The Great Depression, which began in 1929, resulted in the most serious disruption in European economic life since the advent of industrialization. The economy of the West crashed when the largely unregulated speculation on the New York stock exchanges permitted a rapid sell-off that created a ripple effect throughout the world economy. Every nation of Europe was seriously affected. In all countries that were still democratic, assaults were made on the parliamentary system of government. Great Britain and France managed to survive by accepting multi-party political coalitions and economic ideas not dreamed of in the prewar era. Germany, Italy, and Russia, however, had established systems of government that utilized organized and violent control over the citizenry. The vast economic reorganization of Russia, instituted by Stalin, brought untold hardship on Soviet citizens. The industrial machine created by the five-year plan, and admired by many in the West, was oiled by the blood of millions. Germany, the most severely struck by the Depression, fell into the grasp of Hitler and the National Socialist (Nazi) party, which brutally eliminated opponents, real or imagined, while embarking on a rearmament program that helped reverse the economic damage caused by the economic collapse. In Italy, the impact of economic reorganization under state control was less clear, in part because it was obscured by early mobilization for war. Before the lessons of the Great Depression could be fully digested, Europe found itself embroiled in a second world war that proved longer and even more devastating than the first.
After reading this chapter you should understand:
- Factors contributing to the Great Depression in Europe.
- Coalition governments of the Right and the Left in the National Government of Britain and the Popular Front of France.
- The Nazi seizure of power in Germany and its effects.
- Central economic planning in the Soviet Five Year Plan and Italian Fascist "syndicalism".
- The human costs of Soviet Communism, including collectivization, shortages of housing and consumer goods, and the purges.