Discuss the differing responses to the Great Depression in Europe.

Question

What will be an ideal response?

Answer 1

Answers will vary. Some nations managed to retain democratic principles, while others turned to fascism to regain control of the national economy. In England, the Labour prime minister, Ramsay MacDonald, enraged his supporters by forming the National Unity Government, focused on compromise to achieve economic stability. This included following a deflationary plan, moving off the gold standard, and adhering to a policy of balancing the budget; in turn, the compromise provided unemployment benefits (albeit severely cut), and by the late 1930s, was leaning toward a welfare state. France adhered to the gold standard but also followed deflationary policies. France suffered from high unemployment and a relatively late economic recovery compared to the rest of Europe, while also maintaining a democratic standard. In much of Europe, however, centralist and authoritarian governments moved to totalitarian models to seize control of the economy and impart their own changes. Italy, Spain, and Germany all turned to fascism and/or dictatorship, and there were many pro-fascist governments in eastern Europe that held strong control of the economy and nationalized much of it. Austria, Spain, and Portugal had strong right-wing governments that formed a close alliance with the Catholic Church to impart stability and control over education, economics, and propaganda. Germany turned to the support of the National Socialist Party, or Nazi Party, which gained considerable power through consecutive elections to parliament before ultimately seizing power under a dictatorship.