The PSOE played a key role during the Second Spanish Republic , being part of the coalition government from to and to , when the republic was defeated in the Spanish Civil War. The party was then banned under the Francoist dictatorship and its members and leaders were persecuted or exiled; the ban was only lifted in in the transition to democracy. Historically Marxist , it abandoned the ideology in Both the trade unions and the left have often criticised the economic policies of the PSOE for their economically liberal nature.
They have denounced policies including deregulation and the increase in precarious and temporary work , cuts in unemployment and retirement benefits, and the privatisation of big state-owned organisations and public services. The strike was crushed by the army as a result of further undermining of the constitutional order. After the November general election which marked a win for the centre-right forces in a climate of increasing polarization and growing unemployment, along with a desire to make amends for the mistake of not having sided with the republicans in the election against the united right, Largo Caballero adopted a revolutionary rhetoric, calling for violent revolution and a transitionary dictatorship of the proletariat.
The formation of a new cabinet that included CEDA ministers in October was perceived among the left as a reaction , [ 34 ] with the CEDA party being indistinguishable from contemporary fascism to most workers [ 35 ] while CEDA leader Gil-Robles had advocated the establishment of a corporative state already in the electoral campaign. A growing rift between Prieto and Largo Caballero with disparate views of politics, albeit sharing a general pragmatist approach formed in while Besteiro's hold on the party diminished significantly.
In September , a few months into the Spanish Civil War which lasted until , a cabinet presided over by Largo Caballero was formed he also held the functions of Minister of War. The left socialist caballeristas were revolutionary in rhetoric, although in reality they proposed moderate reformist policies while in government. With the PSOE reduced to clandestinity during the Francoist dictatorship , its members were persecuted, with many leaders, members and supporters being imprisoned or exiled and even executed.
The party was legalised again only in during the Spanish transition to democracy. The PSOE congresses in exile during the post-war period were marked by strong anti-communist positions as a reflection of how the exiles remembered the last events of the Civil War which featured bitter strifes with the communists and in line with the stance of other parties of the Socialist International during the Cold War , neglecting any kind of rapprochement with the Communist Party of Spain PCE.
