Mussolini and the Economy Pt 2 Flashcards
How did Italy’s unemployment rise after the Great Depression?
1928 - 300,000
1933 - 1 million
How did Government spending increase after the Great Depression?
- Due to wages falling the Gov spent more (4x)
- 6.9% of Gov income in 1930 spent was 1.5 billion lire
- 1940 this increased to 27.6% spent meaning 6.7 billion lire
What was Cartelisation and how did it help Italy in the Great Depression?
- This encouraged the growth of big conglomerate economic enterprises (cartels) through mergers and takeovers to remove competition
- This was made compulsory in 1936
Where were the bigger Cartels and how useful were these?
- Bigger in the North, the industrial triangle of Milan, Turin, Genoa benefitted heavily
- Deemed useful to the Italian Economy
- Smaller firms and companies in the south were overlooked and shut down
How did Mussolini use the Great Depression to fuel his propaganda?
- He use transport for Propoganda
- he “made the trains run on time”
- Developments of ocean liners showed boost in developments of shipping and boosted morale
Give examples of Mussolini’s Ocean Liners and their significance
- SS Rex August 1931 was the biggest Italian Ocean Liner until 1991
- SS Conte di Savoia was an Ocean Liner built in October 1931
How did Italy cope with bankruptcy?
- Made 3 institutions funded by the Italian Treasury
- IMI and the IRI
- Issued banks 5 and a half billion Lire to be repaid within 10 years (IMI)
- Lent money to companies that needed saving, e.g Ansaldo (IRI)
- IRI also took control of bank-owned companies
How much control of companies did the Italian Government have during the Great Depression?
By 1939
- Owned 80% of shipbuilding and 75% of pig iron productions
- Italy owned 20% of industry, more than any other European country, slightly behind the USSR
- Italy had coped better than others
- Mussolini believed Roosevelts ‘New Deal’ was Americas method to battle unemployment
What was Autarky?
- A self sufficient closed economic system which reduces its dependance on other countries and limits trade
Why did Mussolini want Autarky for Italy?
- He wanted to lessen the Balance of Payments (had achieved a Balanced Budget in 1925)
- He wanted to assert Italy as independent and a world power
When was the policy for Autarky announced?
- Formally announced in 1936
- High Commission of Autarky created in 1937
- The battles heavily were driving towards this anyways, NOTE this is just the ‘formal’ beginning’
What substitutes were made under Autarky?
- 1935, Lanital as a substitute for Wool
- Rayon as a sub for Cotton
What were Mussolini’s import goals, why were these unrealistic?
- He wanted to import less coal, oil and iron ore
- Domestic production would only meet 1/5th of Italy’s needs however
How would Government intervene?
- Government took full control of some companies, mostly in Steel, Chemicals and Armaments industry
- This pushed up the cost of imported goods
What were wage cuts like, and how did the Gov attempt to deal with this?
- Real wages of Italian workers fell by 10% between 1925 and 38
- Ministry for Corporations and Dopolovaro were organisations that employed large numbers of the middle class who’s cuts were less severe than Industrial Workers
What made Autarky more desirable? How did Mussolini contribute to this?
- October 1936 the Lira was devalued and this made Autarky more desirable, less reliance on imports
- M was prepared to lower living standards to avoid spending cuts and tax increases due to spending on Gov contracts
How would Italy do when they joined WW2?
- In 1940 she was unable to match enemies level of production and repair losses in shipping and aircraft
Did Autarky work overall?
- Unrealistic as they could not produce in key areas, coal, oil and raw materials
- Opposite direction to the regimes goal of ‘ruralisation’
- Italy were still dependant on imports for basic needs (food) and its lack of foreign currency meant it was unable to get raw materials for military needs
By how much was workers wages cut in November 1930?
12 Percent
How was road building improved and how were railways electrified?
- Road building doubled between 1929 and 33
- 5,000Km of railway was electrified
How did Government spending on autarkic measures and heavy industry change?
- Doubled from 30 billion Lire in 1934 to 60billion Lire in 1938
How did Italy’s budget deficit grow during the depression?
- Caused by increased welfare spending
- Local tax receipts spent on welfare increased from 6.9% to 20.6%
How much did wheat production increase in tonnes?
- 5.39 million tonnes to 7.27 million between 1925 and 35
What was the Lira’s value fixed to in 1927?
- 19 Lira to the American Dollar
- 92.46 Lira to the British Pound
