Autarchy, War and Economic Planning

After the great 1933 crisis, the most important Italian iron-and steel industries were brought into the Istituto di Ricostruzione Industriale (IRI – Institute for Industrial Reconstruction), the public body managing State shareholdings. In 1934 IRI developed a plan for the global restructuring of the iron-and steel industry, posing the foundations for the start of integrated cycle production (from raw material to the finished product), following the example of the more modern steel industries existing in other countries. The plan, formulated by Oscar Sinigaglia and Agostino Rocca, was opposed by private industrialists (Falck), who claimed that for Italy the best and least expensive way to produce steel was to use the electric furnace and scrap. This latter opinion won the day and Sinigaglia was forced to abandon his plans. After the sanctions inflicted to Italy in 1935 for its aggression against Ethiopia and the start of the autarchy programme, Mussolini was persuaded by the IRI engineers, supported by the military, that the start of integrated cycle production would produce consistent savings and above all that Italy would no longer have to depend on large imports of scrap from abroad (especially from France): in a war economy this factor proved decisive and Mussolini authorised the IRI engineers to implement the plans that had been rejected in 1934. A special holding was created to manage public iron- and steel industries, called Finsider, first headed by Agostino Rocca and later by Arturo Bocciardo. In Genoa the Ansaldo steel works was separated and the Società Altiforni di Cornigliano (Cornigliano Blast Furnaces Company) was created, destined to become the first pilot plant of the new integrated cycle industry. German technology and German engineers were used to build this factory. During the war, orders for the military were used to modernise the industry: for Agostino Rocca the conflict was an ideal occasion to render steel production more efficient, by concentrating it in few large modern plants, standardising production and reducing costs. Thus the conditions necessary for the mass production of goods had finally materialised, allowing Italy to reach a level of industrial specialisation that would prove crucial after the war. Even though during the war the iron-and steel works suffered great damages (the Cornigliano factory was dismantled by the Germans and transferred to Germany), the foundations were nevertheless put in place for the modernisation of the sector. In the post-war period the public sector steel industry underwent a colossal increase which accompanied the economic boom of the 1950s. A compromise was made, establishing the premises for the productive integration of the sector: the great State-owned integrated-cycle steel works (ILVA) in Genoa Cornigliano, Piombino, Naples Bagnoli and Taranto provided the large mechanical industries (such as FIAT) with laminates, whilst private industrialists using the electric furnace and scrap supplied the building sector, or specialised in the production of special-type steel. Today the public sector steel industry no longer exists, whilst the best plants still in function have been bought by private companies (Riva, ThyssenKrupp). Without State investment the modernisation of the steel industry would not have taken place: besides investing in new technologies, the public sector produced a generation of technocrats, such as Agostino Rocca and Oscar Sinigaglia, who played an essential role in revolutionising both technology and the managerial organisation of industrial production.