Fascism and Monopoly

Daniel A. Crane*

The recent revival of political interest in antitrust has resurfaced a longstanding debate about the role of industrial concentration and monopoly in enabling Hitler’s rise to power and the Third Reich’s wars of aggression. Proponents of stronger antitrust enforcement argue that monopolies and cartels brought the Nazis to power and warn that rising concentration in the American economy could similarly threaten democracy. Skeptics demur, observing that German big business largely opposed Hitler during the crucial years of his ascent. Drawing on business histories and archival material from the U.S. Office of Military Government’s Decartelization Branch, this Article assesses the historical record on the role of industrial concentration in facilitating Nazism. It finds compelling evidence that, while German big business principally did not support Hitler before he won the chancellorship in 1933, the extreme concentration of market power during the Weimar period enabled Hitler to seize and consolidate totalitarian power through a variety of mechanisms. Hence, the German experience with Nazism lends support to the idea that extreme concentration of economic power enables extreme concentration of political power. However, most of the conduct that created the radical economic concentration of the Weimar period would be unlawful under contemporary antitrust principles, which casts doubt on claims that a significant shift in antitrust enforcement is necessary to forestall antidemocratic forces.

*Frederick Paul Furth, Sr. Professor of Law, University of Michigan. Earlier versions of this paper were presented at the Tobin Project Conference on Institutions of Democracy (May 2017), the Michigan Working Group on Democracy and Anti-Monopoly (July 2018), the University of Kentucky School of Law, the University of Michigan Business Law Lunch, and the Association of American Law Schools 2018 Annual Meeting Antitrust Section panel. I am grateful for helpful comments on earlier drafts from Matthew Cole, Alexandre Ruiz Feases, Daniel Halberstam, Julian Mortenson, Naomi Lamoreaux, Alec Stapp, and Tim Wu. Courtney Liss provided excellent research assistance.

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