The Schiff Libel: A Dirty Lie and Worse

By Caleb T. Maupin

As unemployment skyrockets, homes are foreclosed, and factories close their doors, many workers and oppressed people are beginning to question the rulers of this society. Every day more and more people begin to call into question the motives of the government, the bankers, and the wealthy, looking beyond their words toward other motives.

As a result, “conspiracy theories” have become more popular. Figures like Alex Jones, David Icke, and Jesse Ventura have done their best to explain the reason for the misdeeds of those in power by science fiction, fantasy tales similar to the Divinci Code or other Hollywood thrillers.

The reason the ruling elites act heartlessly and senselessly is because they are all involved in a secret plot of some kind, gathering together to worship Satan and sacrifice children, or turn themselves into giant lizards and fly into space.

“Conspiracism” is very helpful to the capitalists, as it misdirects the blame from their system, to merely a corruption within it. The conspiracists themselves will proclaim this, saying that the answer is not to remove the system that puts a wealthy few in command of the economy and the worlds wealth, but rather to “restore the republic” and renew the values of 1776 in a mass historical regression of some sort.

So, when faced with the concept of Marxism-Leninism, the conspiracists must refute it. Marxism-Leninism seeks to replace the current order with a system where working people and their organizations run society and not the rich. They call for a new democratic society called Socialism, in which there is popular power. This goal is the opposite of that of the conspiracists. It is a move forward, not backward.

So, the conspiracists are forced to then refute Socialism and Marxism-Leninism as being a conspiracy itself, in order to prevent those who join its ranks from doing so. If Marxism-Leninism is a conspiracy, then there is no need to organize against capitalism, or do anything. The conspiracist can convince his followers to remain in political paralysis or worse, as there is no point in fighting the status quo, if those fighting it, the left, are just another wing of the ruling elites.

The Legend of Jacob Schiff

So, in order to discredit Marxism-Leninism the John Birch Society and other ultra-rightists and conspiracists of Alex Jones vein, have developed what I dub the “Schiff Libel.”

The story goes that the Bolshevik Revolution of 1917 was not a popular uprisings, but merely a plot by the bankers. They argue that the bankers simply seized Russia into their control, the state being a single central corporation that served their profits.
As proof they point to the fact that Jacob Schiff, an Anti-Czarist capitalist with heavy investments in oil, who sided with Japan in the Russo-Japanese war, funded an anti-Czarist organization called the “Russian Freedom Group.”

They also point to the fact that figures like Armand Hammer and others had business transactions with the USSR.

Both of these claims are true, but they do not ad up to the conclusion that the conspiracists wish for us to reach.

Jacob Schiff, a small figure in banking who had financial interests that were hindered by the Czar’s policies in Siberia as he was not given access to the vast oilfeilds there. So, he did in fact fund a group called the “Russian Freedom Group” to move against the Czar. He saw the Czar as preventing him from making profits in Siberia. He was not alone. Numerous capitalists were angered by not getting preferential treatment from the Czar with regards to Siberian oil. J.P. Morgan, Rockefeller, and countless others saw the Czar as their enemy, and supported his overthrow and replacement with another capitalist government.

The February Revolution of 1917, when the Czar was forced to abdicate the throne was supported by nearly all the domestic Russian capitalists. They viewed the Czar as the cause of the failing military policies of the First World War, and as a national embarrassment due to his fascination with Rasputin the con man. The February Revolution of 1917 began with the bourgeoisie unleashing unrest in order to remove the monarchs and nobles, and set up a more efficient means of ruling Russia and winning the war.

But by putting the masses into motion, the capitalists were playing with fire. The anger of ages past boiled over. The capitalist government of Alexander Kerensky was soon competing with a new network of popular workers organizations led by Communists and Socialists, called Soviets. The two governments spent the next few months battling for control of the country.

The Soviets demanded an end to the war, mass food distribution to the hungry, and redistribution of land to the peasants. (Peace, Land, Bread) As the capitalist government refused to do such things, the Bolsheviks and their allies gained popular support with these "transitional demands."

The October Revolution when the Bolsheviks took power several months later was of an entirely different nature than the February Revolution. The capitalists of the world universally opposed it, as it stated as its goal, the seizing of all capitalist enterprises by popular organizations, and the re-organization of society to meet human needs, not profits.

Kerensky's government, supported by international capitalism did all it could to prevent the Bolsheviks from removing it. They banned Bolshevik newspapers, assassinated Bolshevik leaders, printed lies in the press, and did all they could. They failed.


Real Soviet Economic History

After the revolution the governments of Britain, France, and the United States invaded the newly formed Soviet Republic. In response, the Bolsheviks enacted a policy called “War Communism.” They turned the economy into one run with strict military discipline, rationing all goods and putting the “military first.” (Similar to the policy of "Songun" in People's Korea)

In 1924, after the war, Lenin called for the controversial “New Economic Policy” in which banks and major industries remained under public control, but private farms, small shops, food distribution, etc. was strictly regulated, though not under public control.

Finally, in 1928, after much debate, the New Economic Policy ended with the enactment of the “Five Year Plans”, creating an economic boom and putting 91% of Soviet economic activity under state or cooperative control.

At no point did Armand Hammer, Jacob Schiff, or any foreign capitalists dominate a large share of the Soviet economy, even at the height of the New Economic Policy. All of the private businesses were Russian owned, and in addition highly regulated and taxed.

Did the Soviet Regime take loans from various banking agencies? Yes. Did the Soviet Regime hire foreign technicians and experts to help build up state industries, especially during the Five Year Plans? Yes. Did the Soviet Regime purchase goods and products from foreign capitalists in order to economically develop? Yes.

But at no point can any logical person point to the Bolsheviks as being “bankrolled” or “controlled” by any capitalist entity. Despite Stalin’s zigzags in foreign and economic policy, as well as those of his heirs, it was not really until the 1980s when mining and other industries were sold by Gorbachev to the west, that foreign capital began to dominate the Russian economy as it does today, though Putin's regime seems to be reinforcing a kind of Nationalist Capitalism that was absent under Yeltsin and others.


Paralysis or Worse?

The Schiff Libel is pure deception, and nothing more.

What does the Schiff Libel represent? What is its end goal?

There can be two motives in the preaching of the Schiff fantasy.

The first is simply to move people toward paralysis. If capitalism is evil, one cannot fight against the capitalists, because their enemies, the Communists and Socialists, are simply another wing. Therefore, as the world dives into depression and misery, you should simply sit back and somehow attempt to enjoy the ride.

The second result however is more dangerous. The fact that Jacob Schiff is the target of this deception, and not just any capitalists who did business with the USSR or hated the Czar points to another worse lie.

In the U.S. press after the 1917 October Revolution, the myth that the revolution was a “Jewish Coup” was promoted everywhere. The Czarist booklet "The Protocols of the Learned Elders of Zion" was used to persecute Jews in Czarist Russia, and was revived after the 1917 Bolshevik Victory to whip up anti-Semitism and anti-Communism.

The U.S. State Department, the right-wing newspapers, the Ku Klux Klan, and other racist entities attempted to slur the Bolsheviks and Communism, and help further isolate and demonize the Jewish people and Communists alike.

Hitler used the claim that “Marxism seeks to deliver the world directly into the hands of the Jews” to build his fascist movement and squash all popular organizations in Germany, and eventually carry out the holocaust.

The “Schiff Libel”, and conspiracism in general, is a method used by the capitalists to divert workers who seek to fight for justice away from doing so. These things need to be opposed and exposed wherever possible.

Conspiracy theories hold no answer in how to oppose the economic misery people suffer in the modern U.S. They serve make people feel powerless and helpless, and offer no path forward, or in some cases, they advocate fascist reaction.

The answer is to fight back. Put down your DVDs. Organize! Organize! Organize!

Fight For Socialism! Abolish Capitalism!