Aims and results of policies: Mussolini's domestic policies - economic policies Notes

1920s Economic Battles

• Battle over the Southern Problem (1924) aimed to modernise southern Italy through new villages in Sicily and anti-Mafia campaigns, but no villages were actually built and impact was negligible.
• Battle for Grain (1925) promoted wheat production to reduce imports. Import controls and land expansion benefited some farmers and industry (tractor demand), but it caused a decline in olive oil, fruit, and wine exports.
• Battle for Land (1926) involved draining marshes to create farmland. This created jobs and small farms, yet success was limited to specific areas and was largely short term.
• Battle for Lira (1926) revalued the currency to strengthen its position. It helped import coal and iron for rearmament, but made Italian goods more expensive abroad, hurting exports.
• These battles had mixed results, often causing as many problems as they solved, with improvements largely due to broader European recovery rather than Fascist policy.

The 1930s: State Intervention

• The Great Depression saw unemployment rise to 2 million and inflation increase, forcing the government to spend heavily to prevent bank and industrial collapse.
• Creation of the IRI (Institute for Industrial Reconstruction) led to large capitalist monopolies under state influence, public works projects (highways, dams) to tackle unemployment, and protectionist measures to shield Italian industries.
• Autarky increased in theory but self-sufficiency was never achieved, and the economy failed to undergo deep modernisation.
• Benefits were unevenly distributed. Industrialists and landowners gained the most power through the Charter of Labour, while small farmers and business owners often suffered.
• Historians remain divided: some compare Mussolini to Stalin in terms of rapid modernisation, others argue Fascist policies barely modernised due to deference to traditional elites.

Economic Winners and Losers

• Industrialists flourished, gaining control over wages and benefiting from government support.
• Landowners maintained strong influence, reaping profits from agricultural reforms.
• Industrial workers saw improved employment opportunities but lost the right to strike and faced wage controls.
• Small farmers and much of the lower middle class saw little improvement and often emigrated due to poor prospects.
• Fascist bureaucrats enjoyed secure and well-paid positions, contrasting sharply with small business owners who were hit hard by protectionist distortions.