General Smedley Butler an Honest War Hero

Big Business plots to overthrow Roosevelt

In the summer of 1933, shortly after Roosevelt's "First 100 Days," America's richest businessmen were in a panic. It was clear that Roosevelt intended to conduct a massive redistribution of wealth from the rich to the poor. He had to be stopped at all costs.

Their answer was a military coup. It was to be secretly financed and organized by leading officers of the Morgan and Du Pont empires. This included some of America's richest and most famous names of the time:

• Irenee Du Pont - Right-wing chemical industrialist, founder, American Liberty League, assigned to execute plot.
• Grayson Murphy - Director of Goodyear, Bethlehem Steel and a group of J.P. Morgan banks.
• William Doyle - Former state commander of the American Legion and a central plotter of the coup.
• John Davis - Former Democratic presidential candidate and a senior attorney for J.P. Morgan.
• Al Smith - Roosevelt's political foe, former governor New York, codirector of the American Liberty League.
• John J. Raskob* - A high-ranking Du Pont officer and a former chairman of the Democratic Party.
• Robert Clark - One of Wall Street's richest bankers and stockbrokers.
• Gerald MacGuire - Bond salesman for Clark, former commander of the Connecticut American Legion.

*In later decades, Raskob would become a "Knight of Malta," a Roman Catholic Religious Order with a high percentage of CIA spies, including CIA Directors William Casey, William Colby and John McCone.

The plotters attempted to recruit General Smedley Butler to lead the coup.

They selected him because he was a war hero who was popular with the troops. The plotters felt his good reputation was important to make the troops feel confident that they were doing the right thing by overthrowing a democratically elected president.

However, this was a mistake: Butler was popular with the troops because he identified with them. That is, he was a man of the people, not the elite.

When the plotters approached General Butler with their proposal to lead the coup, he pretended to go along with the plan at first, secretly deciding to betray it to Congress at the right moment.

What the businessmen proposed was dramatic. They wanted General Butler to deliver an ultimatum to Roosevelt. Roosevelt would pretend to become sick and incapacitated from his polio, and allow a newly created cabinet officer, a "Secretary of General Affairs," to run things in his stead. The secretary, of course, would be carrying out the orders of Wall Street. If Roosevelt refused, then General Butler would force him out with an army of 500,000 war veterans from the American Legion.

MacGuire assured Butler the cover story would work: "You know the American people will swallow that. We have got the newspapers. We will start a campaign that the President's health is failing. Everyone can tell that by looking at him, and the dumb American people will fall for it in a second."

The businessmen also promised that money was no object: Clark told Butler that he would spend half his $60 million fortune to save the other half.

And what type of government would replace Roosevelt's New Deal?

MacGuire was perfectly candid to Paul French, a reporter friend of General Butler's: "We need a fascist government in this country… to save the nation from the communists who want to tear it down and wreck all that we have built in America. The only men who have the patriotism to do it are the soldiers, and Smedley Butler is the ideal leader. He could organize a million men overnight."

Indeed, it turns out that MacGuire travelled to Italy to study Mussolini's fascist state, and came away mightily impressed. He wrote glowing reports back to his boss, Robert Clark, suggesting that they implement the same thing.

If this sounds too fantastic to believe, we should remember that by 1933, the crimes of fascism were still mostly in the future, and its dangers were largely unknown, even to its supporters. But in the early days, many businessmen openly admired Mussolini because he had used a strong hand to deal with labor unions, put out social unrest, and get the economy working again, if only at the point of a gun.

Americans today would be appalled to learn of the many famous millionaires back then who initially admired Hitler and Mussolini: Henry Ford, John D. Rockefeller, John and Allen Dulles, who, besides being millionaires, would later become Eisenhower's Secretary of State and CIA Director, respectively, and, of course, everyone on the above list. They disavowed Hitler and Mussolini only after their atrocities grew to indefensible levels.

The plot fell apart when Butler went public.

The general revealed the details of the coup before the McCormack-Dickstein Committee, which would later become the notorious House Un-American Activities Committee. The Committee heard the testimony of Butler and French, but failed to call in any of the coup plotters for questioning, other than MacGuire. In fact, the Committee whitewashed the public version of its final report, deleting the names of powerful businessmen whose reputations they sought to protect. The most likely reason for this response is that Wall Street had undue influence in Congress also.

Even more alarming, the elite controlled media failed to pick up on the story, and even today the incident remains little known. The elite managed to spin the story as nothing more than the rumors and hearsay of Butler and French, even though Butler was a Quaker of unimpeachable honesty and integrity. Butler, appalled by the cover-up, went on national radio to denounce it, but with little success. Butler was finally vindicated in 1967, when journalist John Spivak uncovered the Committee's internal, secret report.

MacGuire denied [Butler's] allegations under oath, but the committee was able to verify all the pertinent statements made to General Butler, with the exception of the direct statement suggesting the creation of the organization. This, however, was corroborated in the correspondence of MacGuire with his principle, Robert Sterling Clark, of New York City, while MacGuire was abroad studying the various form of veterans' organizations of Fascist character.

Ultimately the investigative HUAC committee concluded that there was indeed compelling evidence of a plot, as outlined in their report:

"In the last few weeks of the Committee's official life it received evidence showing that certain persons had made an attempt to establish a fascist organization in this country…. There is no question but that these attempts were discussed, were planned, and might have been placed in execution when and if the financial backers deemed it expedient.

"This committee received evidence from Major General Smedley D. Butler (retired), twice decorated by the Congress of the United States. He testified before the Committee as to conversations with one Gerald C. MacGuire in which the latter is alleged to have suggested the formation of a fascist army under the leadership of General Butler.

"MacGuire denied these allegations under oath, but your Committee was able to verify all the pertinent statements made by General Butler, with the exception of the direct statement suggesting the creation of the organization. This, however, was corroborated in the correspondence of MacGuire with his principal, Robert Sterling Clark, of New York City, while MacGuire was abroad studying the various forms of veterans' organizations of fascist character."

Even a 1936 letter to Roosevelt from William Dodd, the US Ambassador to Germany, failed to prompt any action: