Even if San Marino was not directly involved in the First World War (1914-1918), since it only sent volunteers, it did, instead, suffer the consequences. By the end of the war, not only did the level of unemployment, which was already high, increase enormously, but, it was accompanied by an equally high rate of inflation. The political class of the time totally lacked initiative, the ability and the courage necessary to introduce the changes to contain the phenomenon.
As is inevitable in such a situation, there was an outbreak of contrasts between the poorer classes (the major part of the population) and the middle-class (made up of only a few landowners and middle-class families). When the moderate government, in office at the time, attempted to make a few mild concessions to the poorer classes, the middle-class, in an attempt to maintain its feudal-type privileges (share-cropping still existed) over the rest of the population, reacted by adopting the fascist system already on the Italian political scene. This political system, however, calls for popular consent, at least during the embryonic stage; something that never occurred in San Marino.
It would, therefore, be more correct to speak of an oligarchic dictatorship, which justified its existence by comparing itself to the Italian fascist regime. The San Marino Fascist Party was founded in 1922 and immediately showed defects in its internal unity: it must be kept in mind that the only common interest of its members was that of maintaining their privileges – economic, social, etc. Rising to power was not difficult since the other parties at the time were not large enough or compact enough to create a strong opposition.
In 1923 the Grand and General Council was dissolved and transformed in the Main and Sovereign Council. New elections were called and only one list was presented; the list included a majority of fascists and a small group of Catholics. At this point a regime was formed with the consequent transformation of the State to resemble that of Italy. The lack of internal adhesion forced the SFP to continuously look for support from the Italian Fascist Party. The result is that of a continuous interference of the IFP in the internal affairs of San Marino, causing a reduction of its autonomy. On the other hand, this is the only possibility for the oligarchy to affirm its power and persecute political adversaries (represented by members of the Socialist Party).
In San Marino as in Italy, Mussolini did not lose time in demonstrating his untiring activity and began a project for the construction of a railroad connecting Rimini to San Marino, completely financed by Italy. The fascist power seemed to have no rivals. This is the reality until 1941-42, when some socialist leaders return to San Marino and start up a clandestine antifascist movement. Thanks to them the opposition to the fascist government grew and became more compact and stronger. On July 28, 1943, they held an important political demonstration with the result that they were able to obtain the dissolution of the SFP and call new elections.
Unfortunately, the shadow of fascism continued to hover over the small state; the liberation of Mussolini by the Germans and the consequent restoration of fascism in Italy would not be uninfluential to San Marino. Too defenceless to oppose the Germans, the new government rushed into a peace treaty with the regime which allowed it to remain neutral between the belligerant states.
Following this decision, the Grand and General Council delegated its powers to the State Council, composed of twenty members, including some fascists; this actions can only be interpreted as a way to freeze the home political situation while waiting for the international situation to improve.
It is in this climate that the country finds itself having to deal with the Second World War. The only defence such a small state could avail itself of was diplomacy and the State Council had to utilize all of its capabilities to obtain recognition of the neutrality of San Marino. For almost the entire duration of the war, San Marino was a safe shelter for inhabitants of the surrounding areas. More than a 100,000 people requested and obtained refuge; among whom a group of Jews who were, thus, saved from concentration camps. The refugees were settled into public and private buildings, churches, railroad tunnels and in any other place available. For a population of less than 15,000 people, the need to procure food for so many others called for an enormous effort, which was carried out without hesitation.
Unfortunately, on June 26, 1944, the hope of remaining an island of peace in a world at war became a bitter disappointment; the country was hit by an air raid. Totally unprepared for such an event, the population and refugees did not run for shelter from the bombs; this caused the death of sixty persons with injury to many others. The air attack was totally unjustified, as was admitted later on by the British Government, and was caused by erroneous information. The diplomatic activity of the country became more intense following this episode to ensure that its neutrality was not violated again. However, the diplomatic attempts were to no avail when, in September of the same year, there was a direct clash between the British-American and German armies. At the end of the war the British-American troops remained for another two months on San Marino territory, in order to supervise the slow return of the refugees back to their homes.
On March 11, 1945, when the first post-war elections took place, the left-wing parties rose to power and remained in power until 1955. In 1957, the victory went to a coalition of Christian Democrats and Socialist Democrats to which goes the merit of introducing a law acknowledging the right to vote to the women of San Marino (law of December 23, 1958). This right to vote became effective on January 1, 1960.
On September 11, 1973, a Christian Democrat and Socialist coalition government, passed a law which officially recognized equal rights for men and women to occupy public and political offices.