Central Europe

Germany, located in the middle of Europe and dominating Central Europe (the extent of which can be discussed), was previously divided into many small states. According to Countryaah, German language and culture became widespread early on in most of present-day Germany, Austria and Switzerland, as well as gradually in the areas of Eastern Europe and Russia where German immigrants settled. German territory had two centers when German nationalism got wind in its sails in the last century; Vienna, the capital of Habsburg Austria-Hungary, and the country around the Rhine and Main. The “Common German” Reichstag was held in Frankfurt am Main in 1848. The Austro-Hungarian Empire housed large populations with non-German, primarily Slavic and Hungarian, populations. The dual monarchy had dominated its part of Central Europe, Italy and the Balkans in competition with especially France, Russia and the Ottoman Empire (Turkey). The balance of power in Central Europe changed as Prussia began German unification and shifted its center of gravity from the Rhine to northern Germany and Berlin. Prussia took the lead in the entire German territory and then followed Austria-Hungary into World War I, at the end of which the Austro-Hungarian and Ottoman empires were dissolved into a number of new states. In the years before World War II, a new Central European – Greater German – gathering took place, which after the war ended in the division of Europe into two spheres, which was dominated by an outside power, the United States, and by a power, the Soviet Union, which considered itself European, but which also had Asian features. Germany was divided in two, and its economic center of gravity again lay on the Rhine, Main and Neckar as in the time before the unification of Germany.

Central Europe is now no longer divided, and Berlin is not only the capital of Germany, but a Central European center. The reunited, powerful Germany in the middle of Europe is hardly a threat like the one that previously frightened smaller neighbors and gnawed at those in power in London, Paris and Moscow. This is partly due to Franco-German reconciliation and cooperation; The Coal and Steel Union, the Treaty of Rome and the Western Union. The gradually growing EC and the EU have had to ensure both Europe’s peace and economic recovery and development.

Western Europe

French geopolitical interest is characterized partly by competition with the European superpowers, which could threaten from the south, east and north, and partly by France’s past as a colonial power in Africa and elsewhere.

England’s relations with Europe were determined for centuries by the pursuit of a balance on the continent favorable to British interests and by the distance dictated by global interests in the British Empire and later the Commonwealth. Britain’s weakening was already evident at the beginning of the 1900’s and was fulfilled after World War II through decolonization and the successive abandonment of the “east of Suez” presence. NATO and the functioning of the Alliance until the early 1990’s linked Britain and Europe closely to the United States, the former colony and current world power.

Northern Europe

After Denmark had been the only Nordic EU country for a number of years, Finland and Sweden became members of the union in 1995. The votes on EU membership in Finland, Sweden and Norway (1994) showed that it was especially the big cities that wanted membership. Resistance was strongest, and in the case of Norway crucial, in areas where larger sections of the population are dependent on raw material production and processing. The large cities and their surroundings are characterized by service industries and close connection to the outside world. The difference between urban cultures and life in small towns or the open country is so pronounced in the three largest Nordic countries that important issues divide the countries regionally. The capitals and few large cities are oriented towards foreign countries, especially the core areas of Europe, while the connection to the countryside is sometimes weakened. It is a long way – mentally and in time – from Oslo and Stockholm to a northern Norwegian fishing community or a northern Swedish sawmill town. On the other hand, environmental and other grassroots movements have supporters both in town and on land, in the north and south, and they draw a different and regionally unifying pattern. Differences between core areas and the periphery, which are less pronounced in Denmark, are seen everywhere in Europe.

European Central Bank

The European Central Bank (ECB) was founded in 1998 as part of the European Monetary Union. From January 1, 1999, the ECB took over the monetary policy of the members of the monetary union. As is well known, the euro became legal tender in 12 of the EU member states on January 1, 2002 and to date (2015) it is in 19 countries.

The primary goal of the ECB is the price stability of the euro. Further tasks of the ECB are to promote the smooth flow of payment transactions, to manage currency reserves, the implementation of monetary policy and foreign exchange transactions, the supervision of credit institutions and control of financial market stability as well as its advisory function. The ECB has various instruments at its disposal to achieve its monetary policy objectives. The most important instrument is the open market policy. There is also the instrument of standing facilities, foreign exchange market interventions and the minimum reserve ratio to control the money supply and thereby stabilize the price level. In its monetary policy, the ECB is independent of political instructions and influences, both at the institutional, financial and personal level.

Together with the national central banks, the ECB forms the system of European Central Banks (ESCB). The President of the ECB was the Frenchman Jean-Claude Trichet from 2003 to 2011. Halfway through his tenure, he succeeded the Dutchman Wilhelm Duisenberg, who was elected the first President of the ECB in 1998. The ECB is based in Frankfurt am Main. The Italian Mario Draghi (born 1947) has been Trichet’s successor since November 1, 2011.

History of Italy from 1945 to 1990

Italy’s history from 1945 to 1990 was characterized by industrialization and prosperity, but also by social problems and by a political landscape characterized by great contradictions. Almost a majority of the population abolished the monarchy and introduced a republic in a referendum on June 2, 1946.

Italy was a driving force for international cooperation, joined NATO in 1949 and played a key role in the founding of the European Union.

The peace agreement after World War II

The Paris treaty in 1947 was one was a peace treaty after World War II, in which Italy had participated on the Axis side until 1943. On February 10, 1947, Count Carlo Sforza signed the Paris peace treaty. The main provisions of the Treaty were these: Italy renounced to Yugoslavia virtually all of Venice Giulia with the cities of Pola and Rovigno, and also the islands of the Dalmatia coast. The city of Trieste and the surrounding area (from Cittanova in the south to Duino in the north) was separated and was to form an independent area under the supremacy of the UN Security Council.

The so-called French line, which the great powers adopted after prolonged tug of war, was to form the border between Italy and Yugoslavia. Minor border adjustments were made between Italy and France, giving France the Briga and Tenda areas. Austria did not get through its claim on the northern part of South Tyrol. The Dodecanese were relinquished to Greece. Italy pledged to renounce all its former colonies in Africa and had to pay damages to the Soviet Union, Yugoslavia, Greece, Ethiopia and Albania.

Economic growth in the post-war period

The first elections after the peace agreement was signed were held in April 1948. The new coalition government that won the election consisted of the Communist Party (PCI), the Socialist Party (PSI) and the Christian Democratic Party (Democrazia Cristiana). It concentrated on the country’s economic reconstruction. Unlike fascist protectionism, the economy was built on liberalist economic principles. While the world was about to split into two blocks that year, the Communist Party of Italy was banned from the government. At the same time, a party, Movimento Sociale Italiano (MSI), was formed, consisting of people who had previously supported fascism.

The government pursued a Western-oriented policy, and in 1949 Italy joined NATO. Thanks to the help of the Marshall Plan, Italy achieved rapid economic growth. In 1950, an agricultural reform was introduced, which meant that the state confiscated a large part of the land from the large landowners, and then sold it to farmers who did not own land. There was also rapid industrialization, and Northern Italy was competing with Europe’s industry. The same year, the government opened a separate fund to finance industrialization in southern Italy. Construction (highways, airports) was built and loans were offered to those who wanted to invest in the south, but despite this, the financial distance between northern and southern Italy increased.

In the 1953 parliamentary elections, the government parties did not get a majority, and after lengthy negotiations a business ministry was formed, led by Amintore Fanfani.

In December 1955, Italy became a member of the United Nations, and in the same year a large-scale ten-year plan was launched with the aim of raising living standards, removing unemployment and expanding agriculture and industry. In March 1957, Italy, together with the Benelux countries, France and West Germany, signed the Treaty of Rome, which created the European Economic Community, the EEC (later EU), and the European Atomic Energy Community (EURATOM). In 1959, several government crises occurred, but Christian Democrats still retained government power.

From 1958 to 1963 Italy experienced exceptionally rapid economic growth thanks to its participation in the EEC (EU), which stimulated its exports. But the “boom” was primarily for Northern Italy, and especially the industrialized area around the major cities of Turin and Milan. The export industry (automotive, primarily Fiat, but also the textile, business and clothing industries, as well as the chemical, metallurgical and mechanical industries) led the economic progress, while agriculture was hit by strong competition from other European countries. There was also a large-scale migration from southern to northern Italy, where the industry was in dire need of cheap labor. Unemployment in 1963 was only 3 percent.

Domestic politics in the 1960s and 1970s

At the domestic political level, a coalition government was formed in 1962 with the participation of Christian Democrats, Social Democrats and Republicans. The Socialist Party provided parliamentary support to this government, and Amintore Fanfani became prime minister. In 1963, Aldo Moro formed a new unity government. This was the first time since 1947 that the socialists were forming government. The government focused on transferring labor from agriculture to industry, and on a stronger industrial expansion of rural areas in southern Italy, as well as increasing investment for social purposes.

From the late 1960s, Italy’s economic situation deteriorated. The country was hit by the international economic downturn. Unemployment increased, and frequent strike action made it difficult to maintain production in private and public enterprises. The economic crisis complicated the parliamentary situation. In the early 1970s, Christian Democrats Giulio Andreotti and Aldo Moro alternately led governments built on the center-left formula of 1962. Cooperation between Christian Democrats and leftist groups was a prerequisite for a majority in Parliament.

The Communist Party, which was out of government co-operation, made considerable progress during these years. This was mainly due to two factors: first, a growing proportion of the electorate was disappointed by the inability of the center-left to solve the country’s economic and social problems, while at the same time more and more corruption cases were revealed. In addition, the Communist Party had succeeded in gaining democratic credibility. The party’s leader, Enrico Berlinguer, had for several years assured that PCI would advocate for a democratic, pluralistic society, that Italy’s membership in international organizations such as NATO and the EC (EU) should be maintained, that private property rights should be protected and that the party was wholly independent of Moscow.

As early as the late 1960s, Berlinguer had put forward a proposal for a so-called “historical compromise” which would have resulted in a joint effort by Christian Democrats and Communists to devise a reform program to get Italy out of crisis. One consequence of this would be that the communists took part in government responsibility. In the 1976 elections, communists got 34.4 percent of the vote, while Christian Democrats retained 38.7 percent. When the Christian Democrats were still the largest party, President Giulio Andreotti called for government. Andreotti declared that he did not want the Communists. This attitude was likely influenced by US and other NATO partner notices.

The Communists stayed in the background during the government talks, but Andreotti discussed his draft plan with them, and he chose to form a purely Christian-democratic minority government.

Increased crime and extremism in the 1970s

At the same time as the parliamentary situation was stabilized, the unrest and crime in Italian society increased. The Mafia, which had long been terrorizing areas in Sicily, expanded its operations to other parts of the country. Furthermore, terror on political grounds was sharpened. Violent acts of murder and abduction were increasingly carried out by right-wing and left-wing extremist groups.

In the early 1970s, the country was hit by the international economic crisis and later by the energy crisis. Production went down while inflation, government spending, the government deficit and government debt increased significantly. Corruption in the political circles spread and the first bribery cases became known. The climax was reached in 1978 when the left group of the Red Brigades became particularly active. In connection with a criminal case against 15 of its members for acts of terrorism, Christian Democratic Party leader Aldo Moroabducted on March 16 in Rome, and his five bodyguards were killed. The government refused to negotiate with the terrorists, and on May 9 Moro was found killed in a car in the capital. The crime triggered a violent outrage in the people and led to great support for the Christian Democrats in the election that year.

Party political changes in the 1980s and 1990s

In 1983, socialist Bettino Craxi formed a coalition government of Christian Democrats, Socialists, Republicans, Social Democrats and Liberals. He was the first socialist prime minister in the history of the republic. The alliance and the strong rivalry between the Socialists and Christian Democrats in the government position led to an exhausting power struggle that accentuated the lowest aspects of the system. First and foremost, this was the pursuit of support by the clientele system, especially in southern Italy, in addition to the use of corruption.

Developments in international politics towards the end of the 1980s and early 1990s, with the dissolution of the Soviet Union and the fall of the Berlin Wall, led to changes in the political system in Italy as well. Partito Comunista Italiano was dissolved in 1991, and a new left party, Partito Democratico della Sinistra, was created with a party program moving in the social democratic direction. This party was later dissolved when yet another party, Democratici di Sinistra, was created. This party in turn was also dissolved when Partito Democratico was founded.

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