Routes Into the Abyss: Coping with Crises in the 1930s 9780857457851

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Routes into the Abyss

International Studies in Social History

General Editor: Marcel van der Linden Published in association with the International Institute of Social History, Amsterdam Volume 1 Trade Unions, Immigration and Immigrants in Europe 1960–1993 Edited by Rinus Penninx and Judith Roosblad Volume 2 Class and Other Identities Edited by Lex Heerma van Voss and Marcel van der Linden Volume 3 Rebellious Families Edited by Jan Kok Volume 4 Experiencing Wages Edited by Peter Scholliers and Leonard Schwarz Volume 5 The Imaginary Revolution Michael Seidman Volume 6 Revolution and Counterrevolution Kevin Murphy Volume 7 Miners and the State in the Ottoman Empire Donald Quataert Volume 8 Anarchism, Revolution and Reaction Angel Smith Volume 9 Sugarlandia Revisited Edited by Ulbe Bosma, Juan GiustiCordero and G. Roger Knight Volume 10 Alternative Exchanges Edited by Laurence Fontaine Volume 11 A Social History of Spanish Labour Edited by José Piqueras and Vicent Sanz-Rozalén

Volume 12 Learning on the Shop Floor Edited by Bert De Munck, Steven L. Kaplan and Hugo Soly Volume 13 Unruly Masses Wolfgang Maderthaner and Lutz Musner Volume 14 Central European Crossroads Pieter C. van Duin Volume 15 Supervision and Authority in Industry Edited by Patricia Van den Eeckhout Volume 16 Forging Political Identity Keith Mann Volume 17 Gendered Money Pernilla Jonsson and Silke Neunsinger Volume 18 Postcolonial Migrants and Identity Politics Edited by Ulbe Bosma, Jan Lucassen, and Gert Oostindie Volume 19 Charismatic Leadership and Social Movements Edited by Jan Willem Stutje Volume 20 Maternalism Reconsidered Edited by Marian van der Klein, Rebecca Jo Plant, Nichole Sanders and Lori R. Weintrob Volume 21 Routes into the Abyss Edited by Helmut Konrad and Wolfgang Maderthaner

Routes into the Abyss Coping with Crises in the 1930s

Edited by Helmut Konrad and Wolfgang Maderthaner

berghahn NEW YORK • OXFORD www.berghahnbooks.com

Published in 2013 by Berghahn Books www.berghahnbooks.com © 2013 Helmut Konrad, Wolfgang Maderthaner

All rights reserved. Except for the quotation of short passages for the purposes of criticism and review, no part of this book may be reproduced in any form or by any means, electronic or mechanical, including photocopying, recording, or any information storage and retrieval system now known or to be invented, without written permission of the publisher. Library of Congress Cataloging-in-Publication Data Routes into the abyss: coping with crises in the 1930s / edited by Helmut Konrad and Wolfgang Maderthaner. p. cm. – (International studies in social history; v. 21) ISBN 978-0-85745-784-4 (hardback: alk. paper) – ISBN 978-0-85745-785-1 (ebook) 1. World politics–1933–1945. 2. Depressions–1929. I. Konrad, Helmut, 1948– II. Maderthaner, Wolfgang. D727.R674 2013 909.82’3–dc23 2012032899

British Library Cataloguing in Publication Data A catalogue record for this book is available from the British Library Printed in the United States on acid-free paper ISBN 978-0-85745-784-4 (hardback) ISBN 978-0-85745-785-1 (institutional ebook)

Contents Introduction Helmut Konrad and Wolfgang Maderthaner

1

1 Crisis and Workers’ Movements Ferdinand Lacina

12.

2 The Significance of February 1934 in Austria, in both National and International Context Helmut Konrad

20

3 Avalanches of Spring: The Great War, Modernism and the Rise of Austro-Fascism Roger Griffin

33

4 Fascism in Italy between the Poles of Reactionary Thought and Modernity Karin Priester

55

5 Hitler’s Dictatorship: His Role as ‘Leader’ in the Nazi Regime Hans Mommsen

78

6 The Second Spanish Republic: The Challenges Facing a Democracy in Troubled Times Vicent Sanz Rozalén

86

7 The Crisis in the 1930s and the Rise to Power of the Swedish Social Democrats Bengt Schüllerqvist

102

8 The United States in the Great Depression: Was the Fascist Door Open? Nelson Lichtenstein

115

vi

Contents

9 Turkey in the First ‘World Crisis’: From Authoritarianism to Totalitarianism Erik-Jan Zürcher

127

10 Brazil in the 1930s: State Building, Nationalism and Working-Class Agency Alexandre Fortes and Paulo Fontes

139

11 Labour, Organization and Gender: The Jute Industry in India in the 1930s Samita Sen

152

12 Japan’s Way Out of the Crisis of the 1930s as a Strategy for Overcoming Modernity Hiroko Mizuno

167

13 Reappraising the Nanjing Decade (1927–1937): Modernizing China during the World Economic Crisis Susanne Weigelin-Schwiedrzik

183

Notes on Contributors

199

Bibliography

203

Index

219

Introduction Helmut Konrad and Wolfgang Maderthaner

In 2008, when the subprime mortgage crisis shook the American financial system, few could have foreseen that this was the beginning of a global financial crisis. And nobody at all reckoned with a knock-on effect on the ‘real’ economy. On the contrary: stock market bubbles had often burst in the past, decimating the (real and virtual) fortunes of investors, but they had only ever been accompanied by the smallest of effects on production in other sectors, even in those at the centre of the financial crises in question. And there was no talk whatsoever of any effect on politics, either at a national or international level. On the contrary, the brave new world of economic liberalism – which had re-established itself practically across the entire world after the implosion of Soviet socialism – remained unchallenged, with highly vocal advocates in many national governments. However, there then ensued a debacle of truly epic dimensions, such as can only be expressed in the form of superlatives, if at all. In autumn 2008, the international markets found themselves in a state of accelerated disintegration, as a global financial crisis took hold of the credit sector with extraordinary rapidity, first in the USA, then Europe, and then in the threshold countries, devouring banks’ capital reserves. The initial tremors had erupted into a crisis of confidence of gigantic proportions. The ohso-cool and seemingly all-powerful casino of Anglo-American financial speculation collapsed like a house of cards, and three of the five biggest, most influential investment banks on Wall Street quite simply ceased to exist. They had not only been financial mega players, but also unusually powerful politically, exerting a decisive influence on the financial policies of the European Union thanks to their London headquarters. The following year, 2009, was characterized by an economic crisis the likes of which the world had not seen for almost eight decades. Whole nations went bankrupt, including oases of prosperity such as Iceland. New

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Helmut Konrad and Wolfgang Maderthaner

parliamentary democracies such as Hungary were only able to survive thanks to vast amounts of international help. The crisis had dramatic effects even within the eurozone. Greece was badly shaken and had to be saved by the intervention of the European Union. Other states, including Portugal and Spain, also faced the prospect of not being able to underwrite their national budgets. All of the eurozone countries confronted the challenge of reducing massive mountains of state debt. Long queues formed and still form at job centres and welfare institutions. Anxiety has become widespread, and many radical voices can be heard in the search for solutions and for someone to blame. When people fear for their material existence, there are inevitably calls for strong leaders, a stop to migration and the reinforcement of national protectionism. These events unfolded despite a variety of instruments that economists have created since the last global economic crisis to help to avoid a repeat. Historical crises had been analysed, and practical, applicable conclusions drawn: regulatory bodies had been set up, systems for assessing risk developed and multinational protective mechanisms put into place. However, none of this was ultimately able to soften the blow. Some of the consequences of the crisis may have been mitigated, but none of these structures was able to prevent or check it in the final instance. In the midst of the initial shock, in February 2009, the Labour History Society in Vienna organized an international symposium together with the International Institute of Social History in Amsterdam to mark the seventy-fifth anniversary of February 1934 and the fiftieth anniversary of the Viennese research institute’s founding. The aim of the symposium was to put the events of February 1934, to this day a traumatized and traumatizing chapter in modern Austrian history, into a global comparative context. Although the radicalization of Austrian domestic politics that preceded the civil war of February 1934 eludes monocausal explanation, it was at least partly the result of the major crises that shook the global economy in the early 1930s. Even before the crisis of 2008/9 had broken out, the symposium organizers had decided that Austrian developments should be compared with those in other countries, abandoning a purely European perspective and widening its brief across the world, from the USA to Japan. In the event, this turned out to be a felicitous decision, at least in academic terms. There are of course obvious comparisons to be made between the current global financial crisis and the events of eighty years ago. The 1929 crisis also broke out at the New York stock exchange. Exchange rates crashed through the floor, spelling instant ruin for innumerable small investors who had hoped to be able to realize their modest dreams of happiness via the stock market. Then as now, financial crisis rapidly devel-

3

Introduction

oped into an almighty crisis of the entire economy. Loans were cancelled at short notice, and states with close links to the USA were cast headlong into dire financial straits. Foremost among these was Germany, whose economy had boomed during the ‘roaring twenties’ primarily as the result of American investment. Now America dragged Germany down with it, and the American policy of externalizing the consequences wherever possible, in other words reducing the social cost at home by shifting it abroad, meant that Germany was harder hit by the crisis than its country of origin, the United States. All the countries whose economies were linked to Germany were also affected in their turn, including and in particular Austria. The crisis also had an enormous impact on the southern hemisphere. Particularly hard hit were economies that depended on the export of raw materials and agricultural products. Chile’s GDP more than halved between 1929 and 1932. Parts of the agricultural sector collapsed completely in sub-Saharan Africa, which led to famines and mass deaths – for example, in Niger. Some countries, however, remained relatively unaffected. Table 1: Levels of GDP per Capita 1929–1944

1929 1934 1939 1944

United States 6,907 5,120 6,568 12,348

Germany

India

Indonesia

Japan

Argentina

Brazil

4,335* 3,846* 5,549 6,249

665 635 643 675

1,207 1,024 1,124 609

1,949 2,019 2,709 2,558

4,367 3,845 4,148 4,579

1,106 1,156 1,307 1,348

Source: Angus Maddison, The World Economy, Vol. 1: A Millennial Perspective, Paris 2007, p. 60, Table 2–4. * Source: Angus Maddison, Monitoring the World Economy 1820/1992, Paris 1995, p. 194.

One of the main outcomes of the First World War was a drastic reversal of a general tendency to globalization apparent in the decades before the war, economically, culturally and as regards communications. This trend was stopped or at the very least decelerated by increased nationalist antagonism. In addition, the war had broken up huge multinational power structures such as the Osman and Habsburg Empires, and China was now ruled by warlords. The many smaller units that had been created, with their new borders and customs duties, stood in the way of the modern tendency to uniformity, unimpeded communication and unlimited trade. The collapse of Czarist Russia led to the foundation of the Soviet Union

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Helmut Konrad and Wolfgang Maderthaner

in 1922, a new form of state which attempted to eschew the logic of the capitalist world market. The First World War not only changed the face of Europe, but also parts of Africa and Asia. It also had lasting effects on the shaky balance of the global capitalist economy, sparking off a chain reaction of demand, production and price revolution that culminated in a crisis of unprecedented dimensions, fundamentally changing the structures of capitalism itself. The crisis of 1929, like all other crises (and in particular the current crisis), had been preceded by a period of mass renewal, expansion and reconfiguration of the social production apparatus. American and, to a slightly lesser extent, Japanese capitalism had even experienced a phase of unusual growth and accumulation. However, the extent and duration of the cyclical recession that set in swiftly exceeded all previous economic downturns. By 1932, commodity prices had fallen by 30–40 per cent, with figures far higher than this in some sectors. Production in the leading industrial countries fell by up to 50 per cent, and the value of world trade shrank by a third of its previous volume. In 1930, the International Labour Office put the figure of global unemployment at over thirty million – and this was a conservative estimate. The Great Depression was the result of a series and combination of contradictions and conflicts: a structural crisis within the traditional heavy industries from the first phase of industrialization; an accentuation and intensification of competition between the national economies; and increased pressure from workers’ and farmers’ movements for fairer distribution of social wealth. These factors were compounded by a virulent agricultural crisis after the end of the Great War and, above all, by the dramatic collapse of the international credit system. The massive overaccumulation of capital in the USA and in countries that had remained neutral during the war contrasted starkly with the situation in countries whose capital assets had been destroyed by postwar inflation. The duration of the entire interwar period was characterized by something like a coexistence of prosperity and crisis, caused by inflated prices and an associated increase in the need for liquid cash, but also, crucially, by gigantic war and reparation debts. The enormous and enormously unstable system of international loans that developed as a result inevitably broke down as prices suddenly and rapidly sank: from the collapse of the financial system in October 1929, the New York Times Industrial Production Index lost 248 of its original 469 points. By mid-1932 it stood at 58; there had been hundreds of bankruptcies, and collapses of banks and broker companies. In this way, the inequality of wealth distribution in society became apparent as never before. Cheap money was one of the root causes of the catastrophe. The fabulous American way of life was built on credit; demand for the legendary Fordian consumer goods (cars and electrical

Introduction

5

goods above all) could only be fuelled by a policy of granting consumer loans that had outlived its rational necessity. Seventy per cent of American families took up such loans; their potential as consumers and their moderate – and decidedly fragile – prosperity depended on them. It was this cheap money that eventually led to the formation of the speculative bubble whose bursting led directly into the abyss. At first the difference to earlier downturns was a quantitative one as regards the dimensions of market collapse, reduced turnover and falling prices, but soon the difference became qualitative: a drastic reduction in levels of consumption, followed by reduced investment, sparked off a deflationary spiral, substantially affecting an ever-increasing number of companies. Serial bankruptcies led to mass redundancies and an enormous increase in unemployment. The results are well known: currency collapse, statism, the discreditation of democratic principles, the establishment and comprehensive assertion of authoritarian principles, and finally, another apocalyptic world war. This crisis, spreading out across the globe at varying speeds, only served to intensify the anti-globalization tendency that had been apparent since the end of the First World War. This trend towards isolation expressed itself in different ways. Perhaps the most striking example was that of the Soviet Union, which, since the late 1920s and its transition from New Economic Policy (NEP) to a managed economy and collectivization, increasingly withdrew from the all-encompassing logic of the global market economy, setting up an alternative political and economic model of state-led centralism. In many Latin American and Asian countries, governments resorted to import substitution – the planned reduction of dependency on the world market by producing capital-intensive and consumer goods at home. In Europe, but not only there, the notion of protectionism became increasingly influential and contributed to the division of the global economy into separate blocks. This tendency to isolation was coupled to big political changes. The terror tactics employed by the USSR show this with great clarity. As in the case of the historical phenomenon of Fascism, the essence of Stalinist rule, its internal logic or ‘rationale’, is very difficult to understand or explain. After the party dictatorship had been consolidated, party leaders persecuted Soviet citizens according to a kind of quota regulation; sentences were passed as though disgorged from a bureaucratic production line. Every republic, every autonomous region, and every district had its own consignment of ‘enemies of the people’ to work through, whereby the various regional divisions of the secret police entered into a positive competition with one another as regards arrests and condemnations. As far as emigrés were concerned, their nationality alone was normally

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Helmut Konrad and Wolfgang Maderthaner

grounds enough to accuse them of espionage and sentence them. The purges followed no political or rational calculation, being simply a matter of naked, brutal terror on the broadest basis possible; in accordance with this principle, the victims were selected in a virtually random fashion. The only discernible logic was that of collective intimidation, of creating the impression that anyone could be targeted at any time, for reasons beyond their comprehension. In the programmatic essay ‘State and Revolution’ written immediately before the October Revolution, Lenin made reference to older notions from the French Revolution to expound the idea of a higher, more perfect form of democracy that was to develop out of the temporary, yet necessary dictatorship of the proletariat and in which the state apparatus of coercion would die out – ‘socialist’ democracy as the instrument of self-government for a classless society. In its initial phase, the dictatorship genuinely seemed to be laying the foundations for this: freely elected Soviets destroyed the Czarist state apparatus and widespread popular terror broke down all opposition. It was not until the pressures of a three-year civil war forced the dictatorship to make fundamental changes to its internal structure, reducing its social basis, that the elementary action of the masses was replaced by the dictatorship of a bureaucratic police and military state ruled over by the party and the organized terror of the Cheka. The civil war played havoc with the entire economy. Agricultural production was down to two-thirds, and industrial production to a fifth of its pre-war levels; widespread famine caused revolts and unrest, and forced the Soviet government to reorganize production and restart trade between city and countryside within the framework of the NEP. However, putting an end to ‘war communism’ by allowing the individual production of goods (in the country) and free trade (in the towns) also brought about far-reaching processes of social differentiation – and once again the dictatorship changed form and function. It was decided that new heavy industries would be built up, as quickly and with as few compromises as possible, that industrial production would be subject to a huge programme of rationalization, that all trade would be in the hands of the state and, from 1928/29 onwards, that the entire economy would be run on the basis of five-year plans. Accompanied by an omnipresent campaign for the increase of productivity at work, ‘socialist expansion’ and ‘socialist competition’ were propagated, as embodied by pioneer brigades of the first and the Otlitschniki and Stachanowzi of the second five-year period. This industrialization, driven by state bureaucracy, was aimed at creating a solid social basis for the dictatorship of the proletariat. In the meantime, the agricultural economy was being collectivized on a grand scale. Both processes demanded unspeakable sacrifices from the population. On

Introduction

7

the one hand, for economic as well as military reasons, expansion was forced almost exclusively in industries producing capital-intensive goods, to the detriment, above all, of the developing consumer goods industries. Production levels were very low initially, and due to this and the fact that the industrialization process was financed through artificial inflation, wage increases lagged far behind price increases; all those denied access to privileged sources of supplies became increasingly impoverished. Even worse, even more catastrophic were the results of the systematic forced collectivization of agriculture, aimed against the Kulaks. The expropriation and banishing of the Kulaks (and all those who had been successful as individuals during the NEP period) led immediately to massive decreases in harvest yields; food shortages became famine in many areas, and millions died. According to a time-honoured Czarist tradition, the expropriated were sent as forced labourers to northern Siberia, where many of them starved, froze to death or fell victim to epidemics – the numbers of casualties are now impossible to establish with any certainty. The children of those who had been expropriated, banished or starved to death wandered the streets of the big cities in masses, with no one to care for them and no means of support. Against this background, a merciless dictatorship established itself, which justified the unimaginable burdens and privations it laid on its people in the here and now, with its ostensibly ‘objective’ insight into the future development and perspectives of ‘the proletariat’. During this phase, Stalin had also turned the party itself into a blindly obedient organ of his will, successively defeating all internal opposition and destroying it by means of the state terror. In the end, virtually the entire old guard of the revolutionary Bolsheviks fell victim to him. The dictatorship of the proletariat was transformed in this way into a radically different model that could not have been further from Lenin’s original idea of a higher form of democracy – the self-determination of the ‘working masses’ through the means of freely elected Soviets. Instead it had become the dictatorship of an all-powerful party, concentrated in the person of Stalin and governing by means of an all-powerful state apparatus of economic, judicial, police and military bureaucracy. The Soviet Union was to have fulfilled that great human utopia of an ideal society of free equals, a way out of the alienation and contradictions of the modern age. Instead, it became paradigmatic of the authoritarian and totalitarian trauma that gripped the world to such an unimaginable extent during the Great Depression and its attendant crises of culture and civilization. The turning point of 1918 was a seismic shift that shook traditional power structures, unleashing enormous social and political energies. It was a time of new beginnings, intellectually and artistically; the

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Helmut Konrad and Wolfgang Maderthaner

masses were galvanized by new ways of seeing the world, new philosophies of life. Traditional global and religious orders were overthrown, empires and dynasties that had lasted for centuries were done away with, social orders and cultural value systems radically redefined. The war had blown apart old social formations in an act of unparalleled violence, and now the fragments of society were to be put back together to form a new whole. In this context of newly emerging economic and social orders, other, much more threatening developments became apparent: visions of autocratic dictatorship and national populations marching in totalitarian formation. The masses, reeling from war, hunger and privation, were easily led, easy to enthuse, and very soon formed a power basis for totalitarian expansion. Within the space of only two decades, dreams of liberty, equality and social stability had once again turned into a nightmare of collective violence and genocide. These developments are all exemplified in Italian Fascism, whose core members were recruited from the old guard of the ‘revolutionary interventionists’, former socialists (including no other than Mussolini himself), anarcho-syndicalists, futurists, and so on. Demobilized reserve officers formed a further influential social group within the evolving revolutionary movement, and around them gathered remnants of the once legendary arditi, that macho ‘vanguard squad’ from the war. This military nucleus attracted nationalist intellectuals in the tradition of the bourgeois Risorgimento at one end of the social spectrum, supported by big landowners and heavy industry; at the other, it appealed to large swathes of the sub-proletariat. Under the influence and as a result of the extreme social and economic crises of the postwar period, the Fascist movement was thus able to develop very quickly into a plebeian, rebellious, actionist, militantly anti-liberal and anti-socialist mass movement of the ‘declassified of all classes’, of all those who the war had ripped out of productive civilian life. This story repeated itself in Germany. The rebellious, anti-clerical, German nationalist intelligentsia had been shaken to its foundations, and out of its ranks emerged a self-appointed ruling caste, whose thinking and desires had been formed by the (real and imagined) experience of war and whose behaviour was dictated by the masculine, military ideal of unconditional determination and unthinking violence. It demanded a leader with ‘iron will’, prepared to perform the ‘daring deed’ of overturning the state. It was critical of what it saw as the compromises and opportunism of liberal democracy; it countered the enlightened, rational ideals of modern civil society with the Romantic ideal of an aristocratic, military elite. Bold economic and political nationalism and an all-powerful, totalitarian state apparatus were to bring about a radical renewal of the liberal, capitalistic

Introduction

9

economic structures that had been so devastatingly shaken by the crisis. However, it was only under the influence of the worst crisis the modern age had ever seen, and the profound social and cultural tremors that it produced, that a sect based on these ideological foundations could develop into a mass political movement. Hitler’s version of fascism provided a focus for radical criticism of civic, democratic culture; it mobilized irrationalism and an unrelenting appeal to instinct, appetite, intuition; it countered the sceptical relativism of the age with unquestioned, victorious self-confidence. Fascism’s original ideology grew out of the First World War; it despised the ‘middle-class’ aspiration to prosperity, peace and ‘civilization’, offering a militant, heroic ideal of life instead. It also despised the organized labour movement, which claimed as its own the legacies of liberalism and the Enlightenment. And it hated ‘the Jews’, who it saw as an embodiment of both liberal capitalism and revolutionary socialism. The anti-capitalism of fascism was directed against specific, parasitic forms of capitalism that flourished during the war and the inflation that followed; the German Fascists differentiated between ‘grasping’ and ‘productive’ capitalism and propagated a ‘national socialism’, the totalitarian subordination of all ‘self-interest’ to the ‘common good’ – a common good defined as they saw fit, although always within the terms of bundling all the nation’s energies against its external and internal enemies. Fascist Italy constituted a particularly influential role model, much more so than other countries closer to home, such as Austria or Hungary. The charisma of the duce was acknowledged far beyond the borders of his own country, up to and including the USA; he set an important example by ruthlessly and swiftly imposing autocratic economic changes. By contrast to developments in Europe, the pressures of the global financial crisis brought about a clear move to the left in American politics. The Great Depression had even more catastrophic effects here than in the Old World. Average industrial production for the period 1925–29 had been 100; by the nadir of the crisis in 1932, the economic research service of the League of Nations estimated that it had sunk to 77 in Europe and 59 in North America. Unemployment developed accordingly, doubling within just one year and rising to a record of over 25 per cent by 1932. Eleven and a half million Americans had neither job nor salary by this point – including dependent family members that added up to no less than a quarter of the entire population. Moreover, by the summer of 1932, more than half of all employees were working reduced hours. Although previously so prosperous, the middle classes of the United States of America disintegrated. The traditional structures and institutions offering support and solidarity were no longer able to keep pace with demand, and collapsed in their turn.

10

Helmut Konrad and Wolfgang Maderthaner

Franklin D. Roosevelt used the broad electoral support of his coalition government to implement a fascinating experiment, the New Deal – an attempt to stem the rising tide of unemployment and salvage whatever was possible of America’s ailing capitalist system. Devaluing the dollar helped to lighten the burden of debt resting on America’s farmers, and pressure on the market for agricultural produce was relieved by offering subsidies to restrict production, at the expense of society as a whole. The Roosevelt administration guaranteed savings deposits, regulated the financial market and subjected Wall Street to a highly efficient supervisory body. It also initiated a whole series of effective public job creation schemes, and acted as an adjudicator between the capital and labour markets by means of its salary ‘codes’. Roosevelt’s New Deal was an active, state interventionist policy aimed at combating the crisis at a time when depression had spiralled out of control and made lasting inroads on the individualist American myth. The country’s economic mechanisms had been virtually dismantled, leading some to question the very existence of liberal capitalism and its associated principle of liberal democracy. All over the world, whether in democracies or dictatorships, the economic crisis led to an increase in state intervention. The powers of presidents, dictators and prime ministers grew. In Latin America, criticism of liberalism led to demands that the state become more involved in social and economic policy and thus aid ‘development’. Brazil offers an excellent example of this. In 1930, the ‘revolution’ of Getulio Vargas overthrew the ‘Old Republic’, which was replaced by the ‘New State’ (Estado Novo) from 1937 to 1945. The Vargas regime was similar to southern European fascist regimes of the same period in several respects, but nevertheless should be seen as a discrete, unique political formation. The old contrasts between the country’s various states diminished under Vargas (in particular those between São Paulo, Rio de Janeiro and Minas Gerais), and it became possible to form political parties on a national level, like the short-lived fascist Integralists (1932–38) and the communist-led Aliança Libertadora Nacional (founded in 1935), which had similarities to the popular front in Europe. Vargas relied on the support of big landowners and the urban middle classes; his aim was to repress all socialist movements while attempting to win over the working classes with innovative, paternalistic social policies. In many African and Asiatic colonies, the crisis lent new impetus to movements for independence – many of which had the support of the Soviet Union. Intellectuals and trade unionists founded associations in several African countries during the 1930s, through which they sought to exercise indigenous influence on colonial politics. These organizations tended to flourish more in British and Dutch colonies (British West Af-

Introduction

11

rica, the British West Indies and the Dutch East Indies), because forms of indirect rule were practised there allowing the colonies a measure of room to manoeuvre politically. In the French and Portuguese colonies, where Paris and Lisbon kept a firmer hand on the reins, there were clearer limits to political liberty, and opposition was more likely to take the form of rebellious cultural movements. In addition, the pressures of the crisis had led some colonial powers to partially disconnect their economies from those of their colonies through import restrictions to strengthen their own industries and agriculture, leading colonial elites to a heightened consciousness of the economic potential of their own countries. During the Second World War from 1939 onwards, when the Third Reich occupied many colonial powers (France, the Netherlands) and considerably weakened others (Great Britain), many anti-colonial movements experienced a breakthrough. They were then able to lead their countries to political independence during the period 1945–60. In essence, all that can really be discerned in the politics of the interwar period are unique patterns of national development – and even these only become apparent with the necessary historical distance and under the consideration of many factors that most likely would not have been so evident at the time. However, with some partial exceptions, what can be discerned practically the world over is politics exercised ‘from above’, signalling regression from some of the central characteristics of modernity. Political participation decreased, authoritarian decision-making structures came to the fore and parliamentarianism declined. By contrast, the economic strategies that corresponded to this political approach were many and varied. They ranged from the realization of Keynesian principles to policies of currency stabilization at the expense of communal spending power. Some states invested in infrastructure and industrial modernization, while others saw their salvation in pre-modern manufacturing techniques and an economy based on small units. Movements ‘from below’ sometimes supported such attempts, but also often formed a counter force, as the anti-colonial movements show.

Chapter 1

Crisis and Workers’ Movements Ferdinand Lacina

‘Sometime in the next five years, you may kick yourself for not reading and re-reading Kindleberger’s Manias, Panics and Crashes’

This quotation from the American economist and Nobel Prize winner Paul A. Samuelson can be found on the title page of the fifth edition of the well-known A History of Financial Crises, which was released in 2005 by Robert Aliber, two years after the death of its author, Charles P. Kindleberger.1 This advice has clearly not been heeded by numerous participants in the fields of economics and politics. The ideology of neoliberalism, has, to an unimaginable degree, not only worked its way into the core of modern economics, but has also shown itself to be the creed of the politics of globalization. The more regulations fell under the rallying call of liberalization, the more activities and programmes which had traditionally been controlled by the state were administered by private interests. The more optimistic the prognosis for the future was, the more supervision and regulation mechanisms – especially in the finance sector – were loosened or cancelled. No Congress of the United States ever assembled, on surveying the state of the Union, has met with a more pleasing prospect than that which appears at the present time … The great wealth created by our enterprise and industry, and saved by our economy, has had the widest distribution among our own people, and has gone out in a steady stream to serve the charity and the business of the world … Enlarging production is consumed by an increasing demand at home and an expanding commerce abroad. The country can regard the present with satisfaction and anticipate the future with optimism.

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Although many would be inclined to think that President George W. Bush was the first U.S. president to use these words, during his freshman term in office, the same words had actually been spoken nearly eighty years before, on 4 December 1928, when President Calvin Coolidge addressed the U.S. Congress on the eve of the World Financial Crisis. Admittedly, from the Austrian point of view, even during the economic high point of the interwar period such exuberant optimism for the economic situation was non-existent. In 1928, for the first time since the First World War, economic levels returned to what they had been before the war. Living conditions had been miserable since the war, and the years from the late phase of the war until 1928 had been catastrophic, especially in the cities. Rapid hyperinflation reduced the de facto value of money to zero. The high costs of restructuring the economy, bank crashes, and high unemployment had dampened the positive effects of the international boom. The reform work of the interwar period had seen the introduction of the eight-hour working day and a readjustment of vacation time. Additionally, health and accident insurances were expanded, and, most importantly, unemployment insurance was introduced. These changes, although positive, were set against the background of a power struggle between revolutionary and reactionary political entities. The first precursor to the major crisis in Austria was the breakdown of one of the largest banks, the Bodenkreditanstalt, on 29 September 1929. This breakdown came almost exactly at the same time as the ‘Heimwehr’ (a militant right-wing organization) sent an ultimatum to the conservative government of Streeruwitz, in which they demanded constitutional change and the formation of an Authoritarian State (Ständestaat). The Heimwehr organized large demonstrations in the industrial centres of Austria, mostly with the aim of intimidating the workers’ movement. Karl Renner describes the political situation in an article entitled ‘The Blow That Went Alongside the Punch’. This was a reference to the way in which the political uncertainty caused by the Heimwehr’s threat of a march on Vienna led to the cancellation of foreign credit, and the withdrawal of many deposits. Facing such huge losses, the Bodenkreditanstalt entered into a liquidity crisis. Under pressure from the administration, the Creditanstalt, controlled by the Rothschilds, took over the insolvent bank. However, two years later this would prove fatal, as crisis would also strike Creditanstalt, Austria’s largest bank at that time. The notorious ‘Black Friday’ (which in truth was 24 October, a Thursday) occurred almost exactly one month after the collapse of the Credit anstalt. The bubble that the stock market of the United States had enjoyed for most of the 1920s suddenly burst, beginning the worst depression in international economic history. Stock prices in New York skydived for the

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next two months, losing around a third of their market value in the process (as compared to their highpoint in September). After a brief recovery, the descent continued. By the end of 1930, stocks had lost close to half of their entire 1929 value. 1931 saw these values plummet further, to a quarter of their original 1929 level. And, in the worst year, 1932, stock prices deflated to one-fifth of their 1929 levels. On the Parisian stock exchange, shares lost almost two-thirds of their value, and in London, more than 40 per cent. At the beginning of the depression, most were of the opinion that this was merely part of a ‘normal economic cycle’ and was something which could be traced back to several rectifiable causes. However, when it became clear that the crisis was not coming to an end, but rather intensifying, new explanations were found. These included: overproduction in those countries which exported raw materials, a combination of agrarian and industrial crises, the saturation of the U.S. housing and automobile markets, the swelling of credit (artificial money) and the dilution of standards concerning the granting of credit, and finally, the growing inequality between wages and capital income. The amount of faith placed in the ‘self-healing potential of the market’ was enough to make most believe that it alone would lead the world out of the crisis. Accordingly, wages were cut, state spending was slashed and lines of credit were reduced, signalling a ‘deflationary’ plan of action. A commission named by the Austrian Government in 1930 came to the conclusion that deficit spending by the state should cease entirely. On 8 May 1931 the Creditanstalt had to admit its insolvency, and on 11 May it declared bankruptcy. The Creditanstalt was not only the largest lender in the Austrian economy; it also controlled, via its subsidiaries, almost 40 per cent of Austrian industry. The run on the bank forced the government to take action. In the end, the republic had to guarantee 1.6 billion schillings in order to secure its survival. With reference to this amount, it should be noted that the entire revenue of the treasury in the 1931 fiscal year amounted to 2 billion schillings. The domestic as well as the international effects of the near-collapse of the Creditanstalt were devastating. Only two of the seven major Austrian banks survived the coming years. In Hungary, Czechoslovakia, Romania, Poland and Germany, the banks were stormed; for those who had been in doubt, it was now clear that a worldwide financial crisis had begun and was there to stay. The mistakes made in most countries with regard to financial policies contributed further to the increase and extent of the economic misery. Eric Hobsbawm (1996) characterizes this with a drastic comparison: ‘Never has a ship wreck occurred in which neither the captain nor the sailors less understood the causes for the catastrophe, or been less able to fight against them.’2

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The restrictive, protectionist trade policy of the world’s economic powerhouse, the USA, combined with a slump in imports, and a decline in investments and consumption, set interwar Austria (already an economically strained nation) on a path of economic chaos. The limiting of American and British lines of credit hit those countries – like Austria – weakened by the structural crisis in the aftermath of the First World War, and already troubled by worsening terms of trade and negative balances of payment. Following the slogan of ‘strengthening internal markets’, imports were banned in many countries, import quotas introduced, tariffs substantially increased and taxes levied on imported goods. Helene Bauer assessed the situation in her article entitled ‘In the Fourth Year of Crisis’, which was published in the Social Democratic mouthpiece, Der Kampf (The Struggle) in December 1932: The call to arms of those seeking to remedy the crisis at hand, namely to buy domestically produced goods, simultaneously damages the export industries and capacities of every other nation. Furthermore it brings confusion into the production and distribution sectors, decreasing general buying power. After we have observed a terrible decline in world trade during the first years of the crisis, new obstacles erected against importation are functioning exactly as was to be expected; they have limited world trade. In the first half of 1932 alone, the value of traded goods decreased by thirty-four per cent, and their volume by about fifteen per cent.3

Especially for the smaller industrialized nations, the consequences were dramatic: the value of imports in Austria declined by nearly 60 per cent from 1929 to 1932, while exports fell even harder, dropping by almost two-thirds. Unemployment increased dramatically. In Germany, the number of unemployed quadrupled between 1928 and 1931; in the USA, the United Kingdom and Austria, the number doubled. In the industrial regions of Austria, unemployment was naturally higher. By the end of 1932, a report released by the Social Democratic Party in Vienna stated that out of 400,000 party members, of whom 240,000 had been or were working in the private sector, nearly half were unemployed. Additionally, membership in the free labour unions in Austria decreased almost one-third between the end of 1928 and the end of 1932. Correspondingly, the capacity of the labour union movement to demonstrate and agitate diminished. The number of strikes and demonstrations dropped accordingly, and the number of unsuccessful rallies rose. 1924 saw only 4 per cent of strikes end without resolution; 1927, 13 per cent; 1929, 27 per cent; and

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finally in 1931, 36 per cent of all strikes ended in indecision or without a successful outcome. In the well-known study Die Arbeitslosen von Marienthal (The Unemployed of Marienthal), Maria Jahoda, Paul Felix Lazarsfeld and Hans Zeisel showed the social and political consequences of long-term unemployment in a Lower-Austrian industrial village.4 Lazarsfeld designated the large majority of the male population of the town as unemployed men (69 per cent) who were socially and mentally in poor shape. He further designated 23 per cent as ‘unbroken’, and the remaining 8 per cent as either in misery or apathetic. The political consequences of unemployment in Marienthal were devastating. The Social Democrats lost two-thirds of their members there between 1927 and 1931. Lazarsfeld said in addition: ‘the political disposition has not changed, but the needs of everyday life have superseded any political allegiance’. In the study, one unemployed worker was quoted as saying: ‘earlier, for as long as I could remember, I used to read the Arbeiter-Zeitung (workers’ newspaper) diligently, now I glance over it, and throw it away’. Dieter Stiefel summarized this investigation of the unemployed in the interwar period as follows: ‘Due to a lack of organization, misplaced political interests and radicalization, the unemployed were never a strong or decisive social force. They did however, by merely existing, serve as a cause for concern and tension amongst the working population’.5 Those who set out on a path of radicalization and revolutionary action carried with them an illusion of hope, that the workers’ class would be able to break down and overthrow the capitalist system. The fascists were severely underestimated by the communists. Stalin’s declaration of a ‘Battle against Social Fascism’ clearly labelled the Social Democrats as fascist collaborators and sealed their role as the ‘main enemy’. Yet the Social Democrats and the labour unions, weakened by the economic crisis, could do relatively little, and came up with no concrete solutions for fixing the problems in Austria. There was nothing to be done against crises, it was argued; they were seen as an inherent part of the capitalistic economic model. On the one hand, work creation schemes were called for (and desperately needed), which would strengthen the purchasing power of Austrians; however, on the other hand, this would have cost the government a large amount of money, leading to a strain on public finances. The shadow of hyperinflation still hung over Germany and Austria. In Germany, the question of financing unemployment insurance was one of the main issues which arose during this period. The dilemma of having to choose between financing unemployment or preserving national financial stability proved to be a prickly decision, leading to a dispute in March 1930 between the Social Democrats and the free labour unions.

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On the one side stood the government of the social democratic Reichskanzler Müller, and on the other stood the workers’ unions. The end result saw the Grand Coalition of Müller collapse and his government fall. The destruction of democracy in Germany followed shortly thereafter. The end grew ever nearer as the ‘Presidential Cabinets’ of Brüning, Papen and Schleicher dismantled democratic institutions. 1933 saw Adolf Hitler named as Reichskanzler. In January 1931, the International Labour Union Alliance together with the Socialist Workers’ International formed a commission which concluded a programme to combat the crisis. They proposed measures against wage pressure and in favour of the shortening of working hours. Additionally they called for the establishment of employment agencies, the institution of paid vacation, an increase in the school-leaving age, more public works projects, the expansion of unemployment insurance, co-determination in rationalization measures, intensified supervision of monopolies and cartels, the dismantling of trade barriers, and finally the democratization of central banks. In many European countries at this time, the political left stood with its back already against the wall. Accordingly, the demands of the Joint Commission stayed on paper and were given virtually no consideration. The two exceptions were in the short-lived Spanish Republic, which arose following the decline of the monarchy in 1931, and the equally shortlived French Popular Front government. Sweden stands out as the sole ‘stable’ exception or place where the programme actually flourished. The severity of how hard Sweden, like the other Scandinavian countries, was hit by the financial crisis showed in the 1932 unemployment rate of 24 per cent. The Social Democrats, who came to power in Sweden in 1931, introduced a combination of fiscal and exchange rate policies, using international upswings to strengthen their economy. By the end of the 1930s, their GDP had nearly doubled from the level it had stood at on the eve of the financial crisis. In Austria in the autumn of 1931, the leadership of the Alliance of Free Labour Unions and the Social Democratic Party concluded a programme to fight unemployment, which entailed amongst other things an addition to income tax that would be used to fight unemployment. Additionally, many more terms and programmes were agreed upon such as: a cutback in the quotas for foreign labourers, the affording of a new right to the government to overrule decisions made by businesses to close, the introduction of a forty-hour working week and the prohibition of wage reductions, and finally the nationalization of Creditanstalt. In July 1933, at the Conference of the Free Labour Unions, Otto Bauer introduced a programme entitled ‘Work for 200,000’. His pro-

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gramme was based on the works of Johann Schorsch, the Secretary of the Free Labour Unions’ Alliance. Aside from the previous demands, such as a reduction in working hours, the programme called for an increase in lines of consumer credits, as well as an ‘export offensive’ which, when combined with the political neutralization of Austria, would surely afford economic stability and agreement with Austria’s neighbour states. February of 1934 saw Austria take the final step towards a full-fledged dictatorship under the guise of ‘Austro-Fascism’. A violent crackdown on the Austrian Workers’ Movement, the banning of the Social Democratic Party, and the outlawing of Free Labour Unions, all signalled that democracy in Austria was dead. This was preceded by the elimination of the parliament, the suppression of the freedoms of assembly, speech and the press, as well as the systematic withdrawal of social and labour rights. Italy and Germany, before Austria, had also made the transition to fascist governments, and Hungary and Yugoslavia had converted to authoritarian systems. Austria had been hit hard by the world financial crisis, since it was economically vulnerable and weak. Finally, the key bulwark against the fascists, the workers and their organizations, had lost most of their power and had been drastically reduced in importance via massive unemployment and widespread apathy. Otto Bauer described the connection between the economic crisis, the failure of the workers’ movement, and the triumph of fascism as follows: When the crisis struck in 1929, the Labour Party reigned in England, and in Germany, a Grand Coalition led by the Social Democrats held the reins of power. Socialist parties bore the responsibility for their respective countries; however, their economies were controlled by the natural laws and rules of capitalism. The governments led by socialists were not able to avert the crisis and furthermore had no ability to prevent its intensification leading to the credit crisis of 1931. Disappointment turned to anger and resentment towards socialism amongst the masses. In England, the Labour government fell; their leaders joined the capitalist class. In Germany, pauperized masses blamed the republican democracy for the crisis and joined the nationalistic fascist movement.6

Quite correctly, Otto Bauer characterized the employment measures in Nazi Germany as a preparation for the coming war. He also characterized Roosevelt’s measures, fighting against the crisis (the ‘New Deal’), as being based on a series of ‘trial and error’ programmes, which he doubted would succeed. Ultimately, this assumption of Bauer’s proved to be false. It must be conceded that the room for manoeuvre in economic policy was limited by Austria’s economic weakness, especially by its adverse balance of payments. But doubts were nevertheless expressed as to whether the

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crisis should be seen as a ‘natural’ phenomenon. The Social Democratic leadership’s ‘laissez-faire’ approach was questioned by some elements within the labour union movement as the crisis went on and on. Fritz Weber, in an article written more than twenty years ago entitled ‘Between Marx and Keynes’,7 showed how the failures and mistakes of the party and labour union leadership were heavily debated and discussed by Social Democrat emigrants. Already in 1934, Johann Schorsch had criticized the Social Democratic Party leadership, in a report released by the Labour Union International, since they had not actually sought or engaged in any programmes to combat the crisis head on. The Swiss exile’s report ended: ‘if anything can be gained from the events which have transpired in Austria, let it be that the question is raised as to why the labour unions and the socialist parties acted so passively and whether, in other countries and nations, this trend can be averted, and those who represent the interests of the workers can be more than mere spectators.’ It is unnecessary to say that at least part of what was written more than seventy years earlier still holds water today and is of extreme relevance. This is largely due to the question of whether the current crisis, which arose from the financial markets, will have a significant impact on the ‘real’ economy, that is to say, jobs and employment. The question of whether this scenario will transpire also goes hand in hand with the issue of who will bear the weight of the crisis and which measures will be used to combat it. One further question remains: how sustainable will the lessons learned from the breakdown of the neo-liberal system be in the future?

Notes 1. 2. 3. 4. 5.

6. 7.

Charles P. Kindleberger, Manias, Panics, and Crashes. A History of Financial Crises, ed. Robert Aliber. New York 2005. Eric J. Hobsbawm, The Age of Extremes: A History of the World (1914–1989). New York 1996. Helene Bauer, ‘Im vierten Jahr der Krise’, Der Kampf 25(12) (1932). Marie Jahoda, Paul F. Lazarsfeld and Hans Zeisel. Die Arbeitslosen von Marienthal. Ein soziographischer Versuch über die Wirkungen langandauernder Arbeitslosigkeit. Leipzig 1933. Dieter Stiefel, Arbeitslosigkeit. Soziale, politische und wirtschaftliche Auswirkungen am Beispiel Österreichs 1918–1938 (Schriften zur Wirtschafts- und Sozialgeschichte, Vol. 31). Berlin 1979. Otto Bauer, Zwischen zwei Weltkriegen? Die Krise der Weltwirtschaft, der Demokratie und des Sozialismus. Bratislava 1936. Fritz Weber, ‘Zwischen Marx und Keynes’, in Wolfgang Maderthaner and Helmut Gruber (eds), Chance und Illusion/Labour in Retreat. Studien zur Krise der westeuropäischen Gesellschaft in den dreißiger Jahren. Vienna 1988.

Chapter 2

The Significance of February 1934 in Austria, in both National and International Context Helmut Konrad

Austria’s descent into the abyss, from a democracy to a dictatorship, was the result of many factors, as well as being the spark that provided the necessary fire for many events whose effects are still being felt to this day. Both causes and effects are important for understanding Austria today as well as Austria’s future. The Republic of Austria, or rather the Republic of German Austria, as it was called in its early months, resulted from the defeat and subsequent dismantling of the Habsburg Monarchy at the end of the First World War. The First World War dramatically reshaped not only Europe, but the entire world. Until 1914 there had been a measure of consensus as to what was ‘modern’1 or ‘contemporary’ and as to what the future probably held. The ensuing four years of war completely shattered these notions and replaced them with an entirely negative and apocalyptical outlook on the future of the world. The loss of certainty as to what the future would bring had a devastating effect on all European societies, including Austrian, shaking them to their very core. This, combined with the advent of mechanization, led to a common belief that humans were running the danger of becoming automatons themselves through their dependence and utilization of machines. In this war, the old order disintegrated. The remains of the Habsburg Monarchy which were not doled out to the new successor states became

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Austria – which was in itself not a nation per se but merely a name given to that territory which could not be tacked onto any other country. The irony of this was of course that the new borders were nothing more than an expression of the current balance of power rather than being a realization of President Wilson’s fourteen points. This ‘left over’ country began its ‘involuntary existence’ (according to the first resolution of the National Congress after the foundation of the first democratic republic, with the intention of an immediate association with, or even integration into, a democratic Germany) with huge debts, both monetary and social. Wolfgang Maderthaner and myself, and almost forty other authors, examined these mortgages and debts.2 Austria was ‘new’ and difficult to define in many ways, least of all geographically. In addition, the new nation had to be defined economically so as to secure its worth and value; socially, to ensure that it would be stable; politically and culturally, so that it would be visible on the world stage and able to interact with other nations. It is not the purpose of this article to discuss all of the measures taken at this time; however it can be said that there was both progress and failure across the board. The constitution of 1920 and the social legislation of its early years clearly show both the successes and failures of central government during the First Republic. Regardless of their practicality, both the constitution and legislation of these early years saw Austria assume a front-row seat in European political development. It is largely because of the solid foundations laid during this time that the Second Republic was able to organize itself so quickly following the end of the Second World War. There remained, however, huge problem areas, that explain how and why Austria fell so quickly into the abyss. The economic situation was relatively normal for only a short period of time in the second half of the 1920s; both before and after, it was in a horrendous state. Hyperinflation from the end of the First World War, which continued into the interwar period, destroyed personal savings. Coupled with an alarming rate of unemployment, this condemned Austria to failure virtually from the day it was established.3 Every third industrial workplace was lost, and half of those without jobs did not receive any sort of government help or aid, and so did not have to pay any taxes. To this day, the definitive text on the subject is the work of Jahoda, Zeisel and Lazarsfeld on the unemployed of Marienthal, which shows exactly how dire the political and moral consequences of this time were.4 The problem also arose that in Austria, ‘nation’ and state were not congruent terms. After 1918, Austria was seen as being German and Catholic, with all other groups viewed as minorities. The definition of

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‘German’ at this time meant two things. On the one hand, there was an understanding of ‘nation’ as defined by language. On the other, there existed the idea of a German ‘culture’. These two factors combined meant to some that Austria, as a German-speaking nation, was and should be linked to Germany.5 Austria’s Catholicism meant that the Protestant Church was marginalized and the Jewish community was seen as an opponent, even as a domestic enemy. Anti-Semitism went hand in hand with fierce xenophobia and anti-minority sentiment directed chiefly against groups such as the Slovenians in Carinthia. Additionally hatred was directed against Italians due to the situation in the Southern Tyrol and the perceived persecution of German speakers there. Society in the First Republic was largely dominated by veterans of the First World War, who had endured many hardships at the front, and upon returning home sought to impose strictly regulated order that brought extra-legal physical force into daily life. On battlefields such as Isonzo, in Italy, Lutz Musner described how a certain Benito Mussolini and his men formed the ‘Fasci di Combattimento’.6 On the other side of the front, the men of Major Fey refused to surrender their weapons at the end of the war because they considered themselves loyal to Austria and not the new, ‘Jewish-Bolshevist’ Army Minister.7 Fey and his men then formed the ‘Heimwehr’ (Home Defence) to counteract and actively engage any and all revolutionary forces in the country. However, the left armed as well, organizing the ‘Republikanische Schutzbund’ (Republican Protection Alliance) and, although never as prominent as the Heimwehr, still constituted a dangerously large number of armed men (at its record level eighty thousand to a hundred thousand men). The RPA made up for their numerical inferiority by being more uniformly organized. The peace treaty only permitted an official army of thirty thousand men, solely for the purpose of self-defence. The private armies had almost six times as many troops at their disposal. Gerhard Botz dedicated himself years ago to studying the subject of ‘Force in Politics in the First Republic’.8 He estimated that as many as 267 people died in political confrontations on Austria’s streets between November 1918 and February 1934. Of course, the fire at the Justice Palace comes to the fore here, but, generally speaking, periods of time without bloodshed were scarce. In the same period, a further 188 people were killed following political disputes and controversies. If one divides the lifespan of the First Republic (7,060 days) by the number of political deaths, the result is one death every 15.3 days. Put more simply, this means that almost every two weeks there was a political murder or death in Austria.

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This eagerness to respond to disagreements and disputes with force should be seen as a direct consequence of the First World War. Not just physically, but also mentally, the war had desensitized all those involved. Being confronted daily with the dead, the injured, the psychologically incapacitated (dubbed the ‘shakers’ by Karl Kraus9) had left an indelible mark on Austria’s young men, ever lowering the thresholds of emotional trauma and pain. The war had reversed the process of civilization. Society was by and large already well acclimatized to violence and the use of force due to four long years of war; the years of economic and social hardship that followed did nothing but reinforce the necessity and acceptance of a ‘live and let die’ mentality which was nearly omnipresent amongst Austrians. The political landscape was deeply divided. The dividing line ran along the disparities that had been intensified by the First World War. The metropolis of Vienna, still one of the most impressive cultural centres of Europe, accounted for more than one-quarter of the Austrian population. The Social Democrats ruled here with an absolute majority, and from this base they began an ambitious programme of social modernization.10 Here the secular was more important than the spiritual or traditional, and thus life was entirely different than it was in rural areas. In the countryside, the Catholic Church ruled, openly dabbling in politics, spreading its conservative world-view, and dominating the villages and towns. Austrian society was thus divided into two main political camps, which came into conflict over the following issues: modern versus pre-modern, rural versus urban, and secularization versus spiritualization. There was also a so-called ‘third camp’ composed originally of those liberals who had taken leave of the political stage long before (decades before the First World War, the reason was the new quality of anti-Semitism), and left the field to German nationalism. Now, however the remaining groups of this ‘liberal’ camp reformed, and although it remained distant from the conservatives and the church, it began to turn towards National Socialism as its fear of communists and socialists mounted. The growth of Austro-Marxist Socialism was intentionally misunderstood and instrumentalized. Social Democracy and Bolshevism were equated, allowing them to be cast in the role of the ‘enemy of the Republic’. This belief was further helped along by the presence of many Jewish socialists and liberals, who, as already mentioned, were ‘public enemy number one’ in Austria. Thus the dividing line between modern and anti-modern did not run exactly along political groupings and divisions, or right versus left wing, during these years. The middle class was accepting of what modern times had brought, in terms of art and culture, and could at the very least understand the changes, whereas the lower classes, the conservative workers’ circles, viewed everything modern as foreign and unacceptable, and

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chose to cling on to the traditions which had existed amongst them for years. A reproduction of Dürer’s ‘Hare’ hung on the wall of my grandparents’ working-class home, while in politically conservative households there was most likely nothing that could even be considered remotely new or modern in terms of art. It would be false to say that only the conservatives rejected modernity and new trends, for the left also singled out particular elements with which it did not conform. Modern politics is understood to mean more active political participation, largely through the use of a parliament or representative body, as well as constitutional conformity, at least with regards to decisions.11 The Social Democrats quickly realized the inherent flaw in this system of representative government, which is that the decision-making and passing process is long and drawn out, and entirely inefficient. Quick, easy decisions and compromises were thus often preferred, with special regards to politics, so as to cut through bureaucratic ‘red tape’. This trend becomes especially clear with regards to the ‘War Economy Authorization Law’ (Kriegswirtschaftlichen Ermächtigungsgesetz),12 which, since it was accepted by all parties of the First Republic, quickly and efficiently became part of the constitution by 1920, with no hint of opposition from the Social Democrats.13 As Austria’s economy broke down, and the question of punishing those responsible for the collapse of the central Credit Bank arose, the government, particularly the left, sheltered the culprits, as what they had done had been officially authorized and regulated. In this way, the War Economy Authorization Law became a very important part of the history of the democratic phase of the First Republic. If one observes carefully the cracks and rifts within the system in Austria at this time, it soon becomes apparent how astonishing it is that democracy functioned for more than one decade. This can be attributed to many factors, which include a strong democratic tradition, the presence of a solid constitution, and a series of progressive laws that had emerged shortly after the end of the war, such as that granting women’s suffrage. The best explanation for the relatively long survival of democracy in Austria is, however, the fact that Austria was economically dependent on the West.14 In 1922, the resuscitation of Austria succeeded via a loan from the League of Nations, and in 1931 the International Court forbade a planned customs union with Germany since this was seen as breaking the terms of the annexation ban between Austria and Germany (Anschlussverbot). Additionally, it was decided that the annexation ban would be renewed for another twenty years. The loans from the League of Nations were absolutely critical for maintaining a democratic system in Austria.

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For Austria’s neighbours, however, the situation was completely different. Even in Hungary, where there had been a communist revolution following the First World War (in line with revolutions in Austria and Southern Germany) the situation had deteriorated so quickly, it seemed that anti-democratic reactionaries had always been in power.15 The entirety of central Europe, from the Baltic states to the Adriatic Sea, had found its way, following short stints as democracies, to authoritarian structures, with Czechoslovakia and Austria as the only two exceptions. In Prague, the first step towards strengthening and cementing the place of democratic government was removing pressure from outside, due to the fact that if the country failed, the structures within the country would also fail. In Austria this step was also important but not the key issue, as it had already been completed years earlier. Instead, domestic politics proved to be the breaking point for democracy. The year 1932 saw the National Socialists make significant gains during the regional elections (Landtagswahlen) that took place in several of the federal states (Bundesländern). Electoral success secured the National Socialist’s place as the third major political force within Austria. In the process, they absorbed the entire nationalist and national liberal political fronts. Moreover, the National Socialists were further strengthened by defections from the Conservatives and Social Democrats. This rise of the National Socialists saw Austrian politics enter a precarious state, with none of the three political groups able to form a majority, leaving the parliament, at least in the short term, in a state of crisis. In 1933/34 the political situation in Austria was characterized by three main political divisions. The National Socialists had been officially forbidden following several terrorist attacks. They were only able to meet and hold demonstrations illegally. The second group, led by Chancellor Dollfuß, was that of the conservative Christian Socials, which, as the ruling party, had control over the executive and the army, as well as the Heimwehr. Finally, there was a third political group, the workers’ movement, which since the dissolution of parliament in March 1933 had been on the defensive as it had been under attack from all sides. If we consider the case of the workers’ movement and its structural prerequisites for an armed confrontation with the power of the state and the Heimwehr, it becomes apparent that it was the only party carrying on the Social Democratic tradition. Until 1933 and the end of the Social Democracy, the Austrian Workers’ Movement was the only political party that had a free, labour union. In terms of structure, the party was centrally led and ideologically homogeneous, under the banner of Austro-Marxism. Yet this perception of the party, disseminated by Red Vienna, is deceptive. There are at least three

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reasons which help explain how and why the February Revolution did not end differently.16 (1) In Vienna, the organization structure of the party was strong; the Social Democrats had chosen to support its members rather than being parsimonious with party funds. The information network was dense due to the fact that Austro-Marxism placed a much higher value on the political education of its members via conferences and seminars than any other party in the West. The concept of social democracy offered the promise of a ‘worldly’ and comfortable life with many benefits, which helped politically to consolidate its members. This in turn left many docile over time, meaning that the willingness to take risks was reduced, and only the youngest members of the party were ready to take up arms when the party came under threat in 1933. Social democracy had reshaped Vienna, transforming it into an exemplary ‘Social Democratic’ city. This meant that there was much to lose, should any of the other parties gain power. The fact that the party leadership hesitated during the opening stages of the battle was in line with the pattern of behaviour to which the party leadership had become accustomed. The rift between the young and the old within the party was so great that when push came to shove, only the young were idealistic and radicalized enough to defend their system with their lives. The Social Democrats lost the young and the intellectuals first and foremost, with most joining alternative groups and the Austrian Communist Party (KPÖ) who were more action-orientated. In the centralistic structure of the Social Democracy in Vienna, the failure of the party leadership to be at the forefront of the revolution sealed the fate of the rebels and ultimately played a major role in their relatively swift failure. (2) In the industrial regions of Styria, especially the heavily industrialized Mur-Mürz region, there existed an entirely different political tradition amongst the workers. The industrial settlements were in close proximity to conservative, rural towns and villages, which had the effect of influencing both with the ideas and views of the other. Koloman Wallisch, the Secretary of the Styrian Social Democratic Party, came from Hungary and was a member of the Bela Kun movement, so he was experienced in political transformations. The Upper Styrian workers had converted their enterprises and businesses to a socialist system in 1918, and were only convinced after much effort by Otto Bauer to curtail their activities and submit peacefully so as to maintain the established order of 1919. Therefore, Upper Styria had strong radical potential, which meant that the workers there were more than ready to resist and counteract what they perceived as the ‘soft’ party leadership in Vienna. Consequently, the conversion here from Social Democracy to Communism was a mass phenomenon. This mass conversion can be statistically accounted for the pe-

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riod 1934–1945. Under both dictatorships, 90 per cent of all trials of resistance fighters were concerned with Communists. Before 1933/34, this same 90 per cent would have been Social Democrats, not Communists. (3) An entirely different type of Social Democrat existed in the then less industrialized federal states. Lower-middle class, nationally socialized families, who at the very least were not averse to anti-Semitism, were here the representatives of the Social Democrats. The social, anti-clerical and German nationalist sentiments of this group provided for, on the one hand, an aggressive rejection of the Catholic conservative politicians of Austria, however on the other hand, made for an easy transition of this segment of the population to National Socialism, which fought against the very existence of an independent Austria not linked to Germany. So, in Upper Austria, entire contingents of the Republican Protection Alliance changed their allegiance to the National Socialists, with men such as Richard Bernaschek easily influenced by this new ideology.17 In Carinthia, former Social Democrats were found assisting and in the company of National Socialists during the July coup (Juliputsch). It goes without saying that these disenfranchised liberals and leftists did not stand entirely as a bulwark against the conservatives. Not only was the composition of the right wing and the centre right not homogeneous, even the Heimwehr, the militant arm of the right wing, often followed cultural interests, and local or regional leaders. In addition, there was still no real ‘Austrian consciousness, or at the very least a severe lack thereof, and thus nothing that was able to surpass or stand in opposition to the prevailing tradition of ‘rural consciousness’. Rural and federal conservative politics were seen therefore not simply as a uniform conservative front, but rather as groups with similar interests who were united by those interests. One reason for unity amongst the federal and rural Conservatives was a mutual fear and hatred of ‘Red Vienna’ and the ‘Bolshevistic’ Social Democrat. At the same time however, when it came to rural government and decision making, conservatives and the left were often found in cahoots with one another due to the prevailing ‘rural consciousness’, a peculiarity which continued well into the Second Republic. Given all of this, it is clear that the battles of February 1934 could not be won by the socialists. Moreover, despite the large number of victims, the fight itself had no significant influence on moving Austrian politics towards an authoritarian structure – this was decided a year before. But the battle became immediately an international icon. The symbolic value of the battle was of much greater importance than the military effect. The rebellion lacked a programme and was therefore quickly put down. It was not a conflict with an open end, but rather a flaring up of the people’s emotions and their outrage at a perceived lack of self-respect. It provided the work-

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ers’ movement with a history which remains a strong focus of identity and memory to this day. Internationally, it was and is seen as one of the first uprisings against the fascist and right-wing regimes in Europe that was fought with all available means, even at the risk of personal and organizational destruction. Specifically, in contrast to Germany, there was at least a fight against fascism. It came late, too late, but it was an international fanal. The international view of the February Revolution was informed by several thoroughly contradictory perceptions. First of all, there was the notion of a unified and united left. The claim of sole representation of the left was taken on in the First Republic by the Social Democrats via a policy of assertion in the early years, and later by securing control of the capital, Vienna. There were no discussions or conflicts among the left, since the hostile stance of their rivals against them was clear, and this unified them. This monopoly had faltered by 1933 at the latest, when many of the Social Democrats splintered off, either to the Communists or other left-wing groups. In spite of this, the February Uprising was seen as a joint fight, even if it was really just the death throes of the Social Democrats. Internationally the fighting was seen as that of ‘the’ Austrian Workers’ Movement against fascism which, in contrast to Germany, was possible due to the unity of the workers. Internationally, different parliamentary groups invoked and cited the February battles. The picture of Social Democrats and Communists fighting side by side ‘roused the imagination and the hopes of many leftist and communist authors, amongst them Friedrich Wolf, Brecht, Becker, Herzfelde and Otto Maria Graf’,18 wrote Christiane Zehl Romero recently. This especially applies to Anna Seghers and her text The Last Journey of Koloman Wallisch,19 a type of reportage novel, which was composed most likely with the encouragement of Willi Münzenberg, and portrayed a kind of ‘common ground’ for Social Democrats and Communists. Especially noticeable is the fact that Koloman Wallisch attained a nearreligious status amongst the revolutionaries. Seghers describes the nearly religious way of a man who was, in the end, a martyr. The extension of martial law until Wallisch was caught and quickly condemned to death transformed his execution into an iconic moment, during which a cruel regime, acting entirely against the rules that it claimed to uphold and protect, killed a symbolic figure. Seghers was not the only one to propagate such a story. On my desk, there stood for a long time a photograph entitled ‘Koloman Wallisch shortly before his death’ that shows Wallisch leaning against a wall. For many years, it was a source of inspiration, certainly not just for me, but for many others who found their own political definition supported by the almost hagiographic encapsulation of the February Uprising, with which many could identify and sympathize.

The Significance of February 1934 in Austria

29

The ‘Twelfth of February Battalion’, raised during the Spanish Civil War, further demonstrated the symbolic unity of the international working class with those who had fought in Austria. However even here, the worst enemy of the Battalion after the fascists were its own members, who continued an internal conflict that had started years earlier in Austria. Here an ideal and its reality proved to be far apart. Even the ways in which the leftists had made the trip to Spain were different, signalling how the conflict would later unfold. Its unsuccessful end, much like that of the Austrian Social Democrats, had its roots in internal conflicts. Many of those who fought in the Spanish Civil War lost their lives, either upon their return to the Soviet Union in Stalin’s gulags, or in French camps and then in the concentration camps of National Socialist Germany. The wounds that were inflicted upon the left in Spain have even to this day, decades later, not entirely healed. The story of what happened in Austria in February 1934 would be both nationally and internationally incomplete, were one not to observe the side of the victors as well. The Corporate State Constitution (Ständestaatsverfassung) of 1 May came as an additional sign that politics in Austria had regressed, but also signified that this regression would cover the economic and cultural sectors, further weakening the country. The political exclusion of the majority of the population, both on the left and the right, did not help to stabilize the ‘imitation fascism’ of the regime. Therefore, the events of March 1938 should not be seen as an exclusive event or even an event which should have come as a surprise but rather as a direct consequence of what had occurred in February 1934. Internationally the model of a (semi)-fascist fiefdom based on the laws of the Catholic Church and the Encyclical Quadragesimo Anno became common practice. At the end of the Spanish Civil War, the Franco dictatorship was erected on this model. In doing so, Spain became the scene of the second defeat of the Austrian Left. Beaten in battle, weakened through bloody internal conflicts and finally confronted with a triumphal victor, the new face of politics in both Vienna and Madrid began to show itself as a force to be reckoned with. There should be no mincing of words: Engelbert Dollfuß and his political movement smashed democracy in Austria, set up a dictatorship and neglected the most basic rules of the constitutional state which they claimed they were protecting during the brief February Revolution, so that they could get revenge on their political adversaries. The uprising of the Austrian workers, which was the final option left to the Schutzbund, became highly stylized in the public eye as a revolutionary threat to Austria. In reality, it was no more than a strike against the left with the sole aim of removing political and moral opposition. There was widespread

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Helmut Konrad

sympathy and clemency for the far right, and the result was that during the July Coup (Juliputsch) the Chancellor was assassinated, leading Austria to a new tragic event.20 Dollfuß was without doubt a victim of the National Socialists whom he opposed, due to the fact that he chose to style Austria as an imitation of Fascist Italy. This is however only one side of the coin. It must never be forgotten that he had led Austria’s First Republic into the abyss. To this day, the interpretation of the events surrounding February 1934 in Austria remains one of the most disputed chapters of Austrian history. While it is clear that Austria as a whole welcomed the National Socialists and annexation to Nazi Germany, to some degree at the very least, and while the role of Austria and Austrians in the annihilation machinery of the Third Reich is no longer challenged within the academy, the interpretation of the Civil War remains ambiguous at best. What is indisputable is that Dollfuß polarized the politics of the country and, albeit to a lesser degree, academia. This becomes clear when one considers the victims of February 1934. In 2004, parallel to the proposal for the rehabilitation of victims and families of the victims of the German Wehrmacht, the Social Democrats and the Greens made a proposal ‘concerning the rehabilitation of the victims of Austro-Fascism’,21 for which the Speaker of the Social Democrats, Dr Hannes Jarolin, argued as follows: After 1945, those persecuted by the National Socialist legal system as well as those who had been resistance fighters were retroactively rehabilitated. In the aftermath of the Workers’ Uprising against the threat to democracy on 12 February 1934, twenty-one standing court death sentences were issued and carried out, leading to the execution of nine social-democratic functionaries, namely Karl Münichreiter, Emil Swoboda, Georg Weissel, Alois Rauchenberger, Johann Hoys, Koloman Wallisch, Josef Stanek, Josef Ahrer and Anton Bulgari, in spite of dubious findings and reasons, so much so that in normal courts, pardons would have been granted. A further eight Social Democrats were executed under martial law in Holzleiten in Upper Austria. In addition to these victims, countless others were convicted in martial courts to either life-long or long-term prison sentences … Those executed under such draconian measures fought out of political and democratic conviction for the benefit of the First Republic. Additional demands for a minimum death penalty, to be used as a sort of ‘show of force’, were demanded from every Federal State that had witnessed fighting and rebellion, with a minimum of two executions to be carried out as ‘examples’. At a time in which the re-examination and reinterpretation of the past is reinforced and perceived as indispensable for a positive future, it is clear that it is the duty of the delegates to contribute to a political and legal reinterpre-

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31

tation of the Dollfuß-Schuschnigg regime and to advocate a rehabilitation of the victims of this regime, as well as the Nazi regime that followed it. Seventy years after the illegal, draconian judgments of a cruel and wrong regime were handed down, it is high time the victims of that regime, who had vouched for democracy and freedom, to finally receive the justice which they have been denied for far too long.22

While emphasis and effort was placed on passing a resolution which would rehabilitate the victims of the German Armed Forces, finally leading to a recognition law in 2005, the proposal regarding the victims of AustroFascism sat stagnant. A second attempt at proposing the rehabilitation of the victims of the Austro-Fascist regime followed, however the coalition partners of the Social Democrats found the time inopportune for such a measure, leaving the Greens the sole party backing the resolution.23 Therefore, the long shadow of February 1934 looms even into the present. Indeed, it has become more rather than less difficult to bring about closure. The efforts of Dieter Binder and the authors of the resolution failed several years ago, leaving the period open-ended and lacking consensus.24

Notes 1. From 1993 until 2005, around twenty-five researchers at the University of Graz were dedicated to researching the subject area of Modern History under the project entitled ‘Vienna and Central Europe from 1900’. In spite of some remarkable results, which would not have been possible without interdisciplinary cooperation (History, German Language Studies, Literature, Sociology, Philosophy, Art History and Music History), the researchers never came to a consensus, and there exists, to this day, no entirely accepted definition of what ‘modern’ is. 2. Helmut Konrad and Wolfgang Maderthaner (eds), … der Rest ist Österreich: Das Werden der Ersten Republik, Vienna 2008. 3. Fritz Weber, ‘Zusammenbruch, Inflation und Hyperinflation. Zur politischen Ökonomie der Geldentwertung in Österreich 1918 bis 1922’, in Konrad and Maderthaner, ibid., Vol. 2, p. 7. 4. Maria Jahoda, Paul Lazarsfeld and Hans Zeisel, Die Arbeitslosen von Marienthal. Ein soziographischer Versuch über die Wirkungen langdauernder Arbeitslosigkeit, Leipzig 1933. 5. The entirety of the intellectual elite of the Austro-Marxists also followed this idea. Language was acknowledged, especially in central Europe, as the premier qualification for national membership. The concept of the ‘language nation’ was political common sense. Also (or perhaps especially) the Social Democrats, their theorists and thinkers agreed with the idea of a ‘language nation’ (Otto Bauer, Karl Renner). See: Helmut Konrad (ed.), Sozialdemokratie und ‘Anschluss’, Vienna 1978. 6. Lutz Musner, ‘Im Schatten von Verdun. Die Kultur des Krieges am Isonzo’, in Konrad and Maderthaner, … der Rest ist Österreich, Vol. 1, pp. 45–64. 7. Julius Deutsch.

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8. Gerhard Botz, Gewalt in der Politik. Attentate, Zusammenstöße, Putschversuche. Unruhen in Österreich 1918–1938, Munich 1983. 9. Karl Kraus, Die letzten Tage der Menschheit. Tragödie in 5 Akten mit Vorspiel und Epilog, Vienna 1922. 10. On the ‘Rotes Wien’, see the newest edition: Helmut Konrad: ‘Das Rote Wien. Ein Konzept für eine moderne Großstadt? ’, in Konrad and Maderthaner, … der Rest ist Österreich, Vol. 1, pp. 223–40. 11. See endnote 1. 12. RGBl. Nr. 307 from 24 July 1917. Full title: ‘Law of 24 July 1917, with which the Government is endowed with the power, to make the necessary decisions and to take complete control, in the case of war or national emergency, of the economy.’ 13. Klaus Berchtold, Verfassungsgeschichte der Republik Österreich, Vienna 1998. 14. This was stressed by Hans Mommsen in November 2008 at a conference in Vienna (presentation of the 2 volumes of … der Rest ist Österreich). 15. Wolfgang Maderthaner: ‘Die eigenartige Größe der Beschränkung. Österreichs Revolution im mitteleuropäischen Spannungsfeld’, in Konrad and Maderthaner, … der Rest ist Österreich, Vol. 1, pp. 188–206. 16. I made the first attempt at explaining the situation in 2004. Helmut Konrad: ‘Der Februar 1934 im historischen Gedächtnis’, in Dokumentationsarchiv des österreichischen Widerstandes (ed.), Themen der Zeitgeschichte und der Gegenwart. Arbeiterbewegung – NSHerrschaft – Rechtsextremismus: ein Resümee aus Anlass des 60. Geburtstages von Wolfgang Neugebauer, Vienna 2004. 17. Inez Kykal and Karl R. Stadler, Richard Bernaschek. Odyssee eines Rebellen, Vienna 1976. 18. Christiane Zehl Romero, Anna Seghers. Eine Biographie 1900–1947, Berlin 2000, p. 319. 19. Anna Seghers, Der Weg durch den Februar, Berlin 1951. 20. Kurt Bauer, Elementar-Ereignis. Die österreichischen Nationalsozalisten und der Juliputsch 1934, Vienna 2003. 21. Quoted here is a speech given after the resolution proposal of Delegate Albert Steinhauser, addressed to friends on 26 February 2009. 22. Ibid. 23. Ibid. 24. Günther Schefbeck, Österreich 1934. Vorgeschichte, Ereignisse, Wirkungen, Vienna 2004.

Chapter 3

Avalanches

of

Spring

The Great War, Modernism, and the Rise of Austro-Fascism

Roger Griffin

The Catastrophe of Modernity On 12 November 1918 the Republic of German Austria arose – more of a distressed, struggling fledgling than a noble Phoenix – from the dissolution of the Austro-Hungarian Empire. Under the terms of the Treaty of St Germain it was soon forced to change its name to The Republic of Austria. It was to last until 1 May 1934 when the country officially became the Austrian Corporate State (Ständestaat) under Engelbert Dollfuss which itself lasted until the Anschluss with the Third Reich on 12 March 1938.1 In the Spring of 1918, Franz Kafka had written in his notebook: Seen with the impaired vision of a purely earthly perspective, we are in the situation of some passengers whose train has had an accident in a long tunnel at a point where the light of the entrance can no longer be seen, and the light of the end of the tunnel is so faint that we have to keep looking for it, for we keep losing sight of it, and we are not even sure which is the entrance and which is the exit. But all around us we can see, because of the confusion of our senses or the extreme sensitivity of our senses, unearthly creatures, and a kaleidoscopic play of images which, according to the mood and the degree of injury of the individual, is either entrancing or exhausting. ‘What shall I do?’, or ‘Why should I do it?’ are not questions to ask in these parts.2

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This article sets out to use a variant of ‘cultural History’ (sometimes referred to disparagingly by historians of a more ‘empirical’, anti-theoretical disposition as ‘culturalism’)3 to cast an unfamiliar but hopefully revealing light on the political history of interwar Austria by tracing subterranean linkages between the historical situation described in Kafka’s diary entry and the rise of political forces mobilized by new authoritarian and totalitarian ideologies. Between 1934 and 1938 these conspired to sweep away Austria’s fragile liberal democratic order, stripping its citizens of legal protection against persecution and making the majority who had not been seduced by enthusiasm for Hitler impotent to prevent their country’s forced incorporation into the Nazi regime. As a result millions became party to or victims of the apparatus of war, terror and eventually genocide erected in their midst. I hope to show that – once suitably ‘unpacked’ as a metaphor for the disorienting effects of modernity in general and Central European history in the period 1918–1938 in particular – Kafka’s metaphor can help us to understand a little better how this tragic process could unfold in one of the most ‘civilized’ areas of modern Europe.

The Derailment of the Train of Progress By definition, any passage from Kafka’s diaries is open to many readings – Jewish, Christian, Freudian, Kabbalistic, Zen Buddhist, Gnostic, existentialist and so on – which is why for many he has come to epitomize the irreducible ambivalence of modernity itself.4 But the passage also admits a historical interpretation as an allegory for the distressing psychological situation faced at different levels of consciousness by so many Europeans in the fourth year of the Great War. The railway lines can be seen as representing the tracks which allow the ‘train’ of a functioning, intact culture to carry the mass of the inhabitants (train passengers) smoothly and in relative comfort through linear historical time with a collectively imagined community and broadly consensual destination (telos) that renders life meaningful as a communal experience. When culture works as a fully operative railway system providing the subjective infrastructure to the coherence, predictability, and ‘self-evidence’ of everyday life, it confers on individual existence a sense of unreflexive wholeness by endowing it with a nomos, a sense of suprapersonal, ‘eternal’ metaphysical order.5 By 1918 both the residual telos that gave European society a sense of direction, future and progress, and the nomos that provided its shared values, the ‘normality’ of society, already under stress before 1914, had broken down. Indeed, both could vanish altogether for a significant percentage of Europeans under the pressure of highly localized conjunctures

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35

of events which created the impression that the continuum of History itself had been shattered. Prague and Vienna, metropolises of an AustroHungarian Empire in an extreme state of dissolution, were epicentres for the breakdown of telos and nomos in Europe. It is worth noting Kafka’s suggestion in this passage that there was no objective reaction possible to the derailment of History being widely experienced in the spring of 1918: the cultural catastrophe – anticipating the total socio-political collapse of the autumn of 1918 for the Entente powers6 – induced acute disorientation in all. However, the kaleidoscopic patterns of sensations formed by intense hallucinations against the background of intense darkness can induce a sense of fatigue (Ermüdung) or ecstasy (Entzückung) depending on the precise temperament and injuries of the individual passenger. Thus while some are (following the objective logic of the situation) seized by depression and ‘cultural despair’, others may counterfactually and manically compensate subjectively with utopias which blot out the blackness by allowing the faint glimmer of light to be mistaken for a new dawn. As the U.S. historian Peter Fritzsche once said, ‘when it is dark enough you can see the stars’.

Modernity as a Catastrophe for Totalizing Cultural Truths According to this reading, Kafka is finding words and images, not for the ‘human condition’ in general, but for the cataclysmic European experience of contemporary events that had been created by the war for one highly cultured citizen of urban life under the late Austro-Hungarian Empire, and with far less lucidity and literary flair for millions of kindred spirits. The modern sense of catastrophe, both objective and spiritual, which it records with such filmic intensity is the Leitmotif of this article, which attempts to erect a bridge – though more like a temporary walkway of planks and scaffolding than a suspension bridge of stone and steel – over the historiographical gap that has opened up between scholarly analyses of the complex endgame of the First World War and the ancien régime in Europe, and the speed with which – within sixteen years of the armistice – Austria’s infant parliamentary democracy collapsed into dictatorship, only to be forced into a shotgun marriage with the truly totalitarian Third Reich four years later. Both sets of events have been extensively investigated in terms of socio-political and economic factors, but the ‘culturalist’ aspect is still relatively unexplored.7 At least the foundations of this emergency overpass can be erected on stable, well-trodden ground, namely the idea of modernity in the nineteenth and twentieth centuries as a fundamentally disruptive and destabilizing factor in the evolution of Western society. Consistent with this

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premise, modernity has been analysed since 1945 in terms of irreducible ambivalence,8 of the all-pervasive anxiety9 or angst10 of the disinherited mind,11 of spiritual homelessness,12 as the ‘disembedding’ of existence,13 as a ‘maelstrom’,14 and so on. This is nothing new. Already in the late nineteenth century, what was generally seen as an age of progress in the West had come to be associated by its critically alienated artists and intellectuals with such forces as cultural ‘disinheritance’,15 ‘uprooting’,16 ‘degeneracy’,17 ‘disenchantment’ and ‘the loss of the soul’ (Entseelung),18 as ‘anomie’,19 or ‘nihilism’ and ‘decadence’.20 All these diagnoses resonated with a tide of artistic, intellectual and scientistic obsession with decay so strong it gave its name to an entire artistic movement, Décadence,21 and made it self-evident to specialists in genetics that their mission was to help assure a socially hygienic and eugenically sound future.22 The effect of the mechanized devastation and slaughter of the Great War was to democratize and radicalize the sense of the West’s decay, making it the dominant mood of the Zeitgeist. When Oswald Spengler’s The Decline of the West caused an international sensation despite its unreadably (and largely unread) dense prose, and T.S. Eliot’s The Wasteland catapulted him to international fame despite the hermetic experimentalism of its poetic form, it was a sign that, far beyond the confines of the avant-garde, ‘ordinary people’ were experiencing modernity in terms of unreality, breakdown and apocalypse. Decadence was no longer the brooding presentiment of an effete artistic elite. A whole generation felt it might be living through what the Austrian cultural critic and satirist, Karl Kraus, called in his 200–scene (utterly unperformable) black comedy written between 1915 and 1922: Die letzten Tage der Menschheit, or The Last Days of Mankind.23 Thus when in the 1990s the American Marxist theorist Frederic Jameson wrote of modernity as a ‘catastrophe’ that ‘dashes traditional structures and lifeways to pieces, sweeps away the sacred, undermines immemorial habits and inherited languages’24 he is part of a century-old tradition not just of viewing, but experiencing modernity as a ‘disaster’.

The Revolt against Decadence and the Dialectic of Modernity However, Jameson makes an important qualification at the end of his pronouncement: modernity ‘leaves the world as a set of raw materials to be reconstructed rationally’. In contrast, the thesis explored in this chapter is that the rise of so-called ‘Austro-fascism’ (in reality a variant of European para-fascism)25 and Austrian Nazism (very much the ‘real thing’ as far as both its fascist and modernist credentials are concerned)26 cannot be understood simply as products of the birth pangs of the new Austrian state.

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37

Rather they have to be placed in the context of the numerous authoritarian and totalitarian projects, both left and right, incubated by the chaos of the wartime and interwar period throughout the Europeanized and (in the case of China and Japan) partially Europeanized world. Such projects, it is argued here, were attempts to reconstruct rationally – though to outsiders who operate a conflicting value system, irrationally – a world that in its many unique national and regional contexts was by the 1920s not just objectively in crisis. At least in the areas most ravaged by the impact of the First World War, it had subjectively fallen apart. Each project, often pitted against several rival futural schemes in the same country, aimed to create an alternative modernity in which external chaos and inner confusion (a state of distress evoked by the untranslatable German word ‘Zerrissenheit’ or ripped-apart-ness) would be banished in what would be literally a ‘new order’. This concept is expressed more forcibly by the German expression ‘eine neue Ordnung’ which connotes not just a new status quo but a re-ordering of a chaotic situation. For those ‘enraptured’ rather than ‘exhausted’ by the catastrophe of modernity in 1918, cultural pessimism was not a final verdict on the age but a dynamic transitional state of mind which metamorphosed into its opposite: the conviction that out of the death of the old culture a new one was being born in a process known as rebirth, or which I have dubbed (following classical Greek, Renaissance English, Kantian and modern Italian and French usage of the word) ‘palingenesis’. In fact, the pessimism of all the pioneers of the analysis of modernity we have referred to, whether we think of Barrès, Weber, Durkheim, Nietzsche, Nordau or Benjamin, was ‘palingenetic’, living testimonies to what Ernst Bloch baptized ‘the Principle of Hope’ based in the human ‘Noch-Nicht-Bewusste’ or ‘Not-Yet-Conscious’, a faculty he considered more important, more constitutive of the human than Freud’s ‘Unconscious’ (Unbewusste).27 The dialectic of cultural despair and palingenetic hope hardwired into the human mythopoeic faculty can be illuminated by the analysis of cultural dynamics offered by social anthropology, and in particular by Peter Berger’s theory of the innate human need for a nomos.28 This he describes as a ‘sacred canopy’ of mythically and ritually constructed meaning protecting human beings from the horror of the void. This void can be seen as intense subjective experience of the implosion of meaning, or the absence of nomos which arises once existence is reduced to the biological process of birth, procreation and death so devastatingly summed up in the phrase from Samuel Becket’s Waiting for Godot, ‘They give birth astride of a grave, the light gleams an instant, then it’s night once more’.29 For Peter Berger, it is the primordial reflex – so vital to human survival – to ward off nihilism and despair by postulating a

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transcendent reality and a new futurity, thereby creating a new sacrality in time itself that produced the religion-based cultures of traditional society, as well as, in a secular age, the countless ‘temporalized’ utopias30 typical of Western modernity, projects for a new age to be realized within, not beyond, historical time.31 Such an interpretation32 of the psycho-social mechanisms subliminally at work in the genesis and palingenesis of all culture throughout human history highlights a profound relationship between the widespread cultural pessimism and proliferation of utopian projects for cultural or societal renewal that proliferated between 1850 and 1945, not just in the realm of art, aesthetics and philosophy but equally in the sphere of social and political movements intent on inaugurating a ‘new order’, a ‘new era’, and a ‘new world’. This nexus can be sensed in the first issue of the cultural review Die Moderne (‘Modernity’ or ‘Modernism’) published in 1890 where its founder, Hermann Bahr, lucidly expresses the logic of ‘palingenetic pessimism’ – or what Nietzsche called ‘strong pessimism’: a despair so profound that instead of being an entropic terminal state, nihilism undergoes an alchemical transmutation into the manic optimism of a faith in redemption, either through accessing a temporary state of grace and transcendence or through the dawning of a new era. In Zarathustrian tones he captures the widespread longing some quarter-century before the rise of charismatic leaders in Europe, for a propheta figure to redeem the soul from the hell of spiritual anarchy. His ‘charismatic’ role would be to provide both a sense of closure and a new beginning for a society apparently adrift rudderless on the modern ocean of relativism and awash with either decadence or with atomized currents of religiosity no longer channelled into a collective, homogeneous community of faith. A wild affliction courses through the age and the pain is no longer bearable. The insistent call for the Saviour comes from all sides and everywhere there are crucified ones.33 Can it be that Death is stalking the world. Perhaps we are at the end, at the extinction of an exhausted humankind, and these are just the last throes. It might be that we are at the beginning, witnessing the birth of a new humanity, and that these are just the avalanches of spring. We are either rising into the divine or we are plunging down into night and annihilation – there can be no stay. That from out of the suffering salvation will come and that grace will be born of despair, that dawn will break after this terrible darkness and that art will once more take up its rightful place among men – it is in this resurrection, glorious and blissful, that this new journal [Die Moderne] believes.34

The ‘Saviour’ Bahr evokes is thus no longer a metaphysical one, the fulfilment of ancient Messianic hopes inscribed in Holy Texts, but a secular

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Avalanches of Spring

redeemer of collective lost time, able to weave anomic historical time into a new sacred canopy under which humanity itself would become divine, so staving off the Fall, not into a preternatural Hell but into Nothingness, a cosmic anomie announcing the death of the human species as a viable, meaningful life-form.

Redefining Modernism Taking this argument a stage further we arrive at a redefinition of ‘modernism’ as a historical force, one that signifies a considerable expansion in its conventional or ‘orthodox’ remit. Rather than confine it to the sphere of radical innovation in the sphere of art and aesthetics, it now applies to an initiative in any sphere of cultural production, including the scientific, the ideological and the political, to overcome the nomic crisis of modernity in one of two modes of revolt against decadence. The first occurs when the artist or thinker momentarily breaks through to a fresh sense of the sublime, the transcendent, or the numinous. Such ‘epiphanic modernism’ is familiar from the works of such figures as Charles Baudelaire, Vincent Van Gogh, James Joyce, Virginia Wolf and Rainer Maria Rilke, who epitomized the epiphanic moment in the phrase from the 7th of The Duino Elegies ‘Hiersein ist herrlich’: ‘Just to be here is magnificent’ (a poetic pun on Dasein, ‘Being There’, which is the German for ‘existence’, and is given a bitter and certainly unintentional irony by the proximity of Duino to the most apocalyptic fighting of the First World War along the Isonzo battle front). In an Austrian context, Arthur Schnitzler, Hugo von Hofmannsthal, Arnold Schönberg, Gustav Klimt and Egon Schiele were epiphanic modernists, as was Oskar Kokoschka, who once declared his expressionist portraits of the Viennese were of people who ‘lived in security, yet were all afraid’, which is why he ‘painted them in their anxiety and pain’,35 their faces etched with ennui and anomie. A forensic investigation of the complex psychological mechanisms involved in the modern epiphanic experience is Robert Musil’s Der Mann ohne Eigenschaften (The Man without Qualities), which ranks with James Joyce’s Ulysses as the supreme modernist novel of the early twentieth century and is described by one expert as an ‘investigation of the void at the heart of the experience of modernity’.36 In the course of it Musil maps the network of invisible meridians that connect the prevalent ethos of modern anomie both to ephemeral states of mystic transcendence, which he calls ‘der andere Zustand’ (the other condition) or ‘das tausendjährige Reich’ (the millennial realm), and to the spasms of pathological violence committed by the serial killer and misogynist sociopath Christian Moosbrugger.

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Yet in terms of its impact on reshaping European history after the Great War the far more significant mode of modernism was the one expressed by those who intensely experienced the anomie and decadence of the age, but believed they could go beyond private revelations of higher states of being and exit the tunnel of decadent modernity altogether. They convinced themselves that a re-grounding, a re-embedding, a rebirth was possible, that the crashed train of Western civilization could be repaired or replaced altogether pulled by a new locomotive, and speed off on another set of railway tracks leading into a future freed from nihilism and despair, and bathed in preternatural light. At this point modernism becomes ‘programmatic’ rather than simply epiphanic. It was championed by artists such as Wassily Kandinsky and Filippo Marinetti, by architects such as Le Corbusier and Walter Gropius, by philosophers such as Friedrich Nietzsche and Martin Heidegger. It was also promoted by idiosyncratic social reformers such as Madam Blavatsky who believed the lost occultist wisdom retrieved in theosophy could save the West from spiritual starvation, or Richard Ungewitter, who fought a tireless campaign to transform society through naturism, or Alfred Ploetz, the evangelist of the social hygiene needed to combat the problem of degeneration that was crippling the West. Viennese society inevitably produced a rich crop of programmatic modernists too, such as Hermann Bahr, Karl Kraus, Sigmund Freud, Otto Weininger, Ernst Mach and Fritz Mauthner, all seeking in idiosyncratic ways to provide modernity with new foundations, a new arche.

Political Modernism Such reflections lead to the basic thesis of this article. The Great War and its immediate aftermath did more than create concentrated urban and rural areas of acute socio-economic and political instability in Europe which in some countries liberal parliamentary regime proved incapable of resolving, thereby opening up a political space for illiberal movements and regimes to flourish. It also intensified the collective societal experience of anomie, of being trapped in a permanent transition which could only be provided with ‘closure’ through the foundation of a new order.37 Even before 1914 this situation, experienced as ‘decadence’, had fostered a vast range of creative palingenetic responses by individuals desperate to ward off the prospect of the collapse of history as a meaningful narrative and escape the terror of the void. As the U.S. historian Peter Fritzsche puts it, by invalidating ‘the grand narrative of “History”’ as it had developed over the course of the nineteenth century, the Great War:

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encouraged contemporaries to envision the wholesale renovation of the social body. The war offered a new universe, and it generated its own possibilities. … The future had never appeared so dangerous or so open-ended as when viewed from among the ruins of the postwar years.38

A glimpse of the conflicting social and political ‘total world-views’39 dreamed up in the more cosmopolitan areas of Europe in the conditions of breakdown and nomic collapse prevailing after the war is provided by this eye-witness account of the scene in Bohemian Schwabing in the early 1920s: The occult fashion of the time after the First World War had its origin here in Schwabing! Theosophists, … mystics, Gnostics, Taoists, Mazdaists, Buddhists, neo-Buddhists, Zionists crowded together with Nihilists, Collectivists, Syndicalists, Bolshevists, Pacifists, … and other world-reforming fanatics of all races. Here everything impossible to man was jumbled up with all human possibilities, [tempting] those bitten by its heroism to sacrifice themselves for a great idea, for a divine Leader, for a woman.40

Within such a Babel of pessimistic diagnoses of the present and utopian presentiments of new beginnings – all too often refracted through fantasies of communal redemption, sacrifice and cleansing41 – it becomes intelligible that particularly in areas of Europe where the objective social fabric, political structure, and territorial boundaries had been transformed beyond recognition by the war or its outcome, programmatic modernism in the form of utopian political projects to solve the crisis were bound to surface. The Russian Revolution, perhaps the supreme expression of political modernism in Europe,42 served to further fuel palingenetic political expectations outside Russia that History itself had reached a watershed between two eras.43 Inevitably, then, forms of political radicalism that had been largely marginalized by liberal parliamentary systems or by Europe’s absolutist regimes before 1914 now moved centre stage and acquired the character of a heterogeneous crusade of motley programmatic modernisms against a dying civilization. Political creeds proliferated, now familiar to political scientists under such names as anarchism, anarcho-Syndicalism, Marxism-Leninism, democratic centralism, social democracy, political anti-Semitism, Christian nationalism and Christian socialism, organic ultra-nationalism, politicized racism and biopolitics – mostly loose umbrella terms with fuzzy boundaries. They all jostled for position to offer themselves as the exclusive panacea for the crisis of the West. After 1918 Europe became for millions of the spiritually homeless disaffected with liberalism and rationalism an age ripe for a ‘new politics’, born not of the deliberation and debate of a segregated caste

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of politicians, but of decisiveness, of action, of faith, of will, of movement, of planning, of national identity, of solidarity, of charisma, of spectacle, of communal destiny, and of sacrifice.44 Once modernist revitalization movements marched out of the studios, studies, cafés and exhibitions, and into the streets squares and parade grounds, it was bound to have a shattering effect on the European old order, which in the Bolshevik, fascist, and neoconservative mindset now embraced not just conservatism but liberalism itself. As a result, as Peter Fritzsche has observed so acutely: ‘The most spectacular displays of modernism are not to be found in a museum of expressionist art or a collection of prose poetry, but in the avant-garde political collaborations that sought to come to terms with a brand-new world regarded as unstable and dangerous.’45 Two testimonies of the time offer an insight into the primordial process of re-erecting a sacred canopy, of ‘mazeway resynthesis’46 that took place in distressed, disoriented myriad minds attempting to reorder and ‘renomize’ not just aesthetically but socio-politically the modern age amidst the intensified chaos resulting from the Great War, experienced not as the end of civilization, but as a crucible in which a new civilization would be forged. The first is to be found in the opening passage from Ernst Jünger’s Der Kampf als inneres Erlebnis (Battle as an Inner Experience), first published in 1922, which expresses the ecstasy of someone who knows with fanatical certainty that civilization is going to emerge from the tunnel of history’s train-crash on new tracks stretching into a future in which time is no longer ‘out of joint’: There are moments when from above the horizon of the mind a new constellation dazzles the eyes of all those who cannot find inner peace, an annunciation and storm‑siren betokening a turning point in world history, just as it once did for the kings from the East. From this point on the surrounding stars are engulfed in a fiery blaze, idols shatter into shards of clay, and everything that has taken shape hitherto is melted down in a thousand furnaces to be cast into new values. The waves of such an age are surging around us from all sides. Brain, society, state, god, art, eros, morality: decay, ferment – resurrection? Still the images flit restlessly past our eyes, still the atoms seethe in the cauldrons of the city. And yet this tempest too will ebb, and even this lava stream will freeze into order. Every madness has always disintegrated against a grey wall, unless someone is found who harnesses it to his wagon with a fist of steel. Why is it our age in particular that is so overflowing with destructive and productive energies? Why is this age in particular so pregnant with such enormous promise? For while much may perish in the feverish heat, so the same flame is simultaneously brewing future wonders in a thousand retorts. A walk in the street, a glance in the newspaper is enough to confirm this, confounding all the prophets.

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It is War which has made human beings and their age what they are. Never before has a race of men like ours stridden into the arena of the earth to decide who is to wield power over the epoch. For never before has a generation entered the daylight of life from a gateway so dark and awesome as when they emerged from this War. And this we cannot deny, no matter how much some would like to: War, father of all things, is also ours; he has hammered us, chiselled and tempered us into what we are.47

A year before the war’s end, a certain Benito Mussolini was convinced he had witnessed a new elite being born in the front-line fighting with Austrian troops who would transform history: the ‘trenchocracy’. The servicemen of today are the vanguard of the great army who will return tomorrow. They are the thousands who await millions of demobilized soldiers. This enormous mass – conscious of what it has achieved – is bound to cause shifts in the equilibrium of society. The brutal and bloody apprenticeship of the trenches will mean something. It will mean more courage, more faith, more tenacity. The old parties, the old men who carry on with the exploitation of the political Italy will be swept aside. … The words republic, democracy, radicalism, liberalism, the word ‘socialism’ itself, have no sense any longer: they will have one tomorrow, but it will be the one given them by the millions of ‘those who returned’. And it could be something quite different. It could, for example, be an anti-Marxist and national socialism. The millions of workers who return to the mud in their fields, after being in the mud of the trenches, will realize the synthesis of the antithesis: class and nation.48

Both these passages are testimonies to the ethos of ‘avant-garde’, modernist social and political projects to create a new beginning which was reshaping history by 1917.

The Rise of Modernist Authoritarianisms At this point it is important to distinguish two ‘-isms’ deliberately omitted from the earlier list of new species of politics engendered in the laboratory of early twentieth century Europeanized avant-garde culture: authoritarianism and totalitarianism. The interwar authoritarian regimes sought to solve the problems of modernity by blending conservative elements such as politicized Christianity, monarchism, patriarchal family values, a celebration of the peasantry, and rigid class stratification with ‘modern’ currents of ultra-nationalism, anti-Communism, anti-liberalism and anti-Semitism. They hosted varying blends of military and person-

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al dictatorship, often borrowing selectively for style and ethos from the most ‘modern’ animal in the political menagerie of the day: fascism. In Catholic countries such as Portugal, Spain, Hungary, and of course Austria, authoritarianism could draw for its legitimation on highly elaborated Catholic theories of corporatism and the welfare or social state as well as the Church’s critiques of liberal democracy, laissez-faire economics, and individualism. After all, by the 1920s political Catholicism was offering its own brand of alternative modernity.49 Twentieth-century authoritarianism was thus not straightforward ‘reaction’, but a new blueprint for modern society, the product of intensive syncretism improvised in crisis conditions to offer the basis of a new temporality adapted to the national culture. Thus Salazar adapted ideas from Maurras’ Action Française, Hungary under Horthy retained a parliamentary system, while Dollfuss’s regime could capitalize on powerful currents of illiberalism: pan-German ethnic racism and völkisch thought, Karl Lueger’s Christian Socialism, the corporatist socio-economic theories of Othmar Spann (which had their own modernist thrust),50 and the Fascism of neighbouring Italy. However, authoritarianism was imposed by existing elites on the masses from above, with only perfunctory gestures towards radicalizing and mobilizing the masses and only a simulated revolutionary momentum if any towards a radically new socio-political order demanding the marginalization of traditional elites or their absorption into new hierarchies. The Dollfuss regime, for example, was more intent on creating a dam to hold back the rising flood of chaos than channelling any palingenetic expectations it had awakened into the foundation of a new populist völkisch order or the creation of a ‘new man’. The single party it created, The Patriotic Front, was precisely that – a pseudo-populist front for an elitist authoritarian regime. At bottom it had no interest in carrying out anything as radical as a temporal or an anthropological revolution.51 Yet it is precisely the goal of a temporal and anthropological revolution that Emilio Gentile identifies as the hallmark of totalitarian utopianism.52 To this end, totalitarianism was prepared to carry out far more drastic surgery on the body politic of any society it conquered than even the most modernizing neo-conservative authoritarian regime. It sought to resolve the crisis of modernity in a new order based on a transclass social revolution maintained in power by a populist revitalization movement under charismatic leadership. Totalitarianism53 applied comprehensive social engineering – involving the regimentation of mass society against a background of an elaborate political religion and an oppressive state apparatus of surveillance and, outside Fascist Italy, of terror – to the project of what was known in Soviet Newspeak as ‘retooling the soul’. This result was what Zygmunt Bauman terms a ‘gardening state’, one which in the

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case of Nazism and Stalinism ruthlessly weeded out and destroyed the human embodiments of decadence.54 The interwar totalitarian gardening state is the ultimate, most destructively creative product of programmatic modernism as a political response to the crisis of modernity, since it treated the civic population as the raw material for producing a new type of human being, the inhabitant of a new era.55

The Birth of Austrian Political Modernisms from the Great War Several conclusions can be drawn from this whirlwind exposition of a particular meta-narrative56 which allows structural links to be perceived between the rise of cultural modernism, the disorienting, social impact of the Great War and the rise of new kinds of authoritarian regimes pioneering new forms of modernity and new ways of incorporating the masses into the socio-political process. The first is that the ‘Austro-fascism’ of the Dollfuss/Schuschnigg regimes was not a form of fascism or of totalitarianism in the generic sense of the terms, but a home-grown authoritarian remedy for the very real problems posed by the immediate socio-economic crisis ensuing from the Wall Street Crash aggravated by the profound structural problems faced by Austria as an artificially created democratic nation-state, as well as by the threat of Communism and Austrian Nazism. The Ständestaat (corporate state) was simultaneously conceived as a bulwark against anarchy and social conflict as well as being a prophylactic against the degeneracy, spiritual bankruptcy and anomie of the secular individualism fostered by modernity. It was the hybrid of utopianism and Realpolitik, of a conservatism imparted with a futural, modernizing dynamic towards a creative synthesis of the traditional and the contemporary. ‘Austro-fascism’ was thus one of many modernist political solutions to the problems posed by the particular conjunction of modern forces in interwar Europe that undermined the democratic processes of the Austrian Republic, forcing state elites to imagine an alternative socio-political framework to accommodate the modernization process within the fledgling nation.57 Second, Austrian Nazism was a totalitarian and genuinely fascist movement for ethnic revitalization, a radicalization of ethnic nationalism which abandoned Georg Schoenerer’s tamer variant of pan-Germanism in order to erect a more radically modernist sacred canopy, the new Weltanschauung, whose formulation is the central theme of Mein Kampf and which became the doctrine of the NSDAP. The Austro-Nazism which opposed the Dollfuss regime, and the enthusiastic embrace of Nazism by millions

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of Austrians after 1938,58 was made possible by powerful home-grown currents of ultra-nationalism and racism.59 But it is inexplicable without the widespread populist longings for a breakthrough to a new era (Aufbruch), for a new beginning (Neubeginn) in an age of intense crisis, both external and internal, that had led the Viennese writer Heimito von Doderer to write in his diary on 21 November 1924 under the heading ‘The New Revolution’: We must put this nineteenth century behind us once and for all like clearing a pile of manure! Everyone must choose for themselves between future and past. I have decided unconditionally for the future. I now love this modern age (our present) with an exalted passion – as far as it really is the future! It is as yet a nameless future! What undreamt possibilities it contains! Soon I will be able to cast aside every tradition. The only thing is that I must be prepared to accept the unwitting consequences of taking this stance.60

Doderer himself gravitated from an initial enthusiasm for the Russian Revolution to a passion for what he called the ‘national revolution’, a change of allegiances which may seem contradictory on the surface but on a deeper level is utterly consistent with the modernist quest for a new era to begin, for a re-enchantment of a dying world. The assassination of Dollfuss in the abortive Nazi coup of July 1934 can thus be seen as epitomizing the violent clash of two utopian futures, two rival temporalities, two alternative modernities, two new temporalities.61 Both of them rejected liberal democracy, Bolshevism, and the status quo, but only one of them was fired by a vision of renewal endowed with the potential for committing the mass murder of soldiers and civilians on an unprecedented scale in the name of the New European Order. Third, it is no coincidence that it was in fin-de-siècle Vienna where a young Austrian from a village near Linz, the future propheta of the Nazi movement for German rebirth, served his ideological apprenticeship, commenting later in Mein Kampf that ‘Vienna was and remained for me the hardest, though most thorough school of my life’.62 Hitler’s supreme biographer, Ian Kershaw, confirms that ‘the Vienna “schooling” did indeed stamp its lasting imprint on his development’, stressing the way the city ‘epitomized tensions – social, cultural, political – that signalled the turn of an era, the death of the nineteenth century world’. The backcloth to his daily existence was thus one of dissolution: ‘The mood of disintegration and decay, anxiety and impotence, the sense that the old order was passing, the climate of a society in crisis was unmistakable.’63 Hitler’s own comment on the modern Zeitgeist in a speech as Führer echoes his first impressions of life in the Austro-Hungarian capital three

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decades earlier: ‘Nothing is anchored any more, nothing is rooted in our spiritual life any longer. Everything is superficial, flees past us. Restlessness and haste mark the thinking of our people. The whole of life is being torn completely apart.’64 But the dialectic of modernity meant that Vienna was a metropolis buzzing with palingenetic remedies to the rootlessness, anomie and sickness of the modern age that so haunted the young Hitler, providing an ideal habitat not just for modernist art and thought, but for the crystallizations of new total solutions to the problems of modern decadence such as Georg von Schönerer’s Pan-German League, Karl Lueger’s Christian Social Party, Karl Wolf’s German-Radical Party, and Ariosophy, an Aryanized and occultist variant of theosophy evolved by Guido von List and Lanz von Liebefels,65 all of which contained strong elements of ethnic nationalism and anti-Semitism. The ethos of cultural crisis, of revolt against decadence, of longing for Aufbruch which produced the visionary aestheticism of the Viennese Secessionist artists as a powerful expression of epiphanic modernism also helped incubate the Zionism of Theodor Herzl and Max Nordau,66 as well as the emergence of Austro-Marxism as an alternative to Marxism-Leninism, all of which can be seen as ‘programmatic’ forms of modernism. In their radically different ways, all these political movements were bent on removing the causes of decadence root and branch in a radically new type of society. According to our analysis, all can thus be seen as variants of political modernism. They announced secessions not of artists from the classical aesthetic tradition, but of political activists from the Enlightenment project, and thus prepared to jettison wholesale the assumptions about humanism and progress that underpinned it in the name of a new era. The young Hitler graduated from the hard schooling of life in a city saturated with visions of decay and rebirth just in time to undergo his own traumatic rite de passage on the Western Front. He went on to become first the drummer, then the self-appointed leader67 of a movement of national revitalization which he equipped with a new mazeway, an allembracing nomos, a total Weltanschauung exclusively designed to shelter ethnic Germans under its sacred canopy, one which he was finally able to promulgate in unexpurgated form in Mein Kampf written in the Landsberg fortress, its chapters haunted by the recurrent topoi of decadence and rebirth. One of the millions of Austrian Germans who sought existential refuge elsewhere was the writer Hermann Broch. Vienna served as his forward observation post in the battle for the West’s renewal, and it was there that between 1928 and 1931 he composed Die Schlafwandler [The Sleepwalkers], a deeply modernist trilogy of novels exploring the growing

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nomic crisis that was seizing Europe in the first decades of the twentieth century, or what he called ‘der Verfall der Werte’ (the Decay of Values). The bulk of its citizens, however well educated, he portrayed in the novel as cut off from any reflexive insight into the deadly illogical logic that was shaping their lives. Buffeted by the ‘icy hurricane’ of modernity in a world whose protective sky has been ripped to shreds by modernity, each individual remains ‘an outcast from his epoch, and an outcast from Time’. Yet precisely because they are condemned to this historical and ontological exile, Broch shows each to be living on the psychological cusp of the ultimate modernist Aufbruch to a ‘new’ time: revolution. Broch describes this event as the ultimate act of ethnical and temporal palingenesis, as a time ‘of self-elimination and self-renewal, the last and greatest ethical achievement of the new, the moment when time is annulled and history radically formed in the pathos of absolute zero’. The absolute zero point – the train-crash of modernity caused by the Great War – has left the atomized modern individual who becomes ‘aware of his isolation … flung back into the deepest animal anguish, the anguish of the creature that suffers violence and inflicts violence, flung back into an overwhelming loneliness’. This vulnerable psychological state predisposes those who feel strangely exiled and homeless in the modern world to succumb to the primordial longings generated when all sacred canopies are in tatters, all Gods have failed. At the height of outer and inner chaos, even the most ‘educated’ modern citizen becomes vulnerable to the seduction of a new propheta: In the fear of the voice of the judgement that threatens to issue from the darkness, there awakens within him the doubly strong yearning for a Leader to take him tenderly and lightly by the hand, to set things in order and show him the way; … the Leader who will rebuild the house so that the dead may come to life again; … the Healer who by his actions will give meaning to the incomprehensible events of the Age, so that Time can begin anew.68

After his release from the Landsberg prison, Hitler knew that his mission was to be just such a leader for the whole German people once it had been purged of its cultural and human degeneracy. He would thus be the Head Gardener of a new Germany. As he wrote in Mein Kampf: ‘Only when an age is no longer haunted by the shadow of its own feelings of guilt can it find the external force needed to cut out brutally and ruthlessly the wild shoots and root out the weeds.’69 Within ten years Hitler’s private epiphany induced by the Great War had become the official ideology for an entire nation, the blueprint for a secular heaven that condemned millions to a secular hell. A totalitarian

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ideology of lethal radicalness had been poured from the blast-furnace of the Great War. Hitler himself, after his apprenticeship in modernist Vienna, had been – to use the phrase of Ernst Jünger – ‘hammered and chiselled and tempered’ by his own traumatic experiences of modernity in the trenches and was determined that he would no longer be a victim of History, but one of those who would henceforth swing the hammer, wield the chisel, and carry out the tempering. By the time the Third Reich annexed Austria on 12 March 1938, millions of Austrians had convinced themselves that Hitler would rebuild the devastated house of modernity so that time could now begin anew in a millennial realm, a ‘tausendjähriges Reich’, not just spiritual and inward as it was for Musil, but historical and territorial. The ‘madness’ of the Nazi utopia was destined not to ‘disintegrate against a grey wall’, because it had found someone only too willing to ‘harnesses it to his wagon with a fist of steel’. However, the decision of millions to side with the future and relegate the institutions and values of the past to the dung heap of History had unforeseen consequences of the sort Doderer intuited but on a devastating scale he could never have grasped. They had delivered themselves into the hands not of a Saviour or Healer but a political Moosbrugger, not one locked away in solitary confinement with his psychotic fantasies of rape and murder, but elevated to the status of infallible Führer, the serial killer by proxy of millions of ‘sacrificial victims’, of ‘Selbstopfer’ and ‘Fremdopfer’70 immolated on the altar of a millennial Reich built not of the spirit but of concrete and soil, flesh and blood. The avalanches triggered by Hitler’s appointment as Chancellor announced not the arrival of spring, but winter and obliteration for millions. It is a series of events of an enormity that still takes the breath away and defies full comprehension by rational human minds, stretching the historical imagination beyond its limits. But perhaps this chapter will have convinced at least some less sceptical readers that these events become more rather than less intelligible once the elusive linkages between the tide of cultural innovation in the early twentieth century and widespread contemporary political longings for a new beginning are appreciated more fully, or at least considered to be a legitimate topic for historical enquiry.

Notes 1. This article is based on a paper given at the Symposium 1918–1920: Der Fall der Imperien und der Traum einer besseren Welt (Broken Empires and Utopian Dreams of a Better World) organized by Wolfgang Maderthaner and Lutz Musner to accompany the publication of the two-volume collection of essays Das Werden der österreichischen Republik. … und der Rest ist Österreich (Vienna 2008) to commemorate the ninetieth anniversary of the

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2. 3.

4. 5.

6. 7.

8. 9. 10. 11. 12. 13. 14. 15. 16.

17. 18.

19. 20.

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formation of the Austrian Republic. These two volumes contain much material on the political and cultural context of the new republic which complements the argument presented in this article. Franz Kafka, Diary Entry, 1917–1918, in Heinz Politzer (ed.), Das Kafka-Buch. Eine innere Biographie in Selbstzeugnissen, Frankfurt am Main 1965, p. 247. See for example Richard Bosworth’s profound misunderstanding of the position of historians such as Emilio Gentile who take seriously the ideological, cultural, and ‘political religious’ dimension of modern political events as a crucial and neglected aspect of attempted nationalist revolutions in the twentieth century in Richard Bosworth, The Italian Dictatorship, London 1998, pp. 234–35. This position is expressed most lucidly in Zygmunt Bauman, Modernity and Ambivalence, Cambridge 1991, p. 183. Here used not in the specialized sense given it by Carl Schmitt, but with the connotations of totalizing cultural-view familiar from cultural anthropology, or what Nietzsche called ‘a horizon framed by myth’: see Friedrich Nietzsche, The Birth of Tragedy, Oxford 2000, section 23, pp. 122–23. In Germany this catastrophe came to be called simply der Zusammenbruch (the breakdown/collapse). The groundbreaking text which refutes this generalization and contributes much of the conceptual basis for this article is Modris Eksteins’ magnificent Rites of Spring. The Great War and the Birth of the Modern Age, Boston 1989. Significantly, Eksteins too describes the European cultural situation in the aftermath of the Great War as a ‘derailment of history’ (p. 257). A classic text on the cultural and political modernism of Vienna which according to this article is one of the preconditions for the emergence of Austro-Fascism is Carl Schorske’s Fin-de-siècle Vienna. Politics and Culture, New York 1981. Bauman, Modernity and Ambivalence. Sarah Dunant and Roy Porter (eds), The Age of Anxiety, London 1996. Cf. W.H. Auden’s The Age of Anxiety: A Baroque Eclogue, New York 1947. Martin Heidegger’s Sein und Zeit, Tübingen 1927; English edition Being and Time, Albany 1996. Erich Heller, The Disinherited Mind. Essays in Modern German Literature and Thought, Philadelphia 1952. Peter Berger, Brigitte Berger and Hansfried Kellner, The Homeless Mind. Modernization and Consciousness, Harmondsworth 1974. Anthony Giddens, The Consequences of Modernity, Cambridge 1990; id., Modernity and Self-Identity, Cambridge 1991. Marshall Berman, All that is Solid Melts into Air. The Experience of Modernity, London 1982. E.g. in Gérard de Nerval, ‘El Desdichado’ (literally ‘the disinherited one’) published in 1854. Maurice Barrès, Les Déracinés, Paris 1897, the first in his trilogy Le Roman de l’energie nationale. See T.J. Field, ‘Barrès and the Image of “déracinement”’, in French Studies 29(3) (2001), pp. 294–99. E.g. in Max Nordau’s best-selling Degeneration, New York 1895. Max Weber, ‘The Social Psychology of the World’s Religions’, in Hans Gerth and C. Wright Mills (eds), From Max Weber. Essays in Sociology, New York 1946, p. 282. For a major attempt to develop a new synoptic interpretation on Weber’s original thesis see Marcel Gauchet, The Disenchantment of the World: A Political History of Religion, Prince ton 1997; Michael Saler, ‘Modernity and Enchantment’, in American Historical Review 111(3) (2006), pp. 692–716. A term coined by Émile Durkheim in The Division of Labour in Society, New York 1972. Bruce Ellis Benson and Pious Nietzsche: Decadence and Dionysian Faith (Indiana Series in the Philosophy of Religion), Bloomington 2007.

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21. Konraad Swart, The Sense of Decadence in Nineteenth-Century France, The Hague 1964; David Weir, Decadence and the Making of Modernism, Amherst 1996. 22. Daniel Pick, Faces of Degeneration. A European Disorder c. 1848–1918, Cambridge 1989. 23. See Erich Heller’s 1948 essay on Karl Kraus, ‘The Last Days of Mankind’, republished in The Disinherited Mind. 24. Fredric Jameson, The Seeds of Time, New York 1994, p. 84. 25. For this concept, see Roger Griffin, The Nature of Fascism, London 1991, chapter 5; cf. Aristotle Kallis, ‘“Fascism”, “Para-fascism” and “Fascistization”: On the Similarities of Three Conceptual Categories’, in European History Quarterly 33(2) (2003), pp. 219–50. 26. Cf. Modris Ekstein’s judgement on National Socialism: ‘National Socialism was yet another offspring of the hybrid that has been the modernist impulse: irrationalism crossed with technicism. … The intention of the movement was to create a new type of human being from whom would spring a new morality, a new social system, and eventually a new international order.’ Id., Rites of Spring, p. 303. 27. Ernst Bloch, The Principle of Hope, 3 Vols., Cambridge 1986. See J. Daniel and T. Moylan (eds), Not Yet: Reconsidering Ernst Bloch, New York 1997. 28. Peter Berger, The Sacred Canopy. Elements of a Sociological Theory of Religion, London 1967. 29. Samuel Beckett, Waiting for Godot (1948), Act 2. 30. Reinhardt Koselleck, ‘The Temporalization of Utopia’, in The Practice of Conceptual History, Stanford 2002, p. 165. 31. For an extensive analysis and exposition of the psychodynamics of this process in terms of anthropological theories of cultural processes of transition and transformation, see Roger Griffin, Modernism and Fascism. The Sense of a Beginning under Mussolini and Hitler, London 2007, chapters 2–5. 32. This interpretation is in terms of post-structural theory a glaring example of a ‘meta-narrative’. However it has no ‘totalitarian’ connotations, since it is a reflexive metanarrative propounded here in a heuristic spirit, not to close debate or stop free-thinking (as in the metanarratives of single-party states) but to open up debate and stimulate new thinking. For more on this methodological issue, see the appendix to Griffin, Modernism and Fascism. 33. After his collapse into insanity, Nietzsche was to sign his letters ‘der Gekreuzigte’, ‘the crucified one’. 34. Hermann Bahr, ‘Die Moderne’, in Moderne Dichtung 1(1) (1890), pp. 13–15. 35. Quoted by Leonard Zahn, ‘Oskar Kokoschka’, in Das Kunstwerk, Vol. 2, Baden-Baden 1948, p. 29. 36. Patrizia McBride, The Void of Ethics: Robert Musil and the Experience of Modernity, Evanston 2006, p. 7. 37. This societal state is termed by some anthropologists ‘liminoid’ (in contrast to ‘liminal’ situations resolved by rites de passages) and is crucial to the formulation of new cultural systems: see Victor and Edith Turner, ‘Religious Celebrations’, in Victor Turner (ed.), Celebration. Studies in Festivity and Ritual, Washington 1982. For its central bearing on modernist projects to create a new world see Griffin, Modernism and Fascism, chapters 3–4. 38. Peter Fritzsche, ‘Fascism, Desire, and Social Mechanics’, in Werner Loh and Wolfgang Wippermann (eds), ‘Faschismus’ – kontrovers, Stuttgart 2002, p. 80. 39. In the context of the anthropology of revitalization movements, such maps to lead distressed members of society out of the labyrinth of the present into a new era have been called ‘mazeways’, created through a process of ‘maze-way resynthesis’. Anthony Wallace, ‘Mazeway Resynthesis. A Biocultural Theory of Religious Inspiration’, in Transactions of the New York Academy of Sciences, Vol. 18 (1956), pp. 626–38. 40. Georg Fuchs, Sturm und Drang in München um die Jahrhundertwende, Munich 1936, p. 79, quoted in J. Webb, The Occult Establishment, Glasgow 1981, p. 48.

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41. For a brilliant exploration of the nexus between the obsession with degeneracy, political modernism, and the project of societal cleansing involved in genocide, see Aristotle Kallis, Genocide and Fascism. The Eliminationist Drive in Fascist Europe, London 2009. 42. On the intensive cultural, social and political modernism of early Bolshevism, see Richard Stites, Revolutionary Dreams. Utopian Vision and Experimental Life in the Russian Revolution, New York 1989. On the impact of Nietzschean philosophical modernism on Stalinism, see Bernice Rosenthal, New Myth, New World. From Nietzsche to Stalin, University Park 2002. 43. Thirty years ago the Dutch historian Jan Romein had postulated a cultural caesura occurring around 1900 which anticipated this objective caesura in his The Watershed in Two Eras: Europe in 1900, Connecticut 1978. 44. The concept of the ‘new politics’ engendered by the rise of ultranationalism in the nineteenth century was central to George Mosse’s understanding of the genesis of Nazism in such books as The Crisis of Ideology, Berkeley 1974 and The Nationalization of the Masses, New York 1975. 45. Peter Fritzsche, ‘Nazi Modern’, in Modernism/modernity 3(1) (1996), p. 12. For a detailed exposition of the intimate relationship between the cultural avant-garde and fascism in one country, see Mark Antliff, Avant-Garde Fascism. The Mobilization of Myth, Art and Culture in France, 1909–1939, Durham 2007. 46. On the ‘mazeway resynthsis’ see endnote 39. 47. Ernst Jünger, Der Kampf als inneres Erlebnis, Berlin 1929, p. 1. It is significant that Jünger was initially drawn to Nazism as the vehicle of socio-cultural and technological revolution, only to withdraw his support from the regime and enter the inner-emigration of the Conservative Revolution, becoming in the process a leading guru of the post-war European New Right. 48. Benito Mussolini, ‘Trincerocrazia’, in Il Popolo d’Italia, December 15, 1917. Reprinted in E. Susmel and D. Susmel (eds), Omnia Opera di Benito Mussolini, Florence 1951–63, Vol. 10, pp. 140–43. 49. Tom Buchanan and Martin Conway (eds), Political Catholicism in Europe, 1918–1965, New York 1996. 50. Though routinely associated with ‘reactionary’ theories of economics and the state, Spann can be seen as typifying an age in which those seeking formulae to regenerate a dissolute age looked to past models for the basis of a new future (in this case an updated version of medieval corporatist economics): see T.J.F. Riha, ‘Spann’s Universalism – The Foundation of the Neo-romantic Theory of Corporative State’, in The Australian Journal of Politics and History 31(2) (1985), pp. 255–56. 51. Bischof, Pelinka and Lassner (eds), The Dollfuss/Schuschnigg Era in Austria. A Reassessment (Contemporary Austrian Studies, Vol. 11), New Brunswick/London 2003. 52. Emilio Gentile, ‘The Sacralisation of Politics: Definitions, Interpretations and Reflections on the Question of Secular Religion and Totalitarianism’, in Totalitarian Movements and Political Religions 1(1) (2000), pp. 18–55; his argument is elaborated fully in his monograph Politics as Religion, Princeton 2006. 53. The sharp distinction between authoritarianism and totalitarianism drawn here in terms of their function as the attempted realization of palingenetic myth and hence a revolutionary ideology is contentious rather than consensual. It follows Emilio Gentile’s use of the term, and is broadly consistent with the way their semantic relationship is mapped by Juan Linz, Totalitarian and Authoritarian Regimes, Boulder Colorado 2000, but at variance with that of Jacob Talmon in The Origins of Totalitarian Democracy, London 1952. For an overview of this topic see Simon Tormey, Making Sense of Tyranny: Interpretations of Totalitarianism, Manchester 1995. For the nexus between totalitarianism and political religion, see Roger Griffin, ‘God’s Counterfeiters? Investigating the Triad of Fascism, Totalitarianism and (political) Religion’, in Totalitarian Movements & Political Religions 5(3) (2004),

Avalanches of Spring

54. 55. 56.

57.

58. 59. 60.

61.

62. 63. 64.

65. 66.

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pp. 291–326; Richard Shorten, ‘The Enlightenment, Communism and Political Religion: Reflections on a Misleading Trajectory’, Journal of Political Ideologies 8(1) (2003), pp. 13–38. Bauman, Modernity and Ambivalence, p. 29. Significantly, Roberts in The Totalitarian Experiment in the Twentieth-Century, New York 2006 also makes use of Bauman’s concept. One of the most detailed manifestos for the project is Ernst Jünger’s Der Arbeiter [The Worker] of 1932, which still exerts a fascination for the European New Right today. On the ‘reflexive meta-narrative’ underpinning this article, see the appendix to Griffin, Modernism and Fascism, pp. 370–75. This book provides an extensive elaboration of the thesis concerning cultural and political modernism sketched out in this article. A shorter version is provided in Roger Griffin, ‘Modernity, Modernism, and Fascism: A Mazeway Resynthesis’, in Modernism/modernity 14(2) (2008). To associate the attempt of the Dollfuss regime to base a modern state on a blend of corporatism, social Catholicism and patriotism with ‘programmatic modernism’ will certainly be found counter-intuitive and provocative by many readers, and space precludes a full exposition of this point. However, suffice it to say that a clue to the modernism of Austro-fascism is the influence exerted on it by Othmar Spann, whose attempt to envisage a ‘third way’ between democracy and Marxism based partly on Romantic ‘Ganzheitlehere’ is typical of an attempted mazeway resynthesis designed to resolve the liminoidality of modernity by restoring a sense of communal transcendence and nomos. It is thus true to the spirit of ‘reactionary modernism’ identified by Peter Osborne: ‘Reactionary modernism is not a hybrid form (modernism + reaction). Rather it draws attention to the modernist temporality of reaction per se once the destruction of traditional forms of social authority has gone beyond a certain point.’ (Peter Osborne, The Politics of Time. Modernity and the Avant-Garde, London 1995, p. 164). For an extensive elaboration of this thesis concerning ‘conservative revolutionaries’ (among who I would include Spann), see my Modernism and Fascism, chapter 6. Bruce Pauley, Hitler and the Forgotten Nazis: A History of Austrian National Socialism, Chapel Hill 1981. Id., From Prejudice to Persecution: A History of Austrian Anti-Semitism, Chapel Hill 1992. Wendelin Schmidt-Dengler, Martin Loew-Cadonna and Gerald Sommer (eds), Heimito von Doderer, Tagebücher 1920–1939. Vol. 1: 1920–1934, Munich 1996, p. 255 (Diary entry of 21 November 1924). For the concept of modernity’s conflicting ‘temporalities’, see Osborne, The Politics of Time, a book vital for understanding the nature of fascism as a form of ‘political modernism’. Adolf Hitler, Mein Kampf, trans. Ralph Mannheim, London 1992, p. 114. Ian Kershaw, Hitler. 1889–1936: Hubris, New York 1998, pp. 30–31. Hans-Ulrich Thamer, ‘Die nationalsozialistischer Bewegung in der Weimarer Republik’, in Hitlers Weltanschauung, http://www.bpb.de/publikationen/038538116127980381 60277328655153,7,0,Die_nationalsozialistische_Bewegung_in_der_Weimarer_Republik. html (14/04/09). Thamer comments: ‘These were the anxieties in the face of modernity that could be blamed on a scapegoat. This is an ideological declaration of war against the entire emancipatory process of modern history.’ This is probably an allusion to Ernst Nolte’s theory of fascism as resistance against transcendence, but a comment that fails to recognize the futural drive of Nazism towards an alternative modernity and temporality. See Nicholas Goodrick-Clarke, The Occult Roots of Nazism, Secret Aryan Cults and their Influence on Nazi Ideology, New York 1992. See Todd Presner, Muscular Judaism: The Jewish Body and the Politics of Regeneration, London 2007, which explores the deep links between modernist aesthetics, eugenics, body reform culture, and Zionist politics in fin-de-siècle Austria-Hungary. For a post-1945 work

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67.

replete with symptoms of the palingenetic consciousness that characterized Zionism as a child of the fin-de-siècle and (hence) as a form of political modernism, see Israel Eldad, The Jewish Revolution: Jewish Statehood, Israel 2007, e.g. p. 138: ‘We are living in an era of fast-disintegrating concepts. Again it is no accident that our return to Eretz Yisrael is taking place at a time when the hitherto dominant European civilization is in the decline, having burnt itself out.’ For Eldad the Israeli ‘spiritual renascence’ is bound up with the nation’s mission, namely that ‘from our own ancient roots, which have preserved their sap for two thousand years, and from which we cannot and should not cut ourselves off, we may reconstitute and create anew’. Allusion to Albrecht Tyrell, Vom Trommler zum Führer: der Wandel von Hitlers Selbstverständnis, Munich 1975. Hermann Broch, The Sleepwalkers, New York 1964, pp. 640–47. Hitler, Mein Kampf, p. 28. For the distinction between ‘self-sacrifice’ and ‘other-sacrifice’ see Claus-Ekkehard Bärsch, Peter Berghoff and Reinhard Sonnenschmidt, ‘Wer Religion verkennt, erkennt Politik nicht’. Perspektiven der Religionspolitologie, Würzburg 2005, p. 17. The title approximates to ‘Those who do not recognize religion when they see it will not understand politics. Perspectives in religious politology’, a branch of human science obviously germane to the ‘culturalist’ approach history proposed here as a supplement to ‘empirical’ History.

68. 69. 70.

Chapter 4

Fascism in Italy between the Poles of Reactionary Thought and Modernity Karin Priester

Introduction In his work ‘A Brief History of Fascism in Italy’ Brunello Mantelli summarizes the key structural problem of the Mussolini Regime as follows: ‘Even if one were to take the official data and statistics of the “Achievements” and workings of the Fascist Regime in Italy as genuine, it becomes apparent that the will of Mussolini and his cohorts was to create the illusion of “Modernity” while not actually “Modernizing” the nation at all.’1 Modernity without Modernization – in this and similar paradoxes, the researchers of Fascism have tried to identify the ambivalent character of Fascism as a reactionary, populist trend. Jeffrey Herf labelled National Socialism as ‘Reactionary Modernism’; Ralf Dahrendorf described it as an intended thrust into Modernity; Timothy Mason spoke of the social policies of the Third Reich as being structured around the idea of ‘Modernization without Modernity’; and Nicola Tranfaglia described Italian Fascism as being ‘contradictory modernization’. On the other hand, when interviewed by the British Sunday Times in May 2008, the new mayor of Rome, Gianni Alemanno, of the neo-Fascist Alleanza Nazionale Party, claimed that Fascism had played a positive role in the modernization of Italy. As examples, he cited measures against malaria, the reclaiming of swampland (bonifica integrale) and the partial

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erection of the EUR (Eusposizione Universale Roma) quarter in southwest Rome, meant to be completed for the 1942 World Fair (but never completed due to the Second World War).2 Alemanno not only reassessed Fascism historically with his view, but conscientiously masked and glossed over historical fact. This view, of Fascism being a force of modernization and change in Italy, is exactly what is meant by those academics and researchers who have claimed that the Mussolini government sought to give the impression of Modernity, with minimal ‘real’ modernization. Already in 1933, as a precursor to all theoretical-modernization interpretations of Fascism, Franz Borkenau, had seen the Fascist system in Italy as being one of a ‘development dictatorship’.3 In Italy the historian Renzo de Felice is counted amongst the most prominent proponents of this view. He too saw in Fascism a dictatorship of modernization which ultimately had positive consequences for the country. The American researcher of Fascism, A. James Gregor, even attests that Italian Fascism was the ‘paradigmatic form’ of a development dictatorship.4 Mussolini himself had emphasized in the ‘Dottrina del fascismo’ that Fascism would not attach itself to backwards, reactionary doctrines. ‘We will not turn back. The doctrine of Fascism has not a thing to do with the election of de Maistre as a figurehead by his followers.’5 The goal was much rather the creation of a new form of authoritarian government, made possible by the inclusion of the masses. ‘Fascism seeks to build a strong, organic state, which at the same time is based on the masses (base popolare).’6 Therefore Mussolini had defined ‘Totalitarian’ long before the word became the key concept in describing the system he had developed – everything within the realm of the state; nothing private, and nothing reserved. ‘Crisis, when discovered, can only through and within the state be solved.’7 Modernization theories are based upon sociological evolution theories. Modern societies distinguish themselves via four elements: individualization, secularization, rationalization and industrialization. The process of modernization is therefore concerned not only with the process of industrialization, but additionally the formation of the nation-state and the creation of a civic nation with a liberal constitution. Modernization then progresses (along the West European/North American path) with the following steps: Enlightenment, civic revolution (such as in the French or American revolutions), democratization (and higher participation), industrialization and finally bureaucratization. Of course, there are alternatives to this Western model, which is certainly not the only model, and is more or less a euro-centric one. The Russian Revolution and the rise of Fascism in Italy a few years later showed that modernity could be achieved via other routes. While industrialization and

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bureaucratization remained key elements, the inclusion of democratization and individualization proved to be optional, as collectivism and dictatorship proved to be just as effective in breaking through to modernity. In assuming a position of critical distance to the evolution theoretical premises of modernization theories, Shmuel N. Eisenstadt speaks of ‘multiple modernities’. There exists no necessary connection between the structural, the institutional and the cultural dimensions of modern societies.8

Fascism and the Crisis of the ‘Modern’ Wolfgang Schieder, an authority on Fascism in Italy, wrote in his article entitled ‘The Birth of Fascism during the Crisis of the Modern’ that there are three important factors for determining the level and intensity of the process of modernization: the establishment of a national identity, the development of a political constitution, and finally the changing of the nation’s economic structure.9 Schieder goes on to show that all three parameters listed above created a very high potential for conflict during the nineteenth century. This potential for conflict was especially high in those lands and nations which had not completed the structural changes sequentially and gradually, but had rather taken all three in quick succession. While the development of the nation-state proceeded gradually in England and France against the backdrop of industrialization, the same cannot be said for Italy and Germany. ‘For both (Italy and Germany) there was a culmination of conflict which is not found in other European countries. Only in Germany and Italy there emerged at the end of the 19th century a modernization crisis so powerful that it broke the existing political systems there.’ ‘In this crisis’, Schieder said further, ‘the origin of the idiosyncratic dictatorial system is … signalled by the rise of Fascism. Fascism came about first in Italy, and later in Germany as the political answer to the crisis of modernization. Fascism is therefore not merely an aspect of Modernization, but rather a key part of understanding the Crisis of Modernization.’10 Until 1914, the simultaneity of nation-state development, constitutional conflict and economic discord in both countries led to a permanent structural crisis. This structural crisis ultimately culminated in conflict (First World War) or, in the words of Hans Ulrich Wehlers, a ‘synchronization defect’. In Italy, there existed a discrepancy between what was a theoretically liberal country with a constitution (which lacked a developed parliamentary system) and the age-old patronage system. In this system, modern ‘political’ parties did not hold sway, but rather an amalgamation of elites who were entrusted with power from the masses. This

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structure was ultimately responsible for the failure of capitalism in Italy. Italy is not only poor in raw materials; it also lacks investment and development capital. Italian capitalism suffered from chronic capital deficiency and only the ‘industrial triangle’ between Turin, Genoa and Milan offered any economic potential. At the same time, there existed a relatively strong and well-organized worker’s movement, which was comparable with the worker’s movement in Germany. For these reasons, it is clear to see why the masses within Italy called for the development of a stronger state.

Intervention State – The Turning Point Building a ‘strong’ state did not necessarily mean a planned or interventionist economy. The impression that Fascism meant a regimentation of the country’s economy or planned-capitalism is a false one, and would first become a reality against the backdrop of the World Financial Crisis in 1929. The transformation of the country into an interventionist state did not occur immediately in Italy after the rise to power of the Fascists in 1922, but rather later when the conditions of the World Financial Crisis demanded protectionist measures. The first years under Treasury Minister Alberto de Stefani were marked by economic liberalism in accordance with Mussolini’s slogan: ‘strong state, but not an economic state’. Italian Fascism was a pragmatic combination of five main elements, which, although sometimes contrary, had helped to mould the new political system: futurism, revolutionary syndicalism, the nationalism of the ANI (Italian Nationalist Association),11 the left-wing proponents of Fascism as well as the left-wing corporate-state theorists, and the intransigent colonial leaders in Abyssinia (ras)12 as well as their opponents (revisionists) who pressed for normalization. Fascist ideology was therefore recognizable only as an ‘anti’ programme: opposed to socialism, liberalism and democracy, but in favour of a charismatic, central dictator. This view of Fascism had been clear to contemporary observers since Fascism’s inception. The Fascist theorist Julius Evola spoke about Fascism as a ‘synthesis which ran contrary to set demands’, while the Fascist journalist Vincenzo Fani Ciotti (Volt) spoke in 1925 of the ‘five souls’ of Fascism.13 When, at the beginning of the 1930s, the World Financial Crisis gripped the world (which had already begun in 1927), Italy went about tackling the problem in much the same way as F.D. Roosevelt and the U.S.A. did, namely via interventionist measures. However, any similarities come to an abrupt end there. Mussolini’s government did not base its recovery on Keynesian economics, debt, or deficit spending and the stimulation of buying power, but rather on defending the currency via

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‘orthodox’ methods (Zamagni), deflationary politics and wage decreases. At the same time the Italian government also pursued three significant, albeit different, strategies. The first strategy was the ‘forced cartelization’ of industry, so as to discipline and control competition. The second strategy was the expansion of public-works projects such as the ‘bonifica integrale’, the reclamation of swampland and the ensuing settlement.14 The third and most important strategy was the creation of national investment control and price inspection. Mussolini declared in 1921: ‘We have had enough of state-capitalism’ and ‘we want our country to be entirely free from all economic authorities’.15 However, his economic programmes of the 1930s clearly show that he took major steps to promote and direct capital concentration from the central administration.

Modern and Technocratic Tendencies during the Regime Phase – ‘A Flawed Project’ From an international point of view, Mussolini strove first of all (without doubt) for a modernization of the country. Italy in the 1920s was certainly not a modern country, but rather a ‘threshold’ nation; illiteracy was relatively high due largely to the domination of the agricultural sector (until 1935). This was rectified via, amongst other things, a collective adaptation and re-education of the working class, provided for by Fascism, with the aim of reorienting the population towards capitalism. Against the image of Italy as a country of the ‘dolce far niente’, the Fascists attempted to propagate industrial work virtues (punctuality, mechanization, regulation). Under the key ideological concept of productivity (produttivismo), the economic power of the country was disciplined and regulated so as to be more efficient. However, this policy came up incredibly short of achieving its goals. ‘Fascist policy failed even measured by its own yardstick.’16 Due to the need to satisfy multiple groups (his own patchwork party, the old elite of the country, and after the Concordant (1929), the Catholic Church) the ability of the Fascists to manage crises and implement programmes was incredibly restricted.

The ‘Third Way’ and the Changeover to ‘Organized Capitalism’ From the very beginning, Italian Fascism labelled its economic plans, with reference to corporations, as being something between financial liberalism and Soviet collectivization. ‘Corporatism’ was believed to be the

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solution which would help to end class war and overcome demographic differences. This was due to the fact that the professional and the worker would work together, via the injection of state capital. Already in 1921, in the party manifesto of the PNF (Partito Nazionale Fascista), this new model had been propagated as being an ‘expression of national solidarity and as a means of developing productivity (and increasing production)’. However, it was not until 1926, and the beginning of the dictatorship, that corporatism was officially instituted, and then only from above, as a directive from the ministry. It was eight years later, in 1934, that corporatism was embraced by the corporations themselves. Mussolini, always a sceptic of the benefits of a corporate state, made sure that the model was not immediately implemented. The attempts to convert the existing system to corporatism spanned five years, from 1927 to 1932. The corporations believed the answer to the ‘organic crisis’ (Gramsci), could be found in the economic zone via the rectification of the currency and stabilization crises of 1927 and subsequently the effects of the world economic crisis of 1929. ‘Corporatism is, in a strict European context, based around the idea of planned capitalism, which at the end of the 20s and during the 30s arose, and is particularly tied to the development of Fascist Italy.’17 Following 1929, regardless of the system of government present, every capitalistic country transitioned to some measure of ‘organized capitalism’ (Hilferding), in which three problems needed to be immediately solved. First, class conflicts needed to be addressed and antagonism needed to be overcome so to as provide for collaboration which was in the interest of all (Charles S. Maier). Next, new, more efficient production methods needed to be instituted to provide for the phenomena of mass consumption (Fordism) and the Keynesian high-wage policy. Finally, a technocratic elite needed to be created which would spearhead the aforementioned processes.18 All three factors formed the core of the debates concerning the creation of a ‘corporate state’ between 1927 and 1932.19 Already at the beginning of the 1930s, the Secretary of the Corporations, Giuseppe Bottai, had begun to highlight parallels between corporatism and the New Deal, mainly since both called for a turning away from laissez-faire liberalism.

The Corporate State Debate From Bottai and the proponents of modernization’s point of view, corporations society-wide should be regulated on three different levels: economic, political and pedagogically ethical. First, corporations should lead the economic charge towards transforming capitalism within Italy

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to reflect Fordism and Taylorism, with the following key attributes: high wages, strong domestic market demand, rational production processes, and above all disciplined, market competition At the same time, corporations should remodel themselves so as to encourage political representation, namely doing as much as possible to cancel the old idea of citizen (subordinate to the economy) and bourgeois. The parliamentary form of representation had, Bottai claimed, served its purpose; now was the time for ‘direct’ representation. And finally, corporations should work to establish a collective ethical consciousness and serve as a ‘substantial part of the nation’. These goals however did not reflect the reality of what Italian Fascism, with its patchwork composition, could accomplish. Within the Fascist party itself, there stood two stumbling blocks to modernizing the Italian capitalist structure, namely the conservative-statists on one side and the syndicalists (of which Secretary of the Corporations, Bottai, was himself a proponent) on the other.20 The conservative-statists advocated the corporation solely as a type of ‘economic police’ who would keep an eye on the workers. Their exponent, Carlo Costamagna, in his periodical Lo Stato, called for the inclusion of the corporation as an organ of the state during the 1930s. On the other side stood the neo-Hegelian and self-described ‘Philosopher of Fascism’, Giovanni Gentile. Gentile espoused the idea of ‘Actual Idealism’ (also known as actualism) and supported the corporatism theorists Ugo Spirito and Arnaldo Volpicelli, and in some instances, the Secretary of the Corporations, Giuseppe Bottai. From his point of view, corporatism was bound intrinsically to the idea of the society-wide modernization of Italy. He particularly viewed corporatism, in terms of industrial and economical achievement, as being a key facet of modernization. He considered that the corporations should be the driving force behind encouraging productivity within the state, via their role as ‘inner-society development aids’.21 Country, company and nation were seen as a business, best summed up under the slogan ‘azienda nazione’ (nation-as-business).22 In was at this time that Giuseppe Bottai came to prominence. He assumed the burden of working for the privileges of the pubic and planned for a regulated, interventionist economy. On the other side stood the majority of the Italian patronage, represented via the umbrella organization ‘Confindustria’, which had traditionally played the role of ‘rescuer’ when Italy was in crisis; in other words, ‘Profits were privatized while the losses were made the burden of the state’. On the other hand, Bottai rejected meaningless rescue efforts which pumped money into broken-down and structurally weak businesses instead favouring a ‘Fordist’ plan: only a policy centred on high wages would strengthen domestic market demand.23

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The Proprietary Corporation The best attempt to define the ‘corporations’, along theoretical-political lines, came from the philosopher Ugo Spirito, in 1932, during the Congress for Corporate Studies in Ferrara. There, he emphasized the idea of ‘carattere totalitario dents corporazioni’. Private and national economies should be seen as one unit. Spirito outlined his theory as consisting of three steps, with the goal being the eventual fusion of capital and work: first, the businesses would have to become corporations; second, the existing capital would need to change hands from the stockholders to the workers; and finally, the workers would become owners of their corporation, binding the interests of the two to each other. These are the basic ideas of the concept of ‘corporazione proprietaria’ (proprietary corporation). Spirito, realizing that these ideas were far too radical and could not actually be accomplished in Fascist Italy for the time being at least, instead promulgated a ‘middle-ground’ which received wide support. In his memoirs, Spirito reflected: ‘I gave fascism and corporatism a communistic interpretation.’24 Within the Fascist party, this proposal was unanimously rejected on the grounds that it set a nearly impossible goal which would require the complete restructuring of society. Even the Secretary of Corporations, Giuseppe Bottai, stood in opposition to Spirito, not because his concept was too Bolshevist or socialist, rather, for other reasons. Spirito believed that there still existed too much antagonism between the classes, due, in his mind, to the Fascist labour unions which acted as special interest groups and stood alongside the corporations. It was in this area that Spirito saw the biggest hurdle to overcoming class conflict. Bottai did not want the Fascist labour unions to be abolished or reigned in since they served a purpose as the representatives of the interests of the workers, and therefore he rejected Spirito’s concept of the ‘proprietary corporation’. The words which he famously spoke at this memorable congress have proved to be prophetic: ‘The corporations have been’, said Bottai, ‘until now, only a farfalla morta, a dead butterfly, in the album of the sciences.’ Nevertheless, Bottai was sacked shortly thereafter, and assumed an office in the Confindustria, or the Italian Employers’ Federation. The innovators and modernizers had now lost their place within the Fascist hierarchy, and their ideas and solutions were no longer needed. In his memoirs, Ugo Spirito highlights the conflicting interests with which Bottai had to contend. The ‘leftist inclinations’ of some of the Fascists were all apparent, but had to be dressed up in the cloak of avantegarde due to the reality that, at the very core of the party, most remained liberal-conservative.25 From 1934 onwards, Bottai began to lean more to-

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wards the later tendency, aligning himself with the Catholic Church and the Imperialists.26 Following his dismissal as Minister of the Corporations, his career – or rather his place within the Fascist hierarchy – was guaranteed, and in 1936 he was appointed as Minister of Education.27

Corporatism as Ideology In reality, the technocratic, modernistic tendency in Italian Fascism never amounted to much of anything. The advocates of a ‘fordismo all’italiana’ were marginalized beginning in 1932. In practice, the ‘corporate state’ was a stillbirth. As an ideology however, it was still useful, above all vis-àvis a growing number of youth, who called for a ‘second wave’ within the system. They pressed for the fulfilment of the promises and guarantees made with regards to dismantling the bureaucracy and hierarchy as well as the old clientele structures. From 1932 on, the ‘Novisimo’ centred itself on Ugo Spirito and demanded a ‘seconda ondata’, or second wave, with the goal of returning Fascism to its roots.28 The Novisimo specifically wanted Fascism to revert to its 1919 principles and values as well as to ‘internationalize’ itself, spreading the philosophy of a ‘new (Fascist) man’ beyond the borders of Italy.29 Following Bottai’s dismissal, the fate of the corporation as an independent economic entity was sealed. Thereafter, the state was the only institution which could intervene and control the economy. The corporations, originally organs for the self-organization of the ‘producers’, mutated into lackeys of a swelled national bureaucracy, and in the end were only able to control their own matters, not national economic policy. This was set without any regard to their wishes. In any case, the discussion concerning the efficacy of the corporative economic system never happened.30 Bottai labelled corporatism as being the ‘chaotic and hypocritical experiment’ (Bruguier). Corporatism was organized along an experimentally developed structure, which would evolve over time, rather than a planned system which had been drawn out beforehand.31

The New, Technocratic Elite A further important concern of the left-leaning Fascists was the creation of a new elite, a ‘classe dirigente nazionale’ as the harbinger of a new, rational, modern society. In 1942, Ugo Spirito published a treatise on the subject: Technology as a Tool of the Revolution. It was understood that ‘technology’ was meant not only in a scientific sense, but rather in terms

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of competence vis-à-vis the ‘clientele’ mechanism which was the old determinant of elite recruitment. Spirito strove to overcome class conflict with the help of a ‘meritocracy’. He argued that social ascent and the acceptance of leadership functions is due to anyone who can distinguish himself through salary and ‘technical competence’ in the sense of management qualities (with technical competence in this case meaning the leadership competence of technocrats or managers). James Burnham’s then popular book, The Revolution of the Manager, appeared first in Italian in 1941 (La rivoluzione dei technici). Ugo Spirito as well as most of the other corporate-state theorists had no formal economic training, but they were rather philosophers or lawyers. Spirito saw corporatism first and foremost from a normative, philosophical point of view. Being a follower of Hegel, he saw the nation as an expression of a moral idea with strict anti-individualist undertones. In corporatism, he saw a model for social organization which would facilitate the overcoming of particularism and economical selfishness, as well as help to create an elite which would be obliged to look after the welfare of the public, remaining all of the time ethical and rational. In contrast to the paternalistic tradition of the Catholic Church and its ties to the medieval guilds and trade societies, those Hegelian-inspired technocrats who gathered around Spirito were pure statists. The state possessed for him not only an intermediary or synthetic function, but rather allowed for the total subordination of private interests, inclusive of private possession and production means. It becomes clear that, by 1932, the left-leaning Fascist modernizers had already reached their zenith. No new technocratic leadership elite had been created, nor were the corporations structured how they should have been when they were brought under economic planning and task control in 1934. In any case the technocrats led by example, serving as models for the efficient formation of contracts and the proper resolution of conflicts. In key economic issues, they were ignored. Moreover the influence of the Catholic Church, which wanted nothing to do with technocratic modernization or ‘fordismo all’italiana’, grew after the concordat. Their spokesman in this debate was Gino Arias, who called for a less totalitarian variant of Catholic-paternalistic corporatism. ‘The concordat was a de facto period to the sentence of the technocratic tendencies of Fascism, and effectively ended any hope for a role as the modernizing leadership of the nation.’32 Alexander Nutzenadel comes to a negative conclusion: ‘If one measures Corporatism by its successes in accomplishing its goals; the organization and rationalization of all areas of a national economy, the doing away with of private property and professional organizations, and the forma-

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tion of a national economic policy, then one must brand (the Italian case) as a complete failure’.33 Giuseppe Parlato speaks of a ‘progetto mancato’ (missed project) of the left-Fascist technocrats.34 Aldo Mazzacane awards the corporate-state theory a merely propagandistic function, and Alberto Aquarone artistically describes the failed idea as ‘Più fumo che arrosto’ (more aroma than a roast).

Transition to a Mixed Economy under Alberto Beneduce Mussolini stood at the centre of the regime, and thus was the chief decision maker. Mussolini chose not to surround himself with new technocrats, but rather with those who were tested and seasoned, completely independent of the corporations and ‘outside of corporatist logic’.35 Mussolini decided, at the beginning of the 1930s following the collapse of the three most important banks, to set about on an interventionist economic and industrial policy.36 It was at this time that Alberto Beneduce, the ‘grey Eminence’ of the regime, came to the forefront of economic policy. Beneduce, who during the Matteotti crisis in 1924 had been aligned with the socialists, pursued a ‘mixed-economy’ policy.37 The ‘mixed economy’ system had taken root in most economically advanced, capitalist countries, across the political board, in French dirigisme, as well as in most European social democracies. The only, albeit serious, difference could be found in the wage structure. While in Italy ‘cheap wage economy’ (Toniolo) ruled, there were, as has been mentioned, voices of discord (such as Bottai), who advocated high wages and Fordism with the aim of strengthening the domestic market demand.38 On the other hand, since the beginning of the autocracy, Italy had pursued a policy of economic deflation in order to sink production costs. One exception to this was the automobile manufacturer Fiat, which had already in 1912 adopted Fordism as its business model. After its exports dropped by two-thirds between 1922 and 1932, Fiat began to market its products domestically. However, even the Fiat 508 (Balilla) and 500 (which was comparable to Germany’s Volkswagen) cost more than the average annual income of a middle-class employee, and five times that of a worker, even without factoring in taxes and gasoline costs. Additionally, the construction of freeways was left to private commissions and firms, and proved to be an economic fiasco.39 Under the direction of Beneduce, numerous national holdings were founded, the most important of which were the IMI (Instituto Mobilare Italiano, 1931) and the IRI (Instituto per la ricostruzione Industriale [Institute for Industrial Reconstruction], 1933). These two institutes were

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set up only as temporary, emergency concerns, behind which existed no consistent strategy for overcoming the economic crisis. It was only in 1937 that the IRI became a permanent institute.40 These institutes did not engage the problems proactively, but rather on a reactive basis. ‘Fascism was just crisis capitalism with a cudgel.’41 Beneduce stood before the following problem. In Italy, there existed up until that point, against the background of a chronic shortage of capital, the abnormal system employed by the Banca Mista, which fused investment and bank capital into one. In this system, the banks were not only lenders, but also stockholders of those businesses which they financed, thereby risking the security of their clients whenever crisis struck.42 Beneduce, who had never been a member of the PNF but rather a type of ‘grand commis d’état’ (and therefore the embodiment of a technocrat), set about separating the ‘Siamese twins’ of bank and industrial capital via a newly organized system of credit allocation, which separated trade and investment banks.43 Short-term credit remained in the savings banks; long-term industrial credit and financing was entrusted to the national holdings and thereby came under state inspection. Those banks which held stocks in the businesses they had financed in the old system, now became public companies of which the state was the stockholder.44 In the reorganization of the bank system, the state received the shares which had been held before by the banks, becoming in the process the partner of numerous firms. In terms of nationalization, it cannot be said that Beneduce and the IRI followed private-capitalist criteria; the country was following neither a planned economy nor a laissez-faire one, but borrowed from both in terms of economic decisions. The state became share proprietor in the same manner as any other stockholder via the IRI. Furthermore only the IRI itself was a national holding; the businesses and firms it had taken over remained in private possession. ‘The result was a system in which the distinction between public and private enterprise was blurred and decision-making powers were dispersed. … Business enjoyed the benefits of public support without having to accept the onus of effective public control. The façade was totalitarian; the reality atomistic.’45 With the help of the national holdings, national investment control and price inspection was instituted, which together with the entire economy collapsed following the change to an autocracy in 1934.46 The holdings were able to grant long-term industrial credit and began the financing of long-term infrastructural measures. Moreover they functioned as a middle-ground between prospering businesses and those in deficit. This strategy became known as ‘Salvataggio politics’, with the end effect that only the three largest Italian banks were ‘rescued’ and folded into the IRI. However, not all of the businesses whose stocks the banks had con-

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trolled were as structurally unsound as the banks themselves.47 A handful of prospering businesses were folded likewise into the IRI and therefore national possession.48 In 1939, Italy was the country with the highest level of state control, second only to the Soviet Union, and had nationalized nearly all war-relevant industries.49 Needless to say, no proponent of dirigisme economics stood in line with this intervention. The attempt to find a general economic plan simply did not exist in Fascist Italy. Even when Mussolini spoke in 1936 of a ‘regulative plan’ (piano regulatore), he gave no precise or technical data, nor did he offer any substantial reforms in the industrial sector.50 However, the system of National-Equity Investments or a ‘mixed economy’ has, in contrast specifically to the corporate-state model, nothing to do with Fascism, and would be retained for years thereafter in Italy, until well into the 1990s.51 Beginning in the 1980s, the IRI Chairman at the time, Romano Prodi, and his successors began to dismantle the equity investments of the IRI. Finally in 2000, the IRI was dissolved. Therefore, it is entirely misleading to speak about an economic fascism;52 rather after a period of organized capitalism, Italy took on the path of a mixed economy and remains more or less so today. The only actual ‘achievement’ of Fascism lay in the complete overhaul of the wage policy and in a continuous reduction in wages.

The ‘Ruralization’ Concept of Ariggo Serpieris and the Path towards Traditionalism In addition to the already mentioned ‘factions’ within the Fascist party, such as the Catholic Church, the technocratic advocates of ‘Fordism’, and the so-called left-leaning Fascists, was a further group. These were those concerned with ruralization, whose figure-head, Arrigo Serpieri, stood as a type of Walter Darré of Italian Fascism. He opposed the ‘productivity’ myth of the ‘nation-as-business’ (azienda nazione) and represented a ‘rural’ ideology with the following cornerstone: protection of the rural family in its socially stabilizing function, and support for rural private property. Ideologically the differences between the ‘rural’ and ‘municipal cultures’ played an important role.53 This rural group did not adopt the tendency of ‘Blut-und-Boden’ (Blood and Soil), however antagonism between those who lived in metropolises and those ‘simple’ people who lived on the land ran high. Serpieri was Secretary of State for the Ministry of Agriculture from 1929 until 1935, but was sacked due to his agitation for more rights for the southern Italian ‘Big Farming’ interests and the Latifundi. Serpieri, who before his career in Fascism had stood in close political proximity to

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socialism and the technocrats, was the creator of the Bonifica programme, the Bonifica del Tavoliere delle Puglie, the Agro Romano and numerous other projects. These measures won him great support amongst the agrarian population as it encouraged the settlement of small, poor farmers on newly reclaimed and arable land. Unfortunately, most of these measures were not completed due to the beginning of the Second World War. In reality, the highly prepared Fascist agrarian policy turned out to be yet another fiasco.54 Unemployment in the agricultural sector was not reduced; and the promised costs-utility-analysis for the Bonifica programme and resettlement projects was never actually generated. In spite of propaganda which claimed prosperity for Italy’s farmers, the quality of life deteriorated greatly on the land, much more so than in the cities.55 The flight of rural folk rose to such an alarming figure that the regime enacted compulsory measures for farmers to remain on their plots.56 In the end, the cultural attitude in Fascist Italy amounted to nothing more than a sort of ‘Traditionalism’. Formerly avant-garde trends in art such as that of ‘futurism’ were curbed and folded into the so-called ‘second futurism’, which was nothing more than a marginalized version of futurism, used mainly to further the propagandistic needs of the regime.57 In the field of architecture the so-called rationalist movement (a modernist, functionalist, anti-monumentalist style formed by Giuseppe Terragni and Giuseppe Pagano, and comparable with the German ‘Bauhaus’ style)58 was reined in and made second choice to a regime-friendly neoclassicism. Marcello Piacenti, the architect de-jour of the regime (an Italian Albert Speer) was the chief representative of this movement. Realism in philosophy and art were only ‘the flavour of the week’ in the regime: the relationship between the content and the function (contenutismo) was the key concept of the ‘Movimento realista’ which came onto the scene in the early 1930s.59 Ideologically, this about-face of policy in favour of tradition was an attempt by the regime to show the similarities between Caesar Augustus and Mussolini, and to promote the concept of romanità. This concept was based around resurrecting the Roman Empire of Augustus as a method of legitimizing Italian claims in the Mediterranean (mare nostro) and Africa. In addition to the traditionalists and believers in romanità, existed those who sought to glorify rural life and propagate the idea of homeland and ‘soil’ solidarity. This group also criticized regionalism and metropolitan excesses. For example, in the literary and cultural fields, the debate raged between the strapaese (ultra-local) and stracittà (ultra-urban).60 Strapaese, said one of its most notable proponents, were the synthesis of ‘Catholicism, Ruralism, Realism, Hierarchy, and authority’.61

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Summary In contrast to those historical researchers who argue that Italian Fascism, while not successful in its modernization efforts, nonetheless sought to do more than would have been done under different systems, and deemphasize the traditionalist tendencies of the regime, stand historians such as Wolgang Schieder who deny and unmask every ‘modernization’ effort of the Fascists. In terms of methodological aspects, it is nearly impossible to declare which modernization efforts the Fascists were truly responsible for, and further, whether these measures would have been pursued under a different (i.e. democratic) regime. As a whole, Europe underwent a process of modernization during the 1930s, completely independent of political systems. This process entailed, amongst other things, the glorification of technology, expansion of national manpower and work-potential, mass-mechanization, and the development of ‘sport’ as a phenomenon of the masses. ‘The fascist experience produced few results in terms of modernization that other governments might not have achieved.’62 Stanley Payne concludes: ‘the saga of the Italian economy under Fascism was ultimately, for a nascent, industrialized European state, average.’63 The divide between Italy and the industrialized nations was not overcome while the Fascists were in power.64 Schieder postulates: ‘people should … stop attaching any potential for modernization to Fascism. Instead, one must understand that Fascism is a by-product of the culmination of the crisis of Modernization.’65 Sarti emphasized further that there was not a single modernistic intention present in Italian fascism which was actually made a reality. Upon assuming power, the regime swayed back and forth in its reform efforts between traditionalism and experimentalism. ‘The technocratic leadership, the elites of producers and managers originally promised by Fascism, never materialized. … The only technicians actually produced by Fascism were those who rose through party ranks and who mastered the techniques of political propaganda and organization.’66 Similarly Schieder claims that the only modern aspects of the regime were those in the areas of propaganda and mass media via the utilization of newer, modern media such as radio, film and the aeroplane. The single ‘modernity’ present in Fascism was in its appearance.67 In the ‘Duce factory’ (fabbrica del Duce), the myth of the modernistic potential of the regime was the sole product.68 What did Fascism in Italy ultimately accomplish? An expansion of the public sector and the role of the state under the guise of a ‘cheap wage economy’, which led to a drastic decline in the standard of living not only for the worker, but additionally for those working within the public sector. The problems of mass unemployment and a never diminishing

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jobless rate could not be solved internally, and was, instead, only rectified outwardly via the war in Abyssinia.69 Sobering for everyone, particularly those who wish to claim modernization as a tenant of Fascism, are Mussolini’s words from 1942, shortly before his dismissal. Mussolini, who had begun as a ‘revolutionary’ and modernizer, grouped modernity, capitalism and socialism in the same heap, and claimed all to be enemies of the regime due to their obsession with materialism. Materialism shows itself in ‘the skyscraper, the large factories and mass production’. Sarti speaks of the pathetic fate of a man, who in the beginning had championed productivity, but at the end had called for traditionalism and anti-modernity.70 Fascism left behind a swelled national sector in Italy, which contributed not to an adjustment of Italian capitalism, but rather merely to a worsening of the problem. Capitalism in Italy maintained and even strengthened its pre-Fascist characteristics as being over-protected and over-assisted by the state – or in a word, ‘rotten’ (Caffè). The clientele endemic in Italy was not overcome by a meritocracy, but rather reinforced via the entrance of the political parties into the state sector and the utilization of its resources as a benefice, something which has continued almost uninterrupted from the Fascist period to the present.71 This appropriation of state-owned enterprise by the political parties, known casually as ‘consociativismo’, helped to resurrect the patronage system after 1945 with the ‘United’ Democrazia Cristiana standing in the centre. Again, in this area, Fascism was not responsible for any modernization, but rather for a strengthening of the tradition of ‘trasformismo’, which Italy still suffers under to this day. Charismatic leadership is, as Max Weber claimed, always unstable. It lives off the perpetuation of crisis (which it is usually responsible for), the solution of which is the ending of the regime in question. Above all, however, it thrives off the furnishing of successes, the supply of which ran out in both Fascist regimes of the interwar period, due to the inherent need to wage either imperialistic or revanchist wars.

Notes 1. Brunello Mantelli, Kurze Geschichte des italienischen Faschismus, Berlin 1998, p. 9. 2. John Follain, ‘Italy Needed Fascism, Says the New Duce’, in Sunday Times, 11 May 2008, http://www.timesonline.co.uk/tol/news/world/europe/article3908192.ece. 3. Franz Borkenau, ‘Zur Soziologie des Faschismus’, in Ernst Nolte (ed.), Theorien über den Faschismus, Cologne and Berlin 1967, p. 165. 4. James A. Gregor, Phoenix: Fascism in Our Time, New Brunswick 1999; for critique Vera Zamagni, The Economic History of Italy 1860–1990, Oxford 1993, p. 274.

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5. ‘Mussolini’ in Luciano Casali (ed.), Fascismi. Partito, società e stato nei documenti del fascismo, del nazionalsocialismo e del franchismo, Bologna 1995, p. 171. 6. Ibid., p. 174. 7. Ibid. p. 173. 8. Shmuel N. Eisenstadt (ed.), Multiple Modernities, New Brunswick 2002. 9. Wolfgang Schieder, Faschistische Diktaturen. Studien zu Italien und Deutschland, Göttingen 2008, p. 361. 10. Schieder drew comparisons between the commonalities of Italy and Germany and recognized their unique resolution to the problems of the Modern as being special cases within Europe. On the Geistesgeschichtliche level, Helmut Plessner had already in the mid-1930s given Germany the title of ‘belated Nation’. The German historian Jürgen Kocka argued against the thesis that Germany and Italy were ‘special cases’, and instead claimed that every nation had the potential to be a ‘special case’. This criticism was aimed mainly at expressing his belief that the ‘fascist’ solution should not be seen as a deviation from the norm – the ‘Western’ way. To this extent, the idea of a ‘delay’ remains somewhat standard following along the Euro-centric model of modernization while Schieder’s belief in ‘conflict culmination’ is more neutral and can easily be connected with Eisenstadt’s idea of ‘multiple modernities’. Ibid., p. 362. 11. Associazione Nazionalista Italiana, or the Italian Nationalist Association, which merged in 1923 with the Fascists. Many important functionaries of the regime had belonged to this party such as Alfred Rocco (Attorney General until 1930) and Luigi Federzoni (Secretary of the Interior). 12. Ra[s] were local leaders or province sovereigns in Ethiopia (at that time Abyssinia). The label was given to those Italians who had spent long periods within the colony. 13. Vincenzo Fani Ciotti [published under the pseudonym Volt], ‘Le cinque anime del fascismo’, in Critica fascista, 15 February 1925. Already in 1929, Hermann Heller (Gesammelte Schriften, 3 Vols., Tübingen 1992, p. 523) confessed in one of the most well-known and pointed formulations of the function of Mussolini, as pragmatic mediator: ‘Fascism is “Mussolinism” and every facet of the system, depending on the demands of the moment, is adjusted according to his ideas and what best suits him. The system fluctuates between National Denial and the worship of the State, Socialism and Capitalism, Syndicalism and Centralism, and Catholicism and Paganism.’ 14. Critical to the successes of the Fascists, Christoph Kühberger, ‘Tagelöhner und faschistische Sozialfürsorge. Ein Fallbeispiel propagandistischer Sozialpolitik unter Mussolini’, in Christoph Kühberger and Clemens Sedmak (eds), Aktuelle Tendenzen der historischen Armutsforschung, Münster 2005, p. 195, wrote the following: ‘from an economic-historical point of view, the drying and settlement of the Agro-Pontino proved to be of little value compared to cost. Unemployment was not diminished and in 1933 around 1,230,000 Italians were without work; vis-à-vis, the dredging of the Agro-Pontino employed only 70,000 workers. The project therefore had only a propaganda value.’ Gianni Toniolo, L’economia dell’Italia fascista, Rome and Bari 1980, pp. 269 and 276, calculated the number of unemployed between 1932 and 1934 to be ‘only’ 950,000 to 1 million. The unemployment rate itself rose between 1931 and 1936 from 10 to 16 per cent, and only began to decrease at the onset of the first Abyssinian war in 1935. From 1937 onwards full employment was reached, but only via preparation for the coming World War. 15. Ignazio Silone, Der Fascismus. Seine Entstehung und seine Entwicklung, Reprint of the first edition from 1934, Frankfurt am Main 1978, p. 207.

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16. Jon Cohen and Giovanni Federico, The Growth of the Italian Economy 1820– 1960, Cambridge 2001, p. 68. 17. Traute Rafalski, Italienischer Faschismus in der Weltwirtschaftskrise (1925–1936), Opladen 1984, p. 352. 18. Even before the march on Rome, young, revolutionary, intellectual syndicalists such as Massimo Rocca had called for the creation of an elite committed to modernization. Short-term, this group enjoyed success, founding the Gruppi di competenza (Competence Group); however, upon the rise of Mussolini, these theorists were curbed. Mussolini was able to reign only with the support of the old elite, and could not counteract them. Furthermore, he had to take into consideration the different interest groups within the Fascist party. Already by 1924 Massimo Rocca had been excluded from the PNF and from holding the post of province leader (ras) by Roberto Farinacci. Cf. Roland Sarti, ‘Fascist Modernization in Italy: Traditional or Revolutionary?’ in The American Historical Review 75(4) (1970), pp. 1039ff, accessible online via JSTOR. Available in the Italian version under: Alberto Aquarone and Maurizio Vernassa (ed.), Il regime fascista, Bologna 1974, pp. 259–78. 19. For a concise overview of the direction and phases of the discussions concerning the theoretical aspects of the economy even before 1927, see Duccio Cavalieri, ‘Il corporativismo nella storia del pensiero economico italiano: una rilettura critica’, in Il pensiero economico italiano, Vol. II, No. 2 (1994), http://xoomer. virgilio.it/duccio.cavalieri/Articles/CORP.pdf (accessed 15 January 2009). 20. Michele Luminati, ‘Der Corporativismo: immer noch auf der Suche nach der schwarzen Katze in einem dunklen Zimmer’, in Gerd Bender, Rainer M. Kiesow and Dieter Simon (eds), Die andere Seite des Wirtschaftsrechts. Steuerung in den Diktaturen des 20. Jahrhunderts, Frankfurt am Main 2006, comes from a wide field (an entire ‘galaxy’ of opinions); Cavalieri, ‘Il corporativismo nella storia’, pp. 12 and 17, down to a ‘Babylonian’ babble. However, for the actual development of the debate concerning the corporate state, one needs only to observe the discussions between the left-Fascist, technocratic elements on the one hand and the conservative-statists on the other. 21. Charles S. Maier, In Search of Stability. Explorations in Historical Political Economy, Cambridge, Mass. 1987, pp. 79ff, clarifies the difference between the National Socialist regime and Italian Fascist one with the following explanation. The Italians saw corporatism as a tool for overcoming economical backwardness, and unifying and modernizing the country. In Germany, the protection mechanisms of the ‘Standing State’ (Ständestaat) were focused instead on the rural and lower-middle class. 22. See ‘Society as Factory’, cf. Maier, ibid., pp. 19–69. 23. This radical plan would have meant a complete change in the party line and could have been the single spectacular success of the regime: instead, Fascist Italy pursued a policy of wage reduction and the complete subordination of the working class. 24. On the other hand, the Fascists remained staunch in their support of private property in terms of production means. Spirito believed this was a necessity due to the composition of the Fascist party and where their support came from. In official texts such as the Carta del Lavoro (1926), the speech in which ‘funzione sociale’ (social function) was mentioned, it appears that the rest of the contents are merely superfluous. Cf. Thorsten Keiser, Eigentumsrecht im Nationalsozialismus und Fascismo, Tübingen 2005; Cavalieri, ‘Il corporativismo nella storia’, p. 3; Ugo Spirito, Memoirs of the Twentieth Century, edited by Anthony G. Costantini, Amsterdam and Atlanta 2000, p. 119.

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25. Spirito, Memoirs of the Twentieth Century, p. 121. 26. Beate Scholz, Italienischer Faschismus als ‘Export’-Artikel (1927–1935). Ideologische und organisatorische Ansätze zur Verbreitung des Faschismus im Ausland, Trier 2001, pp. 93 and 96. 27. The ‘cleaning house’ of the Fascist party from 1932 onwards can only be briefly touched upon here. Alfredo Rocco, the Attorney General and the most important Fascist theorist, was sacked in 1932. The Secretary of the Interior, Luigi Federzoni (who had come from the ANI) had already been dropped in 1926, with Mussolini assuming his vacated office. Likewise, in 1932, Dino Grandi was removed from his post as Foreign Minister (with Mussolini assuming his office). Arrigo Serpieri, Secretary of State in the Ministry of Agriculture, got the chop in 1935 as a result of his quarrelling with the regime vis-à-vis ‘Big Farming’ and the southern Italian ‘Latifundia’. He was accordingly given the political dead-end ‘Office of the Chancellor of the University of Florence’. Edmondo Rossoni, the Chairman of the Fascist labor unions and a vehement advocate of its autonomy, was forced to step down in 1928. His influence as a proponent of ‘integral syndicalism’ had already begun to fade in 1925. He became Secretary of Commerce in 1935, on the grounds that he would support the statist goals of the regime. Even Roberto Farinacci, the leader of the Intransigents and, beginning in 1925, the short-term chairperson of the PNF, did not hold a single politically important office in the 1930s. Following 1932, Mussolini was not only ‘Il Duce’ and the figurehead of the Fascist state, but also, due to his holding of eight different offices, its ‘Super-minister’. 28. Concerning the Reform movement, for information on the background and tendencies of this internally Fascist youth protest, cf. Michael A. Ledeen, ‘Italian Fascism and Youth’, in Journal of Contemporary History 4(3) (1969), pp. 143ff. 29. From the beginning of the World Economic Crisis of 1929 onwards, the regime constantly labelled the corporation as a panacea for the world’s economic problems. The Fascists attempted to sell the ‘corporate state’ theory as an ‘export’article (Scholz) and to universalize it as the foundation for a new international order. Cf. Beate Scholz, Italienischer Faschismus, p. 106. 30. Cf. Maier, In Search of Stability, p. 87: ‘In a larger sense, fascist economics was not really economics at all’. As well as Paul Corner, ‘L’economia italiana fra le due guerre’, in Giovanni Sabbatucci and Vittorio Vidotto (eds), Storia d’Italia, Vol. 4: Guerre e fascism, Rome and Bari 1997, p. 370; Cavalieri, ‘Il corporativismo nella storia’, p. 38; Giuseppe Conti and Alessandro Polsi, ‘Elites bancarie durante il fascismo tra economia regolata ed autonomia’, in Discussion Papers del Dipartimento di Scienze Economiche – Università di Pisa, No. 27 (2004), p. 47, http://www.dse.ec.unipi.it/ricerca/discussion-papers.htm (accessed 10 January 2009): ‘Fascism never possessed either the drive or the means to formulate an unambiguous economic program, save via political actions (l’azione politica) which meant placing the state in the center, and replacing the markets in the role of economic master.’ 31. Cavalieri, ‘Il corporativismo nella storia’, p. 27. 32. Rafalski, Italienischer Faschismus, p. 373. 33. ‘Nutznadel’ in Aldo Mazzacane, Alessandro Somma and Michael Stolleis (eds), Korporativismus in den südeuropäischen Diktaturen, Frankfurt am Main 2005, p. 354. 34. Giuseppe Parlato, La sinistra fascista. Storia di un progetto mancato, Bologna 2008. 35. Luminati, ‘Der Corporativismo’, p. 41. 36. This was no novelty in the history of capitalism in Italy. Even before the Fascist period, in 1912, under the liberal Prime Minister Nitti, a national insurance institute, the INA, had been created.

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37. Of anecdotal interest, are the names which he bestowed upon his three daughters: Italia (Libera) [free Italy], Vittoria (Proletaria) [proletarian victory] and Idea Nuova (Socialista) [new socialistic idea]; Idea Nuova cunningly married the manager of one of Italy’s largest banks. 38. Cf. Toniolo, L’economia dell’Italia fascista, p. 9. The private consumption declined from an index of 2.1 during the time before the First World War, to 1.3 between 1921 and 1938, and climbed again (to 4.7) only after the Fascist period in 1967. Even more incredible was the decline in public consumption from 3.9 (1897–1913) to 0.4 (1921–1938), with, again, this index only rising after the end of Fascism from 1949 until the 1960s. 39. Daniela Zenone, Das Automobil im italienischen Futurismus und Faschismus. Seine ästhetische und politische Bedeutung, Veröffentlichung der Abteilung ‘Organisation und Technikgenese’ des Forschungsschwerpunktes Technik-ArbeitUmwelt am WZB, Berlin 2002, p. 36 and 41ff. http://bibliothek.wzb.eu/ pdf.2002/ii02–115.pdf (accessed 17 February 2009). 40. Zamagni, The Economic History of Italy, p. 300. 41. Maier, In Search of Stability, p. 71; Corner, ‘L’economia’, p. 349. 42. This system of the ‘business banks or bank-houses’ also existed in Germany and Austria, and led to – in Austria – the rescuing of the Bodenkreditanstalt in the 1930s. 43. The extensive bank law composed by Beneduce in 1936 brought about the following changes: (1) The three largest banks ‘rescued’ by the IRI were placed under national supervision; (2) banks and industry were separated; (3) an institutional and strategic specialization of the bank system either on short- or longterm (industrial) lines of credit was instituted. 44. More exactly, the IRI bought the financing companies with 4 per cent paid interest, via obligatory, state-financed credit, and a loan period of twenty years, during which the banks would have to disentangle themselves from financing and industrial loans. The essential difference with the old banking system was that the IRI did not at the time finance itself via the financial market and savings deposits. For more information about the technical details of the ‘The birth of the banking and entrepreneurial state’ in Fascist Italy, cf. Toniolo, L’economia dell’Italia fascista, pp. 197–268. 45. Sarti, ‘Fascist Modernization in Italy’, p. 1044ff. 46. Corner, ‘L’economia italiana’, pp. 361 and 369ff, shines light on the fragmentary and uncoordinated character of Fascist regimentation. The principles of the national holdings, national regulation of production and private trade, as well as the national organization of labour, differed greatly on paper from liberal economic organization strategies. Nevertheless, the system was chaotically organized and frequently had a negative effect on the economy, and has been labelled as nothing more than ‘little dynamic capitalism’. Zamagni, The Economic History of Italy, p. 303ff, speaks about ‘slow social progress under fascism’. 47. Even these rescue measures were not new in Italian economic history; already at the end of the nineteenth century, and between 1921 and 1923, there had been spectacular ‘rescues’. For more information on continuity between the preFascist and Fascist time, cf. Toniolo, L’economia dell’Italia fascista, p. X, written following a caesura which had taken place at the beginning of the 1960s. 48. This concerns itself therefore, not only with a ‘normal’ economic rescue, as would take place under a liberal economic system with the rescue of banks, reforms and the changing of the existing market mechanism, but also with the purchasing of economically viable concerns and their subsequent nationalization. The state became nothing more than an additional capitalistic entrepreneur without the will to institute planned dirigisme.

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49. After the IRI, the Italian government was the chief shareholder in Italian corporations, controlling 21.5 per cent of all capital as well as 42 per cent of all shares. Cf. Corner, ‘L’economia italiana’, p. 350; Stanley Payne, Geschichte des Faschismus. Aufstieg und Fall einer europäischen Bewegung, Berlin and Vienna 2001, p. 279; Zamagni, The Economic History of Italy, p. 300; Toniolo, L’economia dell’Italia fascista, pp. 249ff. 50. Toniolo, ibid., p. 284. 51. Even the idea of a ‘corporate state’ is not a development or child of Fascist thought, although for propaganda purposes, it was labelled as such. Originally it was a concept which entailed the self-organization of the producers outside the framework of the state. Only the question of the relationship between the corporation and the state was something which the Fascists made their own, and even then it was only as a necessity. 52. The term ‘economic Fascism’ has, since the New Deal until today, been an American, liberal-economic term used to describe political discrimination in terms of economic interventionism. 53. Danilo Breschi, ‘Fascismo e antiurbanesimo. Prima fase: ideologia e legge (1926– 1929)’ in Storia e Futuro 6, 2005. 54. Mussolini saw ruralism first and foremost from a demographic aspect. In the socalled Ascension Day Speech (Discorso Dell’ Ascensione) on 26 May 1927, he criticized the quick growth of the metropolises and the ‘demographic whip’, against the backdrop of public health concerns including a decline in the number of births (cf. Mussolini, 1927, http://cronologia.leonardo.it/storia/a1927v.htm). In reference to the ‘modest’ successes of the Bonifica programmes cf. also Toniolo, L’economia dell’Italia fascista, pp. 156ff. Only 200–250,000 of the planned 900,000 hectares were dredged and dried, as opposed to 790,000 hectares during the pre-First World War Liberal government’s tenure. Substantially higher numbers appear in Cohen and Federico, The Growth of the Italian Economy, p. 40. 55. Toniolo, L’economia dell’Italia fascista, p. 154. 56. Zamagni, The Economic History of Italy, p. 255ff. 57. Leading futurists such as Marinetti and Settimelli acknowledged once again the role of Catholicism. Even when one compares the Fascist cultural policies in Italy with those in Germany it becomes clearly apparent that in terms of art, the Italians were more manifold and pluralistic, allowing for Catholicism and imperialism to play a much larger role. ‘Arte sacra’ [Sacred Art] and the ‘Aeropittura’ [Flying Artists] are just two examples of this. Günter Berghaus, Futurism and Politics. Between Anarchist Rebellion and Fascist Reaction 1909–1944, Rhode Island and Oxford 1996, pp. 240 and 248, speaks about an artistic decline after 1930, and, with relation to the Aeropittura, of ‘through and through imperialistic propaganda’. Susanne von Falkenhausen, Der zweite Futurismus und die Kunstpolitik in Italien 1922–1943, Frankfurt am Main 1979, pp. 165 and 258. 58. Terragni built predominantly in his home town, Como, constructing the famous ‘Casa del Fascio’, known today as the ‘Casa del Popolo’. In the 1930s, Pagano decided to come in step with the official party architecture and conform to master-builder Piacentini. He was rewarded with a role in the building of the University of Rome, where he was responsible for building the Institute of Physics, the sole entirely ‘modern’ building of the complex. From 1942 onwards, however, Pagano dissociated himself with Fascism and joined the resistance. In 1945 he was arrested and died shortly afterwards in Mauthausen concentration camp. 59. The Manifesto realista of Berto Ricci (1933). 60. Within the Fascists, this conflict was epitomized by the debates between Roberto Farinacci (as a proponent of ‘strapaese’) and Giuseppe Bottai (as a modernizer and proponent of ‘stracittà’).

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61. Mino Maccari 1927, cit. after Casali (ed.), Fascismi. Partito, società, p. 88. 62. Maier, In Search of Stability, p. 96, cf. also Zamagni, The Economic History of Italy, p. 243; Cohen and Federico, The Growth of the Italian Economy, p. 111. 63. Stanley Payne, Geschichte des Faschismus, p. 279; cf. also Maier, In Search of Stability, p. 94; Corner, ‘L’economia italiana’, p. 368. 64. Zamagni, The Economic History of Italy, p. 274. The history of the development of wages cannot be expounded here. We can only briefly refer to the nationally decreed wage reduction which occurred during 1927 and amounted to around 20 per cent. 1930 and 1934 witnessed further reductions in wages. Previously, between 1921 and 1926, industrial wages had sunk to between 6 and 8 per cent. Cf. Maier, In Search of Stability, p. 102; Corner, ‘L’economia italiana’, pp. 328 and 346; Stephanie Tilly, Arbeit-Macht-Markt. Industrieller Arbeitsmarkt 1900–1929. Deutschland und Italien im Vergleich, Berlin 2006, pp. 332ff; Zamagni, The Economic History of Italy, pp. 310ff. Once again wages were lowered between 1935 and 1937, with the reduction in 1935 alone being close to 8.5 per cent, brought about by a simultaneous stagnation in nominal wages and an increase in living costs. Cf. Toniolo, L’economia dell’Italia fascista, p. 274. For information on the lower-than-average growth rates in Italy, in comparison to Germany and England, between 1922 and 1938 (as well as during the preFascist era) cf. Corner, ‘L’economia italiana’, p. 368. Cohen and Federico, The Growth of the Italian Economy, p. 24, emphasize that wage controls and dumping were believed to lead to higher profits, a boom in investments and swift growth – however, under Fascism they did not function as planned. 65. Schieder, Faschistische Diktaturen, p. 375. 66. Sarti, ‘Fascist Modernization in Italy’, p. 1042. 67. The so-called ‘Aeropittura’ style which came to popularity as a part of the ‘second futurism’ style, glorified every component of air travel and flight technology, namely those components for which futurism had stood as an artistic vanguard movement: pace, dynamics, the intoxication of speed, and the creation of an ‘Italia’ in whose centre the ‘homo fascisticus’ stood as a ‘new man’. 68. Dino Biondi, La fabbrica del Duce, Florence 1967. 69. In contrast to the National-Socialist regime, the Italian Fascists could claim no reduction in unemployment via their programmes. In the 1930s, due to the political autocracy, the unemployment rate was extraordinarily high (cf. Note 5). Toniolo, L’economia dell’Italia fascista, pp. 297ff. The National Socialists needed to reduce the unemployment rate quickly so as to unite the public behind them and prove their power. On the other hand, in 1933, the Fascists had already ‘consolidated’ power, so much so that there was no real motive for lowering unemployment. Renzo de Felice even goes so far as to designate the 1930s as the ‘years of consent’. It was only in 1935, in view of immense wage abridgments, declining buying power, poor nourishment of the lower social strata due to the decline in protein and increase in grains, as well as the high unemployment rate, that the question arose as to how much ‘consent’ the regime truly had from the average Italian. Mussolini had begun propagating already in the 1930s an antimiddle class rhetoric reinforced by his condemnation of their hedonistic lifestyle and the ‘comfortable life’, and an appeal for his countrymen to live frugally, renounce luxury, remain disciplined and be ready to sacrifice. This begs the question as to whether there actually existed any ‘consent’ and whether this idea too was merely an illusion made possible by the suppression of free-press and opinion polls? The actual victims of the regime, those of the lowest social strata, are seen all too easily. It is no coincidence that before Mussolini’s dismissal (July 1943), in March of that same year there had been major strikes in the industrial centres

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of Italy (Genoa, Milan, Turin and Tuscany) which surely helped to accelerate the end of the regime. These strikes began as social protests, with slogans such as ‘We want Bread’ and only when widened, in their second phase, evolved into political protests against the regime and the German Occupation forces. 70. Sarti, ‘Fascist Modernization in Italy’, p. 1049. 71. For information concerning the quick accumulation of personal wealth by many Fascist functionaries via their holding of various state, national and public offices (enti pubblici) cf. Conti and Polsi, ‘Elites bancarie durante’, p. 46.

Chapter 5

Hitler’s Dictatorship

His Role as ‘Leader’ in the Nazi Regime

Hans Mommsen

In some respects, the plethora of publications and biographies dealing with Hitler’s rise and fall as an eccentric dictator tends to dissolve any clear picture of his rise as undisputed leader of the German National Socialist Worker’s Party (NSDAP) and then as Reich Chancellor to unrestricted political power over vast parts of continental Europe, and his responsibility for the death of millions of people. Hitler’s real career started in 1921 with his first ‘seizure of power’ within the Nazi movement, the then still insignificant and marginal splinter group of the German Worker’s Party DAP/NSDAP, which was sponsored by bourgeois notables of the völkish Thule Society and was destined to draw industrial labour sympathizing with Social Democracy into the nationalist camp. It was symptomatic that his conflict with Anton Drexler, the original founder of the party, arose from Drexler’s attempt to achieve a fusion of the DAP/NSDAP with the ‘Völkischer Block’ of völkish philosopher Otto Dickel. Hitler opposed the amalgamation of the movement with Dickel’s pseudoreligious supporters, and argued in favour of fascist mobilization according to the leadership principle. As an almost indispensable and highly prominent party speaker, Hitler confronted Drexler with the ultimatum of either accepting his unrestricted leadership over the party or cancelling his membership, leaving him only the nominal charge of presiding over the party council. By achieving almost unlimited power, Hitler was able to transform the NSDAP into a fascist organization that was characterized by the rule of the leadership principle on all organizational levels, resulting in the exclusion of intra-party debates and the inhibition of any variety of collective

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decision making. According to his political concept, the party’s activities should concentrate on the realm of continuous propaganda and its energy should be focused above all on attracting new party members and sympathizers instead of participating in programmatic debates. Intra-party debates over programmatic or tactical issues appeared obsolete, not least because their existence would contradict the assumption of the allegedly indestructible unity of the party’s will. ‘The unitedly organized and directed Weltanschauung’, Hitler argued in Mein Kampf, was in need of a ‘sturmabteilungsmäßig’, that is, a militarily structured political party. Therefore, Hitler inhibited any programmatic debates and declared the somewhat oldfashioned programme of the twenty-five points of 1920 as unalterable. In conjunction with the party’s refounding in 1925, Hitler succeeded in his intention to eliminate the emergence of any intra-party factionalism. The party apparatus remained strictly controlled by the Munich local organization, which was dominated by his close supporters. Furthermore, Hitler isolated possible rivals in his movement. Hence, he induced Field Marshal Erich Ludendorff to stand as a candidate in the 1925 presidential elections, whose results were, as expected, devastatingly negative and led to the political isolation of Ludendorff. Simultaneously, Hitler dissolved the so-called ‘Nordwestliche Arbeitsgemeinschaft’, which comprised the party districts in North and West Germany. Their leadership under Gregor Strasser and Joseph Goebbels tried to overcome the predominating influence of the Munich faction and pleaded in 1926 for a more modern party programme. Hitler’s rhetoric succeeded. In particular, he drew Goebbels, who he installed as Gauleiter of Berlin, into his camp. After the defeat of the north-western group, no more significant intra-party opposition to Hitler arose, with the exception of the conflict with Otto Strasser in 1930. Hitler’s tactical move of drawing the leading opponents into his camp by offering them leading party positions proved to be particularly successful, above all his decision to install Gregor Strasser, the most talented sub-leader he ever had, in the position of virtual party secretary. It was mostly to Strasser’s credit that the rapidly expanding party organization was formed into an effective instrument for continuous mass campaigning. Especially after the backlash in 1924, when the NSDAP had difficulties regaining its former strength of 1923, and after the rather meagre voting returns in the Reichstag elections of May 1928, it was regarded as a splinter party that would disappear. Therefore, the Prussian government decided to lift the ban on Hitler’s public speeches. In the September 1930 elections, however, the NSDAP suddenly multiplied its voting support. Forebodings of this breakthrough had been visible since spring 1929 and reflected the accelerating erosion of electoral support for the

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bourgeois centre parties, beginning with a shift of agrarian voters from the DNVP to the NSDAP. But Gregor Strasser realized that the growth of the Nazi movement after September 1930 could not be continued by the strategy of avoiding any tactical alliance with the national conservative groups whose programmatical aims did not really differ from its own propaganda. After the excellent returns for the NSDAP in the presidential elections in July 1932, Hitler’s defeat and the general change in the political atmosphere resulted in growing disillusionment among the NSDAP and its adjacent organizations, as well as among former Nazi voters. For critical observers it became clear that its previous strategy of rejecting any cooperation with the bourgeois right wing could lead to political isolation. But in November 1932 Hitler clung to his ‘all-or-nothing’ strategy and was even prepared to take the risk of new elections. Faced with this perspective, Strasser felt compelled to retreat from his party offices as a warning to the party leadership, whereas Hitler dissolved the central leadership apparatus of the NSDAP that had been created by Strasser. Hitler appointed his rather incompetent henchman Rudolf Hess to act as his ‘deputy leader’. This tactical move of transferring the party leadership to Rudolf Hess was aimed at the twofold target of avoiding possible grievances with Hitler’s conservative partners within the cabinet as well as getting rid of the daily party business performed by the ever-growing bureaucratic apparatus in the ‘Brown House’ at Munich, which was referred to as a capital of the movement. Without any effective leadership, the Nazi party subsequently disintegrated into an agglomeration of about thirty-six relatively independent Gau organizations, whose regional leaders claimed to have direct access to the dictator and were only obliged to follow his immediate orders. But there was no representative board in charge of coordinating the political strategies of the party and its affiliated organizations. The so-called ‘Reich Leadership of the NSDAP’ did not possess any real power, and its members only met at party conventions or festivals. The membership of Rudolf Hess and – before he was liquidated – Ernst Roehm as leader of the Storm troopers in the Reich cabinet could not replace it, since the Reich cabinet gradually lost its former central steering function under the new regime. At the same time, Hitler hesitated to deal with the routine business as chief of the Reich government. After President von Hindenburg decided to leave Berlin for his landed estate at Neudeck, Hitler would come but irregularly into the Reich Chancellory. Instead of working there, he spent his time mainly at the Obersalzberg where Martin Bormann was in charge of the new Fuehrer residence. Bormann was actually controlling the ‘Office of the Deputy of the Fuehrer’ and trying to interfere in the legislative process, but his influence was limited.

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Hitler disliked cooperating with the cabinet, which comprised mainly conservative politicians and only three National Socialists. Hitler hated the atmosphere of solidarity among the ministers, and he was jealous of their intellectual competence. Hence, he ordered that controversial issues were only to be put on the agenda if agreement had already been achieved among the relevant departments. By this method, Hitler’s personal weakness undermined the function of the Reich cabinet to reach agreement over principal political issues. Consequently, the cabinet meetings lost their former clearing functions and were no longer regularly convened. From February 1938 onwards, the meetings were completely cancelled. The ministers would communicate only at unofficial meetings, and the cabinet lost its role as clearing agency. Hitler even prohibited private meetings of his ministers, out of jealousy that they could make decisions behind his back. Thus, the coordination of legislative issues happened either by exchanging written documents between the departments or by the mediation of the Minister of the Reich Chancellory, Wilhelm Lammers. While Lammers was admitted to report to Hitler relatively regularly in the first years of the regime in order to get the latter’s approval for department decisions, personal communication between the ministers and the dictator became the exception rather than the rule. But even Lammers lost direct contact with the chancellor; all communication was subsequently controlled by Martin Bormann who blocked access to Hitler as the dictator’s Secretary and then – after Rudolf Hess flew to Britain – as the Chief of the Party Chancellory. Hitler’s unrestricted power relied to an increasing extent on the destruction or isolation of the traditional administrative bodies, starting with the cabinet and seizing also the classical departments. Hitler’s inclination to deliver new competencies to new institutions, whether they belonged to the party or the state, resulted in a continuous erosion of the unity of public administration and led in the long run to the regime’s progressive self-destruction. This process, however, was not compensated at all by the party apparatus. There did not exist any coordinated leadership among the party and the affiliated organizations, except the centralist financial control by the Munich treasurer. After 1941, Martin Bormann tried to rebuild an efficient party leadership and to gain control over the Gauleiter who still claimed their direct subordination to Hitler. Therefore, below the level of Hitler’s personal staff, there was no political coordination at the top of the Third Reich, whereas new governmental agencies were continuously being established. The continuous splintering of the state authority corresponded to Hitler’s personal inclination and his style of ruling. The dictator rejected any form of bureaucratic government and tended to replace the inherited

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public administration and its bureaucratic regulations by the so-called principle of ‘Menschenführung’, which essentially resulted in a complete personalization of politics and the destruction of the legal foundations of modern state organizations. Hitler perceived the new political style as it was represented by the radicalized leadership type emerging in the ‘East’ as a model for future National Socialist rule. Instead of the inherited patterns of administrative subordination and specialization he preferred the principle of a multi-competent leadership which was not bound by the rule of legal principles and only obliged to the Fuehrer. On 20 August 1934 – after Hindenburg’s death – Hitler ordered the offices of the Reich Chancellor and the Reich President to be fused in his person, partly because he could not decide which of his satraps he would install at the Chancellory. Civil servants as well as the military and the Reichstag deputies were compelled to deliver a personal oath of loyalty to Hitler. Together with the preceding plebiscite, this is to be regarded as a definitive step in introducing the principle of the ‘leadership state’. Besides the hitherto familiar formula of the ‘Fuehrer and Reichskanzler’, the title ‘the Fuehrer’ became officially accepted. From a legal perspective, there were no longer any institutional counterweights against Hitler’s personal rule. But Hitler showed no intention of taking the consequences by giving the leadership cult any institutional form, in a way that was symptomatic of his unwillingness to accept any formal or legal obligations for himself. When Wilhelm Frick, the Reich Minister of Interior, proposed to replace the ‘Enabling Law’ by introducing a new constitution for the ‘Great German Reich’ in 1934, Hitler rejected this plausible project out of hand. He preferred to carry on using article 48 of the ‘Weimar Constitution’ as the legal basis of his rule and rejected the alternative as a revolutionary step. Eventually, in 1945, he would again separate the offices of the chancellor and the president, when he chose Grand Admiral Dönitz as his successor. It was symptomatic that the dictator deliberately avoided any form of legal institutionalization of his dictatorship. The establishment of the ‘leadership state’, therefore, was not accompanied by the creation of a formalized institutional network to prepare or coordinate political decisions. On the contrary, Hitler neglected the day-to-day commitments of a head of government. He would only casually interfere in the legislative process and the executive decision making. No counterpart to the British war cabinet existed. In this respect, Hitler’s ruling habits differed qualitatively also from those of Lenin or Mussolini, who carefully studied the official records and intervened in bureaucratic procedure. Conversely, in the Third Reich the ordinary legislative process was replaced more and more by the issuing of informal ‘Führer-Befehle’,

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that is to say, orders from the Fuehrer for which the countersignature of the responsible cabinet ministers was no longer needed. The escalating informalization of the governmental process in the regime was exacerbated by Hitler’s inclination to reject any institutions that could have served as informal advisory boards. He obstructed the establishment of the Reich Legislative Senate for which a representative hall had already been built in the ‘Brown House’, and he also rejected the creation of the so-called ‘Führerwahlsenat’ that was to meet in the case of his premature death or serious illness. The Fuehrer would meet the party officials at the frequent official festivities and public rituals. The rare Gauleiter meetings also presented opportunities to discuss urgent political issues, but only exceptionally, since they mainly consisted of a series of endless public speeches. Hitler preferred to communicate with his staff members on an oral basis. He would not take any notice of the official records or listen to government experts. In many cases he hesitated to make decisions, and he was inclined to postpone controversial matters until a solution was at hand. Should action be imminent, Hitler would make relevant decisions only after having delivered more or less spontaneous and rather lengthy public or semi-public speeches. He preferred to act surrounded by the entourage of personal advisers who belonged to his unquestioning supporters and he did not pay much attention to the advice of independent experts. Even in crucial political matters he preferred to take a rather ambivalent position and only reluctantly approved decisions that might impair his personal prestige. Despite his unchallenged leadership, Hitler appears to have been a ‘weak’ dictator in some respects, who in many cases would postpone overdue decisions. His tendency never to dismiss former officials or ministers but to replace them by just duplicating their jobs was symptomatic of this. Over the years, he did not tolerate any criticism from within his entourage and was not ready to listen to contrary arguments. In fact, Hitler progressively lost touch with political and military reality. On account of the devastating destruction of the administrative apparatus and the growing self-confidence of rival secondary bureaucracies such as the SS, the Labour Front, the Four Year Plan and the Party Chancellory, there was no counterweight to Hitler’s supremacy. Virtually none of his satraps was in a position or had the courage to obstruct Hitler’s increasingly contradictory and irrational orders. It was symptomatic of the Reich’s escalating military and political crisis after the defeat at Stalingrad that Joseph Goebbels, Abert Speer and Heinrich Himmler tried to reorder its central hierarchy, giving Hitler something like an ‘old man’s role’. This also increased the escalation of terror. Thus, there was little alternative to the futile hope of the Allied

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coalition breaking down, or to simply awaiting complete military defeat, for which Martin Bormann presented heroic scenarios of collapse. Martin Bormann had originally acted as Hitler’s secretary and was responsible for the private property of the dictator, above all the Obersalzberg. As soon as the Nazis had seized power, he was able to exert a decisive influence as he ran the office of the Fuehrer’s deputy in Munich and controlled relations between the party apparatus and the ministerial administration. As the second man behind Rudolf Hess, he controlled the ordinary legislation and promoted the specific interests of the party. Originally, he claimed that civil servants had to be party members, but eventually dropped both this and the plan to merge district administration with that of the corresponding Gau organization. He could not prevent Heinrich Himmler, the chief of the SS apparatus, from curtailing the influence of the NSDAP, particularly as far as the surveillance of popular opinion was concerned. In contrast to the average Nazi functionary, Bormann was both extremely fanatic and bureaucratic at the same time. On the basis of his detailed knowledge of the personal affairs of Hitler’s satraps, he built up a loyal following within the party apparatus, forming a reliable leadership elite and controlling the Gauleiter whose direct access to Hitler prevented any long-range coordination of politics. While he succeeded in getting the support of the regional party administration, he had no influence on Heinrich Himmler’s SS empire. At the very end of the war, however, he was successful in isolating Himmler and excluding him from the inner political circle around Hitler. The main instrument of the Hitler dictatorship was the almost irresistible leadership cult that from the very start was the most effective means of keeping the otherwise splintering regime together. Hitler’s technique of claiming unlimited personal loyalty from his followers while giving extended leeway to his sub-leaders to fulfil their individual material ambitions, proved to be utterly successful. Thus, Hitler supported personal enrichment, frequently on the basis of stolen Jewish property, as well as unrestricted corruption and embezzlement. His habit of endorsing his followers by means of private gifts and generous donations stabilized this system. But more important than the various techniques for keeping Hitler’s personal following in line was the successful strategy of identifying Hitler’s personal role with that of the nation. The main difference between the Nazi regime and the Fascist system in Italy was the fact that under the latter, national institutions such as the army and the monarchy still had considerable public prestige and continued to represent the country, while in the Third Reich there was no institution left besides the person of the Fuehrer that could be identified with the nation. Goebbels’ suc-

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cessful propagation of the leadership myth resulted in Hitler becoming the indispensable symbol of Germany’s national strength, unity and even survival. Hitler, therefore, appeared as the virtual incarnation of the German nation. Even the resistance movement of 20 July 1944 claimed in its first announcement after the putsch that Hitler had been killed by a group of Nazi leaders who had lost their solidarity with the fighting front. It was symptomatic that the notion of Hitler as ‘leader of the nation’ found expression in the continuously used formula: ‘if the Fuehrer only knew’, which exempted the dictator from responsibility for military defeat as well as the crimes against Jews, prisoners of war and members of the Slavic peoples. The fact that Hitler had usurped the place of the nation in the heart of the average German explains why growing public criticism of the war policy after 1942 was not directed against the dictator. His idealized image was exculpated from the responsibility for the imminent military and political breakdown of the Third Reich. Against this background, it is understandable that after May 1945 the Hitler syndrome was turned into the opposite – instead of exculpating the dictator for crime and defeat, he was now identified as the main culprit for the ‘German Catastrophe’, whereas the moral and political responsibility of his followers was emphatically denied. However, this phenomenon cannot conceal the truth that, in the final instance, Hitler was just an exponent of the social and racial resentments that characterized German political culture under the impact of the military defeat that so many refused to accept in 1918. The excessive and anti-Semitic ingredients of this culture functioned as a sounding board for Hitler’s policy of destruction.

Chapter 6

The Second Spanish Republic

The Challenges Facing a Democracy in Troubled Times

Vicent Sanz Rozalén

Over the last three decades, the period of the Second Spanish Republic has become a kind of ‘historiographic legend’ for a wide variety of reasons. On the one hand, it is the period directly preceding the Civil War and, as such, attempts have been made to determine the reasons for the war by focusing on its immediate predecessor. Such a restricted approach could lead us to make the short-sighted mistake of viewing the Civil War as the direct and inevitable result of the Republic, when in actual fact it was the result of tensions caused by the Spanish social, political and economic situation over decades. These tensions came to the surface during the Republic because it was during this period that, for the first time in the twentieth century, democratic means were introduced and institutionalized which allowed people to express their political discontent. On the other hand, after forty years of Franco’s dictatorship, the opposition movements took their bearings from that short period which lasted barely more than five years. And although somewhat idealized at times, such references were not so unrealistic in terms of the values of a society striving for democracy. This is why the experience of 1931–1936 became one of the factors which unified the framework of symbolic ideas on the difficult path towards democracy from 1976 onwards.1 From the early nineteenth century, which marked the beginning of the Spanish bourgeois revolutionary process,2 the notion of a ‘republic’ epitomized the aspirations of the social groups that hoped to see their political rights recognized in the new liberal state. In other words, they demanded the universalization of liberties as the basis of democracy. The

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association of these two terms – republic and democracy – still existed in the 1930s.3 Neither should it come as a surprise that such an association was made when the Republic was preceded by a regime run by local leaders in which political corruption upheld the traditional social order. Its collapse led to the dictatorship of General Primo de Rivera, father of the founder of the Spanish Falange – which began in September 1923 and took Benito Mussolini’s Italy as one of its main models.4 It was a dictatorship in which the involvement of the monarch was perfectly clear from the very beginning. It was in this context that, from the mid-1920s onwards, it became increasingly evident that the reconstruction of Spanish social and political life required rather more than a simple face lift or a simple return to the turnismo of the political parties of the Restoration (in which the ‘official’ liberal and conservative parties had taken turns in office since 1874). The idea of a ‘republic’ re-emerged as an alternative to the corruption, inability to govern and collapse of the political system, and also as an alternative to social inequality and to the balance of power that existed between rural and urban industrial areas. Thus, a wide variety of sectors were united in their need to put an end to the traditional monarchy. These ranged from committed royalists to old-style republicans, socialists and even, in accordance with their own particular beliefs, anarchists. In addition, all this took place in an international context that placed the Second Spanish Republic in a historical paradox. Whereas its origins were somewhat removed from European dynamics, its end – with the Civil War between 1936 and 1939 – became a symbol of a global struggle in the 1930s and led to the confrontation which took place immediately afterwards between different models of social, political and economic organization.5 On the one hand, this chapter will examine the sequence of events in which ‘political’ aspects played the leading role, in other words the successive stages of republican rule. On the other hand, it will examine the manner in which these stages conditioned the preparation and application – or not – of a whole series of measures aimed at lessening the social inequalities of the popular classes who proclaimed themselves to be republican.

The Declaration of the Republic: The Establishment of a Democracy in Times of Crisis In the early 1930s, the recently established republican regime in Spain appeared to be largely untouched by the events taking place in the majority of European countries. Spain had not taken part in the First World War

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and had therefore not suffered its turmoil, death and destruction at first hand. The country did not suffer most of the direct or indirect consequences, namely massive demobilization, the elimination of the borders that had existed prior to 1914 and the breakdown of the previously existing order. Neither was the country suffering from the high rate of debt that characterized the economies of the countries that had been involved in the war and that now conditioned their immediate future.6 The Second Republic was not the result of any of the factors mentioned above. Its origins can be found in the breakdown of an outdated regime and the monarchy’s inability to maintain the traditional system of social control that eventually led to the establishment of a dictatorship aimed at protecting the traditional social and political order. However, it is worth highlighting the fact that the period between 1923 and 1931, at least towards the end, helped to politicize Spanish society profoundly, and this almost immediately led to its republicanization – in other words, to the desire to establish a republican regime as a solution to both the breakdown of the system and to social inequality. This idea became increasingly widespread and received new support from various sources. These included old and new republicans, socialists, anarchists and even royalist conservatives and Catholics who considered that, given the irreversible nature of the situation, the restoration of the Republic could become the catalyst for the regeneration of Spanish society and politics that they sought. In addition, for the conservative and Catholic groups, leaving the establishment of the Republic in the hands of left-wing and centre-left groups would have been a much greater threat to their principles of order. They therefore considered that the best strategy to defend these ideals of conservative order was to do so from within the republican system itself by participating from the very beginning. The municipal elections of April 1931 became a plebiscite on the form of government and the monarchy. The victory of republican candidates in the majority of Spanish cities – forty-one out of fifty – led King Alfonso XIII to proclaim that he could not count on ‘the love of his people’ and as a result he went into exile.7 A provisional government made up of representatives of the various different forces that took part in the Pact of San Sebastián, signed in August 1930, took control of the situation and soon began the task of introducing reforms. Heading the government as President of the new Republic was Niceto Alcalá Zamora, a former Minister for Public Works (in 1917) and Minister for War (in 1922) in the governments of Alfonso XIII and now in the ranks of the Liberal Republican Right (Derecha Liberal Republicana). He was joined by: other ‘new-style’ conservative republicans such as Miguel Maura; Alejandro Lerroux and Diego Martínez Barrio of the Radical Party (Partido Radical); Manuel

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Azaña of Republican Action (Acción Republicana); Alvaro de Albornoz and Marcelino Domingo of the Radical Socialist Party (Partido Radical Socialista); Casares Quiroga and Nicolau d’Olwer, members of proGalician and pro-Catalonian associations respectively; and Fernando de los Ríos, Francisco Largo Caballero and Indalecio Prieto of the Spanish Socialist Workers’ Party (Partido Socialista Obrero Español – PSOE). The intellectual and political project of many of the representatives involved (to a greater or lesser extent depending on who we are referring to) strengthening the role of the state against the predominance of a system of local leaders who only looked after the interests of the traditional oligarchies. It also involved reducing the profound inequalities which existed in Spanish society. It was true that these reforms were intended to transform the structures of social control of the ‘cacique’ system and the power structures of the military and church institutions. But in no way did they promote a revolution which would change the relations of property and production, dispossess landowners of their assets and capital, or establish social equality as the basis of government action. The measures were intended to palliate the effects of social inequality, but not to impose equality by subverting the principles of liberal, bourgeois order, however far to the left the government may have been. And in fact its moderation was one of the reasons it lost considerable support among the popular classes, since the reforms were considered insufficient and ineffective. The anarchists, who were active from a very early stage, considered that supporting the Republic did not necessarily imply defending the establishment of a liberal, bourgeois regime. They supported the Republic because its system of liberties allowed them to occupy a new public space which had been taken away from them during the previous dictatorship. This made it possible for them to use propaganda, rallies and demonstrations to reorganize their trade union (as one of their leaders, Galo Díez, said: ‘it is not worth losing a little which is certain for a lot which is uncertain’).8 People asked, or rather demanded, that the Republic should deliver freedom, not that it should change the class structure of society. The worldwide crisis which had begun at the end of the previous decade added to the pressures on the Republic. Spain’s marginal position in worldwide economic relations and, as we have already mentioned, the country’s considerably lower debt levels compared to the countries which had fought in the Great War cushioned the direct effects of the crisis. However, external demand fell considerably, with the volume of exports decreasing by 75 per cent in 1934. This brought industrial production to a standstill and saw unemployment figures reach one million – with almost three-quarters of those workers belonging to the agricultural sec-

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tor. Having failed to introduce radical tax policy reforms, the state lacked resources and was characterized by marked structural shortcomings. It was thus incapable of dealing with these problems and unable to put forward measures aimed at alleviating the conditions of poverty suffered by the sectors most affected by the crisis. Furthermore, those sectors were precisely the ones that provided the Republic with a considerable proportion of its support. Left-wing republicanism emerged victorious in the parliamentary elections held in June 1931. The PSOE received the most votes and gained 115 members of parliament. The republican-socialist coalition – which held 368 seats, almost 73 per cent of the parliament – governed Spain until the autumn of 1933. Until a new constitution was passed, the political system could not be allowed to grind to a halt and policies were introduced by means of decrees which attempted to deal with the most urgent problems and needs, namely unemployment, education and the separation of church and state. However, all the decrees then had to be sanctioned by parliament. The commission entrusted with drawing up the constitution was headed by Luís Jiménez de Asúa, who defined it as ‘left-wing, but not socialist’, and cited the German Constitution of Weimar as one of its main influences.9 Article One declared that Spain was a ‘democratic republic of workers of all classes’, organized within a system of liberty and justice. The powers of all its organs emanated from the people, as the source of national sovereignty. The constitution established the non-denominational nature of the state and clearly separated state from church. It also introduced the possibility of recognizing that Spanish regions had the right to autonomy, although this did not in any way imply the break up of the integrity of the Spanish state. For the first time in the history of Spain, the constitution also recognized women’s political rights.10 The PSOE participated in the government together with left-wing/ bourgeois republican parties. Over the course of time, this situation gave rise to two sets of problems. On the one hand, it led to the first conflicts of the period with the Radical Party, the republican party with the longest tradition. This party was against sharing government with the socialists because it claimed that they were a party which threatened the existing social order. They demanded that the socialist ministers stand down or be removed from their ministries.11 They were a ‘threat’ perceived from the ‘non-republican’ right, which joined forces with this conservative branch of republicanism. It was then that a political group was specifically formed in defence of property and religion. On the other hand, at the core of the PSOE, disagreements intensified between those who defended supporting the republican state and those who proposed not to collaborate with

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a bourgeois state which was unable to deal with and solve the problems of the popular classes which socialism represented.12 In any case, the programme of reforms undertaken by the republican-socialist governments was extremely far-reaching. With regard to the world of labour, legislation was introduced concerning the right to strike, social security, salaries, and so on. Measures were introduced which attempted to improve the living standards of the working classes and working conditions both in rural areas and industry. Likewise, there were various measures which made up agrarian reform. This became the focal point of tension and eventually led to major outbreaks of political violence. The effects of the law on municipal boundaries (which prohibited workers from other areas being hired until all the residents of the village in which the property was located were employed so as to reduce competition and increase day labourers’ salaries) and the compulsory cultivation decree (which made it obligatory to cultivate productive land in order to reduce unemployment among these same day labourers) were limited by the fact that they were boycotted by the landowners. Agrarian reform did not, by any means, imply the redistribution of property (except in very specific cases involving the old nobility). Its scope was very limited and in fact by the end of this period barely nine thousand peasants had benefited from the distribution of land. It was precisely this agrarian reform which focused the frustrated expectations of the popular classes on the Republic as responsible for improving their social and working conditions. Their frustration ended in protests and, a short time later, in increasingly violent revolts which were severely crushed and repressed by the forces of law and order (in Arnedo, Castillblanco, Casas Viejas). This action was taken by the same republican order that they had helped to establish. Budgetary limitations and the shortage of economic resources choked the potential effects of the large-scale reforms. The international crisis which shook capitalist economies made it more complicated for such measures to have a greater impact. The landowners took full advantage of this situation to boycott the government’s laws: they did not respect the agreements signed or the agreements reached regarding salaries, and they gave preference to workers who did not belong to a trade union, thus removing the most ‘ideologized’, troublesome workers. Insurrectionary action was led by the anarchist trade union, CNT, which declared a state of libertarian communism in various areas (Los Serranos in the Valencian Region, Alto Llobregat in Catalonia). The uprisings were rapidly put down by the republican forces, but such repression was combatted by more uprisings. These were also used as a strategy to dominate the trade union movement against the socialist trade union, FNTT, which was still part of the government.

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Thus, the reformist projects were hindered both by large and small landowners, who considered them to be a threat to their assets, and by the culture of confrontation which originated in the frustrated hopes placed in the Republic.13

The Political Crisis and the Rectifying Biennium The tensions left the republican-socialist coalition without any solid support. Barely two and a half years had passed since the establishment of the republican regime. That was enough, in a time of crisis, for the different expectations – which were at times contradictory – of what the Republic should represent to be clearly apparent and for them to lead to disagreements and ruptures.14 The differences which existed between the various groups which claimed to be ‘republican’ came to the surface with the reformist policies implemented during this short space of time. Added to this was the incipient reorganization, and gradual strengthening, of openly ‘anti-republican’ sectors as a new factor that helped to deepen the political crisis the republic was going through. The fact that, as of summer 1933, it was impossible to maintain the stability of the government, together with the shaken prestige of Azaña and the Republic due to the events in Casas Viejas,15 led to legislative elections being held in mid-November 1933. In addition to these factors, there was growing support from within the PSOE to avoid sharing responsibility for reform policies which were considered insubstantial and limited, along with the Radical Party’s strategy to remove the socialists from government. As a result of these elections, the parliamentary majority shifted to the right, reorganized mainly around political Catholicism, in addition to monarchist groups, employers’ organizations and, to a lesser extent, incipient fascist movements.16 On the other hand, there was a considerable drop in support for the centre-left republican parties, which were totally divided. Their parliamentary presence was reduced to minimum levels (barely eleven members of parliament) and there was also a marked fall in support for the PSOE, which won only 59 seats compared to 114 in 1931. This result was influenced by the active mobilization of conservative sectors (thanks to their rapid reorganization around political Catholicism) in opposition to the reformist projects of the previous biennium, together with the non-participation of many of the popular sectors (mainly anarchists) that were dissatisfied with how slowly the reforms were being introduced. They were also sceptical of the Republic in light of the repression inflicted by the government forces and increasing levels of unemployment.

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The Spanish Confederation of Autonomous Right-Wing Groups (Confederación Española de Derechas Autónomas – CEDA) became the main parliamentary group, with 115 members. This organization was founded in March 1933, and its political aims – social order, tradition, property and religion – were based on reversing the reforms introduced by the republican-socialist governments. It also clearly aimed to rewrite the constitution. The group’s leader, José María Gil Robles, had made visits to Germany and shown an interest in the propaganda systems developed by the National Socialists. In September of that same year he had attended the NSDAP Conference in Nuremberg and he openly admired the Austrian Chancellor, Engelbert Dollfus. With models such as these, the CEDA never explicitly adhered to the republican regime, but instead maintained a utilitarian political accidentalism. Thus, the association took advantage of the situation to design a strategy which began by lending parliamentary support to the centre-right republican groups, then went on to take part in a coalition government and finally took control of the government in order to change the constitution. In the words of Gil Robles, if that strategy failed, ‘we must look for other solutions … since democratic means are no use at all’.17 The republican Radical Party had 102 representatives and its leader, Alejandro Lerroux, was entrusted by the President of the Republic with the formation of a government. Having been a deep-rooted republican party since the beginning of the century, their project was mainly based on maintaining social order and involved reviewing the reforms introduced since 1931. The reforms were therefore reviewed, but that did not necessarily mean they would be reversed.18 However, the Radical Party did not have sufficient parliamentary support to implement its policies. Its options were limited since divisions in the parliament (which was made up of twenty-one different political parties – most of them with very few representatives) prevented the formation of stable majorities. This was even more so since the positions of this multi-party system were generally polarized between left- and right-wing groups. Faced with such a situation, the only viable option was to seek the parliamentary support of the CEDA. Paradoxically, the stability of the Republican government itself was in the hands of a group which wasted no opportunity to express its suspicion of and even blatant opposition to the regime. The Radicals attempted to introduce policies that would have softened the effects of the previous reforms without eliminating them completely. However, the support required from the ‘non-republican right’ meant that intense pressure was applied to carry out a profound review of the reforms, in particular the agrarian, military, education, religious and labour

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reforms and the policies which allowed the creation of autonomous regions within the state. There were demands for a ‘full rectification’ or for power to be transferred to the CEDA.19 Employers’ organizations, from the Confederación Española Patronal Agrícola (Spanish Confederation of Agrarian Employers) to the Bloque Patronal (Employers’ Bloc) demanded ‘real changes’ in order to maintain their business profits, which had been affected by the reduction in exports, the drop in consumption and the labour policies of the first republican-socialist biennium.20 Some of the reformist measures were reversed and others were not, but in any case they were no longer fully applied or they were only partially applied, meaning that their effects were completely watered down. The Law on Faith and Religious Congregations (Ley de Confesiones y Congregaciones Religiosas) of June 1933, one of the main targets of the CEDA, was rendered ineffective. A new agrarian reform was passed in August 1935 which effectively reversed the reforms introduced three years earlier. Land which had been confiscated was returned to its previous owners, control of the Joint Councils (Jurados Mixtos) was passed over to landowners and employers, and work contracts and agreements regarding salaries were systematically broken. The application of these policies led to the division of one sector of the Radical Party that disagreed with the right-wing direction the party was taking. Led by Martínez Barrio, this splinter group formed the Democratic Radical Party. With noticeably fewer representatives in parliament, the Radical Party was increasingly obliged to depend on the right for support.21 This ‘price that had to be paid’ led to major disagreements, resulting in governments characterized by their instability. There were seven governments between October 1934 and January 1936, each one lasting an average of seventy-two days. The corruption scandals which emerged during this same period eventually undermined the foundations of the Radical Party. The repression which occurred after the events of October 1934 became one of the main sources of disagreement between members of parliament who defined their positions in accordance with the increasing power of the right-wing groups. The CEDA occupied more and more ministerial positions in increasingly important ministries. Yet despite the constant crises, the President of the Republic, Niceto Alcalá Zamora, was reluctant to transfer control of the government to Gil Robles. He mistrusted his accidental ‘republicanism’ and sought to form a ‘centre’ group which could restrain both the right- and left-wing groups. However, his efforts were fruitless, and finally new elections were held in February 1936.

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October 1934 and the Insurrectionary Movement The reforms increasingly led to protests from the very same workers’ organizations that had played a key role in establishing the republican regime. The Republic was associated with greater social justice and with substantially reducing the existing inequalities. The structural conditions relating to land ownership had been in place for a long time and only limited progress had been made in improving the balance of power in the workplace. That was why there was an urgent yearning for reforms and why calls were made for the Republic to find a rapid solution to these and other problems. The frustration felt as a result of the slow and limited effects of the measures implemented during the initial stages of the republican-socialist biennium led to hostility among their supporters. The dissatisfaction soon turned to protest, above all in the farming sector.22 The effects of the decision taken by the anarchist union CNT during its conference in June 1931 to stop cooperating with the republican regime were soon felt. During that same month, a general strike was announced in the Telefónica company, the concession for which belonged to the ITT Corporation. This represented the dominance of the leadership of the Iberian Anarchist Federation (Federación Anarquista Ibérica – FAI) over the position maintained by Angel Pestaña, who opted to accept the system in order to achieve specific aims. This strategy of permanent confrontation – of ‘direct action’ – was intended to act as a counterweight to ‘the occupation of social spaces by the socialist union’.23 Faced with what it considered to be restrictions on its ability to act within the new legislation (given that the General Workers’ Union [Unión General de Trabajadores – UGT] – whose leader, Largo Caballero, was Minister for Work – was able to pass laws from inside the government), the CNT chose ‘the street as the stage for its struggle and confrontation with the State’. This gave rise to a climate of hostility towards the Republic among a sizeable sector of the organized working class.24 After the events that took place at the end of 1931 in the village of Castilblanco in Badajoz (where one day labourer and four Civil Guards died), the social tension gradually increased. There were subsequent confrontations in Zalamea de la Serena, Epila, Xeresa and other towns. On 5 January 1932 in Arnedo (La Rioja), the forces of law and order opened fire on a demonstration by workers from the footwear industry who were striking against the dismissal of several workers. A total of eleven people died, including five women.25 The insurrection began almost immediately, and this time it was directly organized by the CNT, with various towns in the Alto Llobregat

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area declaring a state of libertarian communism. This became the most serious confrontation that the Republican government had faced. Miners and textile workers took control of the area between 18 and 23 January of that same year. The intervention of the army crushed the uprising, giving rise to numerous arrests and deportations to African countries.26 However, the anarchist union’s response was to call for a strike in the rest of Spain. Certain towns in the Valencian region and Aragón were the only ones to join the protest and they were quickly suppressed by the army. The situation was similar one year later, when new revolts were organized to prevent the ‘bourgeois Republic’ from becoming stronger. The disturbances spread through towns in Valencia and Aragón, in addition to the province of Cadiz. There, in Casas Viejas, groups of day labourers from the CNT surrounded and tried to take the barracks of the Civil Guard. The subsequent repression involved setting fire to the shack in which a day labourer’s family, some of whom had participated in the earlier events, were taking refuge. The fire, together with the shots of the riot police, killed most of them. This took place on 12 January 1933 and it appeared that the whole episode had come to an end. However, the search for insurgents led to more arrests and summary executions. By the end, three Civil Guards had died, along with nineteen villagers, including two women and one child. Some weeks later, stories about the events began to spread which did not tally with the official reports that had initially been released. Intentionally setting fire to the shack, summary executions and the cruelty of the tortures became the focus of criticism aimed at the government from both the right and the left. The unfortunate statements made by President Azaña in parliament only served to increase the tension even more: ‘the only thing that happened in Casas Viejas, as far as we know, is what had to happen’.27 The direct action instigated by the anarchist trade union gave rise to severe repression and the break-up of its organization. However, at the same time, it provided it with arguments against the government and, by extension, against the republican regime. All this, together with increases in unemployment due to the economic crisis and the moderate results of the reforms introduced by the republican-socialist coalition, damaged the social base on which the Republic stood. A new attempt at insurgency which, just like the previous attempts, lacked any clearly defined strategy was led by the CNT during the winter of the same year in Aragón. Between 8 and 16 December, clashes took place on the streets of Zaragoza. Public transport was protected by the army, premises belonging to the union were closed down and twelve people died on the city’s streets. In La Rioja, Extremadura, Andalusia, Cata-

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lonia and Leon, some towns and villages also joined the uprising, which was immediately put down. This only increased the number of victims and spread the effects of the repression. In total, eighty-six people died, including fourteen Civil Guards and riot policemen. In addition to the repression and disheartenment, the disastrous results achieved using insurrectionary means allowed the more moderate sectors of the CNT to make up lost ground. The Libertarian Trade Union Federation (Federación Sindicalista Libertaria), headed by Joan Peiró, was clamouring for a return to the true principles of anarcho-syndicalism, which had nothing to do with such fruitless uprisings. It was at precisely that time, when the core members of the CNT were considering abandoning their insurrectionary tactics, that the UGT began to plan a revolutionary strategy. Ever since the events in Casas Viejas, the socialist trade union had gradually begun to change direction in their relations with the republican regime. The election results of November 1933 gave new impetus to the idea that there was a need to organize a revolution to give back the Republic its social content. The triumph of the right, with the CEDA obtaining a parliamentary majority, was considered to be a threat. The internal debate in the union – and also within the party – was very intense since several of its main leaders considered it an error to instigate an uprising, although the majority were inclined to ‘defend the Republic’ using insurrectional means if the CEDA formed the government. This led to the creation of a revolutionary committee. The international context in Europe is a fundamentally important factor when attempting to understand this change. Hitler’s rise to power in Germany in 1933 became the main symbol of the rise of fascism. After the events which took place in Vienna in February 1934, it was declared that ‘those who gunned down our comrades in Austria are the same ones who resolve to defeat the Spanish working class here’.28 The lack of a specific declaration of loyalty to the Republic from the CEDA and its leaders helped to strengthen its association with European fascism. The measures introduced by the governments of the Radical Party with the parliamentary support of the CEDA made this more credible – greater control of left-wing parties and trade unions, the presentation of a proposal for a Law on Strikes in March 1934, the imposition of economic sanctions and the seizure of workers’ publications. There were also confrontations with Falangist groups in various different cities. Faced with a republic controlled by the right – and again we insist, regarded as fascist – the only alternative for their defence was the formation of a working-class republic. During the month of June 1934, the FNTT announced a general strike, which was joined by around 1,500 towns and villages. In light of their lack of conviction in the final result, the UGT decided not to back

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the strike, as did the CNT. Indeed, the strike was an utter failure which led to the union’s disappearance from rural areas and left it in such a weak position that it was unable to recover until the outbreak of the Civil War in 1936. Thus, socialist circles, but also left-wing republicans who began to regroup around the Republican Left (Izquierda Republicana – IR) and the Republican Union (Unión Repúblicana – UR), considered that if the CEDA – a non-republican party which did not hide its intentions to modify the constitutional regime currently in place – took control of the government, it would lead to the undermining of constitutional principles. And faced with the threat of fascism, it was necessary to take measures to defend the values that the Republic represented.29 The moment arrived on 4 October 1934. The Radicals lost control of the government and the CEDA became the main party, occupying three ministerial posts. The insurrection began that same night. From the very beginning it proved to be a total failure due to the lack of clearly defined aims, strategy and control. The uprisings were not widespread, even in those regions where the socialists had the greatest support. Many anarchists remained indifferent. In Catalonia, Lluis Companys proclaimed the Catalan State (l’Estat Català) part of the Spanish Federal Republic. Neither the CNT nor the Rebassaires farming unions joined the revolt. The government took control of the situation without any major difficulty. In some industrial cities in Biscay and Guipúzcoa, a strike was also declared with exactly the same result. The only remaining resistance was in the coalfields and industrial areas of Asturias, where trade union membership was high. There, a revolutionary committee was organized around a workers’ alliance made up of socialists, anarchists and communists that coordinated the resistance efforts. For the first time in Western Europe since the events that took place in Paris in the spring of 1871, a revolutionary commune was established.30 Some twenty thousand miners took control of the coalfields and the main cities of Asturias, and established a parallel state. The government sent over eighteen thousand soldiers from garrisons in Africa to defeat the insurgents. By 20 October they had regained control of the situation, but with over twelve hundred deaths. The repression which followed was harsh, with many summary executions, and the chance was taken to pursue groups and leaders who had opposed the CEDA, even though they had not taken part in the revolt. The number of people arrested rose to fifteen thousand, including Manuel Azaña, the former President. From that time onwards, political life was characterized by instability, and the differences between right and left became more marked. However, it also led to a split at the core of the Radical-CEDA coalition due to

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discrepancies over the way in which the repression was carried out. 1935 was characterized by governmental instability, which led Alcalá Zamora to announce new elections for early 1936 in order to put a stop to the ‘authoritarian route’.31

The Short-lived Popular Front Left-wing republicans saw the announcement of new elections in February 1936 as an opportunity to change the course of events. On this occasion they approached the elections as a united force, joining together with Catalan nationalists, socialists and communists to form the Popular Front (Frente Popular). Conservative republicanism was completely discredited and had become a minority force since the majority of its members had shifted towards the CEDA. The Popular Front emerged victorious in the elections, winning 263 seats compared to the 156 seats won by the right, predominantly by the CEDA. The new left-wing republican government – this time without the participation of the socialists, but with their parliamentary support – began the task of salvaging the reformist legislation of the first biennium, albeit with a more moderate tone. The right was displaced from power and the traditional conservative interests of landowners and businessmen lost control of the government. If their support for the Republic had been accidental – even when they were in power – now, in opposition, they had no reason whatsoever to oppose attempts to regain power by any means whatsoever. Organization of the coup d’état began even before the results of the elections were announced. It was only necessary to wait for the appropriate time and a suitable excuse. Meanwhile, they mobilized the rank and file of the CEDA around the defence of order, property and religion. Religion was the factor which acted as a catalyst to intensify the confrontations that took place prior to the coup d’état of July 1936. Defending the established order or defending property were not sufficient on their own to mobilize and intensify political dialectics in parliament, in the press or in the street. Religion was the factor that, combined with these other aspects, provided the emotion required to mobilize the masses. From the very beginning of the Republic, ‘religion’ became one of the main bones of contention. Although not revolutionary, the reformist policies introduced by the republican-socialists did, let us remember, aspire to change the balance of power that had traditionally existed in Spanish society – the army and the church – as part of a project designed to modernize the state. The secularity of the state was considered beyond

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question, and the separation of church and state was indisputable – and to a large extent the president of the government, Manuel Azaña, paid more attention to this than to agrarian reform. The church as an institution, therefore, felt threatened. It had lost the traditional means on which its power was based, it had lost the comfortable and quite considerable economic support that the state had provided for decades, and it had lost its power to influence Spanish society as it was not allowed to participate in education. The ecclesiastical authorities soon positioned themselves against the Republic and actively collaborated with all the movements that wanted to modify and reverse the republican reformist policies. It provided the infrastructure and money to convert the CEDA into a party with mass support characterized by its Catholic element. What is more, it provided the ‘moral’ justification for the coup d’état of July 1936.32 The coup d’état failed, and the confrontation led to a civil war which lasted for three years. Although the fascist elements were essential in the victory of the right and in the establishment of the dictatorship, the role that religion played cannot be ignored – hence the unique nationalistCatholic nature of Spanish fascism.

Notes 1. Javier Paniagua, La transición democrática. De la dictadura a la democracia en España (1973–1986), Madrid 2009. 2. Enric Sebastiá, ‘Estudios preliminar’, in José A. Piqueras, El taller y la escuela, Madrid 1988. 3. José A. Piqueras, ‘Detrás de la política. República y federación en el proceso revolucionario español’, in José A. Piqueras and Manuel Chust (eds), Republicanos y repúblicas en España, Madrid 1996, pp. 1–43. 4. Eduardo González Calleja, La España de Primo de Rivera. La modernización autoritaria (1923–1930), Madrid 2005. 5. Eric J. Hobsbawm, The Age of Extremes: A History of the World (1914–1989), New York 1996, Chapter 5. 6. Julián Casanova, Historia de España (8). República y Guerra Civil, Crítica/Marcial Pons, Barcelona and Madrid 2007. On the effects of the First World War on the economy, see Vicent Soler, ‘Els efectes econòmics de la Primera Guerra Mundial. El marc europeu i la situació espanyola. Un estat de la questió’, in Escritos en honor del profesor Román Perpiñá, Valencia 1983, Vol. 1, pp. 283–99. 7. ABC, 17 April 1931. 8. On Spanish anarchism, see Javier Paniagua, La larga marcha hacia la anarquía. Pensamiento y acción del movimiento libertario, Madrid 2008. The quotation is taken from Casanova, Historia de España, p. 19. 9. Diario de Sesiones de Cortes, 27 August 1931. Part of a speech by Luís Jiménez de Asúa presenting the Constitution project to Parliament. 10. Jordi Solé and Eliseo Aja, Constituciones y periodos constituyentes en España (1808–1936), Madrid 1977.

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11. Angel Bahamonde (coord.), Historia de España. Siglo XX, 1875–1939, Madrid 2000. 12. José A. Piqueras, Persiguiendo el porvenir. La identidad histórica del socialismo valenciano (1870–1976), Valencia 2006. 13. Casanova, Historia de España. 14. La II República. Una esperanza frustrada, Valencia 1987. 15. Gérard Brey, Historia y leyenda de Casas Viejas, Madrid 1976. 16. Paul Preston, La destrucción de la democracia en España: reacción, reforma y revolución en la Segunda República, Madrid 1987. 17. Interview with José María Gil Robles in Hoja Oficial del Lunes, published in La Vanguardia, 2 January 1934, p. 22. 18. Nigel Townson, ‘Algunas consideraciones sobre el proyecto “republicano” del Partido Radical’, in José Luis García Delgado (coord.), La II República española: Bienio rectificador y Frente Popular, Madrid 1988, pp. 53–70. 19. Bahamonde, Historia de España. Siglo XX. 20. Casanova, Historia de España, p. 120. 21. Nigel Townson, ‘Una República para todos los españoles: el Partido Radical en el poder (1933–1935)’, in N. Townson (ed.), El republicanismo en España (1830–1977), Madrid 1994, pp. 193–222. 22. Edward Malefakis, Reforma agraria y revolución campesina en la España del siglo XX, Madrid 2001; Jacques Maurice, El anarquismo andaluz. Campesinos y sindicalistas (1868– 1939), Barcelona 1989, pp. 278–306. 23. Javier Paniagua, Anarquistas y socialistas, Madrid 1989, p. 192; ‘Republicans, Socialists and Anarchists: What Revolution was That?’, in José A. Piqueras and Vicent Sanz (eds), A Social History of Spanish Labour. New Perspectives on Class, Politics and Gender, London and New York 2007, pp. 241–57. 24. Casanova, Historia de España, pp. 62–63. 25. Carlos Gil, La República en la plaza: los sucesos de Arnedo de 1932, Logroño 2002. 26. Josep Termes, Història de Catalunya (VI), Edicions 62, Barcelona 1987. 27. Diario de Sesiones de Cortes, 2 February 1933. 28. Graciano Antuña in Avance, 26 February 1934. 29. Alicia Alted, ‘La oposición republicana’, in Townson, El republicanismo en España, pp. 223–64. 30. Adrian Shubert, Hacia la revolución. Orígenes sociales del movimiento obrero en Asturias (1860–1934), Barcelona 1984. 31. Casanova, Historia de España, pp. 137–51. 32. Id., La Iglesia de Franco, Madrid 2001.

Chapter 7

The Crisis in the 1930s and the Rise to Power of the Swedish Social Democrats Bengt Schüllerqvist

Introduction The era between the two world wars was a period of crisis for the labour movement in most countries in Europe. The steady progress to which many workers’ parties had become accustomed prior to the First World War was broken. After a brief upswing in the wake of the war, the labour unions lost both ground and members in many places during the 1920s. Three distinct lines of development emerged during the interwar period. In several countries fascist movements assumed governmental power and defeated the labour parties. In other countries the socialist parties remained opposition parties without real influence over politics or policies. In Scandinavia, however, a breakthrough occurred for the social democratic parties in respect of gaining office and becoming governing parties. The Swedish Social Democratic Party (SD) became the most successful of these Scandinavian parties. The party was able to establish itself as the leading party for a very long time, both in terms of voting support in the elections and ability to form governments.

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Table 7.1 Swedish Governments 1932–2009 1932–36 1936 (for a few months) 1936–39 1939–45 1945–76 1976–82 1982 -91 1991–94 1994–2006 2006–09

SD Farmers Party SD (with Farmers Party) SD (leads a broad coalition) SD (1951–57 with Farmers Party) Non-socialist governments SD Non-socialist government SD Non-socialist government

SD prime ministers: 61 years. Non-socialist prime ministers: 12 years.

The main question for this article is: how did this Swedish political model develop? Why, how and when did it happen that the Swedish Social Democratic Party turned into the most efficient governmental party?1 Many scholars are in agreement that the 1930s was a turning point in modern Swedish history, even if this change may be interpreted in different ways. One explanation in early Swedish research is that the breakthrough to power was the result of the party’s crisis policy of 1933. My argument is that the ability to get the crisis policy through the parliament was an effect of the new strength of the Social Democrats. Another interpretation maintains that the changes can be attached to a compromise between the labour unions and entrepreneurs’ organizations. This agreement, Saltsjöbadsavtalet, named after the place where the meetings were held, may have contributed to SDs’ capability of staying in power, but it did not cause the rise to power. The same can be said of the argument that there was a strong rise in memberships in labour and other popular organizations during the 1930s. Others put the cause far back in history, explaining it by the democratic tradition in Sweden. But the fact is that in Sweden parliamentarism and general voting rights came late. Not until in the early 1920s did Sweden have a democratic election system. In the 1920s the Social Democrats had three opportunities to form a government, but they were never able to secure the consent of the parliament on important issues, and lost power as soon as the non-socialist parties got together. Finally, a complementary explanation emphasizes the Social Democratic Party’s special competence and skill in governing. My question is then: how was this competence and skill in governing gained and of what did it consist? My idea is that something important happened in the years before the crisis policy of 1933.

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The Economic Crisis in Sweden First, a few words on the effects of the international economic crisis in Sweden.2 In the late 1920s the Swedish economy had a strong development. The international crisis did not reach Sweden until 1931; it came first in the export sector, in timber, and then spread into other fields. In 1931 there was a serious incident in a timber district. Workers were on strike because of a wage reduction. The military opened fire on a demonstration and five people were killed. I will return to the political aspects of the Ådalen shootings. It had strong effects on the political events at that time and has a special place in the collective memory in Sweden.3 Farmers had already for some time seen shrinking prices due to an international production surplus. The prices of farm products fell by half during the depression. The non-socialist government decided on regulations to keep up the prices of the farm products. The SD party was critical of this support to the farmers. The economic crisis in Sweden deepened when a Swedish, internationally very influential, banker and businessman, Ivar Kreuger, committed suicide. His economic empire was collapsing. His death was followed by a series of bankruptcies that threatened the Swedish banking system. In March 1933 the unemployment figures in Sweden reached an all-time high of 187,000 (25 per cent of union members).

The Cossack Election of 1928 and the Horse Trade of 1933 In the last parliamentary election of the decade, in 1928, SD suffered its biggest defeat up to that time, surpassed only in the 1991 election. In Swedish history the 1928 election has received the appellation ‘The Cossack Election’. Posters portraying Russian cossacks plundering crying farm families were a part of the Conservative Party’s successful campaign propaganda. A reason for these attacks was that SD and the Communists appeared on the same voting list as the Labour Party. Four years later, however, SD was able to form a government after having recouped the losses in a new parliamentary election. But that government was still a minority government. The real breakthrough came in the spring of 1933 when SD for the first time succeeded in organizing an economic agreement in the parliament. The Farmers’ Party broke with the remaining non-socialist parties and entered into a bit of ‘horse-trading’ with SD. A number of liberals also joined in the settlement. My thesis is that the Social Democratic Party of Sweden went through a fundamental organizational transformation during the years 1928 to

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1933. The SD party that took the initiative in 1933 was, in many important respects, different from the party that led the weak minority governments in the 1920s and was defeated in the Cossack Election.

Strong and Weak Party Organization My investigation concentrates on the organizational characteristics on the level of the central leadership. The interpretation of the empirical results utilizes concepts developed by the Italian scholar Angelo Panebianco, in his book Political Parties: Organization & Power.4 Panebianco talks of weak and strong parties. It should be noted that these terms refer to organizational structures, not the number of supporting votes in elections. Table 7.2 Strong and weak parties according to Panebianco Weak parties Depending on outside forces Unclear borders to outsiders Ruled by factions sharing power Decentralized structure of power Not systematically organized

Strong Parties Dominates supporting organizations (churches, trade unions, etc.) Clear borders to outsiders Ruled by a monolithic leadership Centralized structure of power Consistent organization

In Panebianco’s terminology, SD was transformed from a weak to a strong organization. This transformation was a prerequisite for the success of SAP as a governing party.

SD and the Labour Movement Different types of relationship for trade unions and a socialist party are an important analytical tool. During a pioneering period a group of prominent SD politicians strived to dominate the country’s trade union movement, and a member of the party’s leading group was made chairman of the joint national trade union organization (LO). A group representing what is often called ‘trade unionism’ repulsed the ‘party men’, however.5 A formal separation was established between the labour union and the political organizations. To the common line belonged a careful, defensive tactic. Together LO and SD formed the leadership for a broad and varied movement, the Swedish labour

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movement. Great independence existed for the labour unions and for the local workers’ organizations to define their own activities. Several groups within the labour movement with alternative programmes challenged the dominating alliance. Syndicalists, left-wing socialists, and communists established their own national organizations. Common among them was that they represented more militant tactics. The concept of class struggle played an important role. The challenging groups, however, differed in regard to the type of relationship between political organizations and trade unions. Many local trade unions had a collective membership in the SD party. This weaving together of SD and the trade union movement was part of the organizational structure that gave the party vague and diffuse borders. The groups which formally stood outside SD could, via the labour unions, periodically (during the ‘left-wing waves’) exercise significant pressure on Social Democratic policy. This made it difficult for the SD leadership to keep a steady political course. The LO leadership retained leading posts within SD, while the party men, after the introductory phase, were left without such posts in LO. SD was very much dependent upon the trade unions economically and for its membership. SAP was not a trade union party to the same extent as the British Labour Party, but a political party with low autonomy and limited room for action. Table 7.3 Strategic Relationships of a Socialist Party to Trade Unions 1. The party controls the unions, the unions = SD 2. The unions are independent from political parties (‘trade unionism’) 3. The party dominates the unions, which are formally independent, but accept a coordinated and party-led strategy 4. No political party (‘syndicalism’)

SD was, in the terms of Panebianco’s definition, a weak organization. In 1917, SD’s party leadership forced out the party’s left wing, while forming a coalition government with the Liberals. A more unified and thus a somewhat stronger party may be said to have arisen, but it was a shrunken party which lost many voters and activists, and most alarming, almost the entire youth organization. Many labour unions, in this period, chose to take a neutral stance on party policy.

The Dilemma of Socialism in Democratic Societies In the parliamentary election of 1920, socialism and nationalization of the economy were major questions. SD suffered a defeat in the election, and the

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newly formed Left Party lost ground. During the entire decade the Social Democrats struggled at a number of crossroads without finding a way forward. The most important of these dilemmas was the question of socialism. Hopes for a future socialist society, where the proletarian majority would reign, bound the strategic thought of many socialists to the ‘workers’ majority’. After the short alliance with the Liberals no non-socialist party was ready to rule with SD, and the left wing of the party was not prepared to form alliances with non-socialists. There was in the elections no majority for a socialist future. What was the road forward, then? The leading circles of SD could not see a revolutionary road as an alternative. This could be viewed as a strategic dilemma for SD, as for all socialist parties operating in a democratic country.

The Weak SD One contributing factor to the weak structure of the SD was that the party chose to quickly welcome back radicals who had left the party in 1917. The return of the radicals coincided with a generational shift within the SD leadership and together these meant that, from the mid-1920s onwards, SD regained the character of a factional party. A further weakening of the leadership within SD occurred when the LO, in a matter which had great impact in the 1920s – the question of industrial peace – chose to rebel against the SD executive and allied itself with the faction on the left. The Social Democratic governments of the 1920s were weak and short-lived. SD was politically isolated and lacked the capability to organize a broad political settlement. At the 1928 party convention the top positions were divided between warring factions. In the election campaign there were conflicting signals from the SD leadership. The ambiguities were used by opponents both on the right and the left, and the Conservative Party as well as the Communists gained ground in the election. To sum up: during this period SD policy was distinguished by its sudden switches between a strategy oriented towards society’s middle strata and a more traditional class party strategy.

The New SD In a short period after the election defeat, several important changes in the SD party structure occurred. I see three steps in this development. The first was the use of anti-communism as a dynamic force. The aim of this element was to isolate the Communists, forcing them to be outside

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of an SD-dominated labour movement, and to create a gap between SD and the Communists. In the first step the political party was mobilized, since trade unionism was still strong in the union leadership. One of the dynamic aspects of anti-communism was that it helped the SD party to define a social democratic identity. The second was the unification of the party leadership, and an end to factional leadership. This meant that the party could speak with one voice, and that potential alliance partners could know with whom they were dealing, and could rely on agreements. These are important qualities for a party which has the ambition to govern a country. The third was a change in the relationship to the unions. This could be described as the social democratization of the unions. At the end of the period the central union organization, the LO, organized an anticommunist campaign of its own and accepted a peaceful labour market strategy, which turned out to be one central characteristic of the so-called Swedish Model. This is not the place for a full account of all the details in the development, but I will make some short comments, firstly on the research material. As well as all kinds of protocols and other types of organizational material, there are several hundred articles written by the party chairman, Per Albin Hansson. Before he was prime minister in 1932, Hansson suffered from financial difficulties. To support himself and his family he wrote several articles every week. The leading SD newspaper in Stockholm was in the hands of the party opposition, and Hansson was banned there, so he had to publish his articles in the SD Gothenburg paper. Combining the protocols of the SD meetings with this vast number of articles gives quite an insight into his political thinking. It is possible to see, week by week, what was in his mind and what questions he thought were important enough to write about.

The Establishment of Anti-Communism In the autumn of 1928, a big party conference was organized in order to analyse the election defeat. Hansson and the party secretary, Möller, made sure that the question on the relationship to the communists came into focus at the meeting. Möller argued that the communist organization with cells at workplaces should be met by a similar SD organization. The leaders of the LO, taking part in the conference as SD members, argued against a ‘civil war’ with the unions. On this question Hansson and Möller received the support of the radicals, who returned to SD. The result was that the party leaders started the campaign in spite of the

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opinion of the trade union leaders. Within the central SD leadership an anti-communist information office was organized. The first effect of this was an SD mobilization to important union meetings and national union conventions. The aim was to prevent the Communist Party (CP) from getting control of any of the national unions. The attendance figures of the union meetings reached numbers higher than ever before (or after). This campaign accelerated when the communists tried to organize a national conference against cooperation with the employers. A communist-led committee was set up. On this question the SD party received support from the LO, who saw the committee as a competing organization. When the LO announced that membership of the committee was not compatible with membership of the LO, the CP members were presented with a dilemma. These were the years of the class-against-class strategy of the Sovietled communist movement. In Sweden many of the communist activists in workplaces did not want to risk getting kicked out of the LO. But the representative of the Comintern told the CP not to give up. The CP was suddenly split in half; one half left Comintern and tried to function as a national communist party. In the days after the split of the CP, Hansson started to publish a specific series of articles. He did not usually write theoretical articles. Now he analysed the class structure of Sweden, and discussed the concepts of Class and Folk (Volk). In order to form an SD government, the SD would have to reach social groups other than the workers, he wrote. The concept of Folk is then better suited than Class. For once Hansson visited the intellectual discussion club, The Marx Society, and had a debate with the left wing of the party. In all languages with a Germanic background, the concept of Folk (Volk) was central in the political and cultural discourse of this historic period. In Germany it was a central concept of the Nazi vocabulary. Hansson spoke of the Home of the Folk (Sw: Folkhemmet), which turned out to be a powerful rhetorical metaphor. In Sweden the concept of Folk did not have the same ethnic or nationalistic connotation as in Germany; the term had more to do with ‘ordinary people’, or ‘the little man (or woman)’, leaving the very rich ones outside. My impression is that Hansson, a clever card player, was astute in playing his political cards in the right order as well. At any other time these articles on the Folk strategy would have been met by strong left-wing opposition. But now, at the moment when the Communists were split, the proponents of a class struggle in Sweden were in a weak position. The SD faction who were ideologically closest to the Communists found their room for action diminishing.

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The Ådalen Shootings and the Change of Leadership Structure in the SD When demonstrating workers were fired upon by soldiers in the spring of 1931 and several workers were killed, SD’s class struggle wing saw an opportunity to challenge the party leadership. In the months following the Ådalen shootings, the struggle for power within the SD became more open; a polarization into two major alternatives took place. This can be studied in the SD party press. The left-wing papers placed all the blame for the episode in Ådalen on the military, the non-socialist government and the employers using strikebreakers. Hansson did not follow that line of argument. He made it very clear that the workers of Ådalen also were to blame. The strike had got out of hand, the strikebreakers had been attacked, and the SD workers and party organization had let the Communists take control of events. Hansson argued that it was time for a rethink on the question of democracy and the use of violence within the labour movement. The workers had to obey the same laws as others. The left wing maintained that the labour movement had a different conception of law and justice than the ruling classes. Debates over these different interpretations were intense. The conflict was resolved at a party leadership meeting preparing for the next party convention. The supporters of Hansson suggested that the central leadership should take control of the party newspapers. This could be understood as a threat to work and sustenance for several members of the party opposition employed at the SD Stockholm newspaper. Hansson brought the question of Ådalen into the debate and challenged the opposition’s right to go public with their own interpretations. When there has been no party leadership meeting, it is the chairman of the party who has the right to talk for the party, not others, he claimed. When the party’s organizational structure came into focus the position of the opposition was weakened. Important people – such as the leading economic spokesman of the party Ernst Wigforss, who was politically close to the left wing – argued for a more centralized power structure. Exactly what happened is hard to say, but the next day the opposition leader Arthur Engberg agreed to follow the line of the majority. The meeting ended with an agreement that the decisions of the meeting should be taken at the forthcoming party congress. The 1932 convention established a dominant party line, and conformity became a requirement for those who wanted to be a part of the leading circle. A unified and strong party leadership emerged, which did not need to deal with competing factions. Thus a new leadership structure was established. The party takeover of the SD Stockholm paper did not happen,

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and when after the election Hansson became Prime Minister, Engberg was appointed Minister of Education. The centralistic tendencies were even more obvious in the SD convention of 1936. All nominees to the central committee were elected, and there was no opposition with candidates of their own.

The Social Democratization of the Labour Unions The first two steps in the transformation of the party were now completed – anti-communism was established, and the power structure was centralized. The third and last step was the change in the party-union relationship. The campaigns to secure SD leadership in the unions continued. After the Ådalen shootings, ambition had been raised. In the internal documents of the CP (Comintern) it can be seen that the aim was to create riots and ‘Another Ådalen’. The SD leaders were not satisfied with controlling the national leadership of the unions; the new ambition was to make all of Sweden safe for events such as Ådalen. The best agitators were sent to communist strongholds in the north. In one of his articles, Per Albin Hansson wrote about the small industrial town of Surahammar: ‘The SD youth club has 250 members and controls the youth of the town. They have a different mentality than communists and nazi students. Their firm grip over the local culture is a powerful asset against those who worship violence.’ In this statement you can see a vision – a ‘Utopia of P.A. Hansson’. In the years to come the SD would build strong organizations all over Sweden, networks that should closely follow every step of the left-wing opposition. This close watch should continue during the Second World War and the Cold War. When the factional policy disappeared, the path opened for a permanent change in the SD relationship to the trade unions. One decisive moment was in the spring of 1933. During a sailors’ strike in Gothenburg there were incidents similar to those in Ådalen, with communist activists using physical violence against strikebreakers. In a debate in the parliament the concurrent events in Germany were used as an example of what could happen when violence between social groups escalated. At the same time the SD leadership had informal discussions with Liberals and Farmers’ Party leaders on support for the SD crisis policy. SD heard from these non-socialist groups that a labour movement without radical influence was a prerequisite for an agreement. From the parliamentary floor Per Albin Hansson forced the national trade union chairman to promise that the unions would expel the Communists from membership. This was an important moment. At a national union conference shortly afterwards, the LO was given the power to kick out of the unions all those

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whose loyalty could be questioned. This time no break of a specific rule or membership of a certain organization was mentioned. An acceptance of democracy and peaceful societal development was required. These decisions were followed by the employment of no less than four people at the central LO office. All of them were assigned specific tasks in the fight against the Communists. The central organizations of the workers were in this period very small; these new officials were a substantial increase in the labour movement bureaucracy. Shortly after, a new generation came into power in LO and the unions – people loyal to the new course of the SD party. The SD and the Farmers’ Party exchanged favours; the SD left its opposition to regulations on farm products, while the Farmers accepted the SD crisis policy and the increased support to the unemployed workers. This ‘horse-trade’ is still talked of as having been a turning point in modern Swedish history.

Foreign Models Politics is formed nationally but the leaders look abroad for examples and paths to follow. In the party documents you can see how the SD party leadership turned to foreign examples when trying to formulate a strategy. After the First World War the German development was no model to follow, nor was that of the Austro-Marxists. For a while the SD leaders watched the British Labour Party closely. But at the end of the 1920s the Labour Party leader Ramsey McDonald, who had followed a strategy close to the one of P.A. Hansson, entered into a conflict with the unions and the party majority, and was forced out of office. After that, all that was left as a model to follow was the Danish SD party. The Danish situation was in many ways an easier one than the Swedish. There never existed a Communist Party of any significance in Denmark. The Danish SD party reached an agreement with the Farmers a few months before the Swedish horse-trade. So the Swedish model was in fact a Danish one. The Norwegian SD party followed the same road a few years later. In Norway the left wing had had a stronger position in the SD party, and had for a while been a member of the Comintern. In Norway the SD agreement with the Farmers came in 1935. After that, one can talk of a joint Scandinavian political model. Angelo Panebianco saw British Labour as the prototype of weak party organization and the pre-First World War German Party as the strong model. He did not include the Scandinavian parties in his study. It seems, in the European interwar period, that the only SD parties that assumed power and office developed a strong party organization and a Folk strategy.

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The Crisis Policy and Overcoming the Depression There has been a debate amongst Swedish scholars on what impact the SD crisis policy and the horse-trade had on the economic development. It has been argued that the SD minister of finance was an early Keynesian. Another position is that the main reason for the quick recovery of the Swedish economy was not the SD policy, but that it had more to do with the general structures and dynamics of industry in Sweden. It is also said that the psychological factor of the deal between the workers and the farmers was greater than the economic consequences. A middle-of-theroad argument, with several supporters, is that the kind of economic and labour market policy that the SD developed was well suited to support big business in Sweden. In 1936 the SD and the Farmers’ Party formally formed a government together, under SD leadership. During the Second World War the other parties in parliament were invited into the government (except the CP of course). After the war, in the 1950s, the workersfarmers alliance returned. What has been the contribution of the SD to the long-term history of Sweden and Scandinavia? The Swedish historian Rolf Torstendahl maintains that on the societal level, during the era of Organized and Participatory Capitalism, the specific contribution of the SD was small.6 Others, like the Danish political scientist Gösta Esping Andersen, have written about the Scandinavian model as one of ‘The Three Worlds of Welfare Capitalism’, giving more credit to the SD contribution.7 In the narrative of Swedish history the legacy of the Folk-home policy is still strong. Today there is a lot of talk of the 1950s as being a golden age in modern Swedish history – the time when the country was a home for the people. And when in 2006 the Conservative Party developed a successful election campaign together with three small non-socialist parties, they called themselves ‘The New Labour Party’. In the autumn of 2008 the newly elected SD party leader, Mona Sahlin, the first female in the job, was forced by the party left wing to include the former CP in the opposition alliance (together with the Green Party). An election was coming up in 2010, the first one since 1928, in which SD had a formal cooperation with a leftist party, led by a man who only a few years ago called himself a communist. Had the public memory of the policies of the communistic parties dissolved, or was there something of a ‘Cossack Election’ once more? In 2009 it seemed like the Swedes were not convinced that the SD crisis policy was a better one than that of the non-socialists. Is the political model of Sweden, created after the election of 1928, finally fading away?

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Notes 1. 2.

3.

4. 5. 6. 7.

The article is to a large extent based on: Bengt Schüllerqvist, Från kosackval till kohandel. SAP:s väg till makten (1928–1933), Stockholm 1992. Introductions to Swedish history in English, see: Lars Magnusson, An Economic History of Sweden, London and New York 2000 (electronic resource); Stig Hadenius, Swedish Politics during 20th Century: Conflict and Consensus, Stockholm 1997. Roger Johansson, Kampen om historien. Ådalen 1931. Sociala konflikter, historiemedvetande och historiebruk 1931–2000, Stockholm 2000. The author discusses how the use of this special event has changed over time. English summary. Angelo Panebianco, Political Parties: Organisation & Power, Cambridge 1988 (Ital. edn 1982). I use the term ‘party men’ for those who advocated SD control of the unions from the start. Rolf Torstendahl, ‘Socialdemokratins roll i industrikapitalismens utveckling’, in Arbetarhistoria 37–38 (1986). Gösta Esping-Andersen, The Three Worlds of Welfare Capitalism, Cambridge 1990.

Chapter 8

The United States in the Great Depression Was the Fascist Door Open?

Nelson Lichtenstein

Was fascism a realistic possibility in the United States during the Great Depression? Certainly, if one seeks to measure that possibility in terms of the depth and severity of the crisis, both in economic and political terms, the United States was in the same league with Germany and other European nations devastated by the Great Depression. Unemployment reached 25 per cent, five thousand banks failed, and middle-class wealth evaporated almost as rapidly as in the Weimar inflation of 1923. From 1930 onwards no year passed without a series of mass demonstrations by the unemployed or without violent confrontations between governmental authorities and working-class militants. In 1932 the famed Bonus March on Washington ended with the U.S. Army destroying the temporary living quarters of some twenty thousand unemployed, many of them World War veterans, who had gathered in the capital to demand relief. Two celebrated novels, one published in 1935 and the other seventy years later, have framed and validated the fears and imaginings of the era. Both evoke the emergence of an American fascism, not by coup or putsch, but through the ordinary workings of presidential politics, familiar, messy, ‘American’, yet in the rendering of these novelists all the more frightening. In It Can’t Happen Here, the Nobel prize-winning novelist Sinclair Lewis stretches the political realities of the early New Deal years just enough to conjure up the possibility of an authoritarian presidency that, like the New Deal itself, denigrates old elites while at the same time

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celebrating the authority of a newly empowered federal government. In the novel the American electorate cast aside a too timid Franklin Roosevelt in 1936 and replace him with a populist Senator, modelled on the fiery Huey Long, who proceeds to nationalize banks and utilities, push women, blacks and Jews back into their proper place, and organize a nationwide corps of paramilitary supporters. All the while, the newly empowered American president receives strong backing from an immensely popular radio preacher, clearly modelled on Father Charles Coughlin, a one-time supporter of FDR, who became an increasingly shrill opponent as the Depression years wore on.1 It Can’t Happen Here remained but a curio piece during the long years of post-World War prosperity, but the emergence of a more polarized brand of religiously inflected politics in recent years proved fertile ground for another dystopian novel, Philip Roth’s The Plot Against America, which appeared in the wake of George Bush’s bitterly contested 2004 re-election. Roth imagines a United States in which a lingering Depression and the prospect of war has generated an increasingly desperate search for extreme solutions, a context in which the popular but increasingly right-wing aviator, Charles Lindbergh, storms the deadlocked 1940 Republican Convention, upsets Wendell Willkie for the nomination, and then barnstorms the nation to oust FDR from the White House. ‘Vote for Lindbergh or Vote for War’ serves as his victorious campaign slogan. Under Lindbergh, the United States becomes isolationist, anti-Semitic, and pro-German. Families are torn asunder as a late-1930s version of America’s contemporary ‘culture wars’ pervades daily life.2 These novels, and there are others offering up similar scenarios, make two things clear. First, that if fascism did ever come to the United States, it would almost certainly come via the ordinary routines of American political life, often led by figures who had once thrived within that milieu. But such novels also imagine that in Depression-era America political and cultural life contained plenty of people and ideas which in Central Europe would have been readily identified with fascist movements and ideologies. When it came to fascism, there was no such thing as an American exceptionalism. The novels of Sinclair Lewis and Philip Roth ring with an element of truth because they highlight many of the cultural and ideological affinities that are common to both New Deal and European efforts to combat the Depression and reconstruct the nation. This is the comparative stance adopted by Wolfgang Schivelbusch, a cultural historian who divides his time between Berlin and New York. In his recent book, The Three New Deals: Reflections on Roosevelt’s America, Mussolini’s Italy, and Hitler’s Germany, Schivelbusch emphasizes the degree to which the American

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New Deal, rather than being a democratic alternative to Nazism or Italian Fascism, looks like a successful and pioneering variant, especially when one examines the monumental architecture, veneration and celebration of the ‘volk’, emphasis on mass propaganda in support of state activity, and even the rise in authority and prestige of the national police. Common to the leadership strata of the United States, Germany and Italy was a modernizing, revitalizing impulse. To this end, the repertoire of ideas and institutions available to reformist politicians in North America were not all that different from those on offer in Central Europe. All were ‘new deals’, post-liberal, state-capitalist systems often with more in common among themselves than with classical Anglo-American liberalism that flourished before 1929. To many contemporary observers, Hitler, Mussolini and Roosevelt were plebiscite-based leaders – autocrats who came to power via varying but thoroughly legal means.3 The inaugural speech of Franklin Roosevelt, in the dark days of March 1933, exemplifies some of these themes. While it is famous for its reassuring assertion that ‘the only thing we have to fear is fear itself’, Roosevelt also offered a call to arms that elevated the state and subordinated the individual in a manner that certainly could have been included in any speech offered by Hitler or Mussolini at that same time. Announced FDR on 4 March: If we are to go forward, we must move as a trained and loyal army willing to sacrifice for the good of a common discipline. We are, I know, ready and willing to submit our lives and property to such discipline, because it makes possible a leadership which aims at a larger good. I assume unhesitatingly the leadership of this great army of our people dedicated to a disciplined attack upon our common problems.4

After this, FDR asked Congress for ‘broad executive power to wage a war against the emergency, as great as the power that would be given to me if we were in fact invaded by a foreign foe’. The National Socialist press caught the statist implications of FDR’s rhetoric. Just as National Socialism superseded the decadent ‘bureaucratic age’ of the Weimar Republic, the main Nazi newspaper Volkischer Beobachter opined, so the New Deal had replaced ‘the uninhibited frenzy of market speculation’ of the American 1920s. The paper stressed Roosevelt’s adoption of National Socialist strains of thought in his economic and social policies, praising especially his bold leadership. ‘If not always in the same words’, the paper wrote, ‘Roosevelt , too, demands that collective good be put before individual self-interest … one can assume that he feels considerable affinity with the National Socialist philosophy.’5

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But rhetoric was hardly the only basis upon which historians have thought that a parallelism existed between the New Deal and fascist Europe. A similar approach to political economy played a key role as well. Although corporatism is often a muddy and ill-defined concept, there is no doubt that the National Industrial Recovery Act (NRA) of 1933–35 was by far the most corporatist experiment of the Roosevelt administration. As with Italian Fascism, key economic and political decisions and arrangements were transposed from parliament to a set of governmental ministries, which in turn delegated decisions involving prices, wages, market share and worker organization to industry itself whose leading figures – almost always representatives of the biggest firm – constructed a ‘code of fair competition’. By 1935 there were more than seven hundred, which legislated industrial conduct for the overwhelming bulk of the American economy. To enforce these codes, the government sometimes went to court, but more often sought to mobilize public opinion, with the symbol of the Blue Eagle and the catch phrase ‘We Do Our Part’ standing at the centre of a system of coercive voluntarism. Those who refused to display the Blue Eagle or adhere to the NRA codes were ostracized, penalized, and in some instances put out of business.6 FDR put General Hugh Johnson in charge of the NRA, assisted by Donald Richberg, a noted labour lawyer. Like many other American progressives, both were enthusiasts for Mussolini-style corporativism. Fascism’s appeal to such liberals was found in its experimental nature, its anti-dogmatic temper, and its moral elan. Johnson, who had been a long-time aide to the industrialist Bernard Baruch, was a particularly close reader of the Italian propaganda pamphlet, The Structure of the Corporate State. He and Richberg drafted the NRA along corporatist lines. As in the reconstruction efforts of Germany and Italy, the NRA entailed both massive public spending and cartel-like industrial planning. Although the NRA had a famous Section 7a which provided that workers could exercise the right to form unions with ‘representatives of their own choosing’, this right remained vague and unenforceable in 1933 and 1934. Indeed, this Section 7a might well have become its opposite, a kind of corporate labour front, because for most large corporations – especially those in steel, rubber and electrical products – and in many paternalistic family firms, Section 7a was interpreted as a warrant to establish company unions controlled by top executives. There would be much worker participation but no opportunity for independent unionism, a prospect endorsed by Richberg, who became an increasingly hostile, right-wing critic of the New Deal in later years and a particular opponent of trade unionism, regardless of the politics of its leadership.7 Indeed, the NRA gave the president enormous power, for the executive had the residual authority to override both labour and capital, and

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impose such codes as the White House saw fit. Richberg later wrote that in drafting the NRA Johnson and he ‘called for a Man of Action, and we got one’. Mussolini’s own response to this was ‘Ecco un ditatore!’ – ‘Behold a dictator!’8 Rexford Tugwell, one of the most left wing and pro-planning members of the Roosevelt brains trust, made a trip to Italy in 1934 and was impressed with Mussolini’s effort to overcome the economic crisis and modernize society. He wrote in his diary that the Mussolini regime has: done many of the things which seem to me necessary. And at any rate Italy is being rebuilt physically in a systematic way. Mussolini certainly has the same people opposed to him as FDR has. But he has the press controlled so they cannot scream lies at him daily. And he has a compact and disciplined nation although it lacks resources. On the surface, at least, he seems to have made enormous progress.9

Waldo Frank, the left-wing novelist and editor, mirrored the thoughts of Tugwell, but with a realistic sense of alarm: The NRA is the beginning of American fascism. But unlike Italy and Germany, democratic parliamentarianism has for generations been strong in the AngloSaxon world; it is a tribal institution. Therefore, a Fascism that disposes of it, rather than sharpens and exploits it, is not to be expected in North America or Britain. Fascism may be so gradual in the United States that most voters will not be aware of its existence. The true Fascist leaders will not be the present imitators of German Furher and Italian condottieri, prancing in silver shirts. They will be judicious, black-frocked gentlemen; graduates of the best universities.10

But the NRA did not lead to an American fascism. Despite its corporatist ideology, and the affinity of some of its leaders for European-style estatism, the NRA never turned into a blueprint for authoritarian governance in the United States. There were three reasons for this. First, the whole point of the NRA was not the elimination of conflict between capital and labour or even the suppression of popular mobilizations, but rather the reduction and amelioration of conflict between capitalists themselves. After three years of depression, the early New Deal was determined to stamp out the hypercompetition that led to a downward spiral of wages and prices. The architects of the NRA hated ‘cut throat competition’. General Johnson called it ‘savage wolfish competition without any direction whatever’. The real enemies of the NRA were neither the Communists nor the more conservative trade unionists, though both labelled this corporatist experiment fascist, but rather the medium and small-time manufacturers and businesses who rebelled at the government-imposed

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codes of fair competition. Indeed it was just such a legal challenge, in the famous Schlechter poultry case, which prompted a conservative Supreme Court to declare most provisions of the NRA unconstitutional.11 Second, the NRA was not anti-labour, or rather it was not afraid of labour. Hostility to the presence of Communists and radicals in the ranks of labour and the unemployed peaked in the years just before the victory of FDR in the 1932 presidential campaign. These were the months in which local police beat up unemployed demonstrators and in which General Douglas McArthur, ignoring the instructions given to him by President Herbert Hoover, sent troops and tanks against the Bonus Army encamped within sight of the nation’s capital. During 1933 and especially 1934 there was much labour activism and strife in the United States. In San Francisco, in Minneapolis, in Toledo and especially in the Carolina Piedmont, local police, national guardsmen and sheriff deputies were called out to battle strikers and demonstrators. But this conflict did not generate an anti-radical call for a restoration of order. It was not fodder for the extreme right, except in some locales such as agriculture in the Deep South and in central California. Indeed, the 1934 elections generated another shift to the left in the American body politic, even as the emergence of Popular Front politics and alliances tempered any overt challenge from either the left or labour. And the New Deal skilfully accommodated its erstwhile opposition on the social democratic left. While the marches of the unemployed on the nation’s capital were met with tanks and gunfire in 1932, just three years later delegations of the unemployed were meeting in the Department of Labor auditorium. Likewise, the politician whose call for a restoration of industrial order rang most loudly was Robert Wagner, architect of the landmark labour law that bears his name. The 1935 Wagner Act did offer as its key rationale the establishment of industrial peace, but only after providing guarantees that genuinely independent trade unions had the power and solidarity to meet with their capitalist adversaries on a terrain that gave to labour the economic and political power necessary to cut a negotiated bargain.12 Ironically, Wagner got his chance to put forward one of the most radical pieces of legislation passed during the twentieth century, because even the crisis of the Great Depression had been insufficient to erode the essential features of American federalism and divided power. It was the Supreme Court, then a recalcitrant and conservative institution, which had put the final, constitutional nail in the NRA coffin, landing a one-two punch that coincided with the disaffection of much business opinion in 1934 and 1935. Wagner’s new labour law was therefore a stopgap designed to repair the damage inflicted by the Court. And of course it had to work its way through Congress, often against the indifference or out-

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right hostility of FDR, Johnson and others who presided over the emergency reconstruction efforts. Had the NRA been more powerful or more successful, the capacity of social democratic parliamentarians to put their impress upon politics would have been frustrated. In Europe, corporatism was successfully anti-parliamentary; in the United States it coexisted with a still powerful legislature, which usefully and democratically jumped into the vacuum left by the collapse, both legal and economic, of FDR’s corporatist experiment.13 But this is not the end of the story, in which a triumphant New Deal and revived labour movement slammed shut the door to U.S. fascism and other right-wing movements. Indeed, it was in the second half of the 1930s that we have to consider yet another moment when the door to American fascism began to squeak open, if only just a bit. By this point three things had happened which led to the emergence of a powerful brand of right-wing politics in the United States. I hesitate to call it fascist because as Waldo Frank had observed, it worked largely through and not against the parliamentary and state-level organs of governance; but unlike the corporatist experimentation of the early New Deal, this post1936 right-wing mobilization was clearly hostile to Roosevelt, to labour, to civil rights and to civil liberties, as well as being isolationist when it came to foreign affairs. And in contrast to the parallels that were drawn between the NRA and Italian corporatism, the right-wing politics of the late 1930s, which extended into the next two decades, had far more of a Prussian flavour.14 First, the rise of a mass trade union movement generated enormous conflict, not just or primarily between capital and labour, but within the working class itself. By the 1930s a majority of all workers in the United States were immigrants, or the offspring of immigrants. They were Catholics, Jews, African Americans and Latinos. White Protestants and North Europeans constituted a minority of all workers, and especially of the blue-collar workers organized into the new unions. Because American corporations had long commanded the loyalty of these more skilled, Protestant, native workers, many of the strikes and unionization campaigns of the early twentieth century took on the character of a kind of internal civil war, an ethnically tinged conflict exemplified by the great packinghouse and steel strikes of the First World War and of the industrial conflict in automobiles, rubber and transport that reached its apogee between 1934 and 1937. If the emergence of the Congress of Industrial Organizations (CIO) constituted the coming into citizenship of a generation of East and South European immigrants and their offspring, then the bitter resistance of the American Federation of Labor represented not so much an

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attachment of one wing of the union movement to craft organization per se, as it did the defence of the petty privileges and power that native and North European workers still commanded within the factory hierarchy. At the great Ford Rouge complex, for example, the rise of the CIO ignited a multiethnic struggle for power in which the politics of Central and Southern Europe was often played out among the sixty thousand workers in Dearborn. The Protestant elite, many of whom were enrolled in the Masonic order, were pro-company, likewise the African Americans who initially looked to Ford paternalism and were mistrustful of the Poles and Italians who constituted the backbone of the newly radical United Automobile Workers (UAW). The Anglo-Irish skilled tradesmen were often syndicalist militants on the one hand and company strivers on the other. Among the tool and die workers there was a pro-German element with Nazi sympathies, as well as a Communist grouping with roots among the Bohemians and Scots.15 This civil war within labour and the lower-middle class provided the social energy out of which emerged a phalanx of right-wing populist movements, hostile to the New Deal, to the new CIO, and to Jews, Communists and African Americans. Among them was the Black Legion, active in the industrial Midwest; the American Legion, a veterans organization, which became increasingly anti-labour and anti-Communist in the 1930s, while in California the predominantly Protestant, lower-middle class followers of Upton Sinclair, who had run for governor on a quasi-socialist platform, shifted abruptly to the right in the late 1930s once it became obvious that New Deal social change in the Golden State would push radical longshoremen and Latino farm workers to the fore. Even more telling was the shift of the immensely popular radio priest, Father Charles Coughlin, from pro-New Deal to a virulent brand of antiCommunist, anti-Semitic, isolationism. Coughlin had been the spokesperson for the American lower-middle class and the Irish, and for Protestant skilled workers who aspired to join it. In Detroit, where Coughlin had played a key role in support of Chrysler unionists who were seeking to shift the company union there into the UAW, Coughlin recoiled in horror in 1935 and 1936 when it became clear that the leadership of the working class would not be Catholic corporatists, but rather a cosmopolitan cohort of secular radicals who saw the new unions as part and parcel of the New Deal coalition. From Coughlin’s point of view, the Rooseveltian welfare state threatened to decrease the prestige and moral authority of the church; while the culturally pluralist politics of the Popular Front promised to subvert the ethnic hierarchies and Christian ethos upon which Coughlin and other traditionalist clerics appealed, both on the radio and in their increasingly frequent revival meetings and convoca-

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tions held in all the major industrial cities of the late Depression era. So Father Coughlin shifted to the right, campaigned for an anti-New Deal third party in 1936, and by the onset of the European war was highly critical of Britain, sympathetic to German aims, and determined to stop Roosevelt from abridging American neutrality.16 Philip Roth’s The Plot against America was therefore hardly a fantasy, but rather an alternate socio-political universe running closely parallel to that which just happened to represent historical reality. But ethnic tensions and resentments are hardly enough to open the fascist door. Big capital also shifted to the right in the late 1930s, creating the alliance with an anxious lower-middle class which has informed and structured right-wing U.S. populism in many a subsequent decade. The failure of the cartel-like NRA and the rise of a socialist-inflected labour movement after 1935 frightened many capitalists who had earlier seen the NRA as either an opportunity to advance their interests or an essential stopgap to prevent total collapse of the economy. ‘The life preserver which is so necessary when the ship is sinking’, observed a Chamber of Commerce official, ‘becomes a heavy burden when man is back on dry land’.17 So now DuPont, General Motors, General Electric, Sears, the oil companies, and a whole cohort of proprietary capitalists moved hard against the New Deal. These businessmen formed the Liberty League which bankrolled an effort to defeat FDR, stymie his programme and persuade the Supreme Court to declare invalid most New Deal legislation, including the Wagner Act. The ‘hate Roosevelt’ quality of this bloc was greatly advanced by the explicitly social democratic, culturally pluralist character of the late 1930s New Deal. As Alan Brinkley has made clear, it was only in the years after 1936 that the term ‘New Dealer’ came to stand for planning, government regulation, social experimentation, and labour power. The New Deal no longer represented an effort to revive a faltering capitalism, but now proposed to regulate and tame it.18 Equally important was a shift in the target of right-wing politics in the late 1930s. President Roosevelt’s court-packing plan of 1937 represented the decisive moment in the crystallization of an aggressive popular, if not populist, brand of anti-union, anti-New Deal sentiment. For more than half a century the Supreme Court had been the conservative defender of property against the government regulation from above, and of labour upheaval from below. When in early 1937 FDR offered the nation his plan to expand, and thereby pack the Court with New Dealers, he opened the door to a world of anti-government invective. Indeed, FDR’s courtpacking plan may be taken as the occasion at which modern conservatism achieves both a mass base and its ideological coherence. Until 1937, small producers, farmers, middle-class shop owners, as well as workers and con-

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sumers, saw the large national business corporation as their enemy and nemesis. They hated the banks, utilities, and agricultural equipment makers. During the early Depression years, for example, chain stores had replaced the railroads, in the demonology of many Southerners as but the latest embodiment of Yankee oppression and commercial seduction. The government loomed far smaller in their social imagination: it stood for the nearby post office, the useful agricultural extension service, and the vital, protective maintenance of social order, at home and abroad. But FDR’s court-packing plan, proffered in the very midst of the sitdown strikes, worked a symbolic revolution, for it seemed to embody all that was threatening in the social and political upheavals of the New Deal. There was the assault on property, the overreach of executive power, the subversion of a hallowed institution of American government, and the New Deal alliance with a radical social movement that threatened the status and power of the old middle class. Thereafter, the American right, no matter how radical, would seek to denounce, defame, and emasculate the power of the central government, but not to expand it except when it came to national security issues – a large exception, but nevertheless a delimited one. Thus the Supreme Court’s eventual validation of the New Deal regulatory state set the stage for the rise of modern American conservatism, whose chief aim was less the conquest of state power than it was the continued fragmentation of American governmental authority.19 This becomes clear when we consider the history of the white South and its resistance to the reformism, of either class or race, that it confronted for two generations after the inauguration of the New Deal. In the 1930s, the New Deal’s offensive against the ‘colonial economy’ of the South was unhappily endured by Southern politicos only as long as their immediate political and financial dependence on federal relief exceeded their longer-term determination to maintain Jim Crow and keep organized labour at bay. But after 1936 the rapprochement between southern Congressional Democrats and the Roosevelt administration fell apart, in part because the CIO had turned its attention to the mills, factories and refineries of the industrial South, and in part because, at the first hint of recovery, the benefits of federal relief paled beside the threat of federal intervention in Southern labour and race relations. Extreme right-wing politics in the United States, and especially in the South, thereafter barricaded itself behind the door of federalism and state’s rights. The American South, which had last dominated the federal government in the years before the Civil War, was reasonably content to stave off New Deal reformism by deploying a threefold veto. In the Congress, its representatives amended all welfare-state legislation to ensure that there were plenty of agricultural, racial and regional exceptions.

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Second, all laws, whatever their content, were administered on a state and local basis, ensuring that ‘good-ole-boy’ officials would take care to preserve class hierarchies and racial mores, regardless of the edicts flowing from Washington. And finally, the South remained essentially lawless when it came to any real effort to enforce a uniform set of social legislative norms. In a pattern that really did have a fascist character, Southern elites had long figured out how to mobilize a big slice of the white working class in the interest of a reactionary and violently oppressive racial order. Thus the bitter resistance to the civil rights movement and to the implementation of school desegregation, which reached its apogee in the 1950s, was but the most overt manifestation of the reactionary manipulation of popular white sentiment, which had first become apparent when Southern elites confronted New Deal statutes covering crop allotments, minimum wages, welfare payments, worker rights, and voting procedures.20 So in the end, the federal and regional character of the American state and of the American right, saved the United States from the emergence of an authoritarian political movement that sought anything but veto power at the seat of national government. Had the American state had more of a Prussian character, then the resistance to the New Deal order might well have taken a more overtly anti-parliamentary, paramilitary character, as it briefly did in the racially tense 1950s and 1960s when resistance to integration generated a revival of rhetoric celebrating ‘states’ rights’, accompanied by sometimes violent clashes with federal authorities. But despite all of its reactionary politics, this fascist road ended in a political cul-de-sac. The racial politics of the American South would eventually go national, but only after they had learned to play the parliamentary game.

Notes 1. 2. 3.

4. 5. 6.

7. 8.

Sinclair Lewis, It Can’t Happen Here, New York 1935. Philip Roth, The Plot against America, New York 2004. Wolfgang Schivelbusch, Three New Deals: Reflections on Roosevelt’s America, Mussolini’s Italy, and Hitler’s Germany, 1933–1939, New York 2006, pp. 1–15 passim; Kenneth O’Reilly, ‘A New Deal for the FBI: The Roosevelt Administration, Crime Control, and National Security’, in Journal of American History 69(3) (1982), pp. 638–58. As quoted in Schivelbusch, Three New Deals, p. 41. Ibid., p. 19. Edward Robb Ellis, A Nation in Torment: The Great American Depression, 1929–1939, New York 1970, pp. 330–64; Colin Gordon, New Deals: Business, Labor, and Politics in America, 1920–1935, New York 1994, pp. 166–203; and see also the long-neglected essay by John Garraty, ‘The New Deal, National Socialism, and the Great Depression’, in American Historical Review 78(4) (1973), pp. 907–44. Melvyn Dubofsky, The State and Labor in Modern America, Chapel Hill 1994, pp. 107–28. As quoted in Schivelbusch, Three New Deals.

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9. Ibid., p. 32. 10. Ibid., p. 37. 11. Gordon, New Deals, pp. 128–65 and 204–39; Stanley Vittoz, New Deal Labor Policy and the American Industrial Economy, Chapel Hill 1987; see the highly useful Theda Skocpol, ‘Political Response to Capitalist Crisis. Neo-Marxist Theories of the State and the Case of the New Deal’, in Politics and Society 10 (1980), pp. 155–201. 12. Lizabeth Cohen, Making a New Deal: Industrial Workers in Chicago, 1919–1939, New York 1990, pp. 251–321 passim; Nelson Lichtenstein, State of the Union: A Century of American Labor, Princeton 2002, pp. 20–53. 13. Dubofsky, The State and Labor, pp. 128–36. 14. For a review of the early literature on this brand of American fascism see, Leo Ribuffo, ‘Fascists, Nazis and American Minds: Perceptions and Preconceptions’, in American Quarterly 26(4) (1974), pp. 417–32. 15. Steve Babson, Building the Union: Skilled Workers and Anglo-Gaelic Immigrants in the Rise of the UAW, New Brunswick 1991; Stephen Norwood, Strikebreaking and Intimidation: Mercenaries and Masculinity in Twentieth-Century America, Chapel Hill 2002, pp. 171–227; Bryant Simon, A Fabric of Defeat: The Politics of South Carolina Millhands, 1910–1948, Chapel Hill 1998, pp. 188–236 passim. 16. Among the outstanding books that explore these issues are Alan Brinkley, Voices of Protest: Huey Long, Father Coughlin, and the Great Depression, New York 1982; Steven Fraser, Labor Will Rule: Sidney Hillman and the Rise of American Labor, New York 1991; Joshua Freeman, In Transit: The Transport Workers Union in New York City, New York 1989; Peter Friedlander, The Making of a UAW Local: A Study of Class and Culture, Pittsburgh 1975. 17. As quoted in Gordon, New Deals, p. 286. 18. Kim Philips Fein, Invisible Hands: The Making of the Conservative Movement from the New Deal to Reagan, New York 2009; Alan Brinkley, The End of Reform: New Deal Liberalism in Recession and War, New York 1996; David A. Horowitz, Beyond Left and Right: Insurgency and the Establishment, Urbana and Chicago 1997. 19. All histories of the New Deal contain an account of FDR’s ‘court-packing’ debacle. A fine one is found in David Kennedy’s Freedom from Fear: The American People in Depression and War, 1929–1945, New York 1999, pp. 331–40; for the shifting nature of American populism see Michael Kazin, The Populist Impulse: An American History, New York 1993; Catherine McNicol Stock, Main Street in Crisis: The Great Depression and the Old Middle Class on the Northern Plains, Chapel Hill 1992. 20. Ira Katznelson, Kim Geiger and Daniel Kryder, ‘Limiting Liberalism: The Southern Veto in Congress, 1933–1950’, in Political Science Quarterly 108(2) (1993), pp. 283–306; Michael Brown, Race, Money, and the American Welfare State, Ithaca 1999, pp. 99–134; Michelle Brattain, The Politics of Whiteness. Race, Workers, and Culture in the Modern South, Princeton 2001, pp. 18–85 passim.

Chapter 9

Turkey in the First ‘World Crisis’ From Authoritarianism to Totalitarianism

Erik-Jan Zürcher

The Turkish Economy 1923–1930 The Turkey of the early 1930s was overwhelmingly an agricultural country. Over 80 per cent of the population lived in the countryside and the agricultural sector completely dominated the economy.1 This would remain the case until the 1950s.2 This agricultural sector, which was primarily composed of sheep farming in the dryer uplands and mountain regions, wheat production in inland Anatolia and the production of cash crops like cotton, tobacco, hazelnuts, figs and raisins in the coastal plains, had gone through hard times in 1927 and 1928, due to unseasonal droughts. Nevertheless, the average growth rate of the agricultural sector between the proclamation of the republic in 1923 and the end of 1929 was 16.2 per cent (largely due to the return to peace conditions), which meant that by the end of the 1920s agricultural output was roughly twice what it had been a decade earlier.3 The world crisis hit agriculture – and the position of Turkey as an agricultural exporter – very hard, as the terms of trade changed rapidly in favour of industrial goods. Since the end of the Turkish war of independence in 1922, agriculture had been the only sector of the economy that had shown significant growth, primarily due to the return of peace after ten years of almost continuous warfare (Balkan Wars 1912–13, First World War 1914–18 and Independence War 1919–22) and the return of conscripted soldiers to the farms. In trade, industry and the service sector activity remained at a very

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low level, however, with growth rates being only half those in agriculture, and this was due primarily to the disappearance of the Armenian and Greek communities that had dominated those sectors at every level. As a result, the industrial growth rate of 8.5 per cent during the 1920s, as Boratav has indicated,4 represents a rebuilding of capacity from very low levels rather than a high rate of industrial growth. By 1927, the level of 1913 was only just being equalled. In trade it was much the same story. Exports to Europe and the United States had been completely dominated by Greek merchants in coastal towns. When they left they took their networks of contacts with them and it took fifteen to twenty years for exports to recover. The government of the early republic was in the hands of a political elite that had been forged in the war years and that consisted of a coalition of bureaucrats and military officers in the service of the central state with local Muslim notables (traders and landowners). Its economic policies between the proclamation of the Republic of Turkey in 1923 and the world crisis have been variously described as nationalist and liberal,5 and perhaps the fairest way to describe them is to say that they were both. The dominance of non-Muslims and Europeans in the modern trade and industry sectors of the Ottoman Empire, the privileged positon of Europeans and European passport holders (often Ottoman Greeks and Armenians) under the system of capitulations that remained in place until 1914, and the stranglehold of the European shareholders in the Ottoman Public Debt Administration over important sections of the economy had left the Turks with a deep distrust of the role of foreign capital. Until 1929 the Turkish government was barred (under the Lausanne Treaty) from changing import and export tariffs unilaterally, but it did everything it could to diminish the role of foreigners and non-Muslim minorities in the economy, forcing companies to employ Muslim Turks in management positions and to use Turkish as the business language, among other things. State monopolies were established to replace the foreign concessions in the trade of tobacco, salt and fisheries, and in the running of the port of Istanbul. On the other hand, like the Young Turk government before them, the Kemalist leadership saw capital accumulation in the hands of a Muslim bourgeoisie and of a prosperous class of property owners in the countryside as the engine for progress and development. It was hoped that, given the opportunity, the Muslim traders and landowners would take the place of the Greek and Armenian bourgeoisie that had disappeared. One mechanism to achieve this was the farming out of activities of the state monopolies to preferred private entrepreneurs. This afforded these entrepreneurs state protection and monopolistic profits. The most important economic measure taken by the government in the pre-1929 era was undoubtedly the abolition in 1924 of the tithe,

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an agricultural tax of 12 per cent that until then had still been levied through tax farming. This significantly increased the trading opportunities for those more affluent farmers who had surplus to sell. As the tithe had been an important source of revenue for the state, its loss had to be compensated – and it was, through the introduction of indirect taxes (on sugar among other things), which thus contributed to a shift in the tax burden from the countryside to the towns, where the consumers lived. For Turkey the crisis of 1929 coincided with the moment when the restrictions of the Lausanne treaty were lifted after six years. The government availed itself of this opportunity to introduce protectionist customs tariffs and foreign exchange controls. This latter was made easier through the founding of a national central bank in 1930, which gained the sole right to issue bank notes and coins. Up to that date the issuing of bank notes had been the prerogative of the Imperial Ottoman Bank, which, in spite of its name, was actually a Franco-British company with its seat in Paris and London. When the crisis broke, the government seemed to be at a loss about its course of action. The value of foreign trade plummeted. Imports went down from over 250 million liras in 1929, to 150 million a year later, and 75 million in 1933. Exports peaked in 1925 at 190 million liras and went down more gradually to a low point of 90 million in 1934.6 While exports were almost wholly agricultural (close to 90 per cent), three-quarters of imports consisted of industrial goods; and the rapid decrease in imports can be explained, firstly, by the deteriorating terms of trade for an agricultural country and, secondly, by the controls imposed by the government from 1930 onwards.

Popular Reaction The crisis and the government’s seeming inability to do much about it increased the unpopularity of a government, and in particular of a ruling party, that was already unpopular with important sections of the population. The ruling party, the Republican People’s Party (RPP), had established a one-party dictatorship in March 1925 through the passing of the Law on the Establishment of Order (Takriri Sükun Kanunu). The opposition parties were banned and the executive was given extraordinary powers for a period of two years.7 In 1927 this arrangement had been prolonged for another two years. During these four years the ruling party had an absolute power monopoly, which it used both to carry out what president Mustafa Kemal [Atatürk] called a ‘social and cultural revolution’ (i.e. the abolition

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of Sharia law, the ban on traditional clothing and the introduction of the European clock, calendar and alphabet) and to strengthen its own position on the ground. The introduction of a European lifestyle and legislation derived from Europe had its supporters, mainly younger intellectuals (bureaucrats and professionals), but it was resented by many, particularly in the provincial towns of Anatolia. At the same time, the way members of local elites managed to abuse their party membership for personal gain also aroused indignation. The way in which the possessions of the Greeks and Armenians that had been killed or expelled were distributed was a case in point. The abandoned possessions were supposed to go primarily to refugees from the Balkans or the Caucasus, but in many cases the richest pieces of real estate ended up in the hands of party functionaries. Sinecures in state companies or companies related to the state monopolies afforded the party elite further opportunities for gain. Finally, the levels of taxation, and particularly the way taxes were assessed without taking account of either the income fluctuations or the hardships brought about by the drought, caused deep anger. The government persisted nonetheless in squeezing every penny out of the – largely rural – population to pay for its public works programme (mainly railways and the building of the new capital Ankara). The historic traumas of the regime made the only other alternative, borrowing abroad, something it was very reluctant to consider.8 It had only just started to repay the portion of the old consolidated Ottoman debt that had been apportioned to Turkey at the peace conference of Lausanne, and the payment of 15 million liras in 1929 represented about 7 per cent of the state revenue.9 By the summer of 1930, Mustafa Kemal was sufficiently alarmed by what he heard about the discontent in the country to encourage the establishment of an opposition party. The idea was that this party was to be as devoutly republican, secularist and nationalist as the ruling party, but that through loyal but critical opposition it could stir the Republican People’s Party into effective action. In August 1930, the Free Republican Party was duly founded by Kemal’s old friend Ali Fethi [Okyar]. Its top echelon all came from circles close to the president. He even ordered his sister to become a member. Right from the start it was seen by the leading cadres of the ruling party as a dangerous experiment (and, one might add, a threat to their position). From their point of view they were soon proved right. The Free Republican Party took part in only one round of elections, the municipal elections of October 1930. It campaigned on a programme that almost exclusively addressed the economic situation, offering a more liberal approach with lower taxation, less state interference and openness to foreign investment. During the campaign this proved massively popular with the voters, in particular in the most developed

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parts of the country, the Aegean seaboard and Marmara basin. A huge demonstration in favour of Fethi Bey in Izmir turned ugly when police shot dead a boy, whose body the father then laid at Fethi’s feet as a sacrifice. Partly due to electoral fraud, the actual success of the party in the elections was limited, but the RPP leadership now managed to convince the president that the experiment was too risky. When Kemal sided openly with the ruling party and emphasized that he was not only president but also chairman of the RPP, the leaders of the opposition realized that they had lost his protection and that the RPP was out for their blood. When the opposition was accused in parliament of being enemies of the regime, Fethi closed down the party voluntarily on 15 November 1930.10 Three weeks later, on 23 December, in the small town of Menemen close to Izmir, a group of half a dozen derwishes caused an incident. They walked into town saying that they were the Army of the Caliphate and would cause the downfall of the ‘infidel republic’. When a young reserve officer (who was also a schoolteacher) tried to stop them, they ceremonially beheaded him and carried his head around on a pole. The riot was quickly suppressed when an army unit reached Menemen and arrested or killed the derwishes, but it was a deeply traumatic event for the Kemalist government in Ankara. What made it so traumatic was two things: the fact that this had happened right in the best-developed part of the country, on the Aegean coast, and that the ordinary citizens of Menemen had stood by and watched it all happen, without any attempt to intervene. Although entirely unconnected to the political events of the previous months, the Menemen incident certainly strengthened the hand of the hardliners in the party who were opposed to political and economic liberalism.

Etatism The period 1930–31 was primarily one of debate and soul-searching about the direction of Turkey’s economic policies.11 Both the inability of free market regimes in Europe and the United States to tackle the crisis effectively and the identification of economic liberalism with the political opposition of the Free Republican Party undermined the position of those who advocated free market solutions. There was increasing consensus in the top echelons of the People’s Party that the state would have to play a leading role in reviving the economy. ‘Etatism’ (devletçilik) became the favoured model, but there was a great deal of disagreement about what this was actually supposed to signify. It was clear that it was not socialism, but rather state intervention in a capitalist system. Circles around

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the Mahmut Celal, the head of the Business Bank (İş Bankası), which had become the dominant financial institution after its forced merger with older banks founded in the Young Turk era, favoured an interpretation in which the state was to create a stronger base on which private enterprise could flourish, while the leading politicians of the RPP, led by prime minster İsmet İnönü, supported the building of a state sector that would permanently dominate the economy. It is significant that Celal was a professional banker, while İnönü’s group consisted of former army officers and bureaucrats without economic or financial expertise. Nevertheless, it was the latter group that won out at the party congress of 1931. Between 1931 and 1933 little was actually done, while the government and party gave priority to the campaigns to further their nationalist cultural policies (the ‘Turkish history thesis’ and the ‘Turkish language thesis’), but from 1933 onwards the state sector began to be built up in earnest. Two major state industrial complexes were built. One was a steel mill and blast furnace built at Karabük with British assistance and the other a huge cotton textile mill, or ‘Kombinat’, built with Soviet assistance in Kayseri. Further state investment went into extension of the railway network and the establishment of a series of sugar factories. The building of a state sector took place in the context of the first instance of economic planning in Turkey’s history: a five-year plan, drawn up with the help of Soviet experts. It followed Soviet precedent with its emphasis on heavy industry, cement production and the ‘three whites’: flour, sugar and cotton. The link between the state and these economic enterprises was formed by two new institutions that were called ‘banks’ but were really investment vehicles for the state: Sümerbank (the Sumerian Bank) for industry, and Etibank (the Hittite Bank) for mining. The declared aim of the introduction of etatism was to achieve autarky for Turkey (in this respect Mussolini’s Italy was as much a source of inspiration as Stalin’s Soviet Union), but in fact the role of foreign credit from the USSR, Britain and Germany in the industrialization was quite important.12 In the agricultural sector, after much hesitation, measures were finally taken to stabilize peasant incomes. In 1935, the Office for Soil Products (Toprak Mahsulleri Ofisi – TMO) was founded, essentially a state buying agency that was given a monopoly in the wheat trade. The TMO established minimum prices at a time when worldwide grain prices were very low and so protected agricultural incomes, but it could only really become effective once it had storage capacity in the form of silos, which could only be built once cement production in Turkey had taken off. The costs of the programme were met in part by a new tax on bread, which was very controversial and which had been the source of the hesitation about its introduction in the first place.13 The aims of the two arms of etatism, the indus-

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trialization drive and the state intervention in agriculture, were sometimes at odds with each other, as the demands of the new industrial complexes tended to take up the meager capacity of the single-track railway system at the expense of the transport of foodstuffs to the towns.14 The successes and failures of economic etatism in Turkey have been judged variously. The politically motivated aversion to foreign direct investment and the drive for autarky meant that levels of taxation had to be very high and that the state sector, including the railways and the port authorities, was allowed to exploit its monopolistic position to set prices relatively high to generate the necessary capital for investment. High taxation had been one of the reasons for the deep discontent that surfaced during the democratic experiment of 1930, and it remained so in the 1930s and 1940s. The drive for autarky and the dogmatic approach of the Soviet-inspired planners militated against the exploitation of Turkey’s competitive advantages, which would have pointed in the direction of agro-industries and food production rather than heavy industry. The decision to squeeze as much tax as possible out of the population in order to build large-scale industrial plants and infrastructure meant that there was no encouragement (or credit) available for the production of tools or equipment that private individuals such as farmers could buy. This negatively affected productivity, which remained very low. On the plus side it has been pointed out that the newly developed state sector did indeed give Turkey a basic industrial infrastructure and that it made it less dependent on imports. The Sümerbank textile mill of Kayseri was a pace-setter. Turkey had been a major producer of raw cotton for decades but now for the first time did not have to import cotton yarn or cloth. Also, the state industries over a period of two decades provided Turkey with its first generation of experienced managers and engineers, without which the private sector industrialization of the 1950s and ’60s would have been much more difficult.

From Authoritarianism to Totalitarianism Establishing a leading role for the state in the economy went hand in hand with significant changes in the political climate of the country. The shockwave created by the Menemen incident, even though it took place more than a month after the closure of the Free Republican Party, seemed to vindicate those in the ruling party who from the beginning had warned that political pluralism would open the door to counter-revolutionary and reactionary movements. From 1931 onwards the state and the party started to extend their control over society. To begin with the internal

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structures of the party were changed in 1931, and again in 1935, to give the centre more top-down control over the branches. Ever since the establishment of the republic, the leadership in Ankara had been heavily reliant on the support of local elites that almost always had also formed the basis for the regime of the Young Turk Committee of Union and Progress between 1908 and 1918, and Ankara was growing more and more impatient with the way the party was being domesticated by these local power brokers. Finally, in 1936, the party congress decided to merge state and party structures on all levels, the minister of the interior becoming secretary-general of the party, and provincial and district governors doubling as regional party chiefs. Opposition was no longer tolerated. Nor was open debate.The press had already been muzzled under the Law on the Establishment of Order of 1925, but that had expired in 1929 and in the following year there were a few attempts to establish a free press, most notably by a Leftist journalist (and old friend of Mustafa Kemal) Arif [Oruç], who criticized the corruption and lethargy of the party in his paper Yarın (Tomorrow) during 1929–30.15 In 1931 a new press law was passed that put an end to such experiments. It made it illegal to publish anything that ‘contradicted the general policies of the country’.16 The following years saw the gradual repression of the most important civil society organizations. In 1931 the Turkish nationalist culture clubs called ‘Turkish Hearth’ (Türk Ocağı), which had built a widespread network of 267 branches throughout the country since 1913, was closed down. The next year its branches were replaced with the ‘People’s Houses’ (Halk Evleri), which fulfilled a very similar function, but which crucially were incorporated into the People’s Party as its cultural and educational branch. The People’s Houses took over the assets of the Hearths. In 1933 the university in Istanbul, the only one in Turkey, was closed down. The whole faculty was dismissed, and only a minority of the professors were rehired after the reorganization. The new institution, now named Istanbul University, was reorganized, and staffed partly with German academics seeking refuge from Hitler’s regime. The new charter ended the autonomy of the university and placed it directly under the control of the Ministry of Education. Ostensibly, the reason for the reform was to improve the academic standards, but the fact that the faculty of the university had been sceptical about the new linguistic and historical theses that were embraced by the president of the republic from 1931 onwards was undoubtedly an important factor. The students of the university also awakened the regime’s displeasure. The National Union of Students held a small demonstration before the Bulgarian embassy in Istanbul to protest the clearing of Muslim graveyards in Bulgaria. The

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demonstrators were arrested and a stern warning was given that the union would be closed down if this happened again. Three years later the union was indeed closed down and its leaders arrested, when students held a nationalist demonstration in favour of the incorporation of the district of Alexandrette (in the French mandate of Syria) with Turkey. In 1935 the Turkish Women’s Union, which had been founded by leading feminists of the late Ottoman era, who had been active in the War of Independence, ‘voluntarily’ dissolved itself at the request of the People’s Party. It declared that its aims had now been met in the new Turkey and that it had become superfluous. The same year the Grand Lodge of the Freemasons in Turkey decided to extend its Summer recess ‘indefinitely’ (in practice until after the Second World War) at the behest of the Minister of the Interior, Şükrü [Kaya], himself a leading mason. The Turkish Society of Journalists and Newspapermen was also dissolved. Interestingly, all of the civil society organizations described here were ideologically close to the Kemalist ruling party. Unlike the organizations like the Derwish orders closed down in the mid-1920s, these were not age-old religious associations, but secularist, nationalist ones with a membership from the educated middle class, devoted to the ideals of modernization and nation building. This is just as true for the Turkish Hearth as for students demonstrating for the incorporation of Alexandrette. Their demands were actually taken over by the leadership of the republic. Ever since the days of the Young Turks, many members of the military and political leadership had been freemasons. Nonetheless, all of these organizations were suppressed or incorporated into the party structure. The official argument was that a unification of all the national forces was needed for the next phase in the revolution, but it is clear that the authoritarian state that had been in being since 1925 felt a need for total control of every aspect of social life. In other words, it turned from authoritarian into (would be) totalitarian.

The Role of the Crisis An interesting question to be asked in the context of this conference is whether this turn towards totalitarianism would have happened anyway or whether we can link it directly to the world crisis. As I have argued elsewhere, a case can certainly be made for the idea that the Kemalist movement, like that of the Young Turks from which it sprang, had an inbuilt tendency towards authoritarian rule; not only because it was ideologically indebted to positivism, or because it was led by professional soldiers, but also because transforming Turkey into a strong

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nation-state built on a modern society based in technology and science was their overriding goal. They did see popular sovereignty, constitutionalism and democracy as emblems of modernity, and legitimized their rule through reference to these concepts, but fundamentally, when faced with the choice between fast elite-led modernization and a slower pace of change with popular support, they opted for the former. They were typical representatives of the ‘revolution from above’. This, however, much better explains the establishment of authoritarian rule in the mid-1920s than the suppression of the ideologically related civil society organizations in the 1930s. Here, I think, the world crisis comes in. The events of 1930 can be seen as a mutual loss of trust between the party leadership on the one hand and large sections of society on the other. There was already a great deal of discontent, particularly in the more developed areas of the country, in 1929–30, as the mass support for the Free Republican Party showed. The suppression of this party caused disenchantment in these areas. The inability of the state to do anything effective to combat the crisis in the years 1930–33 further alienated the population, in particular the urban middle class, who lost many of their small luxuries when import restrictions made consumer goods rare and expensive. But there was disenchantment on the other side as well. The huge support for the opposition in 1930, followed by the traumatic event in Menemen, strengthened the distrust among the Kemalist leadership of civil society in general and of the business community in particular. In the Kemalist world-view there was a strong, almost fundamental opposition between the national interest, to be guarded by state and party, and the selfish concerns of interest groups. And the establishment of etatism was in a sense a reaction to the failure of the private sector to build a modern Turkey, a failure which also became blatantly visible with the crisis of 1929. The fact that the two countries that seemed to have weathered the storm of the crisis best, Italy and the Soviet Union, were both totalitarian states that forcefully mobilized the national resources to establish autarky also certainly inspired the Kemalists. In the years 1930–33, when the crucial choices were made, the liberal democracies seemed to have failed utterly and Nazi Germany was not yet a model that could be emulated. One could argue that the economic policies and the political repression were linked. Once the choice for etatism was made, a system that prioritized long-term economic development over meeting the needs of the current population, and which demanded the squeezing of tax revenues out of an already poor population for the big investment projects, a high degree of repression was probably inevitable as these policies ran counter to the short-term interest of most groups in society. In 1939 Turkey was

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placed on a war footing (although it remained neutral until 1945), and under the ‘National Defence Law’ (Milli Korunma Kanunu) of January 1940 the powers of the authoritarian regime were made even broader. It gained the right to set prices and requisition products, and even to impose forced labour.17 The resentment caused by the Kemalist policies built up during the 1930s and ’40s, and finally showed when the population got their first chance to vote in free and fair elections in 1950. The Republican People’s Party was voted out of office in a landslide by a party which had for its slogan ‘Enough! Now the people will speak’ (Yeter! Artık söz milletindir). The party that came to power, the Demokrat Parti, had its electoral base primarily in the countryside and among the workers and middle class in the towns. It was strongest in the developed west of the country. In other words, it derived its strength from the social groups and regions where opposition had been strongest in 1930, and therefore a case could be made that the authoritarian regime that emerged in the wake of the world crisis froze the political development of Turkey for twenty years.

Notes 1. William Hale, The Political and Economic Development of Modern Turkey, London 1981, p. 64. 2. Şevket Pamuk, ‘Economic Change in Twentieth-Century Turkey’, in Reşat Kasaba, The Cambridge History of Turkey, Vol. 4: Turkey in the Modern World, Cambridge 2008, p. 268. 3. Korkut Boratav, Türkiye İktisat Tarihi 1908–1985, Istanbul 1988, p. 39. 4. Ibid., pp. 39–40. 5. Aykut Kansu has severely criticized the interpretation of the 1920s as the ‘liberal decade’ by economic historians like Boratav, arguing that the state acted to increase its hold on the economy through the exploitation of monopolies in partnership with foreign investors. Aykut Kansu, ‘Economic Policies between 1908 and 1950’, in Erik-Jan Zürcher (ed.), Philologiae et Historiae Turcicae Fundamenta II Turkey in the Twentieth Century, Berlin 2008, p. 370. 6. Max Weston Thornburg, Turkey: An Economic Appraisal, New York 1949, p. 277. 7. Erik-Jan Zürcher, Political Opposition in the Early Turkish Republic: The Progressive Republican Party (1924–1925), Leiden 1991. 8. Cem Emrence, 99 Günlük Muhalefet Serbest Cumhuriyet Fırkası, Istanbul 2006, p. 50; Pamuk, ‘Economic Change’, p. 278. 9. Boratav, Türkiye İktisat Tarihi, p. 36; Hale, The Political and Economic Development, p. 44. 10. Emrence, 99 Günlük Muhalefet Serbest, gives the best analysis of the rise and fall of the Free Republican Party. On pp. 49–72 he analyses the economic causes for the discontent among the population that the party mobilized. 11. For an eyewitness account of the debates in 1930–31 by an ardent supporter of etatism, see Ahmet Hamdi Başar, Atatürk’le Üç Ay ve 1930 dan Sonra Türkiye, Istanbul 1945. 12. Kansu, ‘Economic Policies’, p. 372. 13. Başar, Atatürk’le Üç Ay, pp. 100–4.

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14. Thornburg, Turkey: An Economic Appraisal, p. 80. 15. Mete Tunçay, Tek Parti Dönemine Yurtdışından Muhalefet Eden bir Yayın Organı Arif Oruç’un Yarın’j, Istanbul 1991, p. 8. 16. Nurşen Mazıcı, ‘1930’a kadar basının durumu ve 1931 matbuat kanunu’, in Atatürk Yolu, Vol. 9, No. 5, Ankara 1996, http://dergiler.ankara.edu.tr/dergiler/45/809/10292.pdf (accessed 30 October 2009). 17. http://www.mevzuat.adalet.gov.tr/html/816.html (accessed 30 October 2009).

Chapter 10

Brazil in the 1930s State Building, Nationalism and Working-Class Agency

Alexandre Fortes and Paulo Fontes

In Brazil, as in many other countries, the 1930s marked a decisive turning point in working-class history. We will approach the changes experienced at that historical moment from four convergent perspectives. First we will make use of some historiographical contributions from the last decades in order to identify relevant elements in the country’s earlier trajectory of social struggles, which government propaganda and long-time prevalent academic interpretations attempted to erase from historical memory. Afterwards, we will briefly outline the main features of the corporatist labour relations system established between 1930 and 1943, and comment on its impact on the labour movement in the following decades. We will also analyse the place of the Brazilian experience in the context of the transformations undergone by the three largest Latin American countries in the 1930s and ’40s. Finally, we will make some remarks about the persistent relevance of the debate on these issues for contemporary Brazilian politics. For a long time, the late abolition of slavery in 1888 and the wave of European immigration that followed were seen as the unavoidable starting points for the history of workers collective movements in Brazil. However, recent researches have demonstrated that those movements also had their origins in phenomena that could be identified from at least the first decades of the nineteenth century. Among them, it is worth mentioning

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occasional strikes by slaves and free workers,1 and the creation of trade associations by artisans – frequently former slaves that aimed to buy the freedom of their still enslaved fellows.2 Continuities in organizational traditions among groups of urban slaves and wage-earning workers that became part of the workers movement’s hardcore at the beginning of the twentieth century have also been highlighted.3 However, in spite of those very important precedents and continuities, some very important changes can be observed in the early twentieth century. The first occurrence of a general strike was recorded in 1903 in Rio de Janeiro, and up to 1906 the same experience took place in São Paulo, Santos and Porto Alegre, among others. After a decade of lower strike activities, a new surge was propelled by the effects of the First World War, in particular the combination of accelerated growth in industrial activities and rising costs of living. Its climax was reached in 1917, when simultaneous general strikes almost paralysed the country’s most important urban centres. That increasing collective presence of workers in the public sphere played a decisive role in putting the so-called ‘social question’ at the centre of the Brazilian political agenda. Inside the National Congress, the proposal of a ‘labour code’ spurred debates among supporters of the laissez-faire doctrine and social reformers influenced by positivist, corporatist and socialist ideas.4 In the following two years, new attempts at general strikes were suppressed by fierce state repression, marked by the arrest and expulsion of activists – a situation that got even worse after 1924. In a context marked by conflicting visions about the Russian Revolution and its outcomes, disputes among different political trends inside the labour movement were also aggravated, generally with severely damaging consequences. It was in that adverse situation that labour leaders faced the strategic challenge of beginning to build up forms of permanent organization among factory workers, which, due to their economic relevance and rapidly increasing proportional size, were gradually becoming the most important sector among urban working classes. The challenge was even greater because, contrary to what happened with the trades that had pioneered unionization in the prior decades, large Brazilian mills – mainly found in textile and food processing industries – were at the time marked by a strong presence of women and children. However, during the 1920s, despite those difficulties, although the Brazilian labour movement did not engender mobilizations of the same magnitude as in the 1917–19 period, it deepened its roots and reoriented its strategies, acquiring organizational consistency through the creation of a great number of unions that in general combined in one organization the roles of mutual associations, Bourse du travail, and instruments of collective bargaining.

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Workers remained in great measure excluded from electoral participation because of the disenfranchisement of illiterate citizens and the great presence of recent immigrants in the main urban centres. Moreover, there was hardly any incentive for attempting to overcome such barriers due to the low reliability of the Brazilian political system, marked by the generalized use of electoral fraud and other mechanisms in order to perpetuate the oligarchic control of governments and parliaments. Even so, from 1917 to 1930, many state governments, and the federal government itself, took the first initiatives in creating labour laws, although in an asystematic and very ineffective way. Getúlio Vargas’s candidacy to the Presidency of the Republic in 1929, although it represented above all the landowning oligarchies of some peripheral regions, catalysed the dissatisfactions of urban middle classes and the hopes of workers, to whom he promised the solution of the ‘social question’, through a more active role of the state in intermediating capital-labour conflicts. Defeated by a close margin in a notoriously suspicious electoral system, Vargas took advantage of the devastating effects of the 1929 New York Stock Exchange Crash on the coffee-growing elites from the centre of the country to release – with the decisive support of middle-ranking officials of the armed forces – a successful political movement that brought him to power in October 1930. One of his first administrative acts was the creation of the Ministry of Labor, Industry and Commerce, in 1931. The first staff of the ministry was mainly composed of lawyers with large experience in dealing with the labour movement, whose efforts were directed to the expansion and systematization of the country’s labour law.5 The most remarkable result of their work was the proclamation, in 1943 during the so-called New State Dictatorship (1937–1945), of the Consolidação das Leis do Trabalho (CLT), a comprehensive and detailed legal document that establishes not only workers’ general rights, but also specific guarantees and conditions for many professional groups, as well as the official union structure, in similar bases for workers and employers. Sixty-six years later, the CLT remains as the ruling basis for labour relations in Brazil’s private sector. From the labour movement point-of-view, those twelve years between the creation of the Ministry of Labor and the CLT proclamation can be basically divided in two moments. In the early 1930s, the new government conquered the initiative and succeeded in redefining the grounds on which labour conflicts took place. However, there was still a large space to manoeuvre for organized workers, which legitimated and expanded the repercussion of their struggles, now focusing on the enforcement of the labour law. The state lacked

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the will to face the fierce resistance from employers to any reduction in their profits and to accept any interference in their arbitrary power at the workplace. Thus it was the labour movement that searched to transform the promises of the law in effective social rights, and the immediate result was an important wave of strikes in 1934–35.6 As we will see ahead, a disastrous insurrectional attempt led by the Communist Party followed those labour mobilizations. Both were used for Vargas to justify the intensification of the state repression, opening the path to the ‘New State’ coup in 1937. In the following years, the more militant sector of unionism suffered the devastating effects of imprisonment and torture, and got confined to clandestine action. Yet those segments prone to cooptation saw the space open to take over the unions. Little space was left open even for a more pragmatic collective bargaining. In that new context, the government directed its efforts to impose a controlled patronage over some expressions of popular culture (soccer, samba and capoeira, only to mention the better known among them), promoting their inclusion in the mainstream national culture. By the time of the Second World War, the construction of a stated-defined positive ideal of the ‘national worker’ also began to play an important role in Vargas’s political project. Thus, repression and cultural policy were both vital complementary elements in the political context that gave birth to the CLT and played an essential role in creating conditions for its success and resilience.7 It became a commonsense among critics of the Brazilian labour law – both political liberals and members of the left – to denounce it as a simple copy of the Fascist Italian labour legislation. That is certainly a simplistic statement, easily rebutted by the results of empirical research. However, the most recent tendency to deny the profound fascist influence over the New State law-makers is equally inaccurate, since it is true that ‘large portions of Vargas’s 1937 Constitution’ were, in fact, ‘literally taken from the Carta del Lavoro’.8 In spite of this theoretical inspiration and the repressive methods used to impose them, Vargas’s laws, resignified by workers’ struggles, had an inclusive effect that transformed the country’s political system in a durable way. On the other hand, they created for many decades serious obstacles for class-based and autonomous political projects, even in formally democratic periods such as between 1945 and 1964. They also engendered what an influent work of the late 1970s called a ‘regulated citizenship’, in which the titularity to social rights was dependent upon the inclusion in the formal urban labour market – that had to be proven by one specific document, the ‘labor ID’ – a situation only partially modified in the last decades.9 Recent researches have demonstrated that the extension of some social rights to rural workers was not absent in the Vargas govern-

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ment’s intentions, but they were originally excluded from the CLT’s wide regulatory spectrum.10 If it is correct to affirm that Brazilian corporatism has its irreducible peculiarities, it is also true that, in order to better understand it, we have to locate it as a specific expression of global and regional tendencies that mark that historic period. Made up of national economies almost exclusively based in the exportation of primary goods, Latin America was the region of the world in which the political impact of the depression unleashed by the 1929 Crash was felt most immediately. As Eric Hobsbawm points out, as early as 1930–31, ‘twelve countries changed their government or regime … ten among them through military coups’.11 That was the most remarkable expression of the worldwide reversal in political tendencies, ending a period of more than a century marked by the overall diffusion of liberal institutions. Brazil, Argentina and Mexico, Latin America’s three largest countries, followed distinct trajectories and chronologies, but all arrived at the postwar era with political systems in which workers came to play a significant role as supporters of individual leaders, parties or movements that either polarized or almost monopolized national political life. Maybe the most important difference between the three countries in that period was the fact that in Brazil, contrary to the other two, it was marked by the long persistence of the same leader in power. Getúlio Vargas ruled during the fifteen years from the beginning of the economic depression to the fall of nuclear bombs over Hiroshima and Nagasaki. Between 1930 and 1934, he moved from a provisional government to a constitutional presidency, both expressions of his amazing ability to manipulate the divisions and contradictions inside the previous liberal oligarchic system, on which the largest economic and political interests of the country were still based. In 1937, as we have seen, he became a dictator under the aegis of a Constitution that institutionalized authoritarianism. During the Second World War, his government, in which some sympathizers of the Axis Powers played very important roles, remained neutral up to 1942, when he declared war on Germany and obtained a series of concessions from the United States in exchange for the establishment of armed bases in the Brazilian north-east. The most important element in those negotiations involved North American financial support for the construction of the Volta Redonda steel mill, which would begin the transformation of the country with the largest iron mines in the world from an importer to a great producer of steel, a decisive turning point that unleashed, in the following decades, a qualitative jump in the Brazilian industrialization.

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Three years later, in the months that preceded his removal from power by a military-civilian coup, Vargas converted himself into the supreme leader of a nationalistic and reformist mass movement. In that new capacity, he would finally become a president elected by popular vote in 1950. After almost four years back in power, in a controversial and very conflicting presidential term, Vargas committed suicide on 24 August 1954. In a more democratic environment his notorious skills to conciliate and manipulate different political groups seemed to be neutralized, and his government sunk when faced with charges of corruption and attempts to silence the opposition by using political violence. However, the dramatic effect of his personal sacrifice was amplified by his ‘Letter of Will’ in which he claimed to have struggled against the exploitation of Brazil and its people, and attributed the attacks he suffered to the fact that he had become ‘dangerous to the powerful of the day and to the privileged castes’. Although his politics had always been ambiguous at best, Vargas’s image and memory would be almost immediately turned into the most important symbolic tool unifying an increasingly radicalized anti-imperialist popular movement that would only be defeated ten years later, by the military coup of 1964. Back to the comparisons between Brazil, Argentina and Mexico at the 1930–45 conjuncture, it is worth noting that, in spite of their different courses, they came to very similar results with regards to our topic. Corporatist systems of labour relations were set up, marked by the combination between, on one hand, the recognition, or even the officialization of unions and, on the other hand, the establishment of institutional arrangements guided by the intention of subordinating those working-class organizations to state and party apparatuses, seen as the depositaries of national interests considered to be above class interests. Moreover, those corporatist systems came to demonstrate remarkably resilient characteristics, engendering durable effects in the following decades, either in the survival of the laws that regulate them (as in Brazil),12 or in the subordination of a hegemonic union confederation to the ruling or majoritarian party (as in Mexico and Argentina). In one way or another, the late 1930s and early 1940s witnessed, in the largest Latin American countries, the build-up of the corporatist institutional infrastructure, that – simultaneously or later on – would become the main basis for the development of the populist phenomenon. Although it can certainly be pointed out that in Mexico the origins of those processes can be traced back to the revolutionary process of 1910– 11 and that the main legal principles regarding labour relations were set by the 1917 Constitution, there is general agreement that the Cardenas presidency was pivotal to ensure the institutional stability and power of

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legal enforcement that explain the endurance of the system.13 But how does one explain those wide convergences given the striking national peculiarities? First of all, we have to frame those regional tendencies in the larger context of worldwide changes that marked the period. As Karl Polanyi argued in a classical work, although the crisis of liberalism could be diagnosed already in the 1920s, it was only after the 1929 Crash, more precisely in 1933–34, that the search for alternative political and economic models became imperative. That was a moment marked by the simultaneous experiences of the New Deal and of National-Socialism, but also by the results achieved by the first Soviet Five-Year Plan and by England’s definitive rupture with the Gold Standard.14 In Latin America, it was also in the mid-1930s that it became clear that the world of the nineteenth century would never be restored, and the economic policies first adopted by some of the region’s most important countries at that moment would be later labelled ‘Import Substitution Industrialization’. Some of the most important long-term results of those policies were the quantitative and qualitative changes they produced for the working classes of the countries that adopted them, dramatically increasing their potential political weight. But the impact of these structural changes in the Latin American labour movement was mediated by the specific regional character assumed by the international political and ideological struggles that criss-crossed the period. That was the moment at which the Communist International (‘Comintern’), faced with the overwhelming move forward of Nazi Fascism, abandoned the disastrous strategy of the so-called ‘Third Period’ and adopted the promotion of the ‘Popular Fronts’. In Europe, as pointed out by many authors, that move ended up putting the political left at the centre of broad anti-fascist coalitions, and in some countries even led to a considerable adhesion of segments of the organized working class to Communism as it became quite clear in the immediate postwar period.15 Yet that kind of strategy could hardly be completely transplanted to Latin America, except in a few countries with very specific political situations, such as Chile. In spite of the influences of European fascist experiences over Latin American populists or proto-populist governments, the attempts to characterize them as the main nucleus of political reaction and to set up broad alliances with other forces against them led in general to political disasters. In Mexico, that would be so unrealistic that the Mexican Communist Party acted as a cautious supporter of Cardenas’s reforms and nationalistic politics, which produced great confrontations with the Mexican right and the United States’ interests. A completely different situation would be found in Brazil, where the former leader of the lieutenant’s movement in the 1920s, Luís Carlos

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Prestes, converted to Marxism, was imposed by the Comintern as the new head of the Brazilian Communist Party. The frustrated insurrectional initiative from 1935 opened up political space for Vargas – up to that moment weakened by the distrust of sectors of the traditional elites and of the Catholic Church, as well as by the dissatisfaction among urban middle-classes.16 He forged a wide anti-Communist coalition around himself, becoming in 1937 a dictator with almost absolute powers. The repression that followed that armed upheaval hit Brazilian unionism very hard. Strikes of relevance would take place again only a decade later, in connection with the struggle to democratize the country in 1944–45.17 Even worse were the results from somewhat similar errors through different means by the Communist leadership in Argentina, where their adherence to the anti-Perón coalition in 194618 accelerated the shrinkage of the party working-class rank-and-file that the very rise of the Peronist movement had initiated. However, leaving aside the varying degree of success of their strategies at the level of ‘big politics’, it is possible to affirm that in the 1930s and ’40s Latin American Communists – although in general outnumbered – established a significant influence in their respective labour movements. As demonstrated in recent researches on such distinct industries as metalwork, meatpacking and ports, Communists, most of the time, developed the methods that made possible the organization of factory workers, which in many Latin American urban areas were becoming at that precise moment the core of a new class configuration19 or that developed mechanisms that replaced gangsterism among other groups with a previous experience of unionism, such as happened among the dockers in some important ports.20 Pragmatic and disciplined, Communist working-class militants took advantage of the hopes raised by the expansion of labour law and by the ‘topdown political incorporation’ of the working class in order to mobilize and to expand workplace organization. Simultaneously, they committed themselves to ideological propaganda and, gradually and carefully, to extending party recruitment – a very effective line of action whose results, as we have seen, were sometimes damaged by top-level party leadership decisions. What we want to stress is that, at the moment of their birth – and, at least in the Brazilian case, for much longer – the political forces built up from inside the state that managed to gain some support from the urban working class were engaged in a harsh dispute with Communism, a fact that has unfortunately been forgotten in many recent analyses of the period.21 Certainly, the disputes between, on one hand, Peronists, Varguists and PRI activists and, on the other hand, Communists, did not prevent alliances being set up in specific conjunctures, but the use of the

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repressive power of the state in favour of its supporters was also a very important part of the game.22 Moreover, the mechanisms for officialization of union activities established many explicit ways for excluding the left, aiming, often successfully, to perpetuate the political control of workers’ organizations by the state.23 In the previous sections, we have summarily portrayed some aspects of the Brazilian working-class history and of the Latin American political context of the 1930s and ’40s from which Getúlio Vargas and his labour policies emerged. Now, we can move to a discussion of what remains and what has changed in Vargas’s ‘heritage’ regarding labour relations in Brazil, almost eighty years after he reached national power for the first time. In what concerns the unions, three fundamental aspects of the CLT remain untouched up to now: (1) the need of official recognition by the state; (2) the existence of only one union by branch of economic activity in each territorial unity (usually a municipality); and (3) the compulsory payment of an annual ‘union tax’, corresponding to one day of work, by all workers, regardless of their affiliation or non-affiliation to the union.24 An additional line of continuity could be found in the maintenance of medical, dental and juridical assistance – among others – inside unions. However, other elements originally considered to be integral parts of the Brazilian model of state-controlled union corporatism have undergone important changes, either as a result of the greater political autonomy acquired by unions in the context of democratization since the late 1970s, or a result of legal changes promoted by the 1988 Constitution. Critics of Brazilian official unionism used to say that it had ‘neither feet nor head’, because the CLT, on one hand, did not recognize any form of representation at the workplace and, on the other hand, explicitly prohibited the creation of any kind of union organization involving more than one professional branch, such as general confederations. The sole ‘head’ of the union system was the Ministry of Labor, who had the power to control and to intervene in union activities, including to veto candidacies to the unions’ boards, and to replace elected boards with appointed ones. One of the most shocking aspects of the system was that those repressive activities were financed by 20 per cent of the funds raised from collecting the ‘union tax’ in the entire country having gone to the Ministry of Labor itself. Today, those repressive functions, formerly exercised with the vigilant support of the political police, have been suppressed. The 1988 Constitution established the election of shop stewards proportionally to the total number of employees in a given workplace, although proposals aiming at the legal recognition of factory commissions were defeated. General Confederations have operated freely in the country since 1983, when the CUT

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(Workers’ United Centre) was created and, in Lula’s government, five of them were granted official recognition (so far there are five General Confederations in this situation). That made it possible, although still rare, for the General Confederations to take part in collective bargaining, that basically still follows an annual schedule, with different months for each group of workers, the eventual deadlocks in negotiation being subject to the mediation of Labor Courts – another creation of the Vargas age that survived even to the neo-liberal 1990s. In spite of those important changes, the amazing persistence of many of the main features of the institutional structures built up from the 1930s onwards has maintained them at the centre of recurring debates in Brazilian political and intellectual life. Since 2002, Brazil has been governed by Luís Inácio Lula da Silva, a former factory worker whose leadership was nurtured inside the official union structure, after he was first elected, in 1975, to the presidency of the São Bernardo do Campo Metalworker’s Union in a peripheral sector of the São Paulo metropolitan area known as the ‘ABC region’.25 Leading the most important wave of strikes in Brazilian history, between 1978 and 1980, Lula became the most important critic of the limitations imposed by the labour law. In those years, the attempts of the ABC workers to settle a free collective bargaining were dismissed, their union’s board was replaced by one appointed by the government, and, finally, many of their local leaders, including Lula, were arrested. It was in that context that he proclaimed: ‘The CLT is the worker’s AI-5’, making a comparison between Vargas’s labour law and the instrument created by the military dictatorship in 1968 to provide it with the necessary legal means to destroy the clandestine left, also used to keep the more moderate segments of the democratic opposition under constant threat.26 Lula’s predecessor, sociologist Fernando Henrique Cardoso, a former exponent of the ‘Dependence Theory’27 as well as his old-time colleagues from the so-called São Paulo School of Sociology, blamed populism for the structural fragilities of the Brazilian postwar democratic experience. Some of them believed that after 1930, the country witnessed the passive incorporation of a new working class constituted by rural migrants of recent extraction, in contrast to the idealized image of a former ‘unionism of activist minorities’.28 Others somewhat disagreed with that kind of determinism and emphasized political factors, but concluded that in 1945, workers had ‘forgotten their past of struggles’ and that the Communist Party’s mistaken strategic choices had played a decisive role in legitimizing the official union structure.29 Whatever their analytical disagreements, all of the ‘paulista sociologists’ converged in considering ‘populist unionism’ a key factor in explaining the lack of working-class resistance to the 1964 Military Coup.30

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Thus, it is somewhat understandable that, in his inauguration speech in 1994, Cardoso declared that ‘putting an end to the Vargas Age’ would be the main goal of his presidency. Somewhat more surprising was the path chosen to achieve that aim: an uncurbed adhesion to neo-liberal policies, including an attack of large proportions to working-class historical rights and its organizations, as was made quite clear at the oil workers’ national strike of May 1995. It was at that moment that Brazilian unionism began to undergo a paradoxical turn in its appreciation of the Vargas labour law. As mentioned above, the labour legislation had lost most of its repressive power, and at the same time it was becoming a quite effective weapon against the powerful tendencies that favoured a deregulation of labour relations. Observing the complex and paradoxical historical evolution of the Brazilian corporatist union structures that we have briefly outlined above, many authors have concluded that it has been, from its starting point, marked by a fundamental contradiction. It has only functioned as a source of legitimacy to state power when it has displayed a certain degree of associative vitality, but when that has happened, unions have quickly become the catalyzers of the very kinds of conflict that the corporatist doctrine attempted to deny in its quest for bringing ‘social harmony’ to the country.31 It is possible that the continuity of Brazilian democratization will create future conditions for rebuilding the system of labour relations on new bases. Prospects for that will certainly increase if the country’s remarkable political stability in recent decades is accompanied by active state action in favour of socio-economic development and of combating the huge social inequalities which still characterize it – a combination that, in a certain measure, has been taking place in recent years. At the moment, however, there is nothing on the horizon that indicates that the long reign of the CLT is coming to an end. Thus, the analyses of the relationship between workers, employers and the state in the 1930s and 1940s will probably continue to be a topic of interest in Brazil for some time to come.

Notes 1. João José Reis, ‘A Greve Negra de 1857’, in Revista USP 18 (1993); Arthur Renda Vitorino, ‘Escravismo, Proletários e a Greve dos Compositores Tipográficos de 1858 no Rio de Janeiro’, in Cadernos AEL 6(10/11) (1999). 2. Among others, see Luis Felipe de Alencastro, ‘Proletários e escravos. Imigrantes portugueses e cativos africanos no Rio de Janeiro 1850–1872,’ in Novos Estudos Cebrap 21 (1988); Claudio Batalha, ‘Sociedades de trabalhadores no Rio de Janeiro do século XIX: algumas

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3.

4. 5.

6.

7.

8. 9. 10.

11. 12. 13. 14. 15. 16. 17.

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reflexões em torno da formação da classe operária’, in Cadernos AEL 6(10–11) (1999); Sidney Chalhoub, ‘Solidariedade e liberdade: sociedades beneficentes de negros e negras no Rio de Janeiro na segunda metade do século XIX’, in Olívia Maria Gomes da Cunha and Flávio dos Santos Gomes (eds), Quase-cidadão: histórias e antropologias da pós-emancipação no Brasil, Rio de Janeiro 2007; Beatriz Lorner, Construção de classe: operários de Pelotas e Rio Grande (1888–1930), Pelotas 2001; Antonio Luigi Negro and Flávio Gomes, ‘Além de senzalas e fábricas: uma história social do trabalho’, in Tempo Social, Revista de Sociologia da USP 18 (2006); Marcelo Badaró Mattos, Escravizados e livres: experiências comuns na formação da classe trabalhadora carioca, Rio de Janeiro 2008. Maria Cecília Velasco Cruz, ‘Cor, etnicidade e formação de classe no porto do Rio de Janeiro: a Sociedade de Resistência dos Trabalhadores em Trapiche e Café e o conflito de 1908’, in Revista USP 68 (2005); Maria Helena P.T. Machado, ‘De rebeldes a fura-greves: as duas faces da experiência da liberdade dos quilombolas do Jabaquara na Santos da pósemancipação’, in da Cunha and Gomes (eds), Quase-cidadão. Angela Maria de Castro Gomes, Burguesia e Trabalh: Política e Legislação Social No Brasil 1917–1937, Rio de Janeiro 1979. Michael Hall and Paulo Sérgio Pinheiro, ‘The Clarté Group in Brazil’, in Le Mouvement Social 111 (1980); Regina Morel, Elina Pessanha and Angela Maria de Castro Gomes, Sem medo da utopia: Evaristo de Moraes, arquiteto da sociologia e do Direito do Trabalho no Brasil, São Paulo 2007; Joseli Mendonça, Evaristo de Moraes, Tribuno da República, Campinas 2007. Maria Célia Paoli, ‘O trabalhador urbano na fala dos outros’, in José Sérgio Leite Lopes (ed.), Cultura e identidade operária, Rio de Janeiro 1987; John D. French, The Brazilian Worker’s ABC: Class Conflict and Alliances in Modern São Paulo, Chapel Hill 1992. José Sérgio Leite Lopes, ‘Class, Ethnicity and Color in the Making of Brazilian Football’, in Daedalus 129(2) (2000); Leonardo Affonso de Miranda Pereira, Footballmania: uma história social do futebol no Rio de Janeiro 1902–1938, Rio de Janeiro 2000; Hermano Vianna and John Charles Chasteen, The Mystery of Samba: Popular Music & National Identity in Brazil, Chapel Hill 1999; Antônio Liberac Pires, Bimba Pastinha e Besouro de Mangangá. Três Personagens da capoeira baiana, Goiania and Palmas 2002. Michael Hall, ‘Corporativismo e Fascismo’, in Ângela Araújo (ed.), Do corporativismo ao neoliberalismo. Estado e trabalhadores no Brasil e na Inglaterra, São Paulo 2002, p. 18. Wanderley Guilherme dos Santos, Cidadania e justiça: a política social na ordem brasileira, Rio de Janeiro 1979. Cliff Welch, The Seed was Planted: The São Paulo Roots of Brazil’s Rural Labor Movement 1924–1964, University Park 1999; Vanderlei Vaselezk Ribeiro, ‘Um novo olhar para a roça: a questão agrária no Estado Novo’, Masters dissertation, History Department, UFRJ 2001; Marcus Dezemone, ‘Legislação social e apropriação camponesa: Vargas e movimentos rurais’, in Estudos Históricos 21(42) (2009). Eric John Hobsbawm, Era dos extremos: O breve século XX (1914–1991), São Paulo 1996. As Michael Hall argues: ‘in no other country, a complete corporatist system has survived after the fall of the dictatorship that established it’, in ‘Corporativismo e Fascismo’, p. 26. Kevin J. Middlebrook, The Paradox of Revolution: Labor, the State, and Authoritarianism in Mexico, Baltimore 1995. Karl Polanyi, A Grande Transformação – as origens de nossa época, Rio de Janeiro 1980, pp. 39–48. Eric John Hobsbawm, ‘The Forward March of Labour Halted?’, in Martin Jacques and Francis Mulhern (eds), The Forward March of Labour Halted? London 1981. Paulo Sérgio Pinheiro, Estratégias da ilusão: a revolução mundial e o Brasil 1922–1935, São Paulo 1991. Luiz Werneck Vianna, Liberalismo e sindicato no Brasil, Rio de Janeiro 1976, pp. 153–97; on the period 1944–45, see Francisco C. Weffort, Los orígenes del sindicalismo populista en

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18. 19.

20. 21.

22.

23. 24. 25. 26.

27. 28. 29. 30. 31.

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Brasil: la coyuntura de la posguerra, Lima 1975; Hélio da Costa, Em busca da memória, 1st edn, São Paulo 1995; Paoli, ‘O trabalhador urbano’; Ricardo Maranhão, Sindicatos e democratização (Brasil 1945/1950), São Paulo 1979; French, The Brazilian Workers’ ABC. Daniel James, Resistance and Integration: Peronism and the Argentine Working Class 1946– 1976, Cambridge and New York 1988. Mirta Zaida Lobato, La vida en las fábricas: trabajo, protesta y política en una comunidad obrera, Berisso 1904–1970, Buenos Aires 2001; Alexandre Fortes, Nós do quarto distrito: a classe trabalhadora porto-alegrense e a era Vargas, Rio de Janeiro and Caxias do Sul 2004. Fernando Teixeira da Silva, Operários sem patrões: os trabalhadores da cidade de Santos no entreguerras, Campinas 2003. Among the works that have highlighted the role of Communist rank-and-file activists are: French, The Brazilian Workers’ ABC; Marcelo Badaró Mattos, Novos e velhos sindicalismos: Rio de Janeiro 1955/1988, Rio de Janeiro 1998; Marco Aurélio Santana, Homens partidos: comunistas e sindicatos no Brasil, 1st edn, Rio de Janeiro 2001. Examples of the opposite tendency are: Angela Maria de Castro Gomes, A invenção do trabalhismo, Formação do Brasil, Rio de Janeiro 1988; Daniel Aarão Reis Filho, ‘O colapso do colapso do populismo ou A propósito de uma herança maldita’, in Jorge Luiz Ferreira (ed.), O populismo e sua história: debate e crítica, Rio de Janeiro 2001; J.L. Ferreira, ‘O nome e a coisa: o populismo na política brasileira’, in Ferreira (ed.), O populismo e sua história; id., Prisioneiros do mito: cultura e imaginário político dos comunistas no Brasil (1930–1956), Rio de Janeiro 2002. In the case of Mexico, the situation is even more complicated by the important leadership of the independent Marxist unionist and politician, Vicente Lombardo Toledano, who for most of his career enjoyed a good relationship with the Soviet Union, but on many occasions clashed with the Mexican Communist Party because of his close ties with sectors of the Mexican Revolution official parties. Although it cannot be properly characterized as ‘communist’, Toledano’s influence also expresses the penetration of Marxist ideas and practices inside the Latin American labour movement, a fact that was even strengthened within the peculiar ‘revolutionary’ political environment of Mexico. Middlebrook, The Paradox of Revolution, p. 96. Armando Boito Jr., O sindicalismo de Estado no Brasil, São Paulo 1991. After the initials of the saints celebrated in the names of its three most important municipalities (Santo André, São Bernardo and São Caetano). The Ato Institucional número 5 (Institutional Act No. 5) was issued on 13 December 1968. It included many repressive measures, such as the closing down of the National Congress for an undetermined time, the suppression of the right of meeting and of the habeas corpus for political ‘crimes’. Fernando Henrique Cardoso and Enzo Falleto, Dependency and Development in Latin America, Berkeley, Los Angeles and London 1979. Leôncio Martins Rodrigues, Industrialização e atitudes operárias (estudo de um grupo de trabalhadores), São Paulo 1970. Francisco C. Weffort, O populismo na política brasileira, Rio de Janeiro 1978. Octávio Ianni, O colapso do populismo no Brasil, Rio de Janeiro 1968. Alexandre Fortes, ‘Revendo a legalização dos sindicatos: Metalúrgicos de Porto Alegre (1931–1945)’, in A. Fortes (ed.), Na luta por direitos: estudos recentes em história social do trabalho, Campinas 1999, pp. 19–49. Fernando Teixeira da Silva, Operários sem patrões; id., A carga e a culpa. Os operários das docas de Santos: direitos e cultura de solidariedade 1937–1968, São Paulo 1995; French, The Brazilian Workers’ ABC.

Chapter 11

Labour, Organization

and

The Jute Industry in India in the 1930s

Gender

Samita Sen

This chapter focuses on the impact of the Great Depression on the jute industry in Calcutta. Jute was the largest and most important industry in the eastern region of the country at that time, the largest consumer of raw jute, and the most important commercial crop of the region; it accounted for a large share of exports from the region and the factories employed, just before the Depression, well above three hundred thousand workers. In the 1930s, the industry began to decline rapidly. Independence and the partition of the country in 1947 was the death knell, separating the jute-growing agricultural lands of eastern Bengal from the manufacturing hub in Calcutta. In the colonial period, jute workers shared, in common with workers in other industrial centres of the country, abysmal living and working conditions. They began to organize politically as early as the 1890s, but it was not until the 1930s, when the crisis-ridden industry put a fresh squeeze on labour, that trade unionism made real headway. Other factors helped: elected governments came into power in the provinces in 1937, radical nationalist and communist leaders paid more attention to mobilizing labour for long-term as well as immediate electoral gains. This process of organization was quickened when the independent Indian state came in with a regulatory package for industry and labour. Notably, this process was also one of masculinization, involving the removal of children and marginalization of women from not only the jute industry but the many others that came under the umbrella of the state-regulated ‘formal’

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sector. Women workers, who had constituted about 15 per cent of the workforce at the eve of the crisis and had played a militant role in labour movements in the 1920s and ’30s, were rendered increasingly insignificant. The developments in the jute industry signalled wider trends in the Indian economy. Trade unions, affiliated to all the major political parties of Independent India, were able to bargain for better working conditions and family wage, but this labour elite of adult men constituted no more than 10 per cent of the total workforce, with women and children being relegated to informal and casual work under poor conditions. In the 1930s, two events drew the world closer together than ever before. The Great Depression and the emergence of fascism in Europe and Asia, leading to the Second World War, both had a deep impact on most parts of the world, although some were less affected than others. So far as India was concerned, the rise of fascism had little direct effect. The only story, a remarkable one no doubt, is that of the adventures of Subhas Chandra Bose, a Bengali who sought the help of Hitler and Tojo to defeat the British in India. The Second World War, however, especially with the opening of the Pacific theatre, drew India into its vortex – unlike the Great War before it. The war also signalled the end of two hundred years of British colonial rule, launching India into nationhood and a very new political trajectory. On the economic front, the Great Depression also had an impact on India in the 1930s. Our understanding of the Great Depression, not only its origins in the United States and its impact on Europe but in relation to global economic interdependencies, has deepened and widened with the revisionist historiography of the 1970s. A large body of writing on India’s economic history during this period suggested a need to re-examine and even qualify the orthodoxy shaped by nationalists before and even after Independence – that the Great Depression had a considerable, perhaps even a transformative, impact on the country’s modern secondary sector. Colin Simmons, addressing the question directly in an essay, argued that while attitudes were shaped (and a myth created), the Depression was rather irrelevant to the material performance of the Indian economy, weak as its integration was to the world economy. He re-examined manufacturing, foreign trade and employment statistics to show that there was no noticeable overall downward trend. Manufacturing output suffered a marginal drop of about 9 per cent in 1930–31, rose over the following two years to fall again in 1933–34. For the rest of the 1930s, it grew rapidly. There were, however, two exceptions to this story – coal and, more dramatically, jute.1 Jute, being a packaging material, was linked closely to the volume of commodity trade, and during the 1930s it lost one-third of the value of its output as well as its labour force.

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This chapter will thus focus on jute, to show how the industry sought to manage the sharp and sudden buffetings of the Depression by manipulating labour. Such a policy had a profound political impact on the labour movement in Bengal, setting its footsteps on the path of a militant unionization, which was to have a long-term impact on the region’s industrial and labour history. The jute industry was not, however, exceptional in this regard. The widening of franchise and the establishment of Indian provincial governments in the late 1930s initiated a country-wide process of unionization, drawing already militant union movements, such as in Bombay, within its orbit. The process of organization of labour went hand in hand with increasing state regulation of large manufacturing units in the modern sector. While unionized labour began to have considerable say in these increasingly ‘organized’ (or formal) sector units, 90 per cent of workers remained outside the ambit of regulation. The processes of exclusion which constituted organized labour followed, among others, a gendered trajectory. There was a gradual shift towards adult male workers, reinforced by the introduction of ‘family wage’ and an accompanying ideology of the single adult male breadwinner family. Thus, children were expelled from the workforce in the 1930s; the procession of marginalizing women began at the same time but was completed in the 1950s.

The Jute Industry: Rationalizing Depression Jute, the golden fibre, grown almost exclusively in eastern Bengal, began its industrial career in 1838 in Dundee in Scotland. It was soon apparent that all the advantages of proximity to the fields and cheap labour lay in Bengal. The first factory in 1855 faltered, but by the 1890s the Calcutta jute industry had established itself in the Australian, American and European markets, racing ahead of Dundee to control, by the 1920s, 60 per cent of the international market.2 Its loomage more than trebled between 1873 and 1879, and by 1899 it had trebled once again. In 1881, the industry employed twenty-eight thousand workers; in the next years, employment raised massively.3 As the ‘world’s envelope’,4 its fortunes soared with the massive expansion of commodity trade in the late nineteenth century. If in this early period, jute entrepreneurs ‘simply coined money’,5 the Great War was a bonanza. Calcutta’s jute sales grew by some 118 per cent, but the killing came from a 55 to 65 per cent rise in prices. Dividends went up to as much as 330 per cent, and enormous reserves were accumulated.6 Calcutta mill owners were never to see such prosperity again. Two problems beset the industry at the end of the war. The extraordinary profits had attracted huge investments. While the war lasted, prices

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had held despite extended capacity. With the war over, jute mill owners faced the prospect of plummeting prices. In 1884, the mill owners had formed the Indian Jute Mills Association (IJMA) in an attempt at collective protection of interests. The managing agency system required a slick balancing act, since the promoters held a small percentage of shares, relying on playing proxy to a spread of small investors, whose dividend payments needed to be maintained for the managers to retain control. This, managing agents believed, could be achieved only if high prices were ensured by limiting production. The IJMA struggled throughout the run up to the war to enforce this policy, by sealing a percentage of looms in each mill. A rush of investment after the war increased loomage by more than 30 per cent. The industry’s capacity now exceeded by 25 per cent the highest-known demand. The task of controlling this excess capacity lay with IJMA. The new mills had been more expensive to set up, and they did not have the cushion from the war reserves. They were not amenable to production restrictions. Many refused to join the IJMA, preferring to chart their own path, working long hours and using their capacity to the full to recover their investment.7 The crisis in the industry deepened in 1929 with the Depression. The demand for the ‘world’s envelope’ fell off as commodity traffic slowed down. Increasing instability within Calcutta’s jute industry, on the one hand, and falling sales in overseas markets, on the other, left the IJMA scrabbling for new solutions. They had already approached the government to reduce the working hours by enacting new legislation, hoping thereby to achieve their target of restricting production. They stepped up the campaign in the 1930s. The government was not very sympathetic. They asked instead that the industry ‘organize’ and ‘rationalize’ itself to achieve better utilization of their capacity, work towards greater efficiency, invest in technical progress and be content with ‘reasonable profits’. The mill owners responded to this sage advice with a simple and direct measure – cost cutting through labour retrenchment. In 1931, the mills moved from multiple to single shift, reducing the labour force by between a fifth and a third, according to different estimates.8 The significance of such a move lay in the structure of this colonial industry. The jute industry (in common with the cotton industry, the other major industry in India in this period) invested little in research or technology, depending on old machines and established processes to keep costs down. Keeping a determined eye on stable dividend payment, mill owners were unwilling to forge a new, expensive and uncertain path towards technological efficiency. They did, reluctantly, undertake some mechanization, but this too was directed towards labour saving. The chief components of costs in jute mills were raw material, which the mill owners attempted to control by buying through the IJMA exer-

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cising a near monopsonistic control, and labour, which comprised some 50 per cent of their costs.9 The industry thus depended on casual labour, better to adjust production to the vagaries of international demand. In the 1930s, while the IJMA was still able to function as a group, they sought to tide the crisis by putting a squeeze on labour. Their strategy of casualization did work to a limited extent. In 1931, despite government’s deepest apprehensions, the sixty thousand retrenched workers ‘melted like snow in summer’.10 There was not even a murmur of protest. The story did not, however, end there. IJMA talked loudly and often about ‘rationalization’ and ‘efficiency’, but the essence of their strategy was a sustained reduction of labour costs: elimination of surplus labour, laboursaving mechanization and, more directly, imposing wage cuts, longer hours and larger workloads on the remaining workforce. As the pressure on labour increased, an elaborate mechanism of inspection was initiated to ensure more direct control over quality, speed and discipline on the shop floor.11

Organizing Jute Workers: Revisiting a Paradox The 1930s was a watershed in the history of trade unionism in the jute industry. There have been many attempts to explain what one well-known historian of the jute industry has termed a ‘paradox’ – the fact that despite all the advantages of having a strong racial divide between owners/managers and workers, a strongly localized industry with such a large number of workers and a long tradition of worker militancy, formal organization eluded jute workers.12 In the 1920s, when elsewhere in the country the Bombay cotton industry workers organized under the leadership of the Girni Kamgar Union were able to resist a capitalist onslaught on jobs and wages, jute workers’ unions remained weak and unstable. The first general strike in 1929 was a major event in the industry, but was not backed by sustained unionization. It was to be another decade, towards the end of the 1930s, when unionization took hold and then made rapid headway. One part of the ‘paradox’ is not in question – the jute workers had earned a reputation for violent and militant protest, taking the form of sudden strikes, and assaults on supervisors and managers. There were also frequent physical confrontations outside the mill grounds in the industrial neighbourhood, which the administration characterized as a proneness to rioting. Managers’ inability to predict or prevent lightning strikes has been recorded in some of the earliest accounts of the industry. The beginnings of more systematic and sustained collective action by workers have been traced to the 1890s, when local Bengali labour began to be out-

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numbered by migrants from neighbouring regions to the west and south of the province. Bengali workers felt that these so-called up-country men were crowding into the mills and depressing wages. There were also divisions among workers along religious lines (Hindu and Muslim), which sometimes took the form of mutual confrontations. There were several riots in mill neighbourhoods from the late 1890s, and especially in the 1920s. The rioters also turned against mill authorities and the municipal administration.13 In the early 1890s, workers resisted the introduction of electric lighting, which lengthened the working day. These protests, between the 1890s and 1920s, were usually over immediate or short-term issues like wage hikes, holidays, dismissals or restoration of allowances. In addition, demands for dismissals of oppressive sardars or other mill staff who had ‘insulted’ workers sparked off sudden strikes. Some strikes broke out in response to wage cuts, or to perceived interference in customs such as the conduct of religious festivals. These strikes were usually disorganized, sectional, and prone to individual and group violence targeted at the state, the police, the management, and, in some cases, against other workers. Strikers and ‘loyal’ men were always prone to attack from each other at the picket lines, at the mill gates and in working-class quarters and settlements. These ‘protests’ followed no distinctive pattern, but tended to be less structured and violent. This labour violence, argues Dipesh Chakrabarty, the historian who first used the term ‘paradox’ to characterize jute workers’ politics, was a response to violence in the exercise of managerial (and racial) authority operating in conjunction with colonial power. Subho Basu extends this argument to include the entire administrative apparatus of mill towns, which excluded workers from any form of representation.14 Other historians have not been persuaded by such arguments, pointing out that violence in employer-labour relations was not unique to the jute industry and cannot be explained through race alone.15 Moreover, now, sixty years after Independence, there are not infrequent cases of managers being attacked or even killed within the mill compounds. Until new research emerges, however, Chakrabarty’s thesis remains an influential one. Some historians have leaned towards the ‘spontaneous’ argument, arguing in favour of workers’ autonomy and initiative, drawing our attention to the findings of researchers on European labour movements that even the most seemingly spontaneous collective action are underpinned by modes of networking and organization.16 If militant resistance is one part, the other part of Chakrabarty’s ‘paradox’ is organization, or rather the lack of it. Formal organization came quite early in the industry’s history, the first being the Muhammedan Association formed in 1895 in a jute mill town called Kankinara. Not much

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is known about the activities of this association. During the Swadeshi movement in 1905, Indian leaders began to draw workers into a broader political engagement, but their efforts were superficial and spasmodic and did not result in the formation of stable unions or societies. At the time of the Khilafat and non-cooperation movements in 1920, there were more concerted efforts to mobilize the ‘masses’ and there were a few attempts to campaign among the jute workers. The Khilafatist, Md. Osman, appears to have been the first in the field, and he formed the Kanikara Labour Union in 1920 with Lataffat Hossain, a worker dismissed from a neighbouring factory as its secretary, and Abdul Majid, locally known as Karl Marx, as its president.17 The period immediately after the war saw spiralling prices, leading to much discontent among workers and a spate of strikes in 1920–23. Indian National Congress, meanwhile, galvanized by a newcomer, Mohandas Karamchand Gandhi, had taken the nationalist movement to a new high. The potential for leveraging the contradictions between poor Indian workers and rich European owners and managers operating with the full backing of the colonial state was not lost to this new generation of nationalist leaders. They visited the jute mill towns several times to address workers but were not able to create any formal organization. Pandit Krishna Kumar Shastri did some groundwork in the Barrackpore area but he too failed to institutionalize his reform programme.18 It may be that the Congress’ attempt to harness workingclass grievance was limited by their rhetoric of class harmony. There were some attempts in the 1920s to form trade unions among jute workers by moderate liberals close to the Congress, as well as by more radical socialist ideologues. Most of these were short lived but a few proved stable, such as the Gourepore Works Employees’ Association formed by Santoshkumari Devi with the help of Bankim Mukherjee and Kalidas Bhattacharya. In 1923, they took the initiative to form the Bhatpara Jute Workers’ Association, which became the Bengal Jute Workers’ Association (later ‘Union’ – BJWU). In 1925, Nuddea Mill Workers’ Union and the Reliance Labour Union, also started with Santoshkumari’s help, were amalgamated with BJWU. By August 1928, BJWU had nine branches, all affiliated to the newly founded Workers’ and Peasants’ Party (WPP). The BJWU was one of the most successful and sustained efforts at unionization in the interwar period, providing leadership to the first general strike in the industry in 1929.19 During the general strike, the president of the BJWU was Dr Prabhabati Dasgupta. Trouble in the mills began when IJMA decided to increase working hours from fifty-four to sixty hours a week from July 1929. In the Bhatpara-Jagaddal area, workers led by the weavers began to leave the mills after completing fifty-four hours. The Kankinara Labour Union

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(KLU), at this time the only registered union, began the action. Soon after, BJWU, not a registered union but with much wider support among the workers, began intensive campaigning. By the beginning of August nearly all mills had shut down. Forced to negotiate, the IJMA signed an agreement with BJWU and KLU withdrawing the extension of hours and reintroducing some of the customary allowances. Given that this was the first instance of an industry-wide concession from the jute mill owners, the gains of this strike have been described as ‘significant’. Within the BJWU, however, the communists especially were unhappy with the ‘hasty settlement’, believing that more could have been wrested from the IJMA if the strike had continued. Meanwhile, the few mills that had not joined work went on strike, apparently fearing that they would not receive the benefits of the settlement. Dr Dasgupta was able to remove their misconception and get them to join work, but it was believed that her opponents within the union had fomented these strikes to discredit her, since these were the few mills where she had little influence. Around this time, the office bearers fell out among themselves, ostensibly over strike funds and union money, but also due to personal and political rivalry.20 Despite the success of the general strike, BJWU was unable to consolidate its position. Factionalism apart, the union failed to hold on to its membership. The most telling measure of their weakness lay in their inability to organize any protest at all in 1930–31, when the industry retrenched nearly eighty thousand workers, or in the next few years when the industry reduced its workforce by nearly a third.21 The momentum created by the general strike did hasten, albeit quite slowly, the process of organization. Nirban Basu categorizes the unions of the 1930s into constitutionalists, nationalists, Khilafatists or Muslim communalists, and communists. The Marxist groups worked initially under the banner of the WPP. The Communist Party of India (CPI) formed in December 1933 was banned soon after in 1934 and thereafter the communists worked underground. In this period, however, apart from the CPI, a number of groups professing socialist and Marxist ideologies were floated, and they all became involved in the trade union movement.22 They clashed not only with the Congress, but also with each other, imprinting on Bengal’s labour movement an enduring legacy of factionalism. A group of orthodox Gandhians joined the fray, forming the Bengal Labour Association in 1933–34. All these groups functioned within the Bengal Provincial Trade Union Congress (BPTUC).23 The Muslim communalists were set apart from the left and nationalist trade unionists. The Khilafatists, among the first organizers of labour in the jute industry, operated within a matrix of constitutionalism and communalism. They formed a number of unions in the 1920s and ’30s

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federated under the Bengal National Chamber of Labour. They were covertly backed by the mill owners and the government, and were able to command a loyal following among Muslim workers. The establishment of the Muslim-League-Krishak Praja Party in Bengal reinforced their position. The appointment of H.S. Suhrawardy as Labour Minister in 1937 strengthened their hand.24 All these developments came together in the late 1930s, when elected provincial governments came into place. The inclusion of elected labour seats in the legislature introduced a new element of rivalry and competitive claims to represent labour. The proliferation of political groups and factions within the labour movement was now institutionalized within the state’s polity. It was at this juncture that the second and last general strike in the colonial period took place. The strikes began in February 1937 and broke out in a series that continued until the first week of May. The first phase of the strike was quite disorganized. The left trade unionists had been successful in winning a major share of the labour seats, and some of them gave leadership to these early strikes. That things had changed did become apparent quite quickly. The intensive election campaigns of 1836 had given workers a new sense of power and a greater measure of confidence. Other strikes followed. When the first strikes in Howrah and Budge Budge took place, the leaders began debating in the BPTUC the wisdom of calling a general strike. The bickering continued for two months in various fora until an executive committee meeting of the All India Trade Union Congress in Delhi at the end of March took the decision to develop the then continuing strikes in Budge Budge and Uluberia into a general one. Within a few days of this decision, a non-Congress ministry took oath (1 April 1937). The general strike was an opportunity for Congress and leftist leaders to embarrass the new government, and whirlwind preparations were set afoot. A Bengal Central Strike Committee was formed, a Charter prepared, and by the second week of April new strikes broke out in Barrackpore, and they spread within a week to Hooghly. The conduct of the 1937 general strike was in the hands of the communists and took a more organized and militant form than seen before in the industry. Communist leaders formed committees and held meetings, even though most of them were operating underground. This gave this strike greater staying power, but the communist leaders were also determined to force the mill owners to recognize the workers’ unions, and would only agree to a settlement with ‘accredited representatives’ of workers. The noncommunist elements of the leadership began to urge settlement from the end of April, the strikes began to slow down, and Suhrawardy encouraged the Muslim communal unions to oppose the strike. The strike finally collapsed on 6 May and was called off on 10 May.

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There have been many controversies surrounding this general strike. At that time, there were allegations that hessian dealers and some Indian jute mill owners had fomented and financed the strikes to hit back at the IJMA. Capital, the mouthpiece of the Bengal Chamber of Commerce, praised the leadership and organization of the strike. The question of organization, however, divides the historians. On the one extreme is Omkar Goswami’s interpretation, arguing that the sardars (jobbers and supervisors) were the key players in this general strike and that they were responding to the tremendous economic pressures created by sustained retrenchments, wage cuts, longer hours and increasing workloads. In his view, the leadership was somewhat irrelevant. On the other extreme is the assessment offered by Nirban Basu that the outside organizers of the political parties took the lead and they worked with the sardars on the ground. Basu’s view is corroborated by the constitution of the strike committee, which included representatives of all the squabbling political factions, but not one worker. The role of the strike committee in the dayto-day conduct of the strike is, however, not all that clear. The ‘artificial unity at the top’ could not prevent the wranglings and manoeuvrings on the ground, and hindered effective organization of the strike.25 Perhaps the most positive outcome of the strike was the formation of the Bengal Chatkal Mazdoor Union (BCMU), which began a sustained attempt to bring the diverse groups under one banner. In September 1938, the Jute Ordinance was promulgated, reducing working hours, leading to wage cuts and dismissals. There followed a series of strikes, the most prolonged and bitter of them at Titagarh. There were once again demands for a general strike but this did not materialize. In July 1939, the IJMA again sealed a proportion of looms to control excess capacity, leading to retrenchments. Once again, there were protests and a central rally was organized in Calcutta on 13 August. There was some discussion about the possibility of a general strike, but the war broke out before any decision could be taken.26 The 1930s marked a major shift in the jute trade union movement. Before the First World War, workers’ protests were ‘spontaneous’ in the sense that there was very little direct attempt at long-term organization. After the war, political leaders began to perceive the value of mobilizing workers and realized that in order to do so they needed to create formal associations. This work was taken up in earnest in the 1930s – some would say too much in earnest. Workers’ unions became the object of political competition, a trend that intensified with the institution of the elected labour seats. Trade unions, once they began to make headway, transformed jute workers’ politics. Strikes began to be less violent, better organized and better led, and reached the negotiation table with a better chance of settlement.

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More industry-wide wage and welfare demands found a place in workers’ charters. In the long run, these were of benefit to the jute workers. In the following twenty years, politically affiliated federated trade unions were to pull enough muscle within the state apparatus to transform the poorly paid and casualized workforce into a labour elite earning family wage, with the full security of employment and a range of social insurance benefits.

Organization and Masculinization: Women’s Employment The first section showed that retrenchment and labour saving, which had begun in the 1920s, became an established strategy to ride the recession in the 1930s.27 The second section has shown that this gave an impetus to labour movements, which after many false starts, began to take long-term shape in unionization. The two contending processes were reconciled through an asymmetric assault on child and women workers. Thus, the process of organization was far from being gender neutral, as usually assumed in studies of class. From the 1930s, a gendered nexus among the management, the unions and a privileged (male) section of the workers began to fall into place. The male workers were successfully ‘organized’, unionized and brought within the purview of regulated wages and working conditions. These men strengthened their stranglehold over prized jobs in the organized sector through various exclusionary strategies. The process of organization went hand in hand with masculinization. This meant the elimination of children from the workforce and a gradual marginalization of women.28 In the first decades of the industry, children had a significant share in the workforce. They were the first targets of labour legislation, beginning in 1881. The first attempts involved defining and categorizing child workers, regulating their hours of work and restricting them to certain jobs in the mills. In 1912, more than 11 per cent of the workforce were children. Their numbers began to decline from the 1920s, during the postwar crises. The trend accelerated in the 1930s. The large-scale retrenchment of 1931 signalled the end of child labour. By 1935, child workers were reduced to 1 per cent of the workforce.29 Employers assumed, rightly as it turned out, that the dismissal of children would not encounter much resistance. In fact, there was a general agreement, supported enthusiastically by philanthropists and nationalist ideologues, regarding the priority of education.30 The idea if not the reality of education, and the increasing delegitimation of children’s work in factories in the international discourse on labour welfare, facilitated a positive response to the elimination of children from the mills.

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The process of removing women from the workforce did not prove so straightforward. Women made up about 16 per cent of the workforce at the start of the twentieth century. This was reduced to about 14 per cent by the end of the 1930s. While this may not seem to be a steep decline, policies set in place in the 1930s were to have a definite, if gradual, effect. By 1955, the proportion of women in the workforce had fallen to 9 per cent, and by 1971 to 2.5 per cent. Unlike in the case of children, whose employment was terminated in 1934 when their entry into the factory sheds was prohibited, women were reduced more by ‘natural wastage’ than by retrenchment. The mills stopped hiring women and replaced retiring women workers with fewer men. I have written extensively about this process of women’s marginalization in the jute industry elsewhere, so here I present a summary of the three chief arguments.31 From the 1920s, there was worldwide debate on the legitimacy of women’s work in factories. Under the aegis of the International Labour Organization, there was an increasing focus on the ill effects of factory work on women’s child-bearing and rearing. These debates resonated with nationalist concerns over maternal and infant mortality and population in India. These concerns with labour welfare were an important element in the enquiries of the Royal Commission of Labour, which did its work in 1929–31. These efforts became interlinked with the colonial state’s agenda of ‘rationalization’ to produce, argues Radha Kumar, an attempt to ‘rationalize’ the working-class family. The direction of reform was towards the single male breadwinner with dependent wife and children. In a period of acute economic crisis, capitalists were not likely to lend their ears to the possibility of family wage, but the ideological emphasis on women as wives and mothers rather than as workers came at an appropriate time. In Bengal, maternity benefit legislation, resisted for more than a decade by mill owners, was passed in 1939. At a time of high male unemployment, (male) trade union leaders were more amenable to the retrenchment of women and children if it meant a few additional jobs for men. These processes facilitated the gradual removal of women, just as working conditions were on the brink of improvement.32 The strategy of replacing women and child workers with fewer men was possible in the jute industry because of the gender division of labour in the industry. The significance of this derives from a contrast with the Bombay cotton textile industry. In Bombay, men and women were divided into different departments. In the 1920s, women’s departments were more adversely affected by mechanization. There was, however, no question of replacement. As a result, when women resisted mass retrenchment, they received support from the trade unions and were able to mount long and sustained strikes. In the jute mills, however, there

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were no specific ‘women’s’ tasks. Women did predominate in a few subprocesses, but this varied from mill to mill, and there was no spatial or task-based segregation (except perhaps that weaving was construed as a ‘male’ skill). This facilitated the replacement of women with men. In Union (North) Mill in 1939 and in Anglo-India (Middle) Jute mill in 1941, hundreds of women were sacked and a few men taken on in their place. At this time, the hand-sewing of bags (which women did) was abolished with the introduction of the Herakles sewing machine (run by men). The largest numbers of women’s jobs were lost in this process. In all these cases, trade unions were complicit. Union leaders encouraged women to ‘nominate’ a man from the family in their stead – sons competed for the mother’s nomination and the few women, who did not wish to relinquish their jobs, were forced to comply.33 Does this mean that women were passive in the face of such an assault on their employment? In the jute industry, women (as much or perhaps more) shared with their male counterparts a reputation for militancy. Even in the 1980s, workers and managers told legendary tales of broomwielding women. In the 1920s and ’30s, there were strikes begun and sustained by women (Ludlow Jute Mill Strike, 1928; and Shyamnagar Jute Mill Strike, 1939). The mode of action preferred by women was, however, more akin to the earlier ‘spontaneous’ forms of actions favoured by all jute mill workers. In the 1930s, when trade unions were making rapid strides in organizing male workers, they did not make any effort to bring women into the fold and, equally, women were comparatively less responsive to unionization. Even in the 1950s, when unions were fully institutionalized, women were apt to use their own networks of kin, community and neighbourhood to mount protests, usually outside the ambit of unions.34 Frequently, though, industrial action that had been begun by women passed into the hands of trade unions and the issues changed. Thirty years later, in the 1980s, Leela Fernandes found the small number who still worked in the mills to be deeply suspicious of the unions.35

Conclusion The elimination of women from the organized workforce, a process begun in the early 1930s as a response to the crisis precipitated by the Great Depression, cast a long shadow. While the nature and extent of the impact of the Depression on the Indian economy still awaits definitive scholarship, there can be no doubt that within the modern sector, the two industries most affected were jute and coal. In both these cases, the Depression was the proximate cause of the removal of women and children from the

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workforce. These processes went hand in hand with greater ‘organization’ in its usual twofold and related meanings: first, greater unionization, and second, state regulation to enforce better conditions of work. This chapter has shown that the removal of women and children, that is, masculinization, was intrinsically connected with organization. Many of these processes set afoot in the 1930s were taken forward in the 1950s, when both unionization and regulation came into their own under the aegis of Jawaharlal Nehru’s developmental state. This small core of the now ‘formal’ sector came to form a kind of labour elite comprising about 9 per cent of the country’s workforce, while the majority (including the women and the children) came to constitute the ‘informal’ sector, outside the pale of unionization, where conditions of work remained poor.

Notes 1. Colin Simmons, ‘The Great Depression and Indian Industry. Changing Interpretations and Changing Perceptions’, in Modern Asian Studies 21(3) (1987). 2. Gordon Stewart, Jute and Empire. The Calcutta Jute Wallahs and the Landscapes of Empire, Manchester and New York 1998, p. 3. 3. Samita Sen, Women and Labour in Late Colonial India. The Bengal Jute Industry, Cambridge 1999, pp. 15–16. 4. Stewart, Jute and Empire, p. 110 (quote from R.N. Gilchrist, Secretary to Government of Bengal). 5. Omkar Goswami, Industry, Trade and Peasant Society. The Jute Economy of Eastern India, 1900–1947, New Delhi 1991, p. 3. 6. Sen, Women and Labour, p. 116. 7. Ibid., chapters 1 and 3. For more details: Goswami, Industry, Trade and Peasant Society, chapter 6. 8. Arjan de Haan, ‘Towards a Single Male Breadwinner: The Decline of Child and Female Labour in an Indian Industry’, in Economic and Social History of the Netherlands 6, Amsterdam 1994; Nirban Basu, ‘Outside Leadership, Political Rivalries and Labour Mobilization – The Jute Belt of Bengal, 1919–1939’, in Arjan de Haan and Samita Sen (eds), A Case for Labour History, Calcutta 1999. 9. Tanima Ghosh, ‘Income and Productivity in the Jute Industry across the 1947 Divide’, in de Haan and Sen (eds), A Case for Labour History. 10. Sen, Women and Labour. 11. Stewart, Jute and Empire. 12. Dipesh Chakrabarty, Rethinking Working-Class History. Bengal 1890–1940, Princeton 1989. 13. Sen, Women and Labour. Also see, Subho Basu, Does Class Matter? Colonial Capital and Workers’ Resistance in Bengal, 1890–1937, New Delhi 2004, pp. 114–18. 14. Basu, Does Class Matter?, chapter 3. 15. Amal Das, ‘Outside Intervention in Jute Mill Strikes, Howrah, 1870–1930’, in de Haan and Sen (eds), A Case for Labour History. 16. Ibid. 17. Basu, ‘Outside Leadership’.

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28.

29. 30. 31. 32. 33. 34. 35.

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Ibid. Ibid. Also see Sen, Women and Labour. Basu, ‘Outside Leadership’. Sen, Women and Labour. Congress Socialist Party, Royalists, Bengal Labour party, Communist League, Forward Bloc and Workers’ League were some of these. Ibid. Ibid. Also see Basu, Does Class Matter? Basu, ibid. p. 128. Stewart, Jute and Empire. The current section presents a summary of the arguments in my book, Women and Labour, chapter 4, and in an article ‘Segregation and Solidarity: Women Textile Workers in Calcutta and Bombay, 1920–1940’, in Bharati Ray (ed.), Women and Politics: France, India, Russia, Calcutta 2000. Samita Sen, ‘Politics of Gender and Class: Women in Indian Industries’, in Margrit Pernau, Imtiaz Ahmad and Helmut Reifeld (eds), Family and Gender: Changing Values in Germany and India, New Delhi 2003. De Haan, ‘Towards a Single Male Breadwinner’. Ibid. Samita Sen, ‘Gendered Exclusion: Domesticity and Dependence in Bengal’, in International Review of Social History 42 (1997). Sen, Women and Labour, chapter 4. Also see id., ‘Segregation and Solidarity’. Ibid. Sen, Women and Labour, chapter 6. Leela Fernandes, Producing Workers: The Politics of Gender, Class, and Culture in the Calcutta Jute Mills, New Delhi 1997.

Chapter 12

Japan’s Way Out of the Crisis of the 1930s as a Strategy for Overcoming Modernity Hiroko Mizuno

The period of crisis that gripped Japan during the interwar period was the result of numerous factors and problems, all of which are still to this day discussed by historians. Accordingly there exists in Japan extensive literature and historical studies that concern this period of time, often examining it critically in connection with the ‘Asia-Pacific War’. In dealing with Japanese history of the interwar period, one should not think of the period of crisis of the 1930s as an isolated event but rather as a consequence of the modernization process by which Japan had been shaped as a modern nation-state since the second half of the nineteenth century. As Japan was in almost constant conflict with the Western world as well as with almost the entirety of Asia during this period, the Japanese way out of the crisis of the 1930s mirrors a political attempt to overcome modernity itself. ‘The overcoming of the modernity means’ – said Shigetaka Suzuki, a conservative historian of the 1940s – ‘in the political sense nothing other than the overcoming of democracy, with regards to economics, the rejection of capitalism, and in respect of the history of ideas, the overcoming of liberalism’.1 If one quickly comes to the conclusion that these three problem areas, democracy, capitalism and liberalism, undoubtedly originate from the Western world, we can interpret the overcoming of modernity as nothing other than an attempt to overcome the West. There, not only did Suzuki point out a close connection between the general problems of modernity and the hegemony of the Western world, but he also identified

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an additional Asian complexity as regards a specific Japanese modernity, and it appeared necessary to overcome these problems. In this sense, it should be noted that Suzuki was certainly not concerned with the crisis of the democracy, but rather with the problems that had been caused by democracy, capitalism and liberalism, that is to say the problems of the West. These problems of the West would, indeed, cause the Great Crisis in the 1930s, finally leading to the later catastrophic wars. Seen from this point of view, the question arises of how Japan experienced and internalized ‘modernity’. Which historical events, in retrospect, helped the system along its path of destruction to failure? Finally, and most importantly, which methods did those in power attempt to use to overcome the crisis? In trying to answer these questions, we will examine how Japan tried to overcome the crisis of the 1930s and which strategies were put forward to find a way out of the crisis, focusing particularly on the four characteristics of ‘modernity’ as put forth by Suzuki, which became best known during the interwar period. First of all, to take a historical overview of the political culture of this period (1918–1936), we will examine the Japanese political system of the interwar period, which can be regarded as a symbol of the (imperial-liberal) ‘democracy’ and its end. Secondly, we will consider how various social movements amongst the labourers as well as other social groups that mirrored the problems of liberalism developed and later disintegrated. The third point to be focused on is the question of how the Japanese government tried to overcome the economic crisis and the later Great Depression which occurred as a result of capitalism. Finally we will deal with Japan’s colonial, imperialist expansionist policy in China and Asia, which can be understood as an attempt to overcome the West.

The Political System as a Symbol of the (Imperial-Liberal) ‘Democracy’ and its End (1918–1936) Considering its political circumstances, the period of crisis in Japan can best be understood as the historical process of the destabilization and eventual end of the party government system. The party government system matured in Japan as late as the 1920s in response to calls from the masses for greater political rights, even though it was still strictly restricted by the Meiji Imperial Constitution, which was based on the ‘sacredness’ of the Emperor’s System. At this time there were two large middle-class parties, a more conservative one (Seiyûkai) and a more liberal-orientated one (Kenseikai/Rikkenminseitô), which wrangled with each other for control of the country. Both parties had to live with regular changes in

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the balance of political power. When one made a political mistake or misstep and the whole ministry resigned, the other would come to power, and vice versa. The chancellor was appointed by the Emperor, based on the decision of the traditionally powerful, imperially sanctioned senators, some of the oldest and most elite political groups in Japan. Following a short interruption of the party government system, the liberals formed a coalition government with several smaller parties, which introduced the General Election Law of 1925 (even though only men aged twenty-five and older could vote) that had been made possible through some growing democratic movements. From various social movements arose some new proletarian parties, which claimed to represent the interests of the working class. The first General Parliamentary Election in Japan took place in 1928 in accordance with the General Election Law of 1925. The first half of the 1920s can therefore be generally seen as a time of struggle for universal (male) suffrage. At the same time as the General Election Law was passed, however, an additional law was also ratified in the Parliament: the Peace Preservation Law of 1925 (Chianijihô). The purpose of this law was, above all, to act as a bulwark against any society or club that challenged either the Emperor System or the institution of private property. First and foremost, this law was clearly intended to suppress the left-wing movements as well as the communists. The penalty for breaking this law was a period of up to ten years of imprisonment, either with or without hard labour. In spite of vehement counter-demonstrations, the law was ratified. In the face of intensified activity by communists, however, an amendment was added to the law in 1928 by a conservative government under Giichi Tanaka, changing the penalty from ten years’ imprisonment to death. After this amendment the death penalty was more frequently applied to oppress political enemies. Against the background of the social crisis, the middle-class conservative power base began to come closer to the traditional conservative forces within the country, particularly the military. Therefore the conservative government tended to pursue a policy of radical expansionism internationally. Between 1927 and 1928, troops were dispatched three times (28 May 1927, 20 April 1928 and 8 May 1928) into eastern China (Santôsho), which was in fact equal to ‘assault politics’. Subsequently, on 4 June 1928, a serious ‘incident’ occurred on the Chinese Mainland, later known as the ‘Huanggutun Incident’ (Zhang Zuolin Assassination Incident), in which a Chinese field marshal and warlord, and in part an important collaborator of Japan, Zhang Zuolin, was assassinated by an explosion. This murder was carried out by the Japanese army organization, Kantô Gun/Kwantung Army, which was responsible for the admin-

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istration of ‘Manchuria’. Zhang was murdered specifically because he was considered untrustworthy in maintaining the colonial control of Manchuria. To attempt to deceive the Japanese public, however, the military leadership explained the incident as if it had been brought on by a political enemy of Zhang. When the truth came to light, Emperor Hirohito finally dismissed the prime minister, Giichi Tanaka, for his failure, and the Japanese government had to resign. After the decline of the conservative government, a new government supported by the more liberal-orientated middle-class party was formed on 2 July 1929. The new prime minister, Osachi Hamaguchi, sought primarily to improve Japan’s international relations, ratifying the London Naval Treaty on 22 April 1930. Since the ratification of this agreement was met with hard resistance, primarily from the military (above all from the navy), the Japanese government attempted to appease the army, promising an increase in the budget for the coming year for the Imperial Navy; however right-wing radicals within the military refused to accept this suggestion. In response to their frustration and anger, a member of an ultra-nationalist radical club carried out an unsuccessful assassination attempt on the head of the government, Osachi Hamaguchi, in November 1930. This first incident would not be the only high-profile political assassination attempted during the coming years, and served instead as only the beginning of a series of coups and attacks carried out by rightwing radicals and the military. During the period of crisis in the 1930s, pressure began to mount not just on the ruling party but on the entire two-party system as the military sought to gain influence in politics. Henceforth, the political parties were not just competing with each other for the hearts and minds of the Japanese voting class, but additionally with the anti-democratic military forces. The liberal-orientated government led by the middle-class party leader, Reijiro Wakatsuki, ran into difficulties when the Japanese army apparatus in China (Kantô Gun/Kwantung Army) undertook a bombing attack on a part of the railroad lines of the South Manchuria Railway Company (Mantetsu) on 18 September 1931 near Liǔtiáo Lake (near Mukden/ Shenyang). This military attack, often known as the Liǔtiáo Lake incident or the ‘Mukden incident’, was officially described as military aggression by the Chinese forces, but in reality it was carried out on the orders of Lieutenant Colonel Kanji Ishiwara by Kantô Gun/Kwantung Army as a pretext for the initiation of the long Fifteen-Years-War in Asia. Ishiwara plotted to bring about a radical change in the whole political system of Japan, and saw this attack (which had been authorized by Imperial Headquarters in Tokyo, but only in the event of Chinese aggression) as the perfect way to expand Japanese interests.2

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Lieutenant Colonel Ishiwara, who had spent two years in Germany studying military history, with a focus on the war strategies of Frederick the Great and Napoleon, developed his own theory of war, ‘The Theory of the Final World War’. It was, if nothing else, closely related to Buddhist apocalyptic thought, which is itself traceable back to the nationalist ideas of Chigaku Tanaka, a student of Nichiren and the founder of a Buddhist sect. Accordingly, Ishiwara believed that Japan would sooner or later have to fight against the United States and overcome the Western powers, for which he considered the annexation of Manchuria a prerequisite. Ishiwara believed that Japan needed to prepare and reshape itself totally, according to his theories and beliefs, so as to be more ready for an approaching cataclysmic ‘final world war’,3 which Ishiwara now began with this military attack. This military attack of the Kantô Gun/Kwantung Army was harmlessly regarded as the ‘Manchurian Incident’ at the time, but in reality it had been carefully designed and planned by the leadership of the Kwantung Army, and formed a key element of the following imperial, expansionist politics of Japan. One of the main strategies was of course to disguise the intentions of Japanese military aggression. When the Mukden Incident occurred, therefore, the Japanese government reiterated its stance that Japan did not intend to intervene or get involved in any conflicts in China. On the other hand, however, the incident was propagated to such great effect by the military as being a matter of national defence and merely a ‘response’ to aggression that the majority of the Japanese population supported these military attacks. Therefore the government chose to cave in to public sentiment and hesitantly back further military aggression and involvement in China. Parallel to the invasion of Manchuria, in October 1931, the second of two large coups was plotted in Japan shortly after the first coup that had been planned but never carried out several months earlier in March (known as the March Incident). Both failed coups were plotted by members of an ultranationalist, radical secret society within the military (the Sakurakai or Cherry Blossom Society) which was established in 1930 under the direction of Kingorô Hashimoto. Hashimoto had grown tired of party politics and wanted to dissolve the democratic system within Japan. For this purpose, he wished to reform the country via a military coup d’état, after the fashion of Kemal Atatürk.4 Even though Hashimoto’s October Coup plan could not be put into action and therefore completely failed, its impact on society was of great significance because it was not only supported by a great number of the extreme right as well as the national socialists but had also been planned in collaboration with the Kantô Gun/Kwantung Army. As a consequence of this October Coup

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plan (known as the October Incident), Prime Minister Wakatsuki and his cabinet had to resign.5 Because the liberal government could curb neither radicalism nor insurgency within the military, nor the actions of Kantô Gun/Kwantung Army in Manchuria, the conservatives stepped into the political void in 1931 and formed their own government. This government was led by Tsuyoshi Inukai, who to a much greater extent supported the continuance of military intervention in Manchuria. While the middle-class conservatives were certainly not in favour of the annexation or colonization of Manchuria as the military advocated, they did support the idea of creating a so-called ‘independent’ state of Manchuria with a ‘puppet government’. How Inukai’s actions and decisions are to be interpreted still remains a matter for much dispute. However, it is at least worth pointing out that the ‘revolutionary’ tactics of the Kantô Gun in Manchuria still found little acceptance during this period. With this in mind, one possible interpretation is that, due to a lack of proper assessment by the political parties, the belief still existed that the radical elements within the military could be held in check. Additionally, as long as ‘the decision to create an “independent” state rather than an outright colony in part reflected the ideology of pan-Asian liberation and anti-(Western) imperialism that motivated the Japanese planners’, as Andrew Gordon – an American historian who focuses on Japanese history – explains,6 this action was not less than a first step towards revisionist politics. At the same time Gordon pointed out that ‘it was also a strategy to legitimize the takeover of Manchuria in an era dominated by the Wilsonian ideal of national self-determination’;7 meaning that Japan sought for an alternative to Western imperialism in a very ‘modern’ and ‘Western’ way. In spite of the generous compromises the 75–year-old Prime Minister Inukai had made with the military, he was assassinated on 15 May 1932, during an attempted coup led by ‘revolutionary’ right-wing extremists. Many of those taking part in the coup were young imperial navy officers, who were incensed by continued Japanese adherence to the London Naval Treaty of 1930. In fact, Inukai was, in spite of his conservative attitude, an advocate of the parliamentary system, making him just as much an enemy of the radical elements of the military as any other democratic politician. Less than four months later, another series of politically motivated assassinations struck Japan. Former finance minister, Jun’nosuke Inoue, as well as the director general of the Mitsui Holding Company, Takuma Dan, were murdered by members of a group composed of disgruntled navy officers and right-wing extremists known as the ‘Ketsumeidan’ (League of Blood). The Ketsumeidan developed their own idea of state reform derived from Nichiren’s Buddhism, seeking to eliminate all

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the Western influence of a parliamentary democratic system in Japan and to reinstate the Emperor as supreme leader of the country. In order to solve the political crisis, the military leadership criticized the party government system, claiming that the turmoil of the past years had shown that neither a conservative nor a liberal government could function, and that the next government must be made up of some nonparty entity. In a compromise move, former minister of the navy and prominent Admiral Makoto Saito formed a new Japanese government. With this new political system, the two-party democratic system lost its importance so obviously that henceforth the governments had to be replaced one after another. Subsequently, the two-party system was seriously weakened during the period of crisis in the 1930s. In a further turn of the knife, it was a matter of great importance that a five-member as well as a separate three-member cabinet (called interior cabinet)8 would be used under the Saito government to make the most important political decisions.9 Thereafter, parliamentary debates were only formalities, things of little real value. The parliamentary system was hollowed out completely and accordingly lost its place in Japanese politics. The more the power of the political party system in Japan declined, the more important the military became, although it was embroiled in a power struggle itself. Indeed, the military was by and large divided into two camps: a ‘revolutionary’ (Kôdo ha) one and an ‘evolutionary’ (Tôsei ha) one. The ‘revolutionary’ faction sought to gain power via coups, with the aim of establishing a ruling system headed by the Emperor, while the ‘evolutionary’ faction desired rather to set up a ‘total war’ system of government which would be accomplished by cooperation between the bureaucracy and the Military High Command. While the ‘revolutionary’ group was the dominant force within the army and much more influential politically until 1933, the ‘evolutionary’ faction came to the fore from around 1936. The fate of the ‘revolutionary’ faction within the army was sealed following the failure of a violent coup in 1936. In what has been labelled ‘the 2.26 Incident’, close to fifteen hundred radical, right-wing army officers and enlisted men undertook a so-called ‘Shôwa-Revolution’, attacking and occupying the most important government and public buildings in Tokyo, including the chancellor’s office and the central police station. Former Prime Minister Saito, Finance Minister Korekiyo Takahashi and many other important political and governmental figures were murdered. As a result of the failure of the insurgents, an intensive purge took place against those ‘revolutionary’ elements within the military, due to which the ‘evolutionary’ officers and members of the army gained the initiative. They counted amongst their numbers the then General and later Prime Minister Hideki Tôjô.

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The ‘revolutionary’ faction had been strongly influenced by the ideas of the right-wing intellectual, Ikki Kita. Kita had, in one of his major works (Nihon kaizô hôan taikô/An Outline Plan for the Reorganization of Japan, 1923) espoused the theory of state socialism, in which he transformed the traditional absolutist idea of the Emperor System, that is to say the ‘nation of the Emperor’, into a modern idea based on the completely opposite theory of the ‘Emperor of the nation’.10 According to Sinologist Yoshimi Takeuchi, this ‘real fascist’, Kita, was characterized by his original ‘socialist’ ideas on which Takeuchi put a high historical value, pointing out how difficult it is to make clear where a precise line between the ‘Left’ and the ‘Right’ might lie.11 Although Kita had played no real or essential role in the coup attempt in 1936, he was seen as one of the main leaders who had incited the young officers and enlisted men to violence, and was unjustifiably arrested and executed. Altogether seventeen young officers were convicted and executed alongside Kita. The military was thereafter purged of its ‘revolutionary’ faction, allowing for the ‘evolutionary’ faction to assume control, first of the armed forces, and later of the country.12 It is obvious that because of the multiple coup attempts and political assassinations of the ‘revolutionaries’ within the army, the party government system lost some of its most important figures. The end products of the political turmoil were first and foremost the collapse and demise of the party system of government in Japan, as well as the gradual increase and consolidation of military influence in the political arena.

Social Movements in the Interwar Period as a Product of Liberalism The decline of the party system of government signalled the beginning of a period of suppression for the various social movements within Japan which had flourished during the democratic period, such as political and social movements of women, workers and other socially marginalized groups. While the period of the 1930s is known as the period of crisis in Japan, the years before, especially the 1920s, were not entirely peaceful or calm either. In fact, from 1927, Japan had been in almost constant crisis, with the financial crisis of that year marking the beginning of nearly ten years of insecurity. In 1930, the Great Depression also hit Japan, and in 1931 came the ‘Manchurian Incident’. The ‘Crisis of 1935/36’, propagated in terms of diplomatic relations, was ‘invented’ by the military. With these constant problems and social unrest, the labour movement was, in the 1930s, most certainly on the defensive and countless workers lost their jobs during this time. The number of unemployed was, at its peak, ap-

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proximately three million. In the years from 1930 to 1932, there occurred 900, 984 and 870 labour strikes respectively.13 Similar to the problems faced by the labour class during this period was the plight of tenant farmers. In the 1920s, tenant farmers were, by and large, concerned about the reduction of the rising rental charges for the plots, but in the 1930s they even had difficulty in retaining their right to work and farm without unfair dismissal, and they had to fight for their very right to rent or lease property. Accordingly, the number of disputes involving tenant farmers increased dramatically in the 1930s. For example, in 1931, the number of disputes was 3,419, but four years later this number had nearly doubled to 6,824.14 One of the methods available for solving these disputes and problems was a relentless intervention of the state authorities, right-wing societies or even gangsters to break apart demonstrations, often leading to bloodshed. This often led both workers and tenant farmers to accept public settlements, which usually favoured the managers or landowners. In the 1930s, however, such disputes were limited to companies and firms of small and medium-sized businesses, because larger companies tended to cope better with labour disputes by means of the setting up of a ‘factory council’. Made up of some of the workers, it was expected to solve various labour problems together with the employers. This ‘factory council’ system contributed greatly to the weakening of the labour movement in Japan by preventing the formation of uniform labour movements.15 The suppression of the communists was carried out to great effect, especially under the conservative governments. For the conservatives, communism was entirely unacceptable since it openly stood against the ‘Emperor System’. On the occasion of the crowning ceremony of the Shôwa Emperor (Hirohito) in 1928, the government carried out a purge on Communist Party members and their sympathizers. Altogether, on 15 March 1928, close to sixteen hundred communists and their sympathizers were arrested. With these arrests, several of the most important communist and communist-orientated organizations were dissolved and ultimately banned.16 The violent suppression of the Left by the government had many negative effects. Following the mass arrests of communists of 15 March 1928, what remained of the Left split into several groups, parties and different factions. The situation was further complicated as these groups and factions of left-wing activists were divided by political alignment, with some groups being ‘Right’, ‘Central’ or ‘Left’ orientated. In October 1932, when massive arrests were again carried out at the party headquarters of the communists, it also came to light that among those rounded up was a judge who was a communist activist. He was accused along with

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several additional judges and court clerks who had been arrested with breaking the Peace Preservation Laws of 1925/28. As a result of a mass arrest in the Nagano Prefecture in 1933, for example, 684 Communist Party members and their sympathizers were placed under arrest, including 208 teachers, who had been teaching either at elementary or junior high schools. Thereafter the government intensified the repression of intellectuals as well as school teachers in Japan.17 Confronted with the apparent infiltration of communists and their influence into even the government and state functions of Japan, the Japanese administration took this ‘crisis of thought’ within the country very seriously, mainly blaming some intellectuals and especially jurists for corrupting the institution of the state. For example, in the 1920s, Tatsukichi Minobe, a well-known and respected statesman and legal scholar in Japan, had begun to call for a more liberal interpretation of the Meiji constitution (which had been enacted in 1889). Minobe came under increasing pressure as the 1930s wore on, since he was in favour of a balance of power between the Emperor and the representative government. The situation came to a head in March 1935 with his resignation from his university post, as well as the banning of several of his works. Minobe was not the only academic who came under pressure from the government. Yukitoki Takigawa, who held the professorship of law at the Imperial University of Kyoto at that time, was politically criticized for his liberal teachings and, labelled as ‘seemingly red’, he lost his chair. These incidents led to an outcry from academia and those employed at the universities who questioned the government’s commitment to upholding ‘freedom of knowledge’, but these too were heavily suppressed.18 At the beginning of 1933, the well-known proletarian author, Takiji Kobayashi, was arrested. Kobayashi was immediately beaten and tortured to death. (Incidentally, his famous novel, Crab-Canning Boat or Kanikosen, has recently become an extremely popular book in Japan due to the current economic crisis.) At the end of 1933, the country was in a cheerful mood, at least on the surface, because of the birth of the Crown Prince (the current Emperor Akihito). Under the surface, however, the country was in deep political turmoil. The Communist Party organ, ‘The Red Flag’, had been banned, and the last communist leader, Satomi Hakamada, was arrested in 1935 signalling the end of the pre-war and wartime activity of the communists in Japan.19 This violent crackdown and suppression of the communists was the government’s solution to the ‘crisis of thought’ as well as their answer to coping with ‘modernity’ in the sense of ideas. Andrew Gordon characterized the interwar period in Japan as a period of ‘Imperial-Democracy’.20 If one examines the political situation even

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more closely, we might be able to speak of ‘Imperial-Liberal Democracy’. As far as the Japanese situation in the interwar period is concerned, however, more emphasis and worth should be assigned to the term ‘imperial’ than to ‘liberal’ or ‘democracy’. In this sense, it is quite reasonable to say that during the 1930s in Japan, the political situation could be characterized consistently as ‘imperial’ in terms of political alignment, whereas the terms ‘liberal’ and ‘democracy’ might be less applicable to Japan in the period of social crisis.21

The Economic Crisis and the Later Great Depression as a Result of Capitalism The social crisis in Japan in the interwar period was obviously linked to the economic crisis occurring at the same time. The worst of the economic problems faced by Japan was the Financial Crisis of 1927, which shook the domestic economy for the entire crisis period. The Financial Crisis of 1927, which drove depositors to rush banks and led later to the breakdown of many banks, was originally caused by mistakes made by the finance minister, Noharu Kataoka. He had made reference in a parliamentary speech to the fear of bankruptcy, naming a particular bank, which, before the speech, was not in a severe enough crisis to go bankrupt. Since clients of the bank began to withdraw their money en masse after his remarks, the bank soon collapsed. The panic quickly spread across the entire country, leading to many more bank failures. Only a massive intervention by the Central Bank and the government remedied the situation, but these turned out to be merely transitional measures before the next financial crisis which led to the bankruptcy of one of the largest banks in Japan, the Bank of Taiwan. Many depositors again rushed into the banks to withdraw their money, which resulted in a big financial crisis with the bankruptcy of many banks. Wakatsuki’s government duly collapsed after it failed to save the situation. As soon as a new conservative government was formed, the new prime minister, Giichi Tanaka, put through an emergency measure of a long bank holiday, making it possible for the finance minister, Korekiyo Takahashi, to set up a payment moratorium for two days.22 Due to extensive financial aid from the government, the complete collapse of the Bank of Taiwan was narrowly avoided, but in the course of the Financial Crisis of 1927, the restructuring of the banking sector within Japan was accelerated. Owing to a lack of capital, small banks were virtually wiped out, being either bought up by larger banks, or deactivated. It should come as no surprise that one year later, in 1928, out of twelve hundred banks in Japan, only half were financially stable enough to continue operating. The

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restructuring of the entire banking system led to the concentration of capital and wealth in the hands of a very select number of large banks.23 In 1929, Osachi Hamaguchi formed a new liberal-orientated government (Minseitô) and appointed Jun’nosuke Inoue as the finance minister. Inoue immediately began to prepare plans for a return to the gold standard, and called for drastic austerity budget politics. The return to the gold standard was seen as crucial since it would entail the flexibility of the yen on the world market, hopefully stimulating exports. Whereas it was expected that this financial policy would promote foreign trade, it proved to be disastrous and to significantly weaken the economic situation of the Japanese people. The prices of agricultural products fell drastically, and unemployment climbed, which, as has already been mentioned above, caused significant numbers of strikes and demonstrations. Shortly after returning to the gold standard in 1930, Japan had to abandon it again when its serious economic situation was worsened by the Great Depression. Even the strongest financial powers in the world were forced to leave the gold standard, as Great Britain finally did on 21 September 1931. As soon as the Seiyûkai (conservative) government under Tsuyoshi Inukai was formed in 1931, it had to grapple with two contradictory problems. On one hand, it had to implement economic recovery measures as quickly as possible on the domestic front to improve the country’s disastrous financial situation. On the other hand, however, the Japanese government had to increase military spending to fund the army and its rearmament programmes, especially because of the vast expenses incurred during the ‘Manchurian Incident’. Therefore, the Japanese government was forced to abandon the economic policy of the previous administration. This meant coming off the gold standard and converting from a liberal, laissez-faire economic system, to an interventionist, state capitalist one. The finance minister, Korekiyo Takahashi, strove therefore to boost the economy based around a programme of inflation, low interest rates, and an increase in the selling and circulation of government bonds as opposed to the former finance minister Inoue’s deflationary policies. Thereafter, between 35 and 47 per cent of Japan’s national budget was allocated to the military and armed forces whereas investments in the public sector remained between only 8 and 14 per cent of the budget and lasted for a mere three years during the period of crisis.24 Understandably, therefore, it is disputable whether and to what extent Takahashi’s economic policy (which is often compared to Keynes’ economic policy) contributed to improving the economic situation of Japan. What seems more or less obvious is that due to Takahashi’s intensive interventionist, inflationary policies, the Japanese economy had returned to its 1930 GNP level by 1934, signalling a degree of recovery.25 The finance minister pursued a massive rearmament programme as long as he

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believed it would help to forge national economic recovery. Accordingly, as late as 1935, when the economic situation improved, he made an effort to restrict the allocation of funds to the military. This political decision reflected Takahashi’s belief that rearmament should correspond directly to the financial state of the country. However, the plan for a significant reduction in military expenditure was unacceptable for the military command, who continued to pursue their ‘aggression policy’ in China. Takahashi was assassinated in 1936 during the 2.26 Incident. Thus, the crisis which had been created by ‘capitalism’ (economical liberalism) ended up being solved by the termination of ‘gold standard politics’ as well as the transition to a war economy, while the social and political movements were suppressed with more intensity.

Japan’s Colonial-Imperialist Expansionist Policy in China and Asia as an Attempt to Overcome Modernity and the West It is no coincidence that in the middle of the economic crisis, three days before Great Britain parted with the gold standard, the Japanese military began the so-called ‘Manchurian Incident’. This military attack on northeastern China, which brought considerable international condemnation, severely strained Japan’s relations with China. Although the Wakatsuki government took the position that Japan would not pursue expansionist politics, the Kantô Gun/Kwantung Army in Manchuria pressed forward with their own agenda and policies aimed at the whole region of Manchuria. After Wakatsuki resigned, following criticism for not being aggressive enough, Tsuyoshi Inukai formed a new government as has already been mentioned above. Inukai and his government pursued a more active policy of aggression and expansion. A popular saying of the time was ‘Manchuria (including Inner Mongolia) is the lifeline of Japan’.26 In this way, the question of whether Japan could get out of all sorts of crisis was conditioned on the solution of the crisis in Manchuria. Alongside the exploitation of Manchuria for its raw materials, the Japanese began a colonization programme in 1933 to overcome the crisis. Tenant farmers who could not farm or find work in Japan emigrated to Manchuria. To provide for the Japanese farmers, many of the indigenous farmers were robbed of their land. In 1936, the Japanese government under Kôki Hirota decided that a million households should emigrate to Manchuria through this programme.27 In fact, many Japanese emigrated to Manchuria in order to get away from distress on the mainland. In this way, a way out of the crisis in Japan was to be found outside its national borders.

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During the course of the various campaigns in Manchuria, the Kantô Gun/Kwantung Army established a ‘puppet government’ in the territory it had seized. With the proclamation of the founding of ‘Manchukuo’ (or the State of Manchuria), Japan signalled to the world that, in collaboration with the military, it had apparently settled on a revisionist policy that, in essence, would tear down the old, international security system in Asia which had been established after the First World War. As soon as the ‘Manchurian Incident’ occurred, the Chinese nationalist government under Chiang Kai-shek made a protest to the League of Nations about Japanese military aggression. Although the League of Nations passed a resolution requesting that Japan remove her troops from Manchuria and normalize relations with China,28 the Japanese military continued to advance to occupy the whole region of Manchuria. Since the League of Nations could not conclude any effective measures or punishments for Japan, it was decided to dispatch an investigative commission led by Victor Alexander Lytton. The so-called Lytton Commission delivered a report after its four-month investigation. While the Lytton Report rejected the legitimacy of Japanese aggression, the rights and interests of Japan in Manchuria were acknowledged to a certain extent.29 Following the publication of the report, it appeared as though the issue had been settled. However, in 1933, the League of Nations decided not to recognize ‘Manchukuo’ as an independent state. In response to this resolution, the Japanese government decided to withdraw from the League of Nations in order to break officially with the old international security system, the ‘Washington-Versailles Order’. Japan finally withdrew from the League of Nations in 1935. In addition, it decided to have nothing more to do with either the Washington or London naval treaties, which had obliged Japan to limit her naval armament, in order to ‘free herself’ from the chains of the Western world. With this final break, Japan overcame the problem of ‘modernity’, and finally, that of ‘the West’. The further Japan distanced herself from the international community, the more dramatically the coming of a new crisis was generated. Japanese military propaganda was almost unparalleled in spreading fear and disinformation domestically, dubbing the years of 1935/36 as the ‘crisis years’ during which Japan would be confronted with an international crisis because of her isolation. With the excuse of having to avert the plausibly imagined and ‘invented’ crisis, the Japanese army marched to Beijing and across Northern China, with the very aim of separating the regions concerned from China and setting up a nominally ‘independent’ State of Northern China there as a puppet country, in exactly the same style as ‘Manchukuo’. Japan tried to explain her military expansionism as the only way to overcome the potential social and international crisis. Japan was keen to secure a ‘Greater

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Asian Living Place’ at the expense of Chinese territories to overcome the Western world hegemony. However, Imperial Japan’s military expansionism ultimately spelled her fatal downfall as it led to the Asia-Pacific War with catastrophic consequences for the entire world. Given that each crisis creates a new, often much worse crisis in succession, the strategies Japan had preferred to overcome the crisis ultimately led to a new crisis later on. Japan attempted, however, to nibble away at China continuously, and a frontal war between Japan and China came about in 1937 (the Second Sino-Japanese War). Thus, the outbreak of war in China would mark a radical shift in the Japanese governmental policies from the ‘strategies for overcoming crisis’ to ‘war strategies’. A National General Mobilization Law was enacted in 1938, and the country was officially prepared for the coming total war system.

Conclusion In an attempt to overcome the crisis in the interwar period, which was domestically characterized by party politics and their end, the Japanese government intensified the suppression policy, mainly against Communist Party members and sympathizers. The government was indeed relentless in suppressing different political and social movements. Against the background of critical situations, the various problems faced by Japan in the 1930s, including right-wing coup attempts, military insubordination, economic and social uncertainties as well as unemployment and the economic crisis, were all seen as problems of ‘modernity’. In order to solve these problems caused by modernity, Japan sought a very modern and Western way out in the creation of a colonial order in Asia. Therefore, the time of crisis, which Japan experienced in the 1930s, was not brought to an end, but rather exacerbated and even internalized. When the Japanese began their expansion into East Asia in the 1940s and the crisis extended to the East Asian countries, Japan would, far from overcoming the problems of ‘modernity’, plunge into the abyss.

Notes 1.

2.

Shigetaka Suzuki, ‘Kindai no chôkoku oboegaki’ [Understanding the Overcoming of Modernity], in Wataru Hiromatsu, Kindai no chôkokuron: Shôwashisôshi heno ichishikaku [Thoughts on Overcoming Modernity: A Perspective on History of Ideas during the Showa Period], Tokyo 2008, p. 18. Kentarô Awaya, Shôwa no seitô [The Political Parties during the Showa Period] (Shôwa no rekishi [A History of the Showa Period], Vol. 6), Tokyo 1988, pp. 254–55.

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3.

4.

5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15.

16. 17. 18. 19. 20. 21.

22.

23. 24. 25. 26.

27. 28.

29.

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In reference to his theories, see: Kanji Ishiwara, Saishûsensôron. Sensôshitaikan, Tokyo 1993; as well as Keiichi Eguchi, Jûgonen sensô no kaimaku [The Beginning of the 15–Years War] (Shôwa no rekishi, Vol. 4), Tokyo 1988, pp. 27–30. For information relating to the formation of the Sakurakai, see Source No. 20 in Rekishigaku kenkyûkai (ed.), Nihonshishiryô. Gendai, Vol. 5 [Source Material for Studying Japanese History: The Modern Period II], Tokyo 2001, pp. 40–42; Eguchi, Jûgonen sensô no kaimaku, pp. 33–38. Eguchi, Jûgonen sensô no kaimaku, pp. 86–90. Andrew Gordon, A Modern History of Japan: From Tokugawa Times to the Present, New York 2003, p. 187. Ibid., pp. 399–400. It was composed of the Chancellor, the Ministers of Finance, Foreign Relations, the Army and the Navy. Kentarô Awaya, Shôwa no seitô, pp. 298–99. See Source No. 19 in Rekishigaku kenkyûkai (ed.), Nihonshishiryô. Gendai, pp. 38–40. Yoshimi Takeuchi, ‘Kita Ikki’, in Nihon to Ajia [Japan and Asia], Tokyo 2008, pp. 412–18. Eguchi, Jûgonen sensô no kaimaku, pp. 367–88. Concerning the Situation of the Worker’s Strikes, see Source No. 12 in Rekishigaku kenkyûkai (ed.), Nihonshishiryô. Gendai, p. 28. Ibid., p. 31, source No. 14. Akimasa Miyake and Akihiko Hiraga, ‘Fasshoka to minshû’ [The Spread of Fascism and the People], in Akira Fujiwara and Imai Seiichi (ed.), Jûgonen sensôshi. Manshûjihen [A History of the 15–Years-War: The Manchurian Incident], Vol. 1, Tokyo 1988, pp. 211–46; Rekishikagaku hyôgikai (ed.), Nihongendaishi. Taiseihenkaku no dainamizumu [A Contemporary History of Japan: The Dynamic of Regime Change], Tokyo 2001, p. 122. Miyake and Hiraga, ‘Fasshoka to Minshu’, p. 215; Rekishikagaku hyôgikai (ed.), Nihongendaishi, p. 124. Eguchi, Jûgonen sensô no kaimaku, pp. 239–46. For further information on the case of Takigawa, see: Takayoshi Matsuo, Takigawajiken [The Takigawa Case], Tokyo 2005. Eguchi, Jûgonen sensô no kaimaku, pp. 261–62. Gordon, A Modern History of Japan, p. 161. The preparation of Japanese society for a ‘total war system’ entailed the creation of several programmes amongst the civilian population. These included ‘military classes’ or ‘lessons’ in the schools, the mobilization of women in the ‘National Defense Association of Women’ (Fujinkokubôkai) and the reforming and modernization of the rural regions (Nôsonkôseiundô). Altogether, all Japanese Banks were closed for three days (two days’ holiday, and one Sunday). Masanori Nakamura, Shôwa no kyôkô. Daifukyô to shinobiyoru fashizumu [The Crisis of the Showa Period: The Great Depression and the Rise of Fascism] (= Shôwa no rekishi, Vol. 2), Tokyo 1988, pp. 91–94. Nakamura, Shôwa no kyôkô, pp. 97–100. Ibid., pp. 386–87. Ibid., pp. 371–73. This ‘motto’ is attributable to Foreign Minister Yôsuke Matsuoka, who, following Japan’s withdrawal from the League of Nations, propagated and spread the saying widely throughout the media. See Eguchi, Jûgonen sensô no kaimaku, p. 105. For information concerning the emigration plan for ‘Manchuria’, see Source No. 18 in Rekishigaku kenkyûkai (ed.), Nihonshishiryô. Gendai, pp. 36–38. Source No. 145 in Rekishigaku kenkyûkai (ed.), Sekaishishiryô, 20 seiki no sekai I: Futatsu no sekaitaisen, Vol. 10 [Source Material for Studying World History: The World in the 20th Century. Part I: The Two World Wars], Tokyo 2007, pp. 240–41. For further information on the Lytton Report, see, for instance, Source No. 5 in Rekishigaku kenkyûkai (ed.), Nihonshishiryô. Gendai, pp. 17–20.

Chapter 13

Reappraising the Nanjing Decade (1927–1937) Modernizing China during the World Economic Crisis

Susanne Weigelin-Schwiedrzik

The ‘Nanjing Decade’ starts in 1927 with the establishment of Nanjing as the capital of the Republic of China, the unification of the country under its paramount leader Jiang Jieshi (better known as Tschiang Kaishek), and the implementation of one-party-rule under the nationalist party Guomindang. It ends with the Marco Polo Bridge Incident on 7 July 1937 and the beginning of a fully-fledged war between Japan and China. During this period the Guomindang acted as the planner, motor and agent of modernization in China. It introduced a strategic plan to accelerate industrialization by combining state and private economy. While industries of strategic importance were to be run by the state, and infrastructure as well as heavy industry developed by state investments, light industries were regarded as the main field for private business to develop and flourish. However, even though the Guomindang plans were well structured and based on the experiences of many successful countries in the world, the Nanjing Decade has long been seen by historians as proof of the incapability of the Guomindang to run the country effectively. The reason for this negative assessment of the Nanjing Decade was seen primarily in its political inability to unite the Guomindang Party and the country as a whole. Today we know that this assessment is inadequate,1 as it overlooks the important steps China took towards developing a modern economy during the Nanjing Decade, and underestimates the successes the Guo-

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mindang achieved in preparing the country for a fully-fledged war against Japan.2 While most historians look at the Nanjing Decade with a focus on the internal conditions of reform and development as well as on the impediments the Guomindang government had to face, this chapter will focus on the financial policies of the Guomindang government during the Nanjing Decade. It will discuss the two major currency reforms it undertook in 1933 and 1935, and show that the government managed to introduce a modern financial system to China, despite the problems it had inherited from its predecessors and despite the challenges it had to meet in the context of the world economic crisis. The two currency reforms were conducive to developing the economy of the Nanjing Decade and simultaneously instrumental to establishing the state in the modern sense of the word in China. However, the financial system collapsed in the years after the Sino-Japanese War (1937–1945) when China was hit by hyperinflation. The state-controlled financial system established during the Nanjing Decade was a convincing solution at the time. However, in the aftermath of the Sino-Japanese War, the Guomindang government which had established this system could turn out to fall victim to it.

Strategies for Economic Development during the Nanjing Decade Several authors have shown that the Guomindang government designed a modernization programme for China in 1927 which in many respects resembles the reform and opening policy of the Chinese Communist Party (CCP) since 1978 and the development policy the Guomindang applied to Taiwan after 1949. Michael Meyer argues that the so-called ‘Taiwan miracle’ was based on strategies developed by Guomindang economists in 1927.3 Both with regard to industrialization and to the development of the financial sector, the Guomindang introduced a hybrid economic system with a strong state sector in combination with a market-oriented private sector. What is often overlooked is the fact that the implementation of these strategies led to continuous growth of the economy by 8 to 9 per cent, although shortly after the Guomindang takeover the world entered a period of unprecedented economic crisis. At the time that the Guomindang government designed its strategic plan for the development of the economy, the financial system in China was not yet centralized. Several currencies were in circulation including silver liang (also called silver tael), silver dollar, copper coins, and paper money. Additionally, the central government and local governments, as well as private banks, had the right to mint coins; also the right of banknote issuing was not limited to the state – both Chinese and foreign banks had this

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right. Each kind of currency had various forms in different regions. Foreign currencies such as the Mexican Silver Dollar were accepted as a means of payment. In short, almost all financial institutions in China, including modern or traditional banks, enjoyed the seigniorage of coinage.4 Obviously, the high complexity and the diversity of the monetary system conflicted with the needs of industrialization and modernization. Recent research has divided the development of China’s financial system into two types, namely, the ‘free-market’ type before 1927, and the ‘government monopoly’ type after 1927.5 The main features of the post-1927 financial system were the strengthening of the central banking system, the bureaucratization of commercial banks and the restriction of the free market. The Nanjing National Government implemented from the very beginning a policy of state interventionism, as a strong centralized government was instrumental in supporting China’s national capital, strengthening national defence, and preparing against the Japanese military aggression. The most important measures taken at the time were the following. First, the status of the central bank was consolidated. In October 1927, immediately after the Nanjing National Government had been established, the government started preparations for the founding of a central bank. At the same time, it formulated Issue No. 19 of the Central Bank Regulations and, on 5 October 1928, Issue No. 20 on Central Bank Ordinance defining ‘the central bank as the national bank’. In accordance with the proposals of the National Economic Conference and the first National Financial Conference, this ordinance underlined that the central bank was the national bank operated by the national government. The gross fixed capital of the central bank was twenty million yuan, once and fully allocated by the national treasury. Stocks bought from the bank would be limited to a maximum of 49 per cent of the total capital stock.6 On 1 November 1928, the central bank was established at the former site of the St Petersburg Russo-Asiatic Bank in Shanghai. The then minister of finance, Song Ziwen, declared at the opening ceremony of the central bank that ‘the founding of the Central Bank was designed for the reunification of the country’s currency and treasury as well as the regulation of the domestic finance’.7 By the first half of 1933, in addition to the head office in Shanghai, the central bank established branches in Nanjing, Hankou, Tianjin, Jinan, Xiamen and Hangzhou, and sub-branches in Nanchang, Fuzhou, Luoyang, Jiujiang, Wuhu, Bengbu, Zhenjiang, Yangzhou and Zhengzhou. Moreover, offices and agencies were established all over China, and there were representative offices in New York, Berlin, Geneva, London and Paris. Secondly, in 1928 the government started controlling private banks. The government asked for a reorganization of the Bank of China and the Bank of Communications, two banks with a high standing and a long his-

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tory. Additionally, the government bought stocks in order to increase its influence on the banks. After 1931, the government issued several laws which strengthened its control over private banks.8 Thirdly, the government introduced a new tax system with the aim of boosting revenues. A three-tiered tax system of central, provincial and county taxes was gradually established and local taxes were separated from central taxes, with the main sources of tax revenue under the control of the central government. Additionally, the national government unified the salt policies and the salt tax. Using the European and American countries as an example, it levied taxes on industrial products for daily use. During this period, tax revenues rose sharply at all levels, and the fiscal revenues accounted for about 3 per cent of the GDP.9 Fourthly, it succeeded in re-establishing tariff autonomy. From July 1928 onwards, ministers of the United States, Germany and other countries signed Customs Duty Regulations or Commercial Treaties with the Nanjing government. In these treaties, the abolition of all privileges on customs duties in China was declared, and complete tariff autonomy was admitted to China. After re-establishing tariff autonomy, the Nanjing government made several attempts at reforming the tariff system. Of special importance was that in 1930 it introduced tariffs based on the price of gold instead of silver. Consequently, the income of the government increased.10

The World Economic Crisis and its Impact on China For a long time, researchers advocated the opinion that the World Economic Crisis had not hit China severely. They argued that China had a currency based on the silver standard and was therefore isolated from the international financial system. However, more recent research has shown that China, although not hit as early as 1929, started feeling the negative impact of the World Economic Crisis at the beginning of the 1930s. Silver and its price on the world market was what hit China’s economy most. What was previously seen as a positive factor in safeguarding China was now seen as a main problem China had to solve in order to move on with the modernization of its economy.11 One of the main reasons for the World Economic Crisis was the fact that all major economies of the world were tied into a scheme based on their common policy of gold standard. Because they all stuck to the gold standard, any kind of crisis in the productive or financial sector could easily become an international crisis. As China applied the silver standard at the time, it was isolated from this international tendency and therefore only hit by the crisis indirectly, and with some delay. Another factor that functioned as a firewall against the impact of

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the World Economic Crisis was the fact that in the Chinese countryside, copper coins were still in circulation. From 1930 to 1931, prices did not go down in China, but rose a little bit. Mild inflation was accompanied by mild growth.12 At this time, the price for silver was going down, and China had no problems in meeting the rising demand for money or reserves. This was good for the Chinese economy, but made imports more expensive. The wealth that was accumulated during this time was mostly invested into real estate. The Shanghai Stock Exchange index reached its peak in 1931. In this situation, Chinese exports were sold quite easily, and lots of foreign investment came into the country. Consequently, both in terms of current account and capital account, China developed a favourable balance of trade.13 Starting from 1931, China went into recession with prices falling noticeably and silver flowing out of the country. The reason why China started feeling the negative influence of the World Economic Crisis at that time is to be found in the fact that the gold standard was disintegrating. With the subsequent dropping demand for gold on the international market, the price of gold went down. At the same time, the price of silver went up. Because, as a consequence of this, the different national currencies which had so far relied on the gold standard were devaluated, China’s comparative advantage diminished and its exports became more expensive. When the United Kingdom announced abolishing the gold standard in September 1931, other countries whose currencies were tied to the British pound followed its example. However, the United States waited until April 1934 to declare it was finally abandoning the gold standard. In this situation, silver was sold from the hinterland to the coastal areas and through Shanghai, the financial centre of China, onto the international market. The index of wholesale prices in Shanghai fell from 11.3 per cent in 1932 to 7.7 per cent in 1933, and to 6.5 per cent in 1934.14 The total retail sales in Shanghai decreased by about one-third in the second-half-year of 1932, and then dropped 15 per cent in 1933.15 With the first currency reform in 1933, the Guomindang government tried to overcome the recession, however, it did not solve the problem of China’s dependency on silver and the international silver market.

The First Currency Reform in 1933: Abolish the Liang and Adopt the Yuan The newly formed Nanjing National Government recognized that the government must take control of the currency and unify the note-issuing rights in order to fulfil the aim of economic modernization. The first step to be taken in this direction was summarized under the slogan of

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‘Abolish the Liang and Adopt the Yuan’. The idea was to establish a currency backed by the silver standard and abolish all other currencies. In June 1928, the Nanjing government held a national economic conference, proposing five major steps for solving the financial problems. The meeting adopted the National Currency Bill, the Bill for the Abolition of the Liang and Introduction of the Yuan, the Bill to Ban Paper Money, the Mint Bill and other proposals. The National Economic Conference and the National Fiscal Conference decided that the ‘Abolish the Liang and Adopt the Yuan’ policy should be implemented by 1 July 1929.16 However, this decision was never implemented as scheduled. Instead, the government of the Republic of China issued the Outline for Financial Consolidation in 1929, which said: The currency policy is the axis of the national economy. The currency policy has been deficient for a long time. The basic method to solve this problem is to follow the Prime Minister’s plan on currency revolution, and to implement it step by step. There are two aspects to be concerned about: (1) Centralize the issuing of banknotes, and replace the old currency by the new currency; limit the right of issuing the new currency to the state bank; set up branches and exchange bureaus of the state bank in all regions to enforce centralism. (2) Go for the gold exchange standard. The silver standard of currency is no longer compatible with the world trend. However, the gold standard is not compatible with the economic capacity of our country. Therefore, the best solution for today is to ‘Abolish the Liang and Adopt the Yuan’ by implementing the silver standard as the first step; the second step is to implement a gold exchange system. The implementation of the gold standard system will be pursued in an orderly fashion under the guidance of a distinguished international bank which counts among the founders of this system.17

However, the decision to implement currency reform in two steps ignited fierce discussion in China.18 In order to come to a clear decision, the Guomindang government invited Edwin Kemmerer of Princeton University and other professors from the United States in February 1929, asking them to design a currency reform programme. After nine months of investigation and study, Kemmerer submitted a Law on the Gradual Introduction of the Gold Standard in China (Draft) to the Ministry of Finance.19 In March 1930, the minister of finance, Song Ziwen, accepted this draft and interpreted it as ‘the direct method to leap out of the chaotic state of silver currency into the gold standard’.20 The gold content of the currency suggested by Kemmerer was consistent with the later customs gold, known as ‘Sun’,21 its value equivalent to 40 cents of the U.S. dollar, or 1 shilling and 7 pence of the British pound, or 0.825 Japanese yuan.22 In contrast to Minister of Finance Song Ziwen, some economists ad-

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vocated a gradual transition. They believed that although the transition to the gold standard was necessary, it could not be achieved overnight. Sun Ke, the son of Sun Yat-sen, once said: ‘The implementation of gold standard … cannot be achieved by one government order on paper ... Our country is unprepared for the immediate implementation of the gold standard. For the time being, it is difficult to immediately implement the gold standard.’23 Some people regarded Russia as a good example of those in favour of gradual transition: although Russia implemented gold as the basis of payment for custom tariffs from 1876 onwards, it only introduced the gold standard in 1897, twenty-two years later.24 Nevertheless, ‘even though there were objections at the time, the implementation of the gold standard was the idea shared by the majority of the government’.25 Around 1930, the Nanjing government was prepared to go for a one-time realization of the gold standard instead of implementing the ‘Abolish the Liang and Adopt the Yuan’ policy first. The government announced that custom tariffs had to be calculated on the basis of silver, and the export of gold as well as the import of silver money were banned in 1930.26 The reason the government was convinced to have chosen the right time for this transition was the fact that at the time the price of gold was higher than that of silver. However, as a consequence of the World Economic Crisis, most countries in the world abolished the gold standard, which is why, again, the decision the government had taken was never implemented. Instead the government undertook measures to pursue the ‘Abolish the Liang and Adopt the Yuan’ policy. Although the policy to ‘Abolish the Liang and Adopt the Yuan’ had been under consideration and discussion for decades in China, the process of implementation was comparatively short. It only lasted from 1932 to 1933. On 7 July 1932, Finance Minister Song Ziwen held an informal consultation with the Shanghai banking sector explaining the necessity to unify the currency system under state control.27 He succeeded in convincing the Shanghai bankers, who finally voiced their agreement with the government policies.28 On 5 April 1933, the policy to ‘Abolish the Liang and Adopt the Yuan’ became legally effective, and the Central Political Council of the national government announced on 6 April that the Liang had been abolished and the Yuan adopted all over the country. Simultaneously, China officially entered the silver standard period. In preparation for the introduction of the silver dollar, the government started in 1930 to reorganize the mints and put them under government control. The Shanghai mint was established as the central mint and was technically equipped to meet the requirements of producing the new silver dollar. Other mints which had previously been de facto independent were now reorganized into branches of the central mint, and closed if

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technically not equipped to meet the new standards. In March 1933, the Shanghai mint started producing the new silver dollar. The public was asked to hand in silver stored in private households, and the new silver dollar was issued at an exchange rate of 71.5 liang to 100 pieces of silver dollar.29 The new currency was met with an astonishingly high demand immediately after its introduction. The policy to ‘Abolish the Liang and Adopt the Yuan’ was put on trial first in Shanghai, and then spread throughout the country. On 10 March, all businesses in Shanghai began to implement the silver standard system, and eliminate foreign silver currencies from the market while customs began to accept the silver dollar. The Ministry of Finance issued the ordinance ‘Abolish the Liang’, requiring that all public and private money transactions including receipts and contract notes should use silver coins, while liang coins should no longer be accepted; people were asked to transfer the liang coins in their possession to the Central Mint and have them exchanged into silver dollars.30 Additionally, three banks – the Central Bank, the Bank of China and the Bank of Communications – were allowed to offer this service. From the perspective of China’s monetary history, the implementation of the policy to ‘Abolish the Liang and Adopt the Yuan’ in 1933 transformed the silver-based economy fundamentally. The necessity for this kind of transformation had been under scrutiny since 1436.31 The leadership of the Ming and Qing dynasties, as well as the Beijing government, had continuously pursed this policy but always failed. However, by 1933, the situation made this step inevitable. From 1929 to 1933, the Great Depression had emerged as a worldwide phenomenon. In the early and middle phase of the Great Depression, the impact on China was not so direct and obvious. The impact came later than in other countries of the world. From 1932 to 1934, China began to glide from mild prosperity into recession. 1933 was the most difficult year; panic spread throughout the world economy while the crisis was deepening. The domestic economy started to go down, and the threat of Japanese invasion intensified. Almost at the same time, on 4 March 1933, U.S. President Roosevelt said in his inaugural speech, ‘only thing we have to fear is fear’, and initiated a number of policies with the aim of overcoming the widespread fear and apathy. In the following three months, sixteen major Economic Recovery Acts were consecutively released, with eight of them related to finance. Among them were the famous Banking Act of 1933 and the Federal Securities Act.32 The decision to abandon the gold standard was also taken in this period. All this contributed to the Guomindang National Government finally implementing the policy to ‘Abolish the Liang and Adopt the Yuan’. By its currency reform, the government hoped to

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strengthen and stimulate the economy. It established the state as a major actor in the overall economy as well as in the financial sector, and broke with a policy of non-intervention which had characterized the Chinese economy including the financial sector for thousands of years. With the currency reform it literally established the modern state in China. This step is often overlooked in the research of the Nanjing Decade although it has been of major importance for the further development in China ever since. The fact that the transformation from the traditional monetary system to the modern unified currency took so long is not, as some scholars see it, a sign of the inability to unify the currency and overcome chaos in the economy. It is a due reflection of the complicated economic situation in a country as big as China, with so many regional disparities and a fundamental difference between the rural and the urban sectors of the economy. Although the newly established system was more compatible with the modern economy and the modern state, it soon proved unable to cope with the enormous differences and regional disparities in China. As a consequence, the demand for money rose steadily as the economy grew rapidly. The new currency was unable to meet this demand and was impeded in its development by being tied to the silver standard.33 As a matter of fact, the world economy had already moved into a period in which the silver as well as the gold standard had lost their functionality.

The Currency Reform of 1935 On Sunday 3 November 1935, the then finance minister of the Republic of China, Kong Xiangxi, published the ‘Declaration on the Issuing of the Fabi Currency’ in which he announced the abolition of the silver standard and the issuing of a paper money currency.34 Back in 1933, nobody had expected that a second currency reform would have to take place within only one year and seven months, or that China would give up the silver standard within such a short period of time. The main reason China had to undergo a second currency reform and abolish the silver standard is that China was a country with a rather limited production capacity of silver.35 Consequently the demand for money was rising steadily, and with it China’s dependence on importing silver. However, at the same time it was incapable of controlling the price of silver on the international market as its own contribution to the market was too small. With the newly introduced silver dollar, China was using silver not only as the standard for its currency. The silver dollar contained a high quantity of silver.36 Therefore, the silver dollar was not only used as means of payment in China but became a silver product which could

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be traded on the market when it left the country. When the price for silver was high on the international market, the value of the silver contained in the Chinese silver dollar could be higher than the nominal value it had as a purchasing instrument on the Chinese market. Under these conditions, the silver dollar was flowing out of the country while the Chinese government continuously had to import silver at high prices in order to meet the demand for money in China. This would eventually induce the rise of the prices on the internal market. On the other hand, when the price for silver was falling, silver would flow into China and help the economy to develop. For example, when the international market price for silver went down as a result of the World Economic Crisis, the silver reserves in Shanghai increased by 134.4 per cent, from 186.98 million yuan to 438.34 million yuan, during the years 1929 to 1932.37 However, when the major economies of the world abolished the gold standard, the international demand for silver rose again. Subsequently, China entered a period of recession which forced the national government into another round of currency reform, fundamentally abolishing the silver standard. In this situation, the silver policy of the U.S. government had a decisive effect on the development in China. In July 1933, eight countries, among them the United Staes and China, agreed upon controlling the silver market. The United States committed itself not to buy more than 3,500 ounces of silver per annum, while the Chinese government pledged not to sell any silver for the next few years.38 After this agreement, the Chinese government was confident that sticking to the silver standard would be a safe solution for its currency reform of 1933. Only a few months later, the situation changed fundamentally. In 1934 Roosevelt signed the Silver Purchase Act, which put the U.S. minister of finance into the position of buying silver in the United States and abroad until its price reached the 1.29 dollar limit. As a consequence, the value of silver in the United States in December 1934 was 27.5 per cent higher than in 1929. In England, the value of silver was 30.7 per cent higher than in 1929.39 In contrast to the first wave of impact from the World Economic Crisis, this time, the agricultural sector was hit badly. Prices for agricultural products fell faster than the prices for industrial products. The index of export prices for agricultural products peaked in 1930 and dropped by 7.6 per cent in 1931, 10.5 per cent in 1932, 10.3 per cent in 1933, and 14.1 per cent in 1934.40 If the index of purchase power of agricultural goods in 1931 was 100, then 1932 was 96.31, 1933 was 88.72, and 1934 was 83.61.41 However, the modern sector of the economy, especially modern cities like Shanghai, was hit even worse. The financial sector and the real estate market which had made the city so rich during the previous years were in a state of unprecedented crisis, as more and more silver left the

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country through Shanghai. Foreign banks played a most crucial role in this process which led to a dramatic shrinking of silver reserves in China. Only in Shanghai, the financial centre of China, the silver reserve shrank from 582.9 million yuan in June 1934, to 275.6 million yuan in December 1935 – which amounts to a loss of 52.72 per cent.42 In December 1934, the Chinese ambassador to the United States, Shi Zhaoji, delivered a report to the U.S. congress describing the consequences of the U.S. silver policy for the Chinese economy as ‘dramatic’. If silver continued to flow out of China, the crisis would enter a state of uncontrollability, with aggravating deflation, negative trade balances, diminishing revenues and excessive indebtedness to the point of imminent state bankruptcy.43 The Guomindang government perceived that China was the most important victim of the U.S. silver policy. The situation had come to a point where the government had to decide on a second currency reform through which to solve the dependency of the Chinese economy on silver. When people started storming into banks to take out their savings on 2 November 1935, the government waited only one day until it decided on the introduction of a paper currency called ‘fabi’ to replace the silver dollar. The fabi was to be a managed currency with set conversion rates for the dollar and the pound sterling. As backing for the new currency, the government opted for selling its silver reserves in order to buy foreign currency. With this move they followed the advice of U.S. advisers. The decision came as a great surprise and without much preparation. However, it brought some temporary relief.44 As the main problem the Chinese economy was confronted with at the time was the shortage of currency; the main aim of undergoing currency reform and introducing paper money was to increase the volume of money in circulation. The immediate measure the government took to reach this aim was the nationalization of silver, which meant confiscating private property hoarded in silver, in November 1935.45 As the United States was the country with the highest demand for silver, they became the most important supporter and cooperation partner in this endeavour. As a matter of fact, before taking the decision to go for a second currency reform, the national government had already entered into negotiations with the U.S. government. In a secret note, the Guomindang government had already informed the U.S. government in February 1935 that China would abandon the silver standard and opt for a currency with a fixed conversion rate with the U.S. dollar. China would supply the United States with silver, offering to sell at least two hundred million ounces of silver in 1936.46 The United States, although on the one hand the main reason for the economic problems China encountered, was on the other hand willing to cooperate with China in undergoing currency

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reform. In October 1935, the two governments came to an agreement concerning the price of the silver that China was selling to the United States. The price was fixed at 0.65 dollars per ounce, and thus was favourable for China. Additionally, the two countries came to an agreement that China would allow for silver to at least cover 25 per cent of its reserves.47 Thus it would be able to buy silver when the price was low, and sell it when the price was high. However, if the price of silver went down too much, the United States would start buying silver. The alliance between the two countries contributed to stabilizing the price of silver on the world market. On 15 May 1936 the two countries signed the Sino-U.S. Silver Treaty.48 With this agreement, the worldwide turmoil induced by the U.S. silver policy came to an end. At the same time, the new Chinese currency had gained a reliable basis. China became the first country in East Asia to link its currency to the U.S. dollar. Thus China helped the United States to ameliorate the position of the dollar in the world financial system, and contributed to the gradual takeover of the U.S. dollar as the dominant currency on the global economic system.

Conclusion In many respects, the Nanjing Decade exerted a formative influence on the development of the modern state and economy in China. It established the modern state as the motor and organizer of modernization, and as the driving force in the process of establishing a modern financial system. The banking system which had so far developed without state intervention was gradually put under state control, and thus the economic elite were forced into a dependency from the state and its bureaucracy. By undergoing two currency reforms within two years, the government used its newly acquired power to unify the currency and finally to give up the long-held dominant position of silver in the Chinese monetary system. With the strong ties between the fabi and the U.S. dollar, China entered the dollar-dominated financial system and helped the U.S. dollar to establish its dominance over the British pound sterling. From that time on, a mutual dependency between the U.S. and Chinese economies emerged, and shaped the political relationship between the two countries. However, the two currency reforms, while strengthening the state, weakened society. Acting on behalf of the state, the government robbed the population of its wealth accumulated over the centuries in silver. Instead the state became the legal owner of silver, which is why no one could change money into silver or vice versa in times of crisis any longer. The citizens had to rely on the state in overcoming the economic crisis and

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would learn to assess the capacity of the state by its ability to safeguard its citizens from economic hardships. As the Guomindang found no way out of the hyperinflation which developed in the aftermath of the SinoJapanese War, it turned out to fall victim to its own ambitions to lead a state-guided modernization. Even though China was isolated from the World Economic Crisis as it was the only country relying on silver at the time, the crisis exerted a major influence on the economic development and the introduction of a modern financial system. As the price of silver was directly related to the price of gold, the change in the value of gold in the process of abandoning the gold standard influenced the value of the silver dollar and of the quantity of silver it contained. This influence could be felt in the rural areas as well as in a modern city like Shanghai. It hit the modernizing Chinese economy as a whole and made the second currency reform necessary. The crisis pushed the Chinese government into establishing a modern financial system within a comparatively short period of time, after hundreds of years of discussions and failed attempts. The successes of the Nanjing Decade occurred despite and because of the World Economic Crisis.

Notes 1. 2. 3.

Frederic E. Wakeman (ed.), Reappraising Republican China, Oxford 2000. James C. Hsiung (ed.), China’s Bitter Victory, Armonk, NY 1992. Michael Meyer, Ideen und Institutionen: die historischen Wurzeln der nationalchinesischen Industriepolitik, Baden-Baden 2004. 4. Banks in the modern sense were foreign-owned at the time, and banks in the Chinese tradition were called qianzhuang (money exchange shop), yinhao (silver bank) and dangpu (pawnshop). 5. Xucheng Du, ‘Zhongguo jindai liangzhong jinrong zhidu de bijiao’ [Comparison of the Two Currency Systems in Early Modern China], in Zhongguo shehui kexue 2 (2000), pp. 178–90. 6. Jiaguan Hong, Zhongguo jinrong tongshi: Guomin zhengfu shiqi (1927–1949 nian) [A Comprehensive History of Finance in China, Vol. 4: The Period of the National Government (1927–1949)], Beijing 2008, pp. 62–63. 7. Huixin Zheng, Gaige yu kunrao – Sanshi niandai guomin zhengfu de changshi [Reform and Perplexity – The Attempts of the National Government in the 1930s], Hong Kong 1998, pp. 1–3. 8. Jingping Wu, Jindai Shanghai jinrong zhongxin diwei yu Nanjing guomin zhengfu zhi guanxi. Shanghai jinrongye yu guomin zhengfu guanxi yanjiu (1927–1937) de yinyan [The Relationship between the Position of Modern Shanghai as a Financial Centre and the Nanjing National Government: Foreword to the Study of the Relationship between Shanghai’s Financial Industry and the National Government], Shanghai 2002. 9. A Se En Yang Ge, 1927 zhi 1937 nian zhongguo caizheng jingji qingkuang, Beijing 1981, pp. 63–70 [Chinese translation of: Arthur N. Young, China’s Nation-Building Effort 1927–1937: The Financial and Economic Record, Stanford 1971]. 10. Ibid., pp. 37, 45, 48.

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11. This view and the following is based on research published by Barry Eichengreen and Jeffrey Sachs, ‘Exchange Rates and Economic Recovery in the 1930s’, in Journal of Economic History XLV(4) (1985), pp. 925–46; Ben Bernanke and Harold James, ‘The Gold Standard, Deflation, and Financial Crisis in the Great Depression: An International Comparison’, in Glenn Hubbard (ed.), Financial Markets and Financial Crisis, Chicago 1991, pp. 33–68; James D. Hamilton, ‘Role of the International Gold Standard in Propagating the Great Depression’, in Contemporary Economic Policy 6(2) (1988), pp. 67–89; id., Time Series Analysis, Princeton 1994; Cheng-chung Lai and Joshua Jr-shiang Gau, ‘The Chinese Silver Standard Economy and the 1929 Great Depression’, in Australian Economic History Review 43(2) (2003), pp. 155–68; Cheng Shan Zhi Zi [Tomoko Shiroyama], ‘The Currency Reform in 1935 Reconsidered from the Perspective of China’s Relations with the International Monetary System’ [Zailun guomin zhengfu 1935 nian de bizhi gaige], in Zhang, Donggang et al. (ed.), Shijie jingji tizhi xia de minguo shiqi jingji [The Chinese Economy Within the Global Economic Framework], Beijing 2005, pp. 343–69; Lai Te [Tim Wright], ‘China and the 1930s World Depression’ [Zhongguo yu 1930 nian de shijie da xiaotiao], in Donggang Zhang et al. (eds), Shijie jingji tizhi xia, pp. 370–92. 12. Fo Li De Man, Huobi de huohai: Huobi shi pianduan, Shanghai 2006, p. 165 [Chinese translation of Milton Friedman, Money Mischief: Episodes in Monetary History, New York 1994]. 13. A Se En Yang Ge, 1927 zhi 1937 nian zhongguo, p. 214. 14. Jianbing Dai, Baiyin yu jindai Zhongguo jingji (1890–1935) [Silver and the Modern Chinese Economy (1890–1935)], Shanghai 2005, p. 305. 15. Hong, Zhongguo jinrong tongshi, pp. 62–63. 16. Jiaxiang Zhang, Zhongguo huobi sixiang shi [The History of Chinese Monetary Thought], Wuhan 2001, pp. 1153–54. 17. Ibid., p. 1103. 18. Zhongguo renmin yinhang zonghang canshi shi [Research Center of the Central Branch of the People’s Bank of China], Zhonghua minguo huobi shi ziliao, di er ji, 1924–1949 [Materials on the Monetary History of the Republic of China, Vol. 2, 1924–1949], Shanghai 1991, pp. 60–61. 19. Edwin Walter Kemmerer (1875–1945), American economist and professor of Economics and International Finance. Between 1917 and 1934, he became famous as a ‘money doctor’ and served as financial adviser to the governments of Mexico and Guatemala. He also headed financial missions to Colombia, South Africa, Chile, Poland, Ecuador, Bolivia, China, Peru and Turkey. 20. Zhongguo renmin yinhang zonghang canshi shi, Zhonghua minguo huobi shi, p. 68. 21. The ‘Sun’ was a gold currency used for the purpose of paying tariffs. Its name derives from former Chinese president and leader of the Guomindang, Sun Zhongshan (also known as Sun Yatsen). 22. Zhongguo renmin yinhang zonghang canshi shi, Zhonghua minguo huobi shi, p. 68. 23. Linghe Ma, ‘Guomin shiqi guanjinquan de faxing beijing ji youguan jinbenwei de taolun’ [The Background of the Customs Gold Unit (CGU) and the Gold Standard Debate in Republican China], in Zhongguo qianbi [China Numismatics] 1 (2007), pp. 36–40. 24. ‘Gefang duiyu jin gui yin jian zhi jiuji zhi yijian’ [Different Parties’ Opinions on Remedies for the Devaluation of Silver], in Yinhang zhoubao [Bankers’ Weekly] 14(4) (1930), quoted in Ma, ‘Guomin shiqi guanjinquan’, p. 39. 25. Dai, Baiyin yu jindai Zhongguo jingji, p. 297. 26. A Se En Yang Ge, 1927 zhi 1937 nian zhongguo, p. 257. 27. Zhang, Zhongguo huobi sixiang shi, p. 1155. 28. Hong, Zhongguo jinrong tongshi, pp. 255–56. 29. Jianbing Dai, ‘Jindai yinyuan he tongyuan zhuzao shuliang de yige jianlüe guji’ [A Rough Estimation of the Amount of Silver Dollar and Copper Dollar Coins Minted in Modern China], in Zhongguo qianbi 1 (2006), pp. 15–19.

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30. Hong, Zhongguo jinrong tongshi, pp. 255–56. 31. In 1436, the emperor of the Ming Dynasty issued an imperial edict for the legalization of tael circulation. Therefore, the year 1436 was a milestone year in Chinese monetary history. 32. Caizhengbu caizheng kexue yanjiusuo and Zhongguo di’er lishi dang’an guan (ed.), Guomin zhengfu caizheng jinrong shuishou dang’an shiliao: 1927–1937 [Archival Sources on Financial, Banking and Taxation Affairs of the National Government: 1927–1937], Beijing 1997. 33. Zheng Xuemeng, Dianming zhongguo jingji tongshi [A Short Economic History of China], Beijing 2005, pp. 584–85. 34. Tomoko Shiroyama, China during the Great Depression. Market, State, and the World Economy, 1929–1937, Cambridge 2008, p. 183. 35. A.W. Pinnick, Yin yu Zhongguo [Silver and China], Shanghai 1933, p. 27. 36. Xi Wang, ‘“Menhu kaifang” zhengce de yici kaoyan: Meiguo baiyin zhengce ji qi dui dongya de yingxiang’ [A Test of the ‘Open Door’ Policy: The US Silver Policy and its Impact on East Asia], in Ru Jiang Zhao [Akira Iriye] and Kong Hua Run [Warren I. Cohen] (eds), Juda de zhuanbian: Meiguo yu dongya (1931–1949) [The Great Transformation: The United States and East Asia (1931–1949)], Shanghai 1991, p. 34. 37. Dai, Baiyin yu jindai Zhongguo jingji, p. 280, footnote 6. 38. Zhongguo renmin yinhang zonghang canshi shi, Zhonghua minguo huobi shi, pp. 112– 14. 39. Shiroyama, China during the Great Depression, p. 156. 40. Ibid., p. 93. 41. Peigang Zhang, ‘Minguo ershisan nian de Zhongguo nongye jingji’ [China’s Agricultural Economy in 1934], in Dongfang zazhi [Eastern Miscellany] 32(13) (1935). 42. Dai, Baiyin yu jindai Zhongguo jingji, p. 299. 43. Shiroyama, China during the Great Depression, p. 172. 44. Fang Wen (ed.), Bihuo [The Calamity of the Currency], Beijing 2004, p. 185. 45. A Se En Yang Ge, 1927 zhi 1937 nian zhongguo, p. 279. 46. Yaohua Zi et al., ‘“Fabi gaige” chulong neimu’ [The inside story of ‘Fabi reform’], in Wen (ed.), Bihuo, p. 196. 47. Hong, Zhongguo jinrong tongshi, p. 297. 48. Jiaguan Hong, Zhongyang yinhang shiliao (1928.11–1949.5) [Historical Records on the Central Bank (1928.11–1949.5)], Beijing 2005, p. 357.

Notes on Contributors Paulo Fontes is an Associate Professor at the Fundacăo Getulio Vargas in Rio de Janeiro. He received his Ph.D. in Social History from the Universidade Estadual de Campinas (Unicamp) in 2003. He was a Visiting Professor at Duke (2004) and Princeton (2006–07) universities in the United States. A historian of Brazilian labour and working-class culture in Săo Paulo after the Second World War, Fontes has particularly studied internal migration from the Brazilian north-east to Săo Paulo and its role in the working-class formation. In 2011, his book Um Nordeste em Săo Paulo. Trabalhadores Migrantes em Săo Miguel Paulista, 1945–1966 was the winner of the first Thomas E. Skidmore Prize, sponsored by the National Archive, Rio de Janeiro and the U.S.-based Brazilian Studies Association. Paulo Fontes is the National Coordinator of the GT Mundos do Trabalho, the Brazilian labour historians association. Alexandre Fortes received his Ph.D. in History from the Universidade Estadual de Campinas in Săo Paulo, Brazil. Currently, he is a Professor at the Universidade Federal Rural do Rio de Janeiro, and a researcher granted a productivity scholarship by the Brazilian Council for Scientific and Technological Development (CNPq). In 2011–12, he was a Mellon visiting professor at Duke University Center for Latin American and Caribbean Studies. His current research focuses on the impact of the Second World War on Brazilian working people. He has published many works, including, recently: ‘Nurturing Hope, Deepening Democracy, and Combating Inequalities in Brazil: Lula, the Workers’ Party, and Dilma Rousseff’s 2010 Election as President’ (Labor, vol.9, pp. 7–28, 2012) and ‘When the Plumber(s) Come to Fix a Country: Doing Labor History in Brazil and Latin America’ (International Labor and Working Class History, forthcoming, 2012), both co-authored with John D. French. Roger Griffin is a political scientist and Professor in Modern History at Oxford Brooks University. Recent publications include: The Nature of Fascism (Routledge, 1993); Fascism, Totalitarianism, and Political Reli-

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gion (Routledge, 2006); Modernism and Fascism: The Sense of a Beginning under Mussolini and Hitler (Palgrave, 2007); A Fascist Century: Essays by Roger Griffin, ed. by Matthew Feldman (Palgrave, 2008); and Terrorist‘s Creed: Fanatical Violence and the Human Need for Meaning (Palgrave, 2012). Helmut Konrad, born 1948 in Wolfsberg, Austria. Since 1984 he has been: Professor of Contemporary History, University of Graz; Visiting Fellow at Cornell University (USA), University of Waterloo (Canada), EUI Firenze (Italy) and Yale (USA); Dean, Faculty of Humanities (1987– 89 and 2011–13); Rector of the University 1993–97. His main research focus is on labour history and cultural history. Ferdinand Lacina was head of the cabinet of the Austrian federal chancellor Bruno Kreisky from 1980 to 1982, state secretary in the Federal Chancellery until 1984, Austrian minister of finance from 1986 to 1995, and general director of the Giro Credit Bank (1996/1997).  Nelson Lichtenstein is MacArthur Foundation Chair in History at the University of California, Santa Barbara. There he directs the Center for the Study of Work, Labor, and Democracy. His most recent book is The Right and Labor in America: Politics, Ideology, and Imagination, edited with Elisabeth Tandy Shermer. He has held fellowships from the Fulbright, Guggenheim and Rockefeller foundations, and is the author or editor of more than a dozen books. Wolfgang Maderthaner has been the scientific and administrative director of the Austrian Labour History Society since 1983, and was appointed general director of the Austrian National Archives in April 2012. His fields of research include social history, cultural and urban studies, modernism/ postmodernism, and popular cultures. He has published in several languages, recently: der Rest ist Österreich. Das Werden der Ersten Republik 1918–1920, 2 Bände, Vienna 2008 (together with Helmut Konrad); Neoliberalismus und die Krise des Sozialen. Das Beispiel Österreich, Vienna/ Cologne/Weimar 2010 (with Andrea Grisold); and L’autoliquidation de la raison. Les sciences de la culture et la crise du social, (Editions de la Maison des sciences de l’homme, collection PHILIA), Paris 2010 (with Lutz Musner). Hiroko Mizuno is Associate Professor at Osaka University, Japan. She received her Ph.D. from University of Graz, Austria in 2000, and has written widely on Modern and Contemporary History of Austria and Japan.

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She is currently co-editing (with Jun Kono, Shuichi Iwasaki and Atsushi Otsuru) A History of the Habsburg Monarchy and its Legacy (in Japanese). She is also co-editing (with Takuya Ozawa and Satoshi Tanaka) A World History from 1945 to the Present (in Japanese). Hans Mommsen was born in 1930, and studied History, Philosophy and Literature at the universities of Marburg, Tübingen and Heidelberg. He was Professor at the Ruhruniversität Bochum until 1996 (Chair Modern History). He is founder and director of the ‘Institut zur Geschichte der Arbeiterbewegung’, and a visiting professor at Harvard, Berkeley and the Hebrew University, Jerusalem. He is the author of books on German and Austrian history. Karin Priester is Professor for Sociology at the University of Muenster, Germany. She has published on Italian Fascism, on Marxism, on Racism and on Populism. Her main research fields are Political Sociology, Theory of Fascism and Communism, Political Parties and Political Theory. Vicent Sanz Rozalén is Contemporary History Professor at Universitat Jaume I (Spain). He is also Chair of History, Political Cultures and Social Movements Research Group. He is author of D´artesans a proletaris (1995) and Propiedad y desposesión campesina (2000), and has co-edited Cultura social y política en el mundo del trabajo (1999), En el nombre del oficio. El trabajador especializado: corporativismo, adaptación y protesta (2005) and A Social History of Spanish Labour. New Perspectives on Class, Politics and Gender (2007). Bengt Schüllerqvist is Professor of History at Karlstad University, Sweden, and Director of Research for the Center for Didactic Studies in History. He is also Chairman of the Board of the journal NORDIDACTICA – Journal of Humanities and Social Science Education. Samita Sen is at present the Director of the School of Women’s Studies, Jadavpur University, Calcutta (India). She studied in Calcutta and Cambridge; and in 1990 won the Trinity College (Cambridge) Prize Fellowship. Her monograph on women’s employment in the jute industry in colonial Bengal was published in 1999 and won the Trevor Reese Prize in Commonwealth History. She has since published on gender questions in relation to marriage, migration, education, labour and the women’s movement. Her recent books (jointly edited) are Intimate Others (Stree, 2010) and Mapping the Field: Gender Relations in Contemporary India, Volumes 1 & 2, Readings in Gender Studies I (Stree, 2011 & 2012). She

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has been a member of a Calcutta-based voluntary women’s association, Sachetana, since 1983. Susanne Weigelin-Schwiedrzik, was born 1955, is married to the writer and publisher Wolfgang M. Schwiedrzik, and has three children (born 1983, 1986 and 1994). Since 2002, she has been Professor of Sinology at the Department for East Asian Studies, University of Vienna; since October 2010, Dean of the Faculty for Philological and Cultural Studies; and since 2011, Vice-Rector for Research at the University of Vienna. Erik-Jan Zürcher (born Leiden, 1953), studied Turkish (with Arabic, Persian and Modern History as minors) at the University of Leiden, where he also did his Ph.D. in 1984. From 1977 to 1997 Zürcher worked in the University of Nijmegen, first as a lecturer of Turkish, and later as a senior lecturer in History of the Middle East. From 1989 to 1999 he headed the Turkish department of the International Institute of Social History in Amsterdam. From 1993 to 1997 he held a private chair of Turkish History in the University of Amsterdam. Since 1997 he has held the chair of Turkish Studies in the University of Leiden. He is general director of the International Institute of Social History and a member of the Royal Netherlands Academy of Arts and Sciences.

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Index

Abyssinia 70 Adriatic Sea 25 Aegean seaboard 131 Africa 3, 4, 68, 98 Ahrer, Josef 30 Akihito; emperor of Japan 176 Alemanno, Gianni 55–56 Alexandrette 135 Alfonso XIII.; king of Spain 88 Aliber, Robert 12 Alto Llobregat 91, 95 America (American State) 3, 10, 116, 123, 125 Amsterdam 2 Anatolia 127, 130 Andalusia 96 Ankara 130–131, 134 Aquarone, Alberto 65 Aragón 96 Argentina 3, 143–144, 146 Arias, Gino 64 Arnedo 91, 95 Asia 4, 153, 167–168, 170, 179–181 Asturias (Areas of Asturias) 98 Augustus; Emperor of the Roman Empire 68 Austria (Austrian Corporate State, Austrian Republic, First Republic, Second Republic, Republic of Austria, Republic of German Austria) 3, 9, 13, 15–25, 27–30, 33–34, 44–45, 49, 97 Austro-Hungarian Empire 33, 35 Azaña, Manuel 88–89, 92, 98, 100 Badajoz 95 Bahr, Hermann 38, 40 Balkan 130 Baltic States 25 Barrackpore 160

Barrackpore area 158 Barrès, Maurice 37 Barrio, Diego Martínez 88, 94 Baruch, Bernard 118 Basu, Nirban 159, 161 Basu, Subho 157 Baudelaire, Charles 39 Bauer, Helene 15 Bauer, Otto 17–18, 26 Bauman, Zygmunt 44 Becker, Artur 28 Becket, Samuel 37 Beijing 180 Beneduce, Alberto 65–66 Bengal 154, 160, 163 Bengbu 185 Benjamin, Walter 37 Berger, Peter 37 Berlin 79–80, 116, 185 Bernaschek, Richard 27 Bhatpara-Jagaddal area 158 Bhattacharya, Kalidas 158 Binder, Dieter 31 Biscay 98 Blavatsky, Helena (Madam Blavatsky) 40 Bloch, Ernst 37 Bombay 154, 156 Boratav, Korkut 128 Borkenau, Frank 56 Bormann, Martin 80–81, 84 Bose, Subhas Chandra 153 Bottai, Giuseppe 60–63, 65 Botz, Gerhard 22 Brazil 3, 10, 139, 143–145, 147–149 Brecht, Bertolt 28 Brinkley, Alan 123 Broch, Hermann 47–48 Bruguier, George 63

220

Brüning, Heinrich 17 Budge Budge 160 Bulgari, Anton 30 Bulgaria 134 Burnham, James 64 Bush, George W. 13 Caballero, Francisco Largo 89, 95 Calcutta 152, 154, 161 California 122 Cardenas, Lazaro 144–145 Cardoso, Fernando Henrique 148–149 Carinthia 22, 27 Casas Viejas 91–92, 96–97 Castillblanco 91, 95 Catalonia (Catalan State) 91, 96–98 Caucasus 130 Celal, Mahmut 131–132 Central California 120 Central Europe 25, 116–117, 122 Chakrabarty, Dipesh 157 Chiang Kai-shek (Jiǎng Jièshí), also: Tschiang Kaishek 180, 183 Chile 3, 145 China (Republic of China) 3, 37, 168, 170–171, 179–181, 183–195 Ciotti, Vincenzo Fani (Volt) 58 Companys, Lluis 98 Coolidge, Calvin 13 Costamagna, Carlo 61 Coughlin, Charles 116, 122–123 Crow, Jim 124 Czechoslovakia 14, 25 Dahrendorf, Ralf 55 Dan, Takuma 172 Darre, Walter 67 Dasgupta, Prabhabati 158–159 De Felice, Renzo 56 De‘ Stefani, Alberto 58 Dearborn 122 Delhi 160 Denmark 112 Detroit 122 Devi, Santoshkumari 158 Dickel, Otto 78 Díez, Galo 89 Doderer, Heimito von 46, 49 Dollfuß, Engelbert 25, 29–30, 33, 44–46, 93 Domingo, Marcelino 89 Dönitz, Karl 82 Drexler, Anton 78

Index

Dürer, Albrecht 24 Durkheim, Émile 37 East Asia 194 Eastern Bengal 152 Eastern China 169 Eisenstadt, Shmuel N. 57 Eliot, Thomas Stearns 36 Engberg, Arthur 110–111 England 18, 57, 192 Epila 95 Esping-Andersen, Gösta 113 Europe 1, 4, 5, 9–10, 20, 23, 28, 34–35, 38, 40–41, 45, 48, 69, 78, 97, 102, 118, 121, 128, 130–131, 145, 153 European Union 1 Evola, Julius 58 Extremadura 96 Fernandes, Leela 164 Ferrara 62 Fethi Bey, Mehmet 131 Fethi, Ali (Okyar) 130 France 11, 57 Franco, Francisco 29, 86 Frank, Waldo 119, 121 Frederick the Great (Frederick II); king 171 Freud, Sigmund 37, 40 Frick, Wilhelm 82 Fritzsche, Peter 35, 40, 42 Fuzhou 185 Geneva 185 Genoa 58 Gentile, Emilio 44 Gentile, Giovanni 61 Germany 3, 8, 14–18, 21–22, 24–25, 27–28, 30, 48, 57–58, 79, 85, 93, 97, 109, 111, 115–119, 132, 136, 143, 171, 186 Ghandi, Mohandas Karamchand (Mahatma Ghandi) 158 Gil-Robles, José María 93–94 Goebbels, Joseph 79, 83, 84 Gordon, Andrew 172, 176 Goswami, Omkar 161 Gothenburg 111 Graf, Otto Maria 28 Great Britain (Britain) 11, 81, 132, 178–179 Greece 2 Gregor, A. James 56 Gropius, Walter 40 Guipúzcoa 98

221

Index

Habsburg Monarchie (Habsburg Empire) 3, 20 Hakamada, Satomi 176 Hamaguchi, Osachi 170, 178 Hangzhou 185 Hankou 185 Hansson, Per Albin 108–112 Hashimoto, Kingoro 171 Hegel, Georg Wilhelm Friedrich 64 Heidegger, Martin 40 Herf, Jeffrey 55 Herzfelde, Wieland 28 Herzl, Theodor 47 Hess, Rudolf 80–81, 84 Hideki, Tōjō 153 Hilferding, Rudolf 60 Himmler, Heinrich 83–84 Hindenburg, Paul von 80, 82 Hirohito; emperor of Japan 170, 175 Hiroshima 143 Hitler, Adolf 9, 17, 34, 46–49, 78, 79–85, 97, 116–117, 134, 153 Hobsbawm, Eric 14, 143 Hofmannsthal, Hugo von 39 Hooghly 160 Hoover, Herbert 120 Hossain, Lataffat 158 Howrah 160 Hoys, Johann 30 Hungary 2, 9, 14, 18, 25–26, 44 Iceland 1 India (Independent Indian State) 3, 152–153, 155 Indonesia 3 Inner Mongolia 179 Inönü, Ismet 132 Inoue, Jun‘nosuke 172, 178 Inukai, Tsuyoshi 172, 178–179 Ishiwara, Kanji 170–171 Isonzo; river 22, 39 Istanbul 128, 134 Italy 9, 18, 22, 30, 43–44, 55–63, 66–70, 84, 87, 116–119, 132, 136 Izmir 131 Jahoda, Maria 16, 21 Jameson, Frederic 36 Japan 2–3, 37, 167–169, 171–181, 183–184 Jarolin, Hannes 30 Jeanneret, Charles-Édouard (Le Corbusier) 40

Jiménez de Asúa, Luis 90 Jinan 185 Jiujiang 185 Johnson, Hugh 118–119, 121 Joyce, James 39 Jünger, Ernst 42, 49 Kafka, Franz 33–35 Kandinsky, Wassily 40 Kankinara 157 Karabük 132 Kataoka, Noharu 177 Kaya, Sükrü 135 Kayseri 132–133 Kemal, Mustafa (Atatürk) 129–131, 134, 171 Kemmerer, Edwin 188 Kershaw, Ian 46 Keynes, John Maynard 19, 178 Kindleberger, Charles P. 12 Kita, Ikki 174 Klimt, Gustav 39 Kobayashi, Takiji 176 Kōki, Hirota 179 Kokoschka, Oskar 39 Kraus, Karl 23, 36, 40 Kreuger, Ivar 104 Kumar, Radha 163 Kun, Béla 26 Kyoto 176 La Rioja 95–96 Lammers, Wilhelm 81 Latin America 10, 139, 143–145 Lazarsfeld, Paul Felix 16, 21 Leon 97 Lerroux, Alejandro 88, 93 Lewis, Sinclair 115–116 Li tiao Lake 170 Liebefels, Lanz von 47 Liminiana, Alvaro de Albornoz 89 Lindbergh, Charles 116 Linz 46 Lisbon 11 List, Guido von 47 London 1, 14, 129, 180, 185 Long, Huey 116 Los Serranos 91 Ludendorff, Erich 79 Lueger, Karl 44, 47 Lula da Silva, Luiz Inácio (Lula) 148 Luoyang 185 Lytton, Viktor Alexander 180

222

Mach, Ernst 40 Maderthaner, Wolfgang 21 Madrid 29 Maier, Charles S. 60 Majid, Abdul 158 Major Frey 22 Manchukuo 180 Manchuria (The State of Manchuria) 170–172, 179–180 Mantelli, Brunello 55 Marienthal 16, 21 Marinetti, Filippo 40 Marmara basin 131 Marx, Karl 19, 158 Mason, Timothy 55 Matteotti, Giacomo 65 Maura, Miguel 88 Maurras, Charles 44 Mauthner, Fritz 40 Mazzacane, Aldo 65 McArthur, Douglas 120 McDonald, Ramsey 112 Mediterranean 68 Menemen 131, 133, 136 Mexico 143–145 Meyer, Michael 184 Milan 58 Minas Gerais 10 Minneapolis 120 Minobe, Tatsukichi 176 Möller, Gustav 108 Moosbrugger, Christian 39 Mukherjee, Bankim 158 Müller, Hermann 17 Munich 79–81, 84 Münichreiter, Karl 30 Münzenberg, Willi 28 Mur-Mürz Region 26 Musil, Robert 39, 49 Musner, Lutz 22 Mussolini, Benito 8, 22, 43, 55–56, 58, 65, 67–68, 70, 82, 87, 116–119, 132 Nagasaki 143 Nanchang 185 Nanjing 183, 185 Napoleon, Bonaparte 171 Nehru, Jawaharlal 165 Netherlands 11 Neudeck 80 New York 2, 13, 116, 185 Nichiren; Buddhist monk 171

Index

Nicolau d‘Olwer, Lluís 89 Nietzsche, Friedrich 37, 38, 40 Nordau, Max 37, 47 North America 9, 117, 119 Norway 112 Nuremberg 93 Nutzenadel, Alexander 64 Obersalzberg 80, 84 Oruç, Arif 134 Ottoman Empire (Osman Empire) 3, 128 Pagano, Giuseppe 68 Pandit Krishna Kumar Shastri 158 Panebianco, Angelo 105–106, 112 Papen, Franz von 17 Paris 11, 98, 129, 185 Parlato, Giuseppe 65 Payne, Stanley 69 Peiró, Joan 97 Pestaña, Ángel 95 Piacenti, Marcello 68 Piedmont (Carolina) 120 Ploetz, Alfred 40 Poland 14 Polanyi, Karl 145 Porto Alegre 140 Portugal 2, 44 Prague 25, 35 Prestes, Luís Carlos 145–146 Prieto, Indalecio 89 Primo de Rivera, Miguel 87 Prodi, Romano 67 Province of Cadiz 96 Quiroga, Casares 89 Rauchenberger, Alois 30 Renner, Karl 13 Richberg, Donald 118–119 Rilke, Rainer Maria 39 Rio de Janeiro 10, 140 Ríos Urruti, Fernando de los 89 Roehm, Ernst 80 Roman Empire 68 Romania 14 Rome 55–56 Roosevelt, Franklin D. 10, 18, 58–60, 116–119, 121, 123–124, 190, 192 Roth, Philip 116, 123 Rothschild; banking dynasty 13 Russia 3, 41, 189

223

Index

Sahlin, Mona 113 Saito, Makoto 173 Salazar, António de Oliveira 44 Samuelson, Paul A. 12 San Francisco 120 Santos 140 São Paulo 10, 140, 148 Sarti, Roland 69–70 Scandinavia 102, 113 Schieder, Wolfgang 57, 69 Schiele, Egon 39 Schivelbusch, Wolfgang 116 Schleicher, Kurt von 17 Schnitzler, Arthur 39 Schönberg, Arnold 39 Schönerer, Georg 45, 47 Schorsch, Johann 18, 19 Schuschnigg, Kurt 45 Schwabing 41 Scotland 154 Seghers, Anna 28 Serpieris, Ariggo 67 Shanghai 185, 187, 192–193, 195 Shenyang (early Mukden) 170 Siberia 7 Simmons, Colin 153 Sinclair, Upton 122 South America (American South) 124–125 Southern Europe 122 Southern Tyrol 22 Soviet Union 3, 5, 7, 10, 29, 67, 132, 136 Spain (Spanish Republic, Second Spanish Republic, Spanish Federal Republic, The Republic) 2, 17, 29, 44, 86–100 Spann, Othmar 44 Speer, Albert 68, 83 Spengler, Oswald 36 Spirito, Ugo 61–64 Stalingrad 83 Stanek, Josef 30 Stiefel, Dieter 16 Stockholm 108, 110 Strasser, Gregor 79–80 Strasser, Otto 79 Streeruwitz, Ernst 13 Styria 26 Suhrawardy, Huseyn Shaheed 160 Sun Ke; son of Sun Yat-sen 189 Sun Yat-sen; president of the Republic of China 189 Surahammar 111 Suzuki, Shigetaka 167–168

Sweden 17, 103–104, 109, 111, 113 Swoboda, Emil 30 Syria 135 Taiwan 177, 184 Takahashi, Korekiyo 173, 177–179 Takeuchi, Yoshimi 174 Takigawa, Yukitoki 176 Tanaka, Chigaku 171 Tanaka, Giichi 169–170, 177 Terragni, Giuseppe 68 The United States of America (USA, The United States) 1–4, 9, 12–13, 15, 58, 115–117, 119, 120–121, 124–125, 128, 131, 143, 145, 153, 171, 186–188, 192–194 Third Reich (Great German Reich) 11, 30, 33, 35, 49, 55, 81–82, 84–85 Tianjin 185 Titagarh 161 Tōjō, Hideki 173 Tokyo 170, 173 Toledo 120 Toniolo, Giovanni 65 Torstendahl, Rolf 113 Tranfaglia, Nicola 55 Tugwell, Rexford 119 Turin 58 Turkey (Republic of Turkey) 127–131, 133–137 Uljanow, Wladimir Iljitsch (Lenin) 6–7, 82 Uluberia 160 Ungewitter, Richard 40 United Kingdom 15, 187 Upper Austria 27, 30 USSR 5, 132 Valencian Region 91, 96 Valenica 96 Van Gogh, Vincent 39 Vargas, Getúlio 10, 141–144, 146–149 Vienna 2, 13, 15, 23, 25–29, 35, 46–47, 49, 97 Vissarionovich, Joseph (Stalin) 7, 16, 29, 132 Volpicelli, Arnaldo 61 Wagner, Robert 120 Wakatsuki, Reijiro 170, 172, 177, 179 Wall Street 1, 10, 45 Wallisch, Koloman 26, 28, 30 Washington 115, 125, 180

224

Weber, Fritz 19, 37 Weber, Max 70 Wehler, Hans Ulrich 57 Weimar Republic 117 Weininger, Otto 40 Weissel, Georg 30 Western Europe 98 Wigforss, Ernst 110 Willkie, Wendell 116 Wilson, Thomas Woodrow 21 Wolf, Friedrich 28 Wolf, Karl 47 Wolf, Virginia 39 Wuhu 185 Xeresa 95 Xiamen 185 Xiangxi, Kong 191

Index

Yangzhou 185 Yugoslavia 18 Zalamea de la Serena 95 Zamora, Niceto Alcalá 88, 94, 99 Zaragoza 96 Zehl Romero, Christiane 28 Zeisel, Hans 16, 21 Zhaoji, Shi 193 Zhengzhou 185 Zhenjiang 185 Ziwen, Song 185, 188–189 Zuolin, Zhang 169–170