1933-1939 - On the Eve of War
By the late 1930s, Finland appeared to have surmounted the threat from the extreme right and to have upheld parliamentary democracy. The White hero of the civil war, General Mannerheim, speaking in 1933 at the May 16 parade, called for national reconciliation with the words; "We need no longer ask where the other fellow was fifteen years ago [that is, during the civil war]." In 1937 President Svinhufvud was replaced by a more politically moderate Agrarian Party leader, Kyösti Kallio, who promoted national integration by helping to form a so-called Red- Earth government coalition that included Social Democrats, National Progressives, and Agrarians.
A final factor promoting political integration during the interwar years was the steady growth of material prosperity. The agricultural sector continued to be the backbone of the economy throughout this period; in 1938 well over half of the population was engaged in farming. The main problem with agriculture before 1918 had been tenancy: about three-quarters of the rural families cultivated land under lease arrangements. In order to integrate these tenant farmers more firmly into society, several laws were passed between 1918 and 1922. The most notable was the so-called Lex Kallio (Kallio Law, named after its main proponent, Kyösti Kallio) in 1922; by it, loans and other forms of assistance were provided to help landless farmers obtain farmland. As a result, about 150,000 new independent holdings were created between the wars, so that by 1937 almost 90 percent of the farms were held by independent owners and the problem of tenancy was largely solved. Agriculture was also modernized by the great expansion of a cooperative movement, in which farmers pooled their resources in order to provide such basic services as credit and marketing at reasonable cost. The growth of dairy farming provided Finland with valuable export products. In summary, the agricultural sector of the Finnish economy showed notable progress between the wars.
In addition, Finnish industry recovered quickly from the devastation caused by the civil war, and by 1922 the lumber, paper, pulp, and cellulose industries had returned to their prewar level of production. As before the war, the lumber industry still led the economy, and its success fueled progress in other sectors. By the Treaty of Dorpat in 1920, Finland had gained nickel deposits near the Arctic port of Petsamo. These deposits were the largest in Europe, and production began there in 1939. The success of Finnish products on the world market was indicated by the general rise in exports and by the surplus in the balance of payments. Finnish governments protected economic prosperity by following generally conservative fiscal policies and by avoiding the creation of large domestic deficits or foreign indebtedness.
In the 1920s and the 1930s, Finnish society moved toward greater social integration and progress, mirroring developments in the Nordic region as a whole. Social legislation included protection of child workers; protection of laborers against the dangers of the workplace; compulsory social insurance for accidents, disability, and old age; aid for mothers and young children; aid for the poor, the crippled, the alcoholic, and the mentally deficient; and housing aid. Finland reflected European trends also in the emancipation of women, who gained voting rights in 1906 and full legal equality under the Constitution in 1919. The 1920s and the 1930s witnessed a great increase in the number of women in the work force, including the professions and politics.
Although in many ways Finland was predominantly nationalist and introspective in spirit, it participated increasingly in the outside world, both economically and culturally, a trend that contributed to its gradual integration into the international community.
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