2.3a How successfully did Mussolini's economic plans achieve their aims? Flashcards
What were Mussolini’s initial goals in terms of economic policy
to win over powerful, established industrial elite of Italian society
- he appointed Alberto De’Stefani as minister of finance (pleased Italy’s business groups)
what did De’Stefani do?
favoured a ‘laissez-faire’ approach meaning he wanted no intervention in economy and focused on reducing govt spendign.
-he privatised telephone sector and other public owned industry whilst reducing state expenditure
-deregulated economy and cut protective tariffs
How successful was De’Stefani?
somewhat successful :
- 1921-1924 Manufacturing production improved and Italy had budget surplus
-Agricultural groups were unhappy about reduction in tariffs and he grappled with inflationary problems/ pressure on lira in foreign markets
Who took over De’Stefani as minister of finance?
What did this mean for Italy’s economy
July 1925: Giuseppe Volpi
- marked a transition towards a more regulated, state-run economy that had greater personal influence from M
Order of Mussolini’s ‘battles for the economy’
Battle for Grain 1925
Battle for Lira 1926
Battle for Births 1927
Battle for land 1928
What was the battle for Grain (BoG)
a propaganda campaign launched by Benito Mussolini in 1925 with the aim of gaining self-sufficiency in wheat production and freeing Italy from the “slavery of foreign bread”
–> Schiavitu del pane straniero
Why did Mussolini see the import of large quantities of grain as an immense weakness? (BoG)
during war, supplies could be cut off & country would face starvation
How did Mussolini aim to achieve this self-sufficiency in terms of grain (BoG)
- high tariffs on foreign imports
- govt grants to farmers and govt provided fertilisers, machinery and resistant seeds
- free advice for farmers on latest, efficient farming techniques
- guaranteed high price on grain produce
How was the Battle for grain beneficial for Po valley
large scale farms of po valley in north were able to maximise use of mechanised farming techniques and fertilisers, which boosted industrial firms that created the machinery & chemical industry
Successes of the Battle of Grain?
wheat imports fell by 75% between 1925-1935
wheat production rose from 5.39 million to 7.27 million tons from 1925-1935
- lowered trade balance deficit/ increased exports and reduced imports
- grain production up by 40% by end of 1930s
-5000 newly funded farms were built
Short comings of the battle of grain?
cereal production increased but other forms of agriculture e.g. animals and viticulture fell
lack of competition increased prices for Italian people (400 extra lira in food costs per year)
- iTALY’S total livestock fell by more than 500,000
- production of typical Italian goods (fruits, pastures and olive oil) fell
Was the battle for grain an overall success?
no as most land in central/ southern region were better suited for growing citrus fruits and producing wine/olive oil (opportunity to create valuable export trade was lost
–> self-sufficiency was pursued at the expense of economic efficiency and ultimately living standards of Italians
high import duties and government subsidies meant italy was still dependent on foreign imports (500 million tonnes was imported in 1933)
What was the battle for lira? (BoL)
an economic policy undertaken by the National Fascist Party in Italy during the 1920s and 1930s. It aimed to reduce inflation and fix the Lira at 90 to £, proving the power of the Lira and Italy,
What was the initial value of the lira and what did it fall to in 1926? (BoL)
1922: 90 lira to british £ but by 1926: 150 lira to british £ (price inflation)
What was Quota Novanta? How did it help/hinder Mussolini? (BoL)
the sharp revaluation of the lira to the fixed amount of 92.46
–> increased prestige with Italian public and foreign bankers (they saw this as a way of restricting govt spending
–> however, big businesses & volpi saw this as too high of a value & wanted the lira to be fixed at 120 (didnt happen)
How was quota novanta a disaster for certain Italian industries? (BoL)
disaster for export industries as foreign buyers immediately found Italian goods nearly twice as expensive
–> textiles industry went through a depression
If the battle for lira was meant to be beneficial, why did it actually hamper Italian consumers by making imports more expensive? (BoL)
due to tariffs being placed on undesirable products like consumer goods, the price of imports was high and Mussolini restricted demand to protect battle of grain policy
What happened to the wages of the people after Quota novanta?
Why did the Italian people believe in M regardless of wage problems?
(BoL)
From 1926-1928, unemployment rates trebled whilst wages went down by 20%
–> people accepted wage cuts as M portrayed this as a national battle, where wage cuts were seen as adversities that Italy had to overcome to win
–> people believed that stronger lira would represent a stronger Italy
Who benefitted from the revaluation of the lira? (BoL)
industries like steel, armaments and ship-building as their imports were made cheaper
–> by the time WW2 broke out, companies like Fiat, Montecatini (chemical firm) and Ansaldo (steel-making) were thriving
What happened on the 7th of October 1936 (BoL)
to stimulate economic recovery and improve the balance of payments, Italian government was forced to devalue the lira
What was the Battle for Births? (BoB)
an economic battle which took place during the inter-war years of 1925-1938.
It focused on promoting fecunditá by increasing welfare benefits, legislating tax breaks, and making available better educational opportunities
When did Mussolini announce the battle for birth? what was the aim?
1927 May: M wanted to increase Italy’s population from 40 million to 60 million by 1950s
–> extreme failure as by 1950, population was 47.5 million
Why did Mussolini want an increase in population? (BoB)
M believed greater population= increased military strength= strong empire= Italy becoming a world power
–> he also saw that there would be more competition for employment, keeping wages and labour cost low whilst increases the number of consumers
What things did M introduce to convince people into having children? (BoB)
- marriage loans: loan cancelled per child (completely cancelled after 6 children)
- 1928, married men with minimum 6 children were entitled to civil service jobs, promotions and tax concessions
- bachelor’s tax: single men were taxed
- women’s wages were lowered in 1927 attempted to remove the number of female workers (opposite effect as this made them more appealing to business owners for hiring)
In the 1930s, what were women’s roles in terms of work? (BoB)
1933, women were limited to 10% of work force but by 1930s, Italy still had the highest employment of married females in Europe (44% compared to 47% in 1921)
During 1930s, marriage rates remained but birth rate actually fell
–> 1936, 102.7 births per 1000 women but in 1911, 147.5 births per 1000 women
Battle for land aims? (BoL2)
to galvanise italy into a coordinated society/ increase areas for wheat production (links to battle of grain)
–> aimed to increase ruralisation
What is ruralism? (BoL2)
idea of rejecting modernity & urban cities, instead returning to agricultural life and country side (ironic as M wanted to increase agricultural output by updating farming methods)
Bonifica Integrale: what was it? (BoL2)
land reclamation and improvement project to prevent internal migration from countryside to cities
–> two projects under BI include marshlands draining and building new towns
What was going on with the USA in 1920 in relation to Italian migration? (BoL2)
USA closed off all immigration from Italy= ore rural Italians left villages to cities for a better standard of living
–> population of Rome doubled from 1921-1941
Why was Bonifica integrale beneficial for the Fascists? (BoL2)
useful for propaganda as Pontine marshes that were drained were only 50km away from Rome, easy for tourists to see splendour of Fascism
–> land reclamation helped boost employment and stimulate economy esp after the wall street crash
Draining of marshes reduced malaria by more than 50%, improving health in poorer areas
–> even though govt claimed 475 million hectares of lang was to be reclaimed, only 58% of land was improved
How were peasants involved in the battle for land? (BoL2)
Less than 10K peasants received land promised in propaganda
–> a law that broke up big estates and distributed was dropped as M feared offending large land owners
What is autarky?
being economically self-sufficient by reducing imports and maximising production in the country itself (closed economy opposed to free trade)
When & why was autarky announced?
1936 as a consequence of Great depression, sanctions placed by LoN after invasion of Abyssinia 1935, and was used to overcome dependency on other countries
- promoted national pride and less pressure on Italy’s payments
1937 What was created and what were the aims/achievements
High commission on Autarky:
- encouraged domestic production (heavy industries like coal oil iron)
- subsidised production & allowed monopolies
- wanted to reduce imports by replacing them with new sources e.g. AGIP
- produced substitutes for imported material (lanital instead of wool/ rayon instead of cotton)
By 1939 how was the high commission on Autarky doing?
far from self sufficiency due to lack of raw materials, domestic production only met 1/5 of industrial raw material needs (still needed imports)
Compared to other countries, how was Italy’s grain production?
Italy could not match France or Britain in production & could not replace losses in shipping/ aircraft
–> govt had accumulated a lot of debt due to contracts with companies
–> M however did not increase taxes because he was scared to lose support from public
Due to the autarky what were living conditions like for Italians
Living standards for industrial workers declined – Mussolini was willing to let this happen to avoid tax increases and spending cuts
Mid 30s – prices in shops rose steeply as the drive for autarky pushed up the cost of imported goods
Between 1925-28 – wages fell by over 10%
1933 – unemployment hit 2 million
