Interwar Period: Economic Crisis & Rise of Totalitarianism

Posted on Mar 19, 2025 in History

The Interwar Period (1919-1939)

The Economic Crisis

The Initial Situation

  • The United States: Economic powerhouse of the time.
  • Large industrial, commercial, and financial sector: “Roaring 20s”
  • Europe: Need for economic reconstruction.

Problems in Europe:

  1. Adapting to a “peace” economy.
  2. Financial chaos.

“Dawes Plan” of aid to Germany (1924)

The “Crash” of 1929

  • Caused by speculation in the U.S.
  • Bankruptcy of the New York Stock Exchange.
  • Leads to:

The “Great Depression”

The Great Depression affected the world economy, giving rise to the crisis of the liberal-capitalist system.

Attempt to Solve: The “New Deal”

The “New Deal” involved Government Intervention.

Key actions:

  • Banking supervision.
  • Subsidies (= support).
  • Public works.

Totalitarianism and Fascism

Causes

  • The crisis in democracy after the disappointment caused by the war.
  • The widespread economic crisis: “The Great Depression.”
  • The fear in European countries of a possible revolution, like that which occurred in Russia.
  • Radical nationalism, exacerbated by the negative experiences of the war.

Ideology

  • Politics:
  • Illiberal / undemocratic
    • The state is above individual rights (“totalitarianism”).
    • Cult of the “leader” who represents the State and has all the power.
    • Single party.

Elimination of any political or trade union opposition.

  • There is no separation of powers.
  • Use of violence: the ideas are “imposed” not offered.
  • Nationalism leads to “imperialism” = dominance over others.
  • Social:
  • Importance of the “elites” (the realm of “the best”) that denied equality.

“Indoctrination”, particularly of youth.

  • Ideas of racism: race / culture should be imposed on the rest.
  • Economic:
  • State-directed economy.
  • Autarky: self-sufficiency.
  • Based on public works and the armaments industry.

Methods of Action

  • “Paramilitary” forces.
  • Propaganda, as a means of mobilizing the masses.
  • State resources to serve the party leading the life of citizens (“totalitarianism”).

The Rise of Italian Fascism

The Situation in Italy After the War

Italy came out of the Great War in a worsened state.

  • The hope of territorial expansion was not satisfied.
  • A moral crisis left a great situation [political, economic, social] which provoked criticism of the democratic system.
  • Successive governments were unable to resolve the problems affecting the country.
  • The economic situation was negative, with a loss of wages and increased unemployment.
  • The social crisis was the increase in confrontation between workers and police, resulting in hundreds dead.

The Beginning of Fascism

  • Creation of the “Fasci Italiani di Combattimento”
  • Benito Mussolini, a former socialist, championed Italian intervention in the Great War.
  • Created in 1919, also known as “black shirts.”

Actions of Squads

  • Its military, the squads, were very active in the confrontation with leftist social movements (socialist / communist), violently attacking demonstrators, strikers, union halls, and leftist politicians.

Support Received

  • The Russian Revolution, put forward by the labor movement, frightened the upper-middle-class.
  • The “employers,” the middle classes, and the government saw the squads as an instrument to curb the labor movement and restore public order.

In 1921, the Fascists became the National Fascist Party, with an extremist political agenda.

  • Their strength increased when the squad foiled the August 1922 general strike.

March on Rome

The Coup

  • The growing strength of the Fascist Party and the obvious support of powerful social groups impelled Mussolini to assault power in 1922.
  • This subversive action included accusations of the government’s failure to “ensure law and order” and the need for the regeneration of Italian politics.
  • The government opposed the fascist actions but was overruled by Victor Emmanuel III. Given this fact, the government resigned, and Mussolini was appointed Prime Minister. He was supported by the crown and the army in the process of his rise to power.