The book is from Britain and written by a socialist - this section is about how they try to twist it to their benefit, making the government take over their failing business and then blame the later failure on "socialism".

But yeah, the first Red Scare in the US was during the First World War. Look at how they treated Eugene Debs - https://en.wikipedia.org/wiki/Eugene_V._Debs#Sedition_convic...

Freedom of speech... as long as you don't actually try it.