The London School of Economics

The Fabian Society had developed an obsession with economics in the very first months and years of its existence, when its members met regularly to study and discuss Karl Marx and his economic theories. This obsession led to the Fabians' creation of institutions like the British Economic Association (later Royal Economic Society) and, in particular, the London School of Economics (LSE).

The Fabians' strange interest was motivated by two things. First, they could use economic theories as a "scientific" backing for their Socialist ideology just as Marx had done before them. Second, through educational institutions teaching Fabian economics, they consciously sought to create whole generations of professional economists -- a new ruling class -- who, working as civil servants and other government officials, would implement Fabian policies (M. Cole, p. 88).

The first step in this direction was to get economics recognised as a "science." Needless to say, unlike true science, such as Physics, which is based on universally accepted facts from the natural world, economics had more to do with what economists believed about people's financial behaviour. This resulted in conflicting theories clearly showing that economics was not a science and economics remains a system plagued by theoretical conflict to this day.

Unfortunately, Sidney Webb's machinations ensured that the Royal Commission dealing with the matter recognised economics as a science (Webb, p. 195), just in time for the Fabians' LSE to become a faculty of the University of London as part of the latter's reorganisation in 1900. This paved the way for the infiltration and domination of society - for many generations to come - by a system hell-bent on imposing Socialism on the world.

The central feature of Fabian "economics", which Fabianism shares with other Socialist systems, revolved around state control of resources and production: already in their "Manifesto" of 1884 (G.B. Shaw), the Fabians had called for land nationalisation and state control of the industry.

This is an important point which shows that the Fabians' main concern was the acquisition of power, not the welfare of the general public. Indeed, as later conceded by Fabian leaders, the Fabians had no true practical understanding either of existing society or Socialism and, in particular, no knowledge of the "claims and aims of the working people."

In his history of the Fabian Society, Shaw candidly describes the Fabians' lack of sympathy with working-class aspirations (Shaw, 1892; Pease, p. 30). In fact, apart from the obvious objective to grab power, the Fabians had no knowledge of what they were doing or how to go about "reconstructing society" (Pease, p. 27).

Policies related to working hours or wages came to be adopted almost as an afterthought and for the obvious purpose of falsely constructing Fabianism as a movement concerned with working-class interests (Pease, p. 88).

The Beveridge Report (1942)

All this exposes Fabianism as a project that was as fraudulent as the Marxism from which its masterminds had lifted their economic theories. To sugar-coat their calls for state control of the economy, the Fabians called for growing involvement of the State in the welfare of individual citizens, eventually leading to the cradle-to-grave social security programme devised by William Beveridge in his 1942 Report.

Much of the Beveridge Report had in fact been anticipated by work carried out by the Fabian Research Bureau and published in 1943 as "Social Security" under the editorship of William Alexander Robson (M. Cole, p. 298), an LSE alumnus of political science who acted as the Fabians' "expert" and adviser to local government. Moreover, Beveridge's Report was massively promoted by the Fabian Social Security Committee which also launched the Beveridge Social Security League for the purpose.

Beveridge himself was a long-standing collaborator of the Fabian leadership, had served as director of the Fabians' London School of Economics from 1919 to 1937 and was a friend of the Rockefeller family whom he tapped for funds for the LSE (Rockefeller, p. 81).

Although several leading politicians expressed concerns about the financial implications of the policies proposed in the Beveridge Report, it was adopted and implemented by the Attlee Government, laying the foundations for the modern Welfare (or Nanny) State.

Keynes, Bretton Woods and the IMF (1944)

The Beveridge Report, of course, went hand in hand with the theories of John Maynard Keynes who, as long-time General-Secretary and later president of the Royal Economic Society, was the official economist of Fabian Socialism.

Though officially a member of the Liberal Party, Keynes was undoubtedly a Fabian (Pugh, p. 158) who had made his way into the Economic Advisory Council to the 1929 Labour Government and soon became an apostle of public deficit spending (which advised governments to spend money they didn't have on public projects).

Unsurprisingly, Keynes was one of the architects of the 1944 Bretton Woods conference that established the World Bank and the IMF, which effectively became instruments for bankrolling World Socialism. He also headed the British delegation to Washington that negotiated the $4.34 billion US loan to Britain in late 1945 and early 1946.

Like the other false prophet of Socialism, Karl Marx, Keynes was an accomplished charlatan as evident from the fact that he used his influence in the Treasury to manipulate prices and amass a fortune for himself by speculating on the stock market. As for his General Theory, it was based on distorted logic and unsubstantiated assumptions (for an eye-opening expose of Keynes and his theories, see Martin, pp. 323-41).

Unfortunately, the Fabian propaganda machine raised Keynes to the position of economic guru of choice to left-wing governments on both sides of the Atlantic, enabling him to export his fraudulent theories to America where they were eagerly embraced by the advocates of Socialism by the backdoor.

[For more on Keynes, fellow Fabian Leonard Woolf, and the decadent Bloomsbury group, see the article "From Clapham to Bloomsbury" --ed]

Back in Britain, the Socialist experiment was failing. By 1950, after five years of Fabian government, it was becoming clear that Socialism was incapable of solving practical problems. The state-owned industry was inefficient and unproductive; management was carried on by a new elite of "experts" unconcerned with workers' interests; state controls were being resented; party conferences raised more problems related to enterprise, taxation and government reform than they solved; popular support was fast draining away and the Fabian leadership was forced to acknowledge a loss of conviction that Socialism was a source of good or would even serve as a means to an end (Pugh, pp. 227-30).

Although the Fabian Labour Party was soundly beaten at the 1951 election, Keynes' international system of finance together with the Marshall Plan and generous loans from left-wing American administrations literally saved British Socialism from sure death and artificially kept it alive to fight another day. This is how mounting government spending, ever-rising taxes, national debt and state control for the sake of permanent "economic growth" and "social progress" have become the curse of Socialist-dominated nations around the world.