Economy of fascist Italy
The changing political attitudes of the post-war period and rise of a working class was also a factor and Italy was one of several countries where there was a disagreement about the tax burden.
[1] Benito Mussolini came to power in 1922 under a parliamentary coalition until the National Fascist Party seized control and ushered in a one-party dictatorship by early 1925.
Therefore, he would later write (with the help of Giovanni Gentile) and distribute The Doctrine of Fascism to the Italian society, which ended up being the basis of the Fascist agenda throughout Mussolini’s dictatorship.
[3] Mussolini did not simply thrust himself into the dictatorship position, but rather rose gradually based on his understanding of the existing support for his ideas in the country.
Some fascist syndicalists turned to economic collaboration of the classes to create a "productivist" posture where "a proletariat of producers" would be critical to the "conception of revolutionary politics" and social revolution.
[11] However, most fascist syndicalists instead followed the lead of Edmondo Rossoni, who favored combining nationalism with class struggle,[12] often displaying a hostile attitude towards capitalists.
[13] Since Italy’s economy was generally undeveloped with little industrialization, fascists and revolutionary syndicalists, such as Angelo Oliviero Olivetti, argued that the Italian working class could not have the requisite numbers or consciousness "to make revolution".
[16] Fascist intellectuals were determined to foster economic development to enable a syndicalist economy to "attain its productive maximum", which they identified as crucial to "socialist revolution".
Bridges, canals and roads were built, hospitals and schools, railway stations and orphanages; swamps were drained and land reclaimed, forests were planted and universities were endowed".
[21] As for the scope and spending on social welfare programs, Italian fascism "compared favorably with the more advanced European nations and in some respect was more progressive".
Coming to power in 1922 after the March on Rome, it was a minority government until the 1923 Acerbo Law and the 1924 elections and it took until 1925, after the assassination of Giacomo Matteotti, to establish itself securely as a dictatorship.
The multiparty coalition government undertook a low-key laissez-faire program—the tax system was restructured (February 1925 law, 23 June 1927 decree-law and so on), there were attempts to attract foreign investment and establish trade agreements and efforts were made to balance the budget and cut subsidies.
De Stefani was sacked, his program side-tracked and the Fascist government became more involved in the economy in step with the increased security of their power.
[29] In 1924, the Unione Radiofonica Italiana (URI) was formed by private entrepreneurs and part of the Marconi group and granted the same year a monopoly of radio broadcasts.
Lending to the private sector increased at an annual rate of 23.8 percent: total net profits of joint-stock banks doubled, providing 'excellent opportunities for financial intermediaries.'
This policy was implemented through an extended deflation of the economy as the country rejoined the gold standard, the money supply was reduced and interest rates were raised.
This action produced a sharp recession, which Mussolini took up as a sign of his assertion of power over "troublesome elements"—a slap to both capitalist speculators and trade unions.
Despite strict regimentation, the labour syndicates had the power to negotiate collective contracts (uniform wages and benefits for all firms within an entire economic sector).
[34] Since the syndical laws kept capital and labour separate, Mussolini and other party members continued to reassure the public that this was merely a stop-gap and that all associations would be integrated into the corporate state at a later stage.
The Labour Charter of 1927 confirmed the importance of private initiative in organising the economy while still reserving the right for state intervention, most notably in the supposedly complete fascist control of worker hiring through state-mandated collective bargaining.
In 1930, the National Council of Corporations was established and it was for representatives of all levels of the twenty-two key elements of the economy to meet and resolve problems.
In practice, it was an enormous bureaucracy of committees that while consolidating the potential powers of the state resulted in a cumbersome and inefficient system of patronage and obstructionism.
Businessmen usually argued in favour of "collective self-regulation" being within Fascist ideological lines when forming cartels, subtly undermining corporative principles.
Intervention began with the "Battle of the Grain" in 1925 when the government intervened following the poor harvest to subsidise domestic growers and limit foreign imports by increasing taxes.
To support them, the state created three institutions funded by the Italian Treasure, with the first being the Sofindit in October 1931 (with a capital of Lit.500 million), which bought back all the industrial shares owned by the Banca Commerciale and other establishments in trouble.
In November 1931 the IMI (with a capital of Lit.500 million) was also created and it issued five and one-half billion liras in state obligations as reimbursables in a period of ten years.
At the end of 1933, it saved the Hydroelectric Society of Piemont, whose shares had fallen from Lit.250 liras to Lit.20—while in September 1934, the Ansaldo trust was again reconstituted under the authority of the IRI, with a capital of Lit.750 million.
[40] Although there were economic issues in the country, the approaches used in addressing them in the fascist era included political intervention measures, which ultimately could not effectively solve the strife.
[41] An already bad situation ended up being worse since the solutions presented were largely intended to increase political power as opposed to helping the affected citizens.
Most evidence suggests that rural poverty and insecurity increased under fascism, and their efforts failed markedly to create a modern, rational agricultural system.
