Foreign Relations of the United States, 1947, The British Commonwealth; Europe, Volume III

865.51/9–2547

Memorandum of Conversation, by the Assistant Secretary of State for Political Affairs (Armour)

secret

[Washington,] September 25, 1947.

Participants:	Ambassador Tarchiani
	Mr. Armour, A–A
	Mr. Dowling, SE

The Italian Ambassador said he had asked to see me to continue our conversation of some days ago¹ regarding Italy’s present situation. He said that he had just received a telegram from De Gasperi, which he wanted to read to me, and which in substance said that the continued existence of a non-Communist government in Italy would be determined primarily by the assistance which Italy might receive during the next few months. De Gasperi seemed reasonably confident that the Communist-Socialist motion of no-confidence in the government would fail, and he was firmly disposed to resist Communist demands for their inclusion in the government. He (De Gasperi) did not believe that the Communists would succeed in any attempt to overthrow the government by violence so long as the government was able to maintain essential supplies, principally wheat and coal. Italy’s current dollar resources, however, were down to approximately $2 million, while existing commitments totaled $6 million, and there was no hope that the government could continue purchases in October without assistance.

In this connection, Tarchiani said he wanted to leave with me a copy of a telegram summarizing Vice Premier Einaudi’s conversation in London with Messrs. Snyder and Clayton regarding interim aid,² and to urge upon the Department the importance of making available to Italy every possible amount of assistance. He said that in the existing situation every dollar would help, and he therefore hoped it would be possible to expedite the return of the Fortezza gold, payment of the balance of the suspense account, and settlement for the POW certificates.

I told the Ambassador we would certainly do what we could, and that I would immediately bring his suggestions to the attention of the Departmental officers concerned.

The Ambassador then said he wanted to leave with me a letter urging an increased IEFC allotment of grain for Italy,³ adding that he appreciated the difficulties confronting us in this matter, but that if it became necessary to reduce the present low bread ration in Italy he did not believe the government could survive.⁴

[Enclosure—Memorandum]

Text of the telegram received from Premier De Gasperi by Ambassador Tarchiani:

“Vice President Einaudi and Menichella have presented in London to Mr. Snyder and Mr. Clayton a memorandum on the Italian financial situation pointing out that if within the next few weeks no extraordinary help in dollars will be granted to Italy the collapse of the Italian economy will be inevitable. Such immediate help cannot be found in loans from banking institutions due to the slowness of the procedure and the finalities of the aims of such institutions, which are mainly devoted to the reconstruction of industries. No concession whatsoever was obtained in London by the British Government on the question of the convertibility of sterlings. Einaudi has proposed to Mr. Snyder an advance on the amount of the grant-in-aid to be recovered at a later date out of other extraordinary appropriations to be decided or an advance of forty million dollars on the frozen pounds. Both proposals could be combined. Snyder pointed out difficulties, but promised to examine this and other suggestions although mentioning necessity of Congress’ decision for definitive solutions.”

Washington , September 24, 1947.

1. See p. 965.
2. See enclosure to this document.
3. See footnote 2, p. 973.
4. A typewritten, attached memorandum, without date or signature, reads: “Questions which could be examined with the War Department:—Immediate concession of the balance of the suspense account. —Speedy solution of the granting of the dollars for the scrips of the prisoners of war.—Consideration to the possibility of granting to Italy some dollar amounts against requisitions effected by the United States Armed Forces in Italy.”