MUSSOLINI'S ECONOMIC POLICIES

AIM: TO INCREASE PRODUCTION, MODERNIZATION, AND SELF-SUFFICIENCY

BY: MALIHA AND HARA

BATTLE FOR

LAND

Aims

• To increase the land available for cereal production and help the Battle for Grain

• Provide more jobs, reducing unemployment, stimulating demand

• To improve health by reducing malaria therefore improving living standards

• To show dynamic government in action, impressing foreigners

• To revive rural Italy by altering the pattern of small farmers at the expense of large estates.

• Public health was improved

• Provided thousands of jobs during the depression

• New towns—Latina and Sabaudia—created as show pieces

• Between 1928 and 1938 80,000 hectares were reclaimed.

Failures

• Three quarters of land was in the North; the South was neglected which needed improving the most

• The Fascist regime achieved nothing in the way of land redistribution, which was, in any event, inconsistent with the central thrust of the more high profile Battle for Grain

• Subsidies benefitted large landowners rather than peasants; fewer than 10,000 peasant families were re-settled on reclaimed land, because the desire for increased wheat production called for large scale, machine based farming methods, not hand labour on peasant plots.

• The scheme was abandoned in 1940.

BATTLE FOR

GRAIN

Aims

• To boost cereal production to make Italy self-sufficient in grain

• to reduce the balance of trade deficit

• to lower the necessity for foreign imports of bread

• to show Italy as a major force

Actions

• 1925 High tariffs on imported bread

• Previously infertile land was utilised

• Government gave grants to farmers for machinery and fertilizer

Results

• Cereal production doubled from 1922 to 1939 and was self-sufficient by 1940

• Wheat imports went down 75% between 1925 and 1935

• Other vital aspects of agriculture were ignored

• Necessity of the import of fertilizers posed as a problem in WW2

• Cost of bread sharply increased

• Italian diet generally decreased in nutritional value

BATTLE FOR

LIRA

"In the first five years of Mussolini's rule, taxes on the wealthy were slashed, banking deregulated, taxes on corporate dictators

slashed and later eliminated, and all luxury taxes repealed. In addition, all inheritance

taxes were repealed, as well as taxes on stock and bond transactions, and on movement of

capital in and out of the country"

AIMS• Fix the rate of Lira/British Pound at 90

Lira

• Reduce inflation

• Confirm image of stability due to Fascism

• Prove to others that Italy and its currency are STRONG

BATTLE FOR LIRA

• Lira collapsed; banks were hanging on the edge

• Rate of Lira/BP reached 150 in 1926

• Government forced to bail them out

• Lead to inflation, but then Mussolini forced a major deflation policy: raised interest rates, reducing money supply

SOURCES

• http://www.larouchepub.com/eiw/public/2008/2008_1-9/2008_1-9/2008-9/pdf/16-21_3509.pdf