The Business Plot, also called the Wall Street Putsch, was a political conspiracy in 1933 in the United States to overthrow the government of President Franklin D. Roosevelt and install Smedley Butler as dictator. Butler, a retired Marine Corps major general, testified in 1934 before the House Special Committee on Un-American Activities that wealthy businessmen were plotting to create a fascist veterans' organization with him as its leader and use it in a coup d'état.Schlesinger, p. 85 Although no one was prosecuted, the congressional committee final report said that "there is no question that these attempts were discussed, were planned, and might have been placed in execution when and if the financial backers deemed it expedient."
Most major news media dismissed the plot, with a New York Times editorial characterizing it as a "gigantic hoax". When the committee's final report was released, the Times said the committee "purported to report that a two-month investigation had convinced it that General Butler's story of a Fascist march on Washington was alarmingly true" and "alleged that definite proof had been found that the much publicized Fascist march on Washington, which was to have been led by Major Gen. Smedley D. Butler, retired, according to testimony at a hearing, was actually contemplated". The individuals involved all denied the existence of a plot. While historians have questioned whether a coup was actually close to execution, most agree that some sort of subversive plan was contemplated and discussed.
Background Butler and the veterans
On July 17, 1932, thousands of World War I veterans converged on Washington, D.C., set up tent camps, and demanded immediate payment of bonuses due to them according to the World War Adjusted Compensation Act of 1924. The act stated that bonuses would be paid no earlier than 1925, and no later than 1945. Walter W. Waters, a former Army sergeant, led this "Bonus Army".
It was encouraged by an appearance from retired Marine Corps Major General Smedley Butler, a popular military figure of the time.Archer (2007) , pp. 3—5. A few days after Butler's arrival, President Herbert Hoover ordered the marchers removed. U.S. Army cavalry troops under the command of General Douglas MacArthur destroyed their camps.
Butler, although a self-described Republican, responded by supporting Democratic Party candidate Franklin D. Roosevelt in the 1932 US presidential election.Schmidt, p. 219 "Declaring himself a "Hoover-for-Ex-President Republican," Smedley used the bonus issue and the army's use of gas in routing the "Bonus Expeditionary Force"recalling infamous gas warfare during the Great Warto disparage Hoover during the 1932 general elections. He came out for the Democrats "despite the fact that my family for generations has been Republican," and shared the platform when Republican Sen. George W. Norris opened a coast-to-coast stump for FDR in Philadelphia. ... Butler was pleased with the election results that saw Hoover defeated; although he admitted that he had exerted himself in the campaign more "to get rid of Hoover than to put in Roosevelt," and to "square a debt." FDR, his old Haiti ally, was a "nice fellow" and might make a good president, but Smedley did not expect much influence in the new administration." In 1933, Butler started denouncing capitalism and bankers, going on to explain that for 33 years he had been a "high-class muscle man" for Wall Street, the bankers and big business, labeling himself as a "racketeer for Capitalism".Smedley D. Butler, War is a Racket (Los Angeles: Feral House, 1935, 2003), 26
Reaction to Roosevelt Roosevelt's election was upsetting for many conservative businessmen of the time, as his "campaign promise that the government would provide jobs for all the unemployed had the reverse effect of creating a new wave of unemployment by businessmen frightened by fears of socialism and reckless government spending". Some writers have said concerns over the gold standard were also involved. Jules Archer, in The Plot to Seize the White House, wrote that with the end of the gold standard, "conservative financiers were horrified. They viewed a currency not solidly backed by gold as inflationary, undermining both private and business fortunes and leading to national bankruptcy. Roosevelt was damned as a socialist or Communist out to destroy private enterprise by sapping the gold backing of wealth in order to subsidize the poor."
McCormack–Dickstein Committee On November 20, 1934, the U.S. House of Representatives "Special Committee on Un-American Activities Authorized to Investigate Nazi Propaganda and Certain Other Propaganda Activities", also known as the McCormack–Dickstein Committee, began examining evidence of an alleged plot to seize the White House. On November 24, the committee released a statement detailing the testimony it had heard and its preliminary findings. On February 15, 1935, the committee submitted its final report to the House of Representatives.Archer, p. x (Foreword)
During the committee hearings, Butler testified that Wall Street broker Gerald C. MacGuire attempted to recruit him to lead a coup, promising him an army of 500,000 men for a march on Washington, D.C., and financial backing. Butler testified that the pretext for the coup would be that the president's health was failing.Archer, p. 155. Despite Butler's support for Roosevelt in the election and his reputation as a strong critic of capitalism,Schmidt, p. 231 Butler said the plotters felt his good reputation and popularity were vital in attracting support amongst the general public and saw him as easier to manipulate than others. Given a successful coup, Butler said that the plan was for him to have held near-absolute power in the newly created position of "Secretary of General Affairs", while Roosevelt would have assumed a figurehead role.
Those implicated in the plot by Butler all denied any involvement. MacGuire was the only figure identified by Butler who testified before the committee. Others whom Butler accused were not called to testify because the "committee has had no evidence before it that would in the slightest degree warrant calling before it such men ... The committee will not take cognizance of names brought into testimony which constitute mere hearsay."Public Statement on Preliminary findings of HUAC, November 24, 1934, p. 1
On the final day of the committee,Archer, p. 189 January 29, 1935, John L. Spivak published the first of two articles in the Communist magazine New Masses, revealing portions of testimony to the committee that had been redacted as hearsay. Spivak argued that the plot was part of a plan by J. P. Morgan and other financiers who were coordinating with fascist groups to overthrow Roosevelt.
Historian Hans Schmidt concludes that while Spivak made a cogent argument for taking the suppressed testimony seriously, he embellished his article with his "overblown" claims regarding Jewish financiers, which Schmidt dismisses as guilt by association not supported by the evidence of the Butler-MacGuire conversations themselves.Schmidt, p. 229
On March 25, 1935, MacGuire died in a hospital in New Haven, Connecticut, at the age of 36. His attending doctor at the hospital attributed the death to pneumonia and its complications, but also said that the accusations against MacGuire had led to his weakened condition and collapse which in turn led to the pneumonia.G.C. M'Guire Dies; Accused of 'Plot', The New York Times (March 26, 1935) (subscription). An image of the article is also accessible down the page here. Retrieved July 27, 2017.
Butler's testimony in detail
1933 On July 1, 1933, Butler met with MacGuire and Bill Doyle for the first time. MacGuire was a $100-a-week bond salesman for Wall Street banking firm Grayson Murphy & CompanySchmidt, p. 224s:McCormack–Dickstein Committee#Testimony of Gerald C. Macguire and a member of the American Legion Department of Connecticut.Archer, p. 6.Wikisource: McCormack–Dickstein Committee report, testimony of Gerald C. MacGuire This was consistent with MacGuire's testimony: "You are a past department commander in the American Legion?" "No, sir; never held an office in the American Legion, I have just been a Legionnaire – oh, I beg your pardon. I did hold one office. I was on the distinguished guest committee of the Legion in 1933, I believe." Doyle was commander of the American Legion Department of Massachusetts. Butler stated that he was asked to run for National Commander of the American Legion.Wikisource: McCormack–Dickstein Committee report, p. 1
On July 3 or 4, Butler held a second meeting with MacGuire and Doyle. He stated that they offered to get hundreds of supporters at the American Legion convention to ask for a speech.Wikisource: McCormack–Dickstein Committee report (Doyle and MacGuire's second visit) MacGuire left a typewritten speech with Butler that they proposed he read at the convention. "It urged the American Legion convention to adopt a resolution calling for the United States to return to the gold standard, so that when veterans were paid the bonus promised to them, the money they received would not be worthless paper." The inclusion of this demand further increased Butler's suspicion.
Around August 1, MacGuire visited Butler alone. Butler stated that MacGuire told him business executive Grayson Murphy underwrote the formation of the American Legion in New York, and Butler told MacGuire that the American Legion was "nothing but a strikebreaking outfit."Wikisource: McCormack–Dickstein Committee report (Third visit with MacGuire) Butler never saw Doyle again.
On September 24,Archer, p. 178Wikisource: McCormack–Dickstein Committee report, p. 20 MacGuire visited Butler's hotel room in Newark.Wikisource: McCormack–Dickstein Committee report (Meeting in hotel) In late September Butler met with Robert Sterling Clark.Wikisource: McCormack–Dickstein Committee report (Meeting with Clark) Clark was an art collector and an heir to the Singer Corporation fortune.Schmidt, pp. 239, 241Archer, p. 14 MacGuire had known Clark when Clark was a second lieutenant in China during the Boxer Rebellion, where he had been nicknamed "the millionaire lieutenant".
1934 During the first half of 1934, MacGuire traveled to Europe and mailed postcards to Butler.Wikisource: McCormack–Dickstein Committee report, p. 3 On March 6, MacGuire wrote Clark and Clark's attorney a letter describing the Croix-de-Feu,Wikisource: McCormack–Dickstein Committee report, p. 10 a nationalist French league of the Interwar period.
On August 22, Butler met MacGuire at a hotel, the last time Butler met him.Archer, p. 153Wikisource: McCormack–Dickstein Committee report, p. 3 and p. 20 According to Butler's account, it was on this occasion that MacGuire asked Butler to run a new veterans' organization and lead a coup attempt against the President. Butler revealed the story of the plot to Paul Comly French, a Philadelphia Record reporter.
On September 13, French, who had once been Butler's personal secretary,Mennonite Church Historical Archives Paul French Biographical Information met MacGuire in his office.Wikisource: McCormack–Dickstein Committee report, p. 5 MacGuire was open about his fascist desires and the plot to take over the government. In late September, Butler told Veterans of Foreign Wars (VFW) commander James E. Van Zandt that co-conspirators would be meeting him at an upcoming Veterans of Foreign Wars convention.
On November 20, the McCormack-Dickstein Committee began examining evidence. French broke the story in the Philadelphia Record and the New York Post on November 21.Archer, p. 139 On November 22, The New York Times wrote its first article on the story and described it as a "gigantic hoax".
Committee reports The Congressional committee preliminary report of November 24, 1934 said: