Militant Authoritarianism & Fascism

In Italy, Benito Mussolini was firmly in power by the 1930s. He began his rise to national prominence in 1919, partly by denouncing the terms of the Treaty of Versailles, which many Italians believed had cheated their country of land it was owed as a reward for fighting on the Allied side. Mussolini's rise to power was also aided by the fact that Italy, like Germany, suffered severe inflation and massive debt after WWI, leading to strikes, shortages, and massive unemployment.

Mussolini used fear and terror to gain political power and used a band of supporters dubbed the Blackshirts to threaten his opponents with physical violence. In 1924 his Fascist Party won a majority in parliament, and Mussolini, referring to himself as Il Duce (“the leader”), became Prime Minister of Italy. He then outlawed future elections and established a one-party dictatorship. When the Depression hit, Mussolini used it as a pretext to take over both industry and agriculture, desiring to transform Italy into an autarky (economically self-sufficient state). By 1939, the state controlled most of the country's industry and banks. The economy was still largely agricultural and unable to support a large military regime like that of Nazi Germany. While economic production increased, it was slow, and many remained unemployed, especially in rural areas.

In Germany, the Depression followed a decade of anger over the Treaty of Versailles, economic uncertainty, massive inflation, and social unrest—conditions that offered the National Socialist Party (Nazi Party) under Adolf Hitler an opportunity to consolidate power. By the time the Depression hit, 4 million Germans were out of work. Taking advantage of a history of anti-Semitism in Europe (most notably in Austria), Hitler and the Nazis also claimed that Jewish bankers and business owners had caused the Great Depression and promised they would no longer be allowed to create such havoc. Frustrated German voters readily accepted their arguments. The Nazis were becoming the largest party in the legislature, and President Paul von Hindenburg was pressured to appoint Hitler chancellor in January 1933 to deal with the growing crisis.

Laws were passed limiting job opportunities and social activities for Jewish people, and restrictions only grew harsher as the decade wore on. Hitler banned all political parties other than the Nazis, making Germany a one-party state. Like Mussolini, Hitler wanted to turn Germany into an autarky (economically self-sufficient state). Those not working in an industrial capacity could find a place in the ever-expanding Germany military. By cutting wages, taking control of labor unions, and spending on public works and re-armament, unemployment fell significantly by 1935. Many around the world applauded Hitler’s handling of the Great Depression.

Brazil's economy was largely dependent on coffee exports, and when the Great Depression hit,  coffee prices declined sharply as the economy failed. Unemployment soon soared, and unrest led to a revolution against the government in 1930. Getúlio Vargas, a prominent lawyer and politician, became provisional president. He then seized power under the pretext of a potential communist insurrection, beginning his eight-year long Estado Novo dictatorship. 

While Vargas did not espouse the strict autarky (economic self-sufficiency) of Germany and Italy, he believed that Brazil's future success depended on ridding itself of reliance on foreign investment and business. His speeches warned constantly against allowing foreigners to take control of key industries and the strategic minerals necessary for military defense. The economic emancipation of Brazil, he declared, would be possible only through a policy of industrialization led by the state and protection of its industries from competition and interference from abroad. Vargas won the support of many urban workers by establishing a minimum wage and presenting himself as the "workers' guardian," bringing together labor and government. Brazil reemerged from the economic crisis sooner than the United Kingdom or the United States, a comeback sustained by World War II production, as Vargas joined the Allies after flirting with the idea of allying with Germany.