Italy had emerged from World War I in a poor and weakened condition. An unpopular and costly conflict had been borne by an underdeveloped country. Post-war there was inflation, massive debts and an extended depression. By 1920 the economy was in a massive convulsion - mass unemployment, food shortages, strikes, etc. Contents [hide]
1 Fascist economic policy
2 First steps
3 Firmer intervention
4 The Corporative phase
5 The Great Depression
6 After the Depression
8 See also
Fascist economic policy
The neutrality of this section is disputed.
Please see the discussion on the talk page. (February 2008)
Please do not remove this message until the dispute is resolved. Benito Mussolini came to power in 1922 and transformed the country's economy along fascist ideology. He was not an economic radical; while he reshaped the political scene he neither had nor sought a free-hand with the economy. He was prepared to align with industrial groups and forge an accommodation with capitalism. As with Nazi Germany the economic policies of Mussolini are difficult to define. There is a messy tangle between economic theory and economic practice which leads to two opposing views - either Mussolini had an economic plan, or that he did not, but instead reacted to changes without forward planning. . To proponents of the first view, Mussolini did have a clear economic agenda, both long and short-term, from the beginning of his rule. The government had two main objectives - to modernise the economy, and to remedy the country's lack of strategic resources. To stimulate development Mussolini pushed the modern capitalistic sector in the service of the state, intervening directly as needed to create a collaboration between the industrialists, the workers, and the state. The government crushed fundamental class conflicts in favour of corporatism. In the short-term the government worked to reform the widely-abused tax system, dispose of inefficient state-owned industry, cut government costs, and introduce tariffs to protect the new industries. The lack of industrial resources, especially the key ingredients of the industrial revolution, was countered by the intensive development of the available domestic sources and by aggressive commercial policies - searching for particular raw material trade deals, or attempting strategic colonisation. To those arguing that Fascist policy was not clear, the view in the preceding paragraphs is based on a naive acceptance of Italian propaganda. Mussolini knew close to nothing of economics and did not care greatly; he put little pressure on industry and the government efforts were ad hoc, rather than following a clearly defined policy. Indeed, certain historians have argued that Italian fascism was actually a negative force on the Italian economy - holding back genuine modernisation and badly distorting economic development, even before the war. First steps
The Fascist government began its reign in an insecure position. 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. Economic policy in the first few years was largely liberal, with the Ministry of Finance controlled by the old liberal Alberto De Stefani. The government undertook a low-key laissez-faire program - the tax system was restructured (February 1925 law, 23 June 1927 decree-law, etc.), there were attempts to attract foreign investment and establish trade agreements, efforts were made to balance the budget and cut subsidies. The 10% tax on capital invested in banking and industrial sectors was repealed, while the tax on directors and administrators of anonymous companies (SA) was cut down by half. All foreign capital was exonerated of taxes, while the luxury tax was also repealed . Mussolini also opposed municipalization of...
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