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Denmark - 1929-1940 - Crisis and Stability

The Social Democrats and the Social Liberals won the majority at the election in April 1929, and formed a coalition government led by Th. Stauning and P. Munch as Prime Minister and Foreign Minister respectively. This was to become the longest-ruling government of the century. Its extensive reform programme was seriously hampered by the world-wide Depression which hit Denmark in the middle of 1930.

Initially, the agricultural sector encountered problems with sales and prices. In the first half of the 1930s, many farmers were affected by debt crisis and resultant foreclosure. In 1931, the towns also began to feel the crisis as businesses went under and jobs were lost. By 1932, unemployment had risen to over 40%. Externally, the government attempted to ease the situation by trade agreements with Great Britain and Germany. At home, it made a number of emergency agreements with one or both opposition parties. In 1932, the Exchange Control Office was set up to control the external sector of the economy, and all parties gradually acknowledged the need for state intervention in the country’s economy.

Political extremism flourished in the atmosphere created by the Depression and the Fascist/Nazi movements that had begun to stir in Europe. Denmark’s Communist Party (DKP) prospered and succeeded in getting two members elected to the Folketing in 1932, one being the party’s chairman for many years, Aksel Larsen.

In 1931, right-wing extremists formed the very active Landbrugernes Sammenslutning (Agrarian Revival Movement, LS), which organised a huge march to Copenhagen by the country’s farmers in order to exert pressure on the Rigsdag and the King. Certain factions within LS were members of the extreme right-wing Fascist or Nazi groups which came and went throughout the 1930s. Their membership was small and they did not get into the Folketing until 1939. Faced with right-wing accusations that democracy was inefficient, the larger parties set out to demonstrate its efficiency by a number of cross-party agreements.

The most important of these was known as the Kanslergade Agreement, named after the street where Stauning’s residence was located. It was entered into by the government and the Left, and completed on 30 January 1933, the day that Hitler became Chancellor of Germany. It provided for a number of measures, including the first of many extensions by law to the collective labour agreement between employers and employees, a devaluation of the krone and state subsidies to the farming community. Finally, the agreement also required the Liberals to withdraw its objections to the Social Reforms which K.K. Steincke, the minister of social affairs, had been striving to introduce for a number of years.

The Social Reform of 1933 simplified legislation and laid down the principle of law. It also introduced fixed charges for social services. When the government succeeded in winning a majority in the Landsting in 1936, it became simpler to pass the reforms. The parties in power, aided by the Conservatives, put forward a proposal for a new constitution but the bill was rejected by a referendum held in 1939.

The emergency agreements blurred the ideological divisions between the parties. On the one hand, purely liberalistic objectives were in decline and on the other hand, the Social Democratic Party abandoned its original socialist goals and became a party for the workers and the people with greater appeal to a wider sector of the population. Their new position was underlined in 1934 by the introduction of Stauning’s programme entitled ‘Denmark for the People’. The crisis also led to closer co-operation between the State, the administration, the trade organisations and the two sides of industry.

Foreign policy in the 1930s was dominated by the relationship with Germany. Hitler’s take-over in 1933, Germany’s withdrawal from the League of Nations later that same year and the country’s overt rearmament in 1935 meant that Denmark’s policy on security and neutrality again had to accommodate its powerful neighbor. The British government furthermore made it clear that Denmark could not expect any military support in the event of a conflict with Germany.

The Nordic countries attempted to coordinate their policies of neutrality, but their interests differed to such an extent that they were unable to co-operate on security policy. The question of whether the armed forces should be strengthened had still not been resolved by the parties. An agreement in 1937 did produce more personnel and additional equipment, but only enough to emphasise the country’s neutrality. Under no circumstances would Denmark be able to defend itself if the worst came to the worst.

In 1939, Germany approached the Nordic countries with a proposed non-aggression treaty. The other countries rejected it, but a few months before the beginning of the war Denmark agreed to sign the non-aggression pact although it was generally felt to be worth less than the paper it was written on. When war broke out in September 1939, Denmark declared itself neutral. But Denmark’s relations with Germany and Great Britain became increasingly precarious as the country tried to remain politically and economically balanced between the two nations.

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Page last modified: 22-07-2013 18:53:41 ZULU