Doing Math in Mussolini’s Pocket : Ernesto Rossi and Fascist Public Finance (1926-1930)

Abstract

This essay deals with the brief but intense collaboration of Ernesto Rossi with the «Riforma Sociale», a prestigious journal of economics and social sciences founded by Francesco Saverio Nitti in 1894 and directed by Luigi Einaudi since 1908. Between 1926 and 1930, Rossi authored seven long essays on issues of public finance, applied economics, and economic statistics that have been relatively neglected by historiography. The rereading of these contributions allows us to illuminate some central moments in his training as an economist. This essay focuses on four articles he devoted to a deep analysis of the Italian budget and public debt, recalculating public revenues and expenses, with relation both to the accrual-based balance and the cash-based balance, in the attempt to make them comparable year by year, despite relevant changes introduced in those years in accounting practices and norms. The highly technical character of this analysis did not hide the political message underpinning Rossi’s findings highlighting some significant inconsistencies and shortcomings in the fiscal policy pursued by Mussolini’s government. Its declared aims were to attain a balanced budget, to reduce and consolidate the huge public debt, to secure monetary stability and, last but not least, improve the transparency of public accounting practices. Rossi’s deep and accurate revision of the public budget showed how these different but closely interlinked objectives, crucial for attaining and maintaining middle-class consensus to the regime, were often betrayed, or, at least, pursued with little determination and consistency