After his inauguration, and after suppressing a coup attempt, Baldomir announced his intention to reform the 1934 constitution but then procrastinated on carrying out the project. Several months later, the opposition led one of the most important political demonstrations in the history ÍÍÍÍof the country, demanding a new constitution and a return to democracy. Under pressure from organized labor and the National Party, Baldomir advocated free elections, freedom of the press, and a new constitution.

Baldomir's administration could not avoid the consequences of World War II or the pressures and interests of the Allied forces. Although he declared Uruguay's neutrality in 1939, that December the Battle of the Río de la Plata took place. The badly damaged German battleship Graf Spee, cornered by a British naval force and required by the Uruguayan government to leave its refuge in the port of Montevideo, was blown up and scuttled by its own crew just outside the harbor. After this, Uruguay assumed a pro-Allied stance. In 1940 it began an investigation of Nazi sympathizers and finally, in 1942, broke relations with the Axis.

The Blancos persistently attempted to obstruct legislation introduced by Baldomir and criticized the Colorados' policy of cooperation with the United States in hemispheric defense. Baldomir's Blanco ally, Herrera, fought for neutrality, and in 1940 Herrera opposed the installation of United States bases in Uruguay. In 1941 Baldomir forced his three Herrerist ministers to resign they had been appointed to his cabinet in accordance with provisions of the 1934 constitution. Baldomir subsequently appointed a board, without the participation of Herrerists, to study a constitutional reform. Finally, in February 1942 Baldomir dissolved the General Assembly and replaced it with the Council of State (Consejo de Estado), composed of Batllists and other Colorados. This quasi-coup was carried out without arrests, deportations, or the closing of newspapers. It was an in-house agreement to overcome the institutional crisis initiated on March 31, 1933, and to avoid enforcement of the existing constitution. Batllists and Communists welcomed the new situation, but the Socialists argued that Baldomir had been one of the protagonists of the 1933 coup. Independent Nationalists remained on the sidelines. Herrerism, freely accused of being pro-Nazi, proFranco , and pro-Argentine, was the big loser.

In November 1942, national elections were held. Although an electoral law had been passed in 1939 to avoid the formation of coalitions that would endanger the two-party system (Blancos and Colorados), Independent Nationalists were allowed to participate as a new political party, separate from Herrerism. Thus, the National Party divided into two splinter parties and continued as such until 1958. Socialists and Communists were also split, a situation that continued until 1971, when the Broad Front Coalition was created. Batllists supported the Colorado candidate, Juan José Amézaga (1943-47), who won the election.

At the same time, a new constitution was sub 29amitted t to plebiscite and was approved by 77 percent of the electorate. As amended on November 19, 1942, the constitution retained the presidency, restored the General Assembly, implemented strict proportional representation in the Senate, and abolished the mandatory coparticipation imposed by the 1934 constitution for ministries and boards of autonomous entities.

Data as of December 1990