State Intervention

The financial crash of 1929 ended an exceptional period of prosperity, and the consequences were not only social and economic, but also political, cultural and psychological. The American Way of Life was threatened . While many feared authoritarianism and the end of democracy, this crisis created the conditions for the implementation of radical reforms. The Nazi regime’s priority was employment. As Hitler announced via radio on 1st February 1933, the government would act “with steely determination and the most tenacious perseverance” to rescue German peasants from poverty and eliminate unemployment “within four years”. The italian fascist government created the Istituto per la ricostruzione industriale (IRI – Institute for Industrial reconstruction). The State gave it the capital required to bail out the banks, but at the same time IRI acquired their shares and industrial holdings, managing them independently, and subsequently disinvesting. The three most important banks were nationalized. In the Soviet Union the agricultural collectivization in the kolchoz was the pre-condition for forced industrialization. The State intended to seize an important share of agricultural production, partly to feed the working class in urban centres, and partly to export in return for the technology required by the USSR.