While fear of communism was common in the 1920s, the Cold War with the USSR solidified America's collective distrust and fear of communism. Aspects of communism seem to be at odds with the Constitution. Communism also threatens capitalism.
In the 1920s, anti-communist sentiment was high in the United States. Communist parties were becoming more popular, and many labor unions were pushing for more socialist elements. Part of this distrust was based on a fear of immigrants, many of whom pushed for communist policies. After the end of World War II, however, anti-communism hit a high in the United States, and the existential threat posed by the Soviet Union fueled these fears until the USSR collapsed.
Some communist philosophers argued that capitalism should be gradually changed into socialism. Others, however, claimed that revolution was the only way to replace capitalism. The threat of revolution ensured that United States officials were wary of communist organizations.
The work of Karl Marx was sharply critical of certain aspects of capitalism. Many capitalists accept these criticisms but feel that they can be adequately addressed through rules and regulations. Many nations that few would consider communist have a number of elements of Marx's socialism. Nordic nations, in particular, have moved away from the libertarian view of the free market.