When the war broke out in 1914, the Italian socialist party was divided as to the policy to be adopted.
One group clung to the rigid principles of Marxism. This war, they maintained, is a war of the capitalists. It is not seemly for the proletarians to side with any of the belligerent parties. The proletarians must wait for the great revolution, the civil war of the united socialists against the united exploiters. They must stand for Italian neutrality.
The second group was deeply affected by the traditional hatred of Austria . In their opinion the first task of the Italians was to free their unredeemed brethren. Only then would the day of the socialist revolution appear.
In this conflict Benito Mussolini, the outstanding man in Italian socialism, chose at first the orthodox Marxian position. Nobody could surpass Mussolini in Marxian zeal. He was the intransigent champion of the pure creed, the unyielding defender of the rights of the exploited proletarians, the eloquent prophet of the socialist bliss to come. He was an adamant adversary of patriotism, nationalism, imperialism, monarchical rule and all religious creeds. When Italy in 1911 opened the great series of wars by an insidious assault upon Turkey , Mussolini organized violent demonstrations against the departure of troops for Libya . Now, in 1914, he branded the war against Germany and Austria as an imperialist war. He was then still under the dominating influence of Angelica Balabanoff, the daughter of a wealthy Russian land owner. Miss Balabanoff had initiated him into the subtleties of Marxism. In her eyes the defeat of the Romanovs counted more than the defeat of the Hapsburgs. She had no sympathies for the ideals of the Risorgimento.
But the Italian intellectuals were first of all nationalists. As in all other European countries, most of the Marxians longed for war and conquest. Mussolini was not prepared to lose his popularity. The thing he hated most was not to be on the side of the victorious faction. He changed his mind and became the most fanatical advocate of Italy ‘s attack on Austria . With French financial aid he founded a newspaper to fight for the cause of the war.
The anti-Fascists blame Mussolini for this defection from the teachings of rigid Marxism. He was bribed, they say, by the French. Now, even these people should know, that the publication of a newspaper requires funds. They themselves do not speak of bribery if a wealthy American provides a man with the money needed for the publication of a fellow-traveller newspaper or if funds mysteriously flow into the communist publishing firms. It is a fact that Mussolini entered the scene of world politics as an ally of the democracies, while Lenin entered it as a virtual ally of imperial Germany .
More than anybody else Mussolini was instrumental in achieving Italy ‘s entry into the first World War. His journalistic propaganda made it possible for the government to declare war on Austria . Only those few people have a right to find fault with his attitude in the years 1914 to 1918 who realize that the disintegration of the Austro-Hungarian Empire spelled the doom of Europe . Only those Italians are free to blame Mussolini who begin to understand that the only means of protecting the Italian-speaking minorities in the littoral districts of Austria against the threatening annihilation by the Slavonic majorities was to preserve the integrity of the Austrian state, whose constitution guaranteed equal rights to all linguistic groups. Mussolini was one of the most wretched figures of history, a ridiculous braggart and swaggerer. But the fact remains that his first great political deed still meets with the approval of all his countrymen and of the immense majority of his foreign detractors.
When the war came to an end, Mussolini’s popularity dwindled. The communists, swept into popularity by events in Russia , carried on. But the great communist venture, the occupation of the factories in 1920, ended in complete failure, and the disappointed masses remembered the former leader of the socialist party. They Rocked to Mussolini’s new party, the Fascists. The youth greeted with turbulent enthusiasm the self-styled successor of the Caesars. Mussolini boasted in later years that he had saved Italy from the danger of communism. His foes passionately dispute his claims. Communism, they say, was no longer a real factor in Italy when Mussolini seized power. The truth is that the frustration of communism swelled the ranks of the Fascists and made it possible for them to destroy all other parties. The overwhelming victory of the Fascists was not the cause, but the consequence of the communist fiasco.
The program of the Fascists, as drafted in 1919, was vehemently anticapitalistic.  The most radical New Dealers and even communists could agree with it. When the Fascists came to power, they had forgotten those points of their program which referred to the liberty of thought and the press and the right of assembly. In this respect they were conscientious disciples of Bukharin and Lenin. Moreover they did not suppress, as they had promised, the industrial and financial corporations. Italy badly needed foreign credits for the development of its industries. The main problem for Fascism, in the first years of its rule, was to win the confidence of the foreign bankers. It would have been suicidal to destroy the Italian corporations.
Fascist economic policy did not at the beginning essentially differ from those of all other Western nations. It was a policy of interventionism. As the years went on, it more and more approached the Nazi pattern of socialism. When Italy , after the defeat of France , entered the second World War, its economy was by and large already shaped according to the Nazi pattern. The main difference was that the Fascists were less efficient and even more corrupt than the Nazis.
But Mussolini could not long remain without an economic philosophy of his own invention. Fascism posed as a new philosophy, unheard of before and unknown to all other nations. It claimed to be the gospel which the resurrected spirit of ancient Rome brought to the decaying democratic peoples whose barbarian ancestors had once destroyed the Roman empire . It was the consummation both of the Rinascimento and the Risorgimento in every respect., the final liberation of the Latin genius from the yoke of foreign ideologies. Its shining leader, the peerless Duce, was called to find the ultimate solution for the burning problems of society’s economic organization and of social justice.
From the dust-heap of discarded socialist utopias, the Fascist scholars salvaged the scheme of guild socialism. Guild socialism was very popular with British socialists in the last years of the first World War and in the first years following the Armistice. It was so impracticable that it disappeared very soon from socialist literature. No serious statesman ever paid any attention to the contradictory and confused plans of guild socialism. It was almost forgotten when the Fascists attached to it a new label and flamboyantly proclaimed corporativism as the new social panacea. The public inside and outside of Italy was captivated. Innumerable books, pamphlets and articles were written in praise of the stato corporativo. The governments of Austria and Portugal very soon declared that they were committed to the noble principles of corporativism. The papal encyclical Quadragesimo Anno (1931) contained some paragraphs which could be interpreted but need not be -as an approval of corporativism. In France its ideas found many eloquent supporters.
It was mere idle talk. Never did the Fascists make any attempt to realize the corporativist program, industrial self-government. They changed the name of the chambers of commerce into corporative councils. They called corporazione the compulsory organizations of the various branches of industry which were the administrative units for the execution of the German pattern of socialism they had adopted. But there was no question of the corporazione’s self-government. The Fascist cabinet did not tolerate anybody’s interference with its absolute authoritarian control of production. All the plans for the establishment of the corporative system remained a dead letter.
Italy ‘s main problem is its comparative overpopulation. In this age of barriers to trade and migration the Italians are condemned to subsist permanently on a lower standard of living than that of the inhabitants of the countries more favored by nature. The Fascists saw only one means to remedy this unfortunate situation: conquest. They were too narrow-minded to comprehend that the redress they recommended was spurious and worse than the evil. They were moreover so entirely blinded by self-conceit and vainglory that they failed to realize that their provocative speeches were simply ridiculous. The foreigners whom they insolently challenged knew very well how negligible Italy ‘s military forces were.
Fascism was not, as its advocates boasted, an original product of the Italian mind. It began with a split in the ranks of Marxian socialism, which certainly was ah imported doctrine. Its economic program was borrowed from German non-Marxian socialism and its aggressiveness was likewise copied from Germans, the Alldeutsche or Pan-German forerunners of the Nazis. Its conduct of government affairs was a replica of Lenin’s dictatorship. Corporativism, its much advertised ideological adornment, was of British origin. The only home-grown ingredient of Fascism was the theatrical style of its processions, shows and festivals.
The short-lived Fascist episode ended in blood, misery and ignominy. But the forces which generated Fascism are not dead. Fanatical nationalism is a feature common to all present-day Italians. The communists are certainly not prepared to renounce their principle of dictatorial oppression of all dissenters. Neither do the Catholic parties advocate freedom of thought, of the press or of religion. There are in Italy only very few people indeed who comprehend that the indispensable prerequisite of democracy and the rights of men is economic freedom.
It may happen that Fascism will be resurrected very soon under a new label and with new slogans and symbols. But if this happens, the consequences will be detrimental. For Fascism is not as the Fascists trumpeted a “new way to life” ; it is a rather old way toward destruction and death.
 This program is reprinted in English in Count Carla Sforza’s book Contemporary Italy (translated by Drake and Denise de Kay, New York 1944). pp. 295-296.
 Cf. for instance Mario Palmieri, The Philosophy of Fascism (Chicago 1936), p. 248.
This article is serialized from the book Planned Chaos (1947) by the great 20th century economist who was too good to receive a Noble Prize: Ludwig von Mises (1881-1973). (c) 1995 Bettina Bien Greaves. All rights reserved.