In November 1934, retired Marine Corps Major General Smedley Butler testified before the House Un-American Activities Committee that he had been approached by wealthy financiers to lead 500,000 veterans in a coup against President Franklin Roosevelt. The Congressional investigation found the allegations credible. No one was prosecuted. The press dismissed it as a hoax. Seventy years of declassified documents and historical research suggest Butler was telling the truth.
In November 1934, Major General Smedley Darlington Butler walked into a closed hearing room in the House Office Building and told Congressional investigators that representatives of some of America's wealthiest families had asked him to lead a military coup against the President of the United States.
Butler was not a crank. At 53, he was the most decorated Marine in American history — holder of two Medals of Honor, the Marine Corps Brevet Medal, and the Distinguished Service Medal. He had commanded Marine forces in China, led the suppression of the Boxer Rebellion, fought in the Philippines and Central America, and served as director of public safety in Philadelphia. His nickname was "The Fighting Quaker." His reputation for integrity was unimpeachable.
And he claimed that Wall Street wanted him to overthrow Franklin Delano Roosevelt.
The Congressional committee that heard Butler's testimony — the Special Committee on Un-American Activities, chaired by Representatives John McCormack and Samuel Dickstein — issued a preliminary finding that shocked the few who paid attention: "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." The committee stated it had "been able to verify all the pertinent statements made by General Butler."
No one was ever prosecuted. The major newspapers called it a hoax. The final committee report was never officially released. And for decades, the Business Plot was dismissed as either Butler's paranoid fantasy or a minor inquiry blown out of proportion.
Then the documents started surfacing.
The story began in July 1933, when Butler received a visit from Gerald MacGuire, a bond salesman for the Wall Street firm Grayson M-P Murphy & Co. MacGuire was also a former commander of the Connecticut American Legion. He told Butler he represented wealthy veterans who wanted Butler to attend the upcoming American Legion convention in Chicago and lead a movement to restore the gold standard — which Roosevelt had abandoned in April 1933, infuriating financial conservatives who believed it would destroy the dollar.
Butler was skeptical but agreed to meet again. Over the next sixteen months, MacGuire visited Butler at least nine times. The conversations became progressively more explicit about what was really being planned.
By the summer of 1934, according to Butler's testimony, MacGuire had dropped the pretense about the gold standard. He told Butler he had just returned from a trip to Europe where he had studied the organizational structure of fascist veterans' movements — particularly the Croix de Feu in France, which had used 500,000 veterans as the muscle for an attempted coup against the French Third Republic in February 1934.
"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. 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."
Gerald MacGuire to Butler, as testified November 1934MacGuire told Butler the plan was simple: Butler would lead a veterans' march on Washington — not to overthrow Roosevelt directly, but to pressure him into creating a new cabinet position, "Secretary of General Affairs," who would handle the day-to-day operations of government while Roosevelt remained as a ceremonial figurehead. Butler would control the Secretary position. The plotters had studied Mussolini's March on Rome and the structure of Italian fascism as organizational templates.
The funding, MacGuire said, was already in place.
According to Butler's sworn testimony, MacGuire claimed the conspirators had secured $3 million for immediate organizational expenses. If the operation expanded, they could access up to $300 million. These were staggering sums in 1934 — equivalent to roughly $65 million and $6.5 billion today.
Butler asked who was behind the money. MacGuire, according to testimony, named his employer Grayson M-P Murphy — a director of Guaranty Trust Company and Morgan-connected firms — along with members of the DuPont family and other officials at J.P. Morgan & Co. Butler testified that MacGuire said "the DuPont interests" were the primary financial backers.
Butler didn't believe it. Or rather, he didn't want to believe it. He kept meeting with MacGuire to see how far the plan would go. In September 1934, Butler asked Paul Comly French — a Philadelphia journalist he trusted — to meet with MacGuire independently and verify the story.
French did. And MacGuire told him the same thing.
On September 13, 1934, Paul French met Gerald MacGuire at MacGuire's office in New York. French posed as a sympathetic contact interested in the veterans' movement. He took detailed notes.
MacGuire repeated the core plan: organize 500,000 veterans as a paramilitary force, march on Washington, force Roosevelt to create the General Affairs position. He showed French documents and photographs from his European research trip. He explained that the American Liberty League — a newly formed anti-Roosevelt organization funded by DuPont and Morgan interests — would provide political cover and legitimacy for the movement.
MacGuire told French the operation had to move quickly. Roosevelt's popularity was still strong. The window for organizing mass resistance was limited. If Butler wouldn't do it, they would find someone else — possibly Douglas MacArthur, the Army Chief of Staff who had led the violent dispersal of the Bonus Army in 1932.
French reported everything to Butler. Butler contacted the McCormack-Dickstein Committee, which was already investigating Nazi and fascist activities in the United States. On November 20, 1934, Butler testified in executive session. French testified six days later.
The Special Committee on Un-American Activities heard Butler's allegations seriously. Chairman John McCormack was a careful, conservative Democrat with no history of conspiracy-mongering. The Committee called MacGuire to testify.
MacGuire admitted meeting with Butler multiple times. He admitted traveling to Europe to study veterans' organizations. He admitted working for Grayson M-P Murphy and having connections to the American Liberty League. But he denied everything about a coup. He said the meetings with Butler concerned only the gold standard and veterans' bonus issues.
The Committee investigated. It reviewed MacGuire's travel records — which confirmed the European trip. It interviewed other witnesses. It examined the financial structure and leadership of the American Liberty League, which had been founded in August 1934 — precisely the time MacGuire claimed the operation was moving into its organizational phase.
In its preliminary report, the Committee stated: "This committee received evidence from Maj. Gen. 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."
Chairman McCormack told the New York Times: "We received evidence showing that certain persons had made an attempt to establish a fascist organization in this country... 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."
Despite the Committee's findings, major newspapers treated the story as a joke. The New York Times buried its initial coverage on page 23 under the headline "Gen. Butler Bares 'Fascist Plot' to Seize Government by Force." Time magazine called it "Plot & Plotters" and suggested Butler had been taken in by "crackpots."
After the Committee's preliminary report was released, the Times editorial page declared: "At best the whole affair is a joke." The paper suggested Butler had either fabricated the story for attention or had been the victim of confidence men who never had any real resources or serious intent.
No major business leader was called to testify. Grayson Murphy gave one interview to reporters in which he called the allegations "a joke" and "perfect moonshine." The DuPont family never commented publicly. Representatives of J.P. Morgan & Co. were never questioned.
The Committee's investigation ended in February 1935. The final report was never officially published. The preliminary findings were allowed to quietly disappear from public discourse.
Gerald MacGuire died in 1934, shortly after his testimony, at age 37. The cause of death was not widely reported.
One detail that received almost no press coverage at the time: Butler was not the only veterans' leader who claimed to have been approached.
On November 21, 1934 — one day after Butler's testimony became public — James Van Zandt, the national commander of the Veterans of Foreign Wars, issued a statement confirming he had been contacted by "agents of Wall Street" in 1933 with a proposal to lead a fascist movement of veterans. Van Zandt said he had dismissed the approach and had not thought it worth reporting at the time, but Butler's testimony prompted him to speak up.
Van Zandt's statement was reported in the Philadelphia Record and a few other papers. He was never called to testify before the Committee. His statement was never investigated. Major newspapers ignored it entirely.
Van Zandt later served as a Republican Congressman from Pennsylvania for 24 years. He never retracted his statement about being approached by Wall Street interests to lead a veterans' coup.
Founded in August 1934 — exactly when MacGuire claimed the plot was moving from planning to organization — the American Liberty League became the public face of wealthy opposition to Roosevelt's New Deal. Its stated purpose was to "defend and uphold the Constitution" and protect property rights against what it characterized as socialist encroachment.
The League's leadership read like a directory of American corporate power: Jouett Shouse (president), John W. Davis (1924 Democratic presidential candidate), Alfred Sloan (GM president), and numerous members of the DuPont family. The organization spent over $1.2 million between 1934 and 1936 on anti-Roosevelt publicity campaigns — an extraordinary sum for a private political organization in the Depression era.
Several individuals Butler had named as conspirators — including Grayson Murphy — were Liberty League directors or major donors. The timing was suspicious: the organization was created within weeks of MacGuire's final meetings with Butler and months before Butler went to Congress.
The League distributed millions of pamphlets arguing that Roosevelt's policies violated constitutional limits on federal power. It funded legal challenges to New Deal legislation. It organized speakers, radio programs, and newspaper advertising. Critics noted that for an organization claiming to represent a grassroots movement, it was funded almost entirely by millionaires and major corporations.
The League disbanded in 1940 after Roosevelt's overwhelming reelection victories in 1936 and 1940 demonstrated its political ineffectiveness. By that time, war in Europe had shifted public attention away from domestic political battles.
Butler's full testimony remained classified for decades. But journalist John Spivak obtained access to the Committee's executive session transcripts and published excerpts in the left-wing magazine New Masses in January and February 1935. Spivak's reporting provided details that had been deleted from the public versions of the Committee findings.
According to the complete testimony, Butler said MacGuire told him the plotters had modeled their plan on the structure Mussolini used in Italy: maintain the existing government in form while transferring real power to a new position controlled by the plotters. Roosevelt would remain as President — his popularity made removing him politically impossible — but would be reduced to a figurehead role.
The Secretary of General Affairs would control policy, appointments, and government operations. Butler, as the public face of the movement and commander of the veterans' organization, would control the Secretary.
MacGuire allegedly told Butler that the core organization would be funded by major Wall Street interests but would present itself publicly as a grassroots veterans' movement demanding sound government and protection of the Constitution. The American Liberty League would provide political cover and legitimacy.
Butler asked MacGuire what would happen if Roosevelt resisted. MacGuire reportedly said the presence of 500,000 organized veterans — implicitly backed by the threat of force — would make resistance impossible. He cited the Bonus Army incident of 1932 as evidence that the government would back down when faced with massed veterans.
The Bonus Army incident was fresh in everyone's memory. In June and July 1932, approximately 43,000 World War I veterans and their families had marched on Washington demanding early payment of a service bonus promised for 1945. They built a shantytown near the Capitol and refused to leave.
On July 28, 1932, President Hoover ordered the Army to clear the camps. General Douglas MacArthur — who would later be named by MacGuire as an alternative to Butler — commanded the operation. Major Dwight Eisenhower served as his liaison. Major George Patton led cavalry units. The Army used tanks, tear gas, and bayonets to forcibly remove the veterans, then burned their encampments. Two veterans were killed and hundreds injured.
The incident created widespread public sympathy for veterans and demonstrated both the government's willingness to use force against its own citizens and the potential power of organized veterans as a political constituency. MacGuire explicitly cited the Bonus Army to Butler as evidence that massed veterans could force government action — though MacGuire's proposed version would be far larger and better organized.
Butler had publicly supported the Bonus Army in 1932, which made him a natural choice to lead a veterans' movement. His criticism of the violent dispersal had enhanced his reputation among veterans even as it alienated him from Army leadership.
Butler later explained his thinking in his 1935 book "War Is a Racket," a scathing indictment of war profiteering that became a bestseller. Butler argued that American military interventions served corporate interests rather than national defense. He had come to believe that his entire military career had been spent as "a high-class muscle man for Big Business, for Wall Street and the bankers."
"I helped make Mexico safe for American oil interests in 1914. I helped make Haiti and Cuba a decent place for the National City Bank boys to collect revenues in. I helped in the raping of half a dozen Central American republics for the benefit of Wall Street."
Smedley Butler — War Is a Racket, 1935This perspective made Butler uniquely unreceptive to MacGuire's pitch. The plotters had apparently assumed Butler's conservative reputation and military background would make him sympathetic to their cause. They miscalculated. Butler's experiences had turned him into a critic of exactly the kind of corporate power the plotters represented.
Butler also believed in democratic government and constitutional process, whatever his disagreements with specific policies. He testified that his decision to report the plot to Congress rather than dismiss it as fantasy was based on his assessment that MacGuire had real backing and resources — the European trip, the detailed planning, the specific dollar amounts all suggested serious intent.
Seventy years of historical research and declassification has provided substantial, though not conclusive, evidence about the Business Plot:
Confirmed facts: Gerald MacGuire did meet with Butler at least nine times between July 1933 and September 1934. MacGuire did travel to Europe in 1934 and did study fascist veterans' organizations. MacGuire's ship passenger records, located by BBC researchers in 2007, confirm the European trip and its timing. Paul Comly French did meet with MacGuire in September 1934 and did provide independent corroboration of the coup allegations. The McCormack-Dickstein Committee did find Butler's testimony credible and did state it had verified his pertinent statements.
Confirmed context: Wall Street and corporate interests were genuinely terrified of Roosevelt's policies. The abandonment of the gold standard, banking reforms, new labor protections, and proposed wealth taxes represented an existential threat to their economic and political power. The American Liberty League and similar organizations represented a real mobilization of wealthy opposition. Fascism was seen by many American conservatives in the 1930s not as a threat but as a potential model — a way to suppress labor unrest and communist organizing while maintaining capitalism and traditional hierarchies.
Unresolved questions: How far beyond MacGuire did the conspiracy extend? Butler named major figures at DuPont and Morgan, but never met them directly. Were senior executives involved, or was MacGuire working with mid-level operatives who exaggerated their backing? How serious was the plot — was it operational planning or exploratory conversation? Why were no criminal charges filed despite the Committee's findings?
In 1973, when the House Committee on Un-American Activities was finally abolished, it issued a final historical report on its predecessor committees. The section on the McCormack-Dickstein Committee stated: "The committee received evidence showing that certain persons had made an attempt to establish a fascist organization in this country. There is no question that these attempts were discussed, were planned, and might have been placed in execution."
Historian Arthur M. Schlesinger Jr., in his Pulitzer Prize-winning "The Age of Roosevelt," concluded that while the plot never reached operational stage, "MacGuire had indeed spoken to Butler about raising a veterans' army to march on Washington" and that the conspiracy "deserved more serious attention than it received at the time."
Journalist John Spivak, who broke the initial detailed story in 1935, continued researching the plot for the rest of his life. In his 1967 memoir, he wrote: "The plot was real. The plotters were real. The money was real. What remains disputed is how close they came to acting."
The Business Plot ultimately failed for one simple reason: Smedley Butler said no.
The plotters had chosen their target well in many respects — Butler's military credentials, his popularity among veterans, his public criticism of government policy all made him an ideal figurehead. But they fundamentally misread his character. Butler's criticisms of government came from a populist, anti-corporate perspective, not from the right-wing authoritarianism the plotters represented.
What remains documented is this: Representatives of Wall Street financial interests approached America's most decorated military officer with a plan to use veterans to pressure or overthrow the elected government. The officer reported it to Congress. Congress investigated and found the allegations credible. No one was prosecuted. The major newspapers dismissed it as fantasy. And for decades, the incident was treated as either a hoax or an aberration too embarrassing to examine seriously.
The Business Plot stands as a reminder that American democracy was not inevitably secure during the 1930s. While Europe fell to fascist movements, similar forces operated in the United States with similar goals and significant resources. The difference was not that America was immune to such threats, but that at a critical moment, one man refused to participate.
Butler died of cancer in 1940, as Europe burned and America debated intervention in another world war. His funeral was attended by thousands of veterans and working people. Few members of Washington's political establishment came. Butler had become, in his final years, an inconvenient figure — too decorated to dismiss, too radical to embrace, a reminder that the threats to democracy sometimes came not from foreign enemies but from concentrations of domestic wealth and power.
The documents from the McCormack-Dickstein Committee investigation remain partially sealed. Complete declassification has been repeatedly delayed. What we have is sufficient to establish that something happened in 1933 and 1934 that frightened one of America's most formidable military officers enough to risk his reputation by going to Congress.
Whether it was a fully operational conspiracy or an exploratory conversation that never matured into action may never be definitively established. What is clear is that powerful interests explored the option, found a willing organizer in Gerald MacGuire, identified a potential leader in Smedley Butler, and were prepared to commit substantial resources to the effort.
They picked the wrong Marine.