was at the time a supporter of Franklin Delano Roosevelt, Herbert Hoover’s rival in the ongoing 1932 campaign for the presidency. Over the course of his career in the Marines, he had led men in various American imperial campaigns throughout the Caribbean, Central America, the Philippines, and China. During the course of his career, he had seen firsthand how the military was used abroad to further the business interests of American financiers and bankers, later describing war as a racket and himself as a “gangster for capitalism.” Smedley Butler entered the Bonus Army’s Hooverville camp and expressed great sympathy for their cause. Over and over, he warned them against lawless acts, assuring them that they had “the sympathy of 120 million people in this nation,” and that they’d lose it if they rioted. But otherwise, he listened to all of their complaints, staying with them into the early hours of the morning, and encouraged their continued demonstration, reminding them that they “didn’t win the war for a select class of a few financiers,” and urging them to “[h]ang together and stick it out till the gate bars of hell freeze over.” Butler had a reputation as a soldier’s general, rather than a general’s general, in that he was far more popular among those he commanded than among those who commanded him. The stark difference between Butler and other generals would soon be demonstrated with terrible clarity.

Bonus Army protesters raise their hands to confirm they are Americans who served overseas.

A striking parallel can be seen between Hoover’s response to the Bonus Army in the summer of 1932 and Donald Trump’s response to Black Lives Matter protesters in the summer of 2020, both incidents precursors to an organized coup attempt perpetrated by those who had vehemently opposed the preceding, legitimate protest movements. All of us should remember the George Floyd protests during the summer of 2020, and how Donald Trump and his extremist boosters called the protesters “thugs,” “anarchists,” and “terrorists.” In June of 2020, peaceful racial justice protesters in Washington, DC, were tear gassed and fired on with rubber bullets as Trump threatened to “deploy the United States military and quickly solve the problem.” In a remarkable instance of history rhyming, Herbert Hoover, back in 1932, likewise believed that the Bonus Army marchers were dangerous and was considering the same measures. The nation’s top cop, J. Edgar Hoover, head of the Bureau of Investigation, precursor to the FBI, was whispering in the President’s ear that the Bonus marchers were Communist terrorists, all of them highly trained, armed with machine guns and airplanes, none of which was true, but J. Edgar Hoover was a fearmonger—that was how he built and funded the FBI, by manufacturing panic about domestic enemies. U.S. Army intelligence and General Douglas MacArthur were also telling Hoover that the Bonus marchers weren’t what they claimed to be, that they were “rabble-rousing insurrectionists and Communists” bent on revolution, which of course led to claims that they were all Jews, and that they weren’t even veterans, as they claimed. In truth, the Bonus marchers, whom MacArthur had begun derisively calling Boners, were a remarkably diverse group composed of about equal thirds white, Jewish, and Black Americans. MacArthur’s claims that they weren’t veterans were simply lies that the press amplified. The Veteran’s Administration had surveyed the Bonus Army and recorded that 94% of them were indeed vets, the majority having served overseas, and almost a quarter of them disabled in the line of duty. It’s true, maybe half of them were Communist or sympathetic to Communism, or at least with Socialist leanings, but this was not unsurprising at the time, as many in the Depression-era U.S. were more and more enamored with Communism, Socialism, and even Fascism, as we will further see. Indeed, in that very election year, the Socialist presidential candidate garnered three times the number of votes he had received in the previous election year. Certainly Communists would have liked to turn the entire Bonus Expeditionary Forces to their cause, but the fact was, most of the Bonus Army were just destitute and starving victims of the Hoover economy. In fact, they routinely destroyed Communist literature that was being circulated among them, and many embraced the mantra, “Eyes front—not left.” Just as with the BLM protests, some violence did erupt in clashes with police. When, on the President’s prompting, some veterans were evicted from derelict buildings that the police chief himself had previously arranged for them to camp in, they pushed back, some bricks were thrown, and the tousle resulted in one policeman shooting two veterans dead. Despite the fact that this was a pretty clear case of police failure to control a volatile situation, and it resulted in the deaths of demonstrators, not police, the incident was used to justify the unconscionable brutality that ensued.

General MacArthur convinced President Hoover that the situation warranted military action. MacArthur, along with his aides, future general George S. Patton and future president Dwight D. Eisenhower, were directed to expel the veterans from the city. Eisenhower and Patton apparently thought the entire thing too political and distasteful, but MacArthur appeared to relish the chance to bring the might of the U.S. Army against unarmed American citizens. In full military dress, he deployed infantrymen with fixed-bayonets, cavalry with drawn sabers, a machine gun detachment, and even five tanks onto the streets of the U.S. capital. The poorly-timed operation took place just as many federal employees clocked out for the day and entered the streets, such that crowds of Bonus Army veterans mingled with crowds of onlookers who mistook the military forces for some kind of parade. The cavalry charged the crowds, trampling men, women and children, while the infantry advanced on them, bayonet tips pressing the crowds back. Bonus marchers and city residents alike fled in abject terror as tanks ran them down and cavalrymen struck them with the flats of their sabers. Tear gas grenades burst in their midst, igniting fires and completing the transformation of the nation’s capital into a warzone. Within hours, all the Bonus Army vets had retreated to their shantytown outside the city, and despite the fact that President Hoover had ordered the military not to enter their encampment, MacArthur sent tanks, machine guns, and troops to surround the Hooverville. The veterans waved a white flag of surrender and asked for an hour to get their families out. MacArthur granted them this, and when the hour had elapsed, he sent his forces in to burn their shacks and lean-tos to the ground. President Herbert Hoover stood at a window in the White House and watched the fires. What he saw destroyed that night was not only the homeless encampment that bore his name. He was also watching his chances for reelection go up in smoke. Perhaps more than his handling of the economic crisis, his handling of the Bonus Expeditionary Forces provided his opponent, Democratic candidate Franklin Delano Roosevelt, all the ammunition he needed to win his campaign.

The burning of the Bonus Army Hooverville at Anacostia Flats.

Perhaps few words are needed to introduce the next major character in our story, FDR, as he is widely known and considered by many to be the best or at least the most influential U.S. President of the 20th century. We know FDR principally as the architect of progressive New Deal legislation that helped America begin to recover from the Great Depression and programs that provided a social safety net for the future, and as the wartime leader who shepherded us through World War II, the mobilization for which would be what finally ended Depression. We remember him as the first president to enter our homes and reassure us in his Fireside Chat radio addresses. And we remember him seated on a wheelchair, paralyzed from the waist down by infantile polio, and therefore an inspiration to all overcoming physical disability. FDR was not, however, exactly as one might imagine him. He did not, for example, contract polio as a child, as the term “infantile polio” suggests. In fact he was a vigorous outdoorsman, enjoying sailing, horseback riding, and fishing up until the day he became ill at 39 years old, and indeed, he remained athletic after his paralysis, as his physical rehabilitation regime was robust. He became an avid swimmer and even had a pool installed at the White House. Despite his good health, his critics unsurprisingly used his paralysis against him to insinuate that he was ill or diseased or even unable to discharge the duties of the offices to which he was elected. Likewise, the circumstances of his birth were often used against him. He was not of such a background as one might expect for a social reformer. He had been born into great wealth and privilege, of the Hyde Park branch of the Roosevelts, former president Teddy Roosevelt his first cousin. We might credit the influence of his father, who instilled in him the importance of working to help the suffering and the poor, for the causes he would later champion, and we might further credit Eleanor Roosevelt, his cousin, whom he married, who regularly performed volunteer work in New York slums and worked tirelessly to improve the conditions of poor women and children. FDR was never a Communist or Socialist, however, as his critics on the far right would paint him. In fact, he was an inveterate capitalist, devoted to salvaging the economy rather than changing the economic order, as those on the far left would have preferred. And those on the far left did not claim him as their own, believing that he favored fat cats with his reforms and did not go far enough in redistributing wealth. The opposition of Huey Long and Father Charles Coughlin, those two populist firebrands that history has deemed demagogues, reveals just how moderate FDR really was despite the revolutionary liberal reforms he would enact in his first hundred days. Both had supported Roosevelt in his campaign against Hoover, but in the terrible interregnum, as conditions further plummeted under the lame duck and Roosevelt—who was dutifully making plans for his first hundred days—went yachting, both turned against him, but for far different reasons, which illustrate the fact that FDR was no extremist. It happened that FDR was joined on his yachting excursion by one of the richest men in America, Vincent Astor, as well as several other wealthy members of the New York Yacht Club. Long and Father Coughlin both saw FDR as revealing himself to be a puppet of Wall Street, despite his rhetoric. To Long, this meant he served the elite, the financial powers that be, who hoarded wealth, rather than the people who were suffering without it. Father Coughlin too took FDR’s actions to indicate he was in the pocket of bankers, but as Coughlin’s ideology evolved, international banking interests came to mean an international Jewish conspiracy, which in turn meant Communism. So somehow, FDR being friendly with wealthy bankers made him a Communist, if that makes any sense. But of course, it doesn’t make much sense, for FDR had denounced bankers in particular, in no uncertain terms, as the “unscrupulous money changers” responsible for the banking crisis. And in his first hundred days, he made good on the promises of his campaign, such that those he formerly yachted with would come to view him as a “traitor to his class.”

When he took office, Roosevelt immediately declared a national bank holiday to stave off runs that would force further bank failures. In his first Fireside Chat, FDR successfully convinced many Americans to trust the banks again because of the changes he had pushed through Congress with the passage of his Emergency Banking Act, and banks saw a billion dollars returned to them over the ensuing weeks. If this was all the Emergency Banking Act had done, Wall Street would certainly have thought Roosevelt on their side. He was, after all, from a wealthy family. Surely he had a vested interest in protecting the wealthy classes. In fact, the way that Roosevelt was seizing broad executive powers in his efforts to right the ship of the American economy sat very well with many in his wealthy class, among whom Mussolini, the strong leader of Italian Fascism, had become more and more popular in recent years, in large part due to a widespread propaganda campaign in America that we will examine further in part two of this series. Many had high hopes that FDR would prove to be another Mussolini, whom they viewed as a benevolent dictator taking bold action to set his country in order. The Emergency Banking Act, however, also gave the Secretary of the Treasury the power to seize gold in an emergency. One of the principal concerns leading to the failure of the economy was the outflow of gold from the country during the ongoing crisis of confidence, and Roosevelt felt he needed the means of curtailing that if necessary. When his new executive powers suddenly enabled him to take their gold, that changed things for the wealthy. Roosevelt had assured the public that the gold standard was safe, but a couple of days after taking this power to seize gold, he signed an executive order forbidding banks to make gold payments in a further effort to prevent hoarding. This was taken as a signal that he absolutely intended to abandon the gold standard after all and resulted in even more hoarding by the very wealthy, the financiers and bankers whom FDR had been accused of serving. FDR then felt compelled to do exactly what he had promised not to, and a month and a half after taking office, he signed an executive order requiring all Americans to surrender their gold money to the U.S. government in exchange for paper currency. This was meant to be a temporary emergency measure to shore up the American gold reserves, but the wealthy, the very gold hoarders causing the emergency, worried that if they converted all their fortune into currency, rampant inflation would destroy their fortunes. To make matters worse, Roosevelt seemed intent on publicly shaming them for their gold hoarding. FDR had been pointing at gold hoarders as unpatriotic social enemies for some time, and when he took office, he threatened to have the names of all those who had recently withdrawn gold from the nation’s banks published by the press, prompting many to redeposit their gold just to avoid such disgrace. Then, Roosevelt threw his support behind the Pecora Committee, a senate subcommittee devoted to investigating and revealing to the public all the unethical and reckless practices of Wall Street insiders and financial institutions in manipulating the market, an investigation that, later that year, bolstered the passage of the Glass-Steagall Act which cleaved investment firms from banks and insured bank deposits. It is safe to say that, for every powerful enemy among the ultra-wealthy that chief counsel Ferdinand Pecora made over the course of his investigation, President Roosevelt made one as well.

Hoover and Roosevelt on the latter’s inauguration day.

On May 9th, 1933, exactly two months after his inauguration, Bonus Army marchers returned to Washington, DC. These poor veterans remained angry over the violence the former president had inflicted on them, and rightly so. They further had some gripe with the new president, FDR, who had recently slashed veterans’ benefits in order to reduce the deficit. Roosevelt, however, took a very different tack in resolving their grievances. He directed the veterans to be housed at an abandoned Army camp in Virginia, where they would be provided medical care, fed well, plied with hot coffee and even treated to concerts by the Navy Band. It was a major humanitarian effort, and to top it off, Eleanor Roosevelt, the First Lady of the United States, visited the camp and gave the protestors a sympathetic ear. This gesture was not lost on them: “Hoover sent the army,” they said, “Roosevelt sent his wife.” While Roosevelt did not work to award the vets their bonus, he did work to resolve their unemployment. One of his principal New Deal programs was the Civilian Conservation Corps, putting young, unmarried men to work planting trees and laying telephone poles. In order to help the members of the Bonus Expeditionary Forces, Roosevelt waived the original age requirement of the corps and put thousands of the disaffected veterans to work. This all seems like something of a happy ending, but there were forces conspiring against Roosevelt. I have argued in the past against conspiracy theories about so-called “smoke-filled rooms,” but here certainly, considering what we know about what followed, some such secret meetings must have been convened. The powerful enemies that Roosevelt had made were seeking a way to remove him, despite or perhaps because of all the good he was doing the country. They sought to preserve their own wealth above all else, the rest of humanity be damned, and they saw in the veterans’ organizations that had mobilized a dissident army to march on the capital a tool that in their hands could give them everything they wanted.

Until next time, remember the famous Mark Twain quote, “History Does Not Repeat Itself, But It Rhymes.” And further remember that Mark Twain never actually said or wrote that. As near as the wonderful online sleuth at Quote Investigator has been able to determine, that quote first appeared in 1970 and was later misattributed to Twain. However, Twain did once write “History never repeats itself, but the Kaleidoscopic combinations of the pictured present often seem to be constructed out of the broken fragments of antique legends,” and that’s just as true, if not quite so quotable.

The Business Plot - Part One: The Bonus Army

Follow and Support Us!