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'Socialized' Advertising

President Truman recently made a frontal attack on the current million-dollar advertising campaign of the private power interests. “You can hardly pick up a newspaper or a magazine these days,” the President said, “without seeing an expensive full-page advertisement denouncing the ‘Socialism’ of our public power program.”

The powerful utility interests, Truman points out, are trying a new line of propaganda: “They raised the cry of ‘Socialism’—apparently on the theory that if you can’t persuade people, maybe you can frighten them; if you haven’t got the facts, try a few scare words.

“The cost of those ads is mostly paid for by the taxpayers, because the costs of such advertising are deductible for income-tax purposes. It looks to me as though that advertising campaign itself is pretty close to ‘Socialism’, because the taxpayers finance so much of the cost.”

The President’s observation is one which is shared by all who have watched the steady stream of “advertorials” aimed at labor and all liberal ideas, disguised as an attack on Socialism. The election campaigns this year will intensify the propaganda barrage. Advertisers will pass the cost of their ads to the public by masking the political content under the guise of tax-free “institutional advertising.”

The well-developed habit of slurring together the Welfare State, Socialism and totalitarian Communism first attracted our attention some months ago. A brief appeal to the readers of the Socialist Call brought in overwhelming response. Now not a day goes by but a letter comes in with another clipping of another ad urging: “Let your leaders know that you oppose ‘Socialistic’ schemes that lead to Communism.”

Joseph T. Ferguson, who ran against Taft in the last Ohio Senatorial race, can testify to the political power of ad propaganda. Corporations deducted as business expenses advertising favoring Taft. Mr. Ferguson points out that “while these ads did not mention Taft’s name, they were the type of thing that had the effect of scaring any voter to death who might be thinking of voting for the Administration.”

The technique of fear is skillfully combined with the technique of avoidance. The voter is frightened into voting against something “Socialistic” while the Internal Revenue Department is lulled into acquiescence by the lack of any specific mention of either laws or candidates.

It is not institutional advertising, for example, to carry over the name of Roberts Dairy Company of Omaha, Nebr., such stuff as this: “Such teaching [the New Morality] constitutes a ‘softening-up’ process for totalitarianism. Its advocates are not only the stooges for Stalin, but also for the traitorous American Socialists who would, without any contribution of their own whatsoever, take over the wealth of the country accumulated throughout the past 175 years.”

Theoretically, the cost of advertising—space and preparatory work—which is clearly in the area of public controversy and is of a lobbying nature designed to influence public opinion in favor of the signer—is not deductible. Nevertheless, in so far as we can discover, the costs of sponsoring the radio show Meet Corliss Archer and the present advertising program against “Socialized electricity” alike are deductible for “America’s business-managedtax paying Electric Light and Power Companies.”

The campaign of the electric companies against the federal power program is a good example of propaganda aimed at a specific government proposal. A favorite method seems to be to prepare a full-page ad for magazines with national circulation and then have the same ad reproduced in local papers over the signature of the local power company. A recent ad layout in American Magazine charges that “the people who plan and work for a Socialistic USA know that permanent control of a few key industries and services will give the government the power to take over just .about everything.” We can finish reading the same ad in the Toledo Union News, placed by the Toledo Edison Company: “One of the key industries that they’re trying to take over is electric light and power.”

The same pattern is repeated time and again throughout the nation. The high point in this campaign must have been the full-page ad in Collier’s which asked: “Do you want to pay for a government honeymoon at Niagara Falls?” The ad continues with the customary treatment: “The government plan is a long step toward Socialized electricity.” Collier’s then helped with an editorial which was later reproduced as a full-page ad in the New York Times. Among other things Collier’s said that “the government’s proposal is another example of the creeping Socialism that we discussed last week.” The discussion is legitimate while the coincidence is somewhat suspect. In this case America taxpayers paid several times over for a distorted attack on a specific legislative proposal.

An indication of what is spent by business on propaganda can be glimpsed in the following figures: The Buchanan Committee, a special House committee investigating lobbying, in May, 1950, sent out questionnaires to 173 large corporations seeking information relative to lobbying activity over a three-year period (Jan. 1, 1947, to June 30, 1950). Sixty-five corporations out of those replying spent, according to their own admission, $2,194,519 for printing and distributing leaflets, booklets, books and other material dealing with public issues. Thirty-one reported spending $2,013,369 for advertising covering public issues.

The out which is provided by advertising is illustrated by a report to the Buchanan Committee from the NAM listing only 1.9 percent of the NAM’s $4 million annual budget as allocated to legislative activities. Not mentioned was the $2 million allotted for a public relations program or the $395,850 revealed to have been spent, largely on advertising, in the NAM campaign to abolish price controls. Attacks on specific legislative proposals, carried in ads whose costs were deductible, have been common. The Guaranty Trust Company of New York placed an ad in Business Week of April 4, 1949, which assailed President Truman’s recommendations to the 1949 Congress. The oft repeated refrain, “the proposed program is Socialistic,” appears once more and again we pay for purely political propaganda.

Business Week of September 2, 1950, carried an ad for the National Education Campaign of the American Medical Association appealing for aid in “the medical profession’s $1 million advertising campaign . . .designed to tell every American the truth about state Socialism.” Did this money escape taxation also through legitimate business expense”—or perhaps, as a “donation for educational purposes”?

Listing of them as donations for educational purposes exempts from taxation one series of ads brought to our attention. The Small Business Economic Foundation, “a non-profit organization to develop and promote a better understanding of the American Way of Life,” is running a series (up to 105 at last count) of “educational ads” in the Midwest, South and Far West. While the ads do not seem to attack any specific measures on the surface, Dewitt Emery, President of the Foundation, is evidently not taking any chances. Contributions are tax-exempt on the grounds of education. We “explain to workers the advantages of our free competitive system of business” is his promise.

A majority of the ads we’ve seen in this series are aimed at taxation. “Do you wonder where your money goes?” is a favorite question, posed with many variations and always in bold black type. “In less than five years, the federal government spent more of YOUR MONEY than it spent during the ENTIRE FIRST 152 YEARS OF OUR NATION.” “You Pay Income Taxes!” “You Pay Business Taxes!”

Since the Small Business Economic Foundation seems to be against all taxes, obviously their ads have little or no bearing on the Constitutional amendment to limit taxes now. circulating the country. “You have no Constitutional right to keep one penny of your income,” the Foundation screams across a full page in the Des Moines Register of February 6, 1952. “In 1949 the government took one-fourth of all the money earned by the American people. How much more of your income are you going to spend for government?” After this the “millionaires’ amendment,” limiting personal and corporate taxes to 25 percent of income, sounds appealing.

Number 99 in this series of educational efforts tells us to “GO BACK TO SLEEP, if you don’t care. . . . “ Then follows an interesting list: “If you don’t care that the government has invested, committed or guaranteed billions of dollars of your tax money in various non-veteran enterprises . . . whether your money is loaned in a business you never heard of, or to non-veterans who couldn’t get a loan from a private bank . . . if you don’t care that, in the year 1951, BILLIONS of your tax money was loaned to non-veteran privileged groups—GO BACK TO SLEEP.” (Our Italics) Evidently veterans’ groups are too sacred—or too big—for the Foundation.

The Foundation does not neglect to do its bit for isolationism and consequently for Stalin. “How much longer can you pay to support your family, our defense program and continue to support the rest of the world?” Not long is Mr. Emery’s fond hope. “103 Billion DOLLARS of Americans’ earnings were given away.”

“We’re healthy and wealthy. . . . But how wise are we?” Not very, the Foundation replies several ads later: “Socialism is government ownership or control of the means of production [factories and businesses] and governments get this power by different methods”(All this is in caps, 36-point, bold-face type.) In Russia the method is by “violence,” in Britain, “nationalization” and in “America, instead of actually taking over the means of production from private owners, our government has . . . (the rest follows in caps, 24-point, boldface type) unlimited power to tax the earnings of businesses! So now the owners can keep only 1/8 of what their business earn. This is Socialism in Disguise!”

We quote the following in full since it is repeated throughout the series and is a gem of its kind:

If we are to stop Socialism in disguise, we must insist that our tax money be used only for defense and for this moral purpose

LIFE, LIBERTY, THE RIGHT TO EARN AND HOLD PROPERTY—these three gifts of God preceded all manmade laws and are superior to them. Therefore, the purpose of our government must be . . . “To make and enforce laws which protect every individual’s God-given life, liberty and the right to earn and hold property from the interference of any other individual or group—and these laws must also protect people from the government itself.”

Since an individual cannot lawfully interfere with the Life, Liberty or Property of another individual, then a moral government cannot lawfully interfere with the Life, Liberty or Property of individuals or groups.

The National Small Businessmen’s Association, the parent body of the Foundation, is a registered lobby. The Foundation has the blessing of the largest oil and rubber in the country.

One member of Congress, Sen. Hubert Humphrey (D, Minn.), has opened the way for an investigation into political propaganda by way of advertising. On April 1, Senator Humphrey told his colleagues that “newspapers and other publications and periodicals of America are flooded with what amounts to outright political advertising. One of the loopholes in our present laws affecting campaign expenditures is the use of political advertising by business concerns who deduct the cost from their tax returns.”

Humphrey has called upon the Treasury Department to study its statutes on this question and, if they are adequate, to regulate the growing abuse. If the statutes are not adequate, Senator Humphrey plans to press for legislation to meet the problem. Holding up ads sponsored by the McGraw-Hill and Safeway Corporations, Humphrey charged that a recent Safeway “food and freedom” ad is “nothing but a wholesale attack upon the Defense Production Administration.” McGraw Hill’s ad entitled “Some Things are Worse Than Strikes” has nothing to do with the business of that company. Such ads are not only discriminatory in terms of other taxpayers (who must pay for the privilege of advertising their political views out of personal expenses), but are an open form of lobbying.

We have covered but a bare sampling of the material we have received over a four-month period. We have not discussed the role of such organizations as the NAM and the Foundation for Economic Education in the promotion of reactionary propaganda on a scale with which liberals cannot compete unless protected by a tax policy which does not allow exemption for expenditures on obviously political projects.

Socialists are alarmed by the nature of an attack on labor and all liberal ideas which hot only masks itself as an attack on Socialism but also slurs over the gulf between Stalinist totalitarianism and democratic Socialism. This attack will increase in intensity with the approach of the fall elections. Among our strongest allies in the free world’s contest with totalitarian Communism are the democratic Socialists of Europe and Asia, and they will watch our electioneering and its results closely. If the lies of reactionary ad propaganda go unanswered and unchallenged in the coming campaign, the repercussions abroad will be severe.