765.00/8–1351
Memorandum by the Deputy Assistant Secretary of State for European Affairs (Bonbright) to the Deputy Under Secretary of State (Matthews)1
Subject: New Italian Government
The new De Gasperi Government in Italy has been endorsed by wide margins in both houses of the Italian Parliament.
The reorganization of the Government was precipitated by disputes within the Christian Democratic Party over economic policy, foreign policy, and anti-Communism. The new Cabinet, which is of approximately the same political complexion as its predecessor, reflects [Page 641] formal rather than substantive compromises by De Gasperi on economic and foreign policies, and is expressly committed to more vigorous sanctions against both Communists and Fascists in Italy. Assuming that Christian Democratic Party unity and discipline have been restored, the new Government will enjoy parliamentary stability. The Democratic Socialists and the Liberals declined to rejoin De Gasperi in the coalition, but will support the Government in foreign policy and in anti-Communist measures at home, while playing the role of loyal opposition on economic policies.
Piccioni, Vice Premier in the new Cabinet, begins to emerge as De Gasperi’s heir apparent; he is the former Secretary General of the Christian Democratic Party and a staunch Party man, but unlike De Gasperi, who aspires to lead several parties in a coalition government, is a one-party man and less adept at inter-party compromise.
Economic Policy
The dispute over Finance Minister Pella’s deflationary policies has been quieted if not settled by reallocation of functions between the economic ministries, by giving the Christian Democrat “Left Wing” representation in the Cabinet (Fanfani as Minister of Agriculture and Trade Unionist Rubinacci as Labor Minister) and by eliminating weak links (especially Togni as Minister of Industry). Pella remains as the principal economic minister, and De Gasperi has expressly stated that economic stabilization remains the “inevitable point of departure” for maintaining purchasing power of the lire and reducing unemployment. The Government will continue to press forward with agrarian and tax reforms but there seems to be little prospect that its deflationary policies will be liberalized to the extent demanded by both the social reformers and by businessmen to help spread available resources over both reform and defense programs. A system of priorities will be initiated to direct available resources toward essential sectors of the economy on the basis of the needs of civil consumption, security and foreign trade; direct Government intervention is to be expected in high priority sectors, such as agriculture, power, scarce materials and non-luxury building.
Anti-Communism
De Gasperi has publicly stated that anti-sabotage and anti-subversion laws will be tightened, with particular reference to slowdown strikes. In this context, he also forecast tightened sanctions against resurgent Fascism. The Prime Minister has privately told Ambassador Dunn that the Government will also clamp down on subversive attacks in the press, and step up efforts to provide work [Page 642] for the unemployed, to assist the newly elected non-Communist municipal administrations, and to accelerate emigration. Ambassador Dunn told him of the great interest in the United States in the anti-Communist program, and mentioned that in similar situations in the United States, we have sometimes appointed special committees to deal with the subject and to obtain support of all organs of government dealing with the matter.
The new Cabinet has decided to postpone until after a census, to be held November 4, the remaining municipal and provincial elections in Southern Italy; it is not yet, however, clear when these elections will be held.
Foreign Relations
De Gasperi has made it entirely clear that Italy continues to support the North Atlantic Treaty. Within the context of “Atlantic solidarity” the new Government will press for revision of the Peace Treaty and will permit no doubts of its rights regarding Trieste, although recognizing in friendly relations with Yugoslavia a factor for peace and security. It is to be expected that the Italian Government will henceforth be more insistent and aggressive in putting forward Italy’s claims vis-à-vis her friends and allies, at least until the Peace Treaty is revised and the Trieste question settled.
Count Sforza’s removal from the Foreign Ministry responds to Christian Democratic and Rightist criticism of his alleged lack of forcefulness in championing Italy’s position in relations with her friends, but there has been no question of his or the Italian Government’s devotion to the cause of defense against Italy’s enemies. By taking the Foreign Ministry himself, De Gasperi has avoided a sharp fight among various candidates for the job, but by sacrificing Sforza, has lost an important buffer between himself and the critics of Italy’s foreign policy both on the Right and on the Left.
Count Sforza’s appointment as Minister without Portfolio in charge of European Union Affairs should offset any apprehension that Italy will withdraw from efforts to unite Western Europe; also, Taviani, the new, strong-willed Christian Democrat who will be Undersecretary in the Foreign Office, has been Chief Italian Delegate to the Schuman Plan and European Army negotiations.
Since Ambassador Tarchiani has been personally and politically associated with Count Sforza and his policies, it would not be surprising if the Ambassador were replaced relatively soon.
- Drafted by Greene.↩