Foreign Relations of the United States, 1958–1960, Western Europe, Volume VII, Part 2

239. Report by the Operations Coordinating Board⁰

July 8, 1959.

OPERATIONS PLAN FOR ITALY

A. Objectives and General Guidance

1. Objective.

An Italy free from Communist domination or serious threat of Communist subversion, having a constitutional, democratic government and a healthy self-sustaining economy, and able and willing to make important political, economic and military contributions in support of the free world coalition.

2. General Guidance.

a. Exercise of U.S. Influence. Due to its improved economic, financial and military position, Italy has become increasingly self-confident and considers that with its improved position it should have an increasingly important and responsible role in the Western Alliance. [5 lines of source text not declassified]

b. Consultation and Participation. In order to encourage continued Italian support for U.S. international policies, the U.S. should consult with Italy on international matters in which the two countries have important national interests. Wherever possible and appropriate, the U.S. should support the desire of Italy to participate in international conferences dealing with matters of concern to the Italians.

c. Defense. The U.S. should continue to assist Italy to strengthen its defense capability, emphasizing U.S. support through provision of modern weapons, and encouraging the Italian Government to absorb, in so far as feasible, the costs of conventional weapons and maintenance thereof. MAP assistance will be provided in accordance with established priorities.

d. Italian Economy. The Italian economy has progressed, in recent years, to the point at which we need not consider grant economic aid under the MSP. The U.S. should concentrate on facilitating a normal, sound and self-sustaining economic relationship with Italy.

e. Political Orientation of Italian Government. The U.S. should encourage the maintenance in power of a friendly democratic and pro-Western oriented Italian Government based on the support of and/or participation of all or most of the Center parties of which the Christian Democratic Party is the bulwark. These include the Christian Democrats, Social Democrats, Liberals, Republicans, and possibly the Democrats (ex-Monarchists). However, given the complexities of forming a majority government, it is necessary to support minority Christian Democratic governments which draw their support from either the democratic left (Social Democrats and Republicans) or the right. [less than 1 line of source text not declassified] We should not support a government which depends for its majority on either the Communist Party, or Socialist Party as presently oriented.

f. Anti-Communist Activities, [less than 1 line of source text not declassified] the Communist Party and Communist influence in Italy are still powerful and will remain, for the foreseeable future, the major threat to the implementation of U.S. policy in Italy, [2 lines of source text not declassified]. The Italian authorities should also be encouraged to employ the legal means at their disposal to weaken the organizational and financial strength of the Communist Party and its affiliated organizations.

g. Labor. The U.S. should support the free unions in their effort to combat Communist control over Italian labor. [3–1/2 lines of source text not declassified]

B. Operational Guidance

3. U.S. Bilateral and Multilateral Relations with Italy.

a. Our relations with Italy both bilaterally and with respect to multilateral problems involving the UN or other international organizations have in general been excellent. The Italian Government has made special efforts to ensure that Italy’s voice internationally be heard and given due weight. It will not always be easy for us to accommodate this Italian desire for consultation and participation in major international decisions which only indirectly involve Italy.

b. We should continue to give maximum support, wherever possible and appropriate, to the Italians on this score. It is important also that we continue to keep the Italians informed, as may be appropriate, regarding our consultations with the French and the British on global subjects, as well as with respect to other international matters in which Italy may have a legitimate interest. In light of evidence that the French are endeavoring to re-establish their special relationship with Italy originally provided in the Santa Margherita Agreement of 1951,¹ we should remain alive to the need of maintaining close contact with the Italians. This is particularly necessary to ensure that French recalcitrance in NATO should not diminish Italy’s full support of the alliance.

4. U.S. Interests in Italy’s Relations with International Organizations and with Other Nations.

a. International Organizations.

(1) Italy has been one of the most energetic and progressive of the European nations in working towards regional integration and in participating in such organizations as the United Nations, the North Atlantic Treaty Organization (NATO), the Western European Union (WEU), EURATOM, the Coal and Steel Community (CSC), and the Common Market.

(2) The Italian Government’s positive attitude toward these movements has served and will continue to serve U.S. interests and should be encouraged. We are particularly interested in encouraging Italy to seek the assistance of OEEC (the Organization for European Economic Cooperation) and other international organizations in efforts to raise the economic level of less developed Italian areas.

b. Other Nations.

(1) Yugoslavia.

a. We wish to see further reduction of Italo-Yugoslav political and economic tensions.

b. While the U.S. should take no action to encourage escape of Yugoslav nationals, we should continue to take steps towards precluding the involuntary repatriation of Yugoslav national political refugees. The U.S. should provide Italy with technical advice. In light of the limited extent of U.S. interest in Yugoslav refugees in relation to the basic objective of reducing the total problem of refugees, we should provide only limited assistance to supplement Italian and international assistance. Our assistance should primarily emphasize development and maintenance of emigration processing facilities for escapees and refugees.

(2) Austria. We should continue to encourage Italy and Austria to resolve the problems of the Alto Adige–South Tyrol bilaterally within the framework of the Gruber–de Gasperi accord.²

(3) Communist Bloc Nations. We do not wish to see and should discourage any Italian recognition of Communist China and East Germany. In connection with economic relations with these two Communist states, as well as with other Communist bloc nations, we wish to encourage Italy’s support for U.S. efforts to maintain COCOM strategic trade controls.

(4) Somalia. We wish to see and should encourage maximum Italian support for the future economic viability of Somalia.

5. Special Considerations of Our Military Relations with Italy.

a. Italy should be encouraged to continue the excellent contribution to the NATO defense effort, as marked by its acceptance of IRBMs and its promise to maintain a 4% annual increase of its total defense budget, so that, with U.S. grant aid assistance, Italy can proceed towards meeting NATO MC–70 force level requirements. In addition to the forces immediately required by MC–70 the U.S. recognizes the importance to Italy of certain national forces which will be available to SACEUR in the event of war. The U.S. should continue to permit the Italian Government to use equipment for these national forces which is excess to the needs of the Italian forces immediately required by MC–70.

b. The U.S. should maintain forces in Italy primarily in accord with military requirements. However, due regard in this connection should be given to the political factors in Italy.

c. It is important to continue the good progress made in building good troop community relations for our forces stationed in Italy, by special training programs and operational procedures.

6. U.S. Interests in Italian Internal Political Situation.

a. Center

(1) We should keep in touch with all major Christian Democratic Party factions while maintaining close relations with Segni and members of the present government. We should encourage the Christian Democrats as a whole to seek a broad and stable base for the government by inducing the other Center parties to join in coalition with them, whenever the situation permits.

[2 paragraphs (11 lines of source text) not declassified]

b. Left.

(1) [4–1/2 lines of source text not declassified] to the extent feasible, we should encourage the development of autonomist elements within the Socialist Party and expose them to U.S. thinking.

(2) We should continue [less than 1 line of source text not declassified] to oppose the Communists and to seek to reduce their hold on nearly 25% of the Italian electorate.

c. Right.

(1) Informal contacts should be maintained with Democratic Party (former Monarchists) leaders in order to evaluate trends within the Party [2 lines of source text not declassified].

[1 paragraph (4 lines of source text) not declassified]

d. Other. We should maintain correct relations with President Gronchi and expose him as much as possible to U.S. views. Our official attitude should be one of neither approval nor disapproval of his actions on the internal political front. At the same time we should not hesitate to make known our official position in the event President Gronchi’s views on the international situation are in conflict with those of the United States.

7. U.S. Interests in the Political Orientation of Italian Labor. We should continue to administer the various U.S. programs, including procurements and U.S. local labor contracts, in Italy in such a manner as to weaken Communist and fellow traveler organizations and to strengthen their opponents, the free labor unions, cooperatives and similar organizations, in the struggle for control of Italian labor. We should also endeavor to discourage company unions which tend to split and weaken the effectiveness of the free trade unions. We should continue to encourage the Italian Government and private employers to grant preference to the greatest extent possible to the free non-Communist unions in all matters of labor-management relations, and to enact legislation designed to enforce effectively the provisions of labor contracts. We should attempt to discourage any formal or informal collaboration between Communist and anti-Communist labor organizations. American business organizations in Italy should continually be encouraged to follow labor policies helpful to our objectives. On the specific point of use of our visa controls to hinder Communist influence over Italian transport workers, we should continue within the realm of present capabilities the implementation of the law requiring individual seamen’s visas and should make an effort to require individual air crewmen’s visas, thus hitting at Communist influence over CGIL air crews.

8. U.S. Economic Aims and Activities with Regard to Italy.

a. While Italy has made great progress in the last few years in achieving economic independence and stability, it continues to suffer from demographic pressures and limited natural resources. In our efforts to combat Communist influence, we will continue to find it useful to exercise helpful influence in procuring economic benefits for Italy in the shape of loans, preferably from private sources, for sound development projects, and as may be appropriate, supplies of available U.S. agricultural surplus under approved Title II and Title III Public Law 480 programs for regular voluntary agency programs, school lunch programs, and for emergency situations.

b. We are particularly interested in seeing Italy continue in its progressive liberalization of imports from OEEC countries and eliminate, or at least greatly reduce, the discriminatory treatment of imports from the dollar area. We view as constructive, and to be encouraged, the Italian effort to support liberal trade and commercial practices and policies on the part of Common Market countries vis-à-vis other countries. We are especially interested in influencing the Italian Government toward positive improvements in the atmosphere for both domestic and foreign private investment in Italy, including more satisfactory petroleum legislation and administrative regulations on investment of foreign capital. For further increase in Italian productivity we should continue to support through the European Productivity Agency (EPA) the Italian National Productivity Committee as a continuing Italian institution which will be entirely Italian financed.

c. We should continue to influence the Italians toward using the financial resources of international lending institutions and of various European countries as a supplement to their own governmental and private investment in Italian development. Accompanying this effort, we should continue to exert all appropriate pressure on the Italian business community and conservative political groups to adopt more liberal business, economic and social policies. We hope to see continued and increased Italian cooperation in this area with other Western European countries, for example, in OEEC, EEC and EPA, designed to help develop free enterprise economy in Europe.

d. We should continue to observe very carefully the activities of Mattei and ENI (Italian State Petroleum Agency) in the political, as well as the economic field.³ We should under present conditions offer no encouragement to any approach, either official or unofficial, seeking U.S. support for Mattei.

e. We should continue to encourage Italy to develop within the EURATOM framework Italy’s promising programs for the application of the peaceful uses of atomic energy. Italy should also be encouraged to actively support the International Atomic Energy Agency through an increased donation of talent and resources and participation in Agency projects; and to maintain an active interest in the joint projects of the OEEC, notably those relating to third party liability and to chemical reprocessing of nuclear fuel elements. To the extent appropriate, we should seek to advance the early adoption of comprehensive internal atomic energy legislation, the absence of which has handicapped Italy’s efforts to exploit the peaceful uses of the atom.

9. Attitudes Toward U.S. Personnel Overseas.

a. We must continue to take positive actions to improve foreign attitudes towards U.S. personnel overseas and to remove sources of friction. The special report prepared by the OCB, “United States Employees Overseas: An Inter-Agency Report”,⁴ dated April 1958 is an effort to provide a common approach and guidance in this field.

b. Hold to a minimum consistent with the program requirements the number of U.S. citizens employed by the U.S. Government in Italy; insure that newly assigned U.S. personnel receive orientation and that their dependents receive appropriate indoctrination in the field; and periodically remind them that they represent the United States abroad and are expected to maintain a high standard of personal conduct and of respect for local laws and customs.

Note: See latest National Intelligence Estimate, NIE 24–58, dated November 4, 1958, entitled “The Political Outlook in Italy”.⁵

0. Source: Department of State, OCB Files: Lot 62 D 430, Italy. Secret. A statement of “Purpose and Use of the Operations Plan;” Annex A, Agency statements describing U.S. programs in Italy; Annex B, List of arrangements or significant agreements with Italy; Annex C, Intelligence précis on Sino-Soviet Bloc activities in Italy; a Financial Annex; and a Pipeline Analysis are not printed. In an undated memorandum attached to the source text, Bromley Smith, Executive Officer of the OCB, noted that the Board concurred in the Operations Plan for Italy at its July 1 meeting and that this plan superseded the Outline Plan of Operations for Italy approved May 15, 1957. An extract of this plan is printed in Foreign Relations, 1955–1957, vol. XXVII, pp. 412–415. Minutes of the July 1 meeting are in Department of State, OCB Files: Lot 62 D 430.
1. Italian Prime Minister Alcide de Gasperi and Foreign Minister Carlo Sforza met with French Prime Minister René Pleven and Foreign Minister Robert Schuman at Santa Margherita in northern Italy February 12–14, 1951, to achieve greater coordination between their two countries on international affairs. The meeting resulted in agreements on the future of Germany and the creation of a European military force. The two nations also agreed to cooperate in the strengthening of European unity.
2. The Gruber-de Gasperi agreement, signed in September 1946 by Italian Prime Minister Alcide de Gasperi and Austrian Foreign Minister Karl Gruber, provided Austrian recognition of the Brenner Pass area as the Italian-Austrian border and Italian guarantees of cultural and administrative autonomy for the German-speaking populace of the Alto-Adige area. In February 1959, the Austrian Government raised the issue of discrimination against German-speaking inhabitants of the Alto-Adige area and demanded greater autonomy for them.

3. At its July 1 meeting, the OCB discussed the activities of Mattei and ENI:

   “In response to a question by Mr. Harr (Acting Chairman), the Board discussed Enrico Mattei and the Italian petroleum monopoly. Mr. Phelan noted the U.S. had not been approached by the Italian Government on this question since the resignation of the Fanfani government with whom Sr. Mattei had close connections. There were some indications that ENI was over-committed overseas and might curtail operations. Mr. Dulles (CIA) [2–2/2 lines of source text not declassified] noted Italian dependence on POL imports for which Italy pays millions of dollars in foreign exchange each year. Especially since the new oil strike in Libya, Italy will feel herself excluded from participation in sharing world petroleum. U.S. cooperation and consultation with Italy in the area of petroleum supply would be especially meaningful. Mr. Dulles said the U.S. must look ahead or we will inevitably face commercial and political problems arising in this connection with Italy and possibly Japan and Germany. Mr. Murphy expressed general agreement with Mr. Dulles on this point.

   “Mr. Harr proposed a special study of this matter. Mr. Dulles suggested private Italian companies could perhaps participate instead of the Italian Government. He thought American oil companies might be inclined to cooperate. Mr. Harr suggested that the Italian Working Group examine this question and report to the Board. (Reaction of the other members to this suggestion was not made known.) Mr. Dulles suggested a high-level approach by a senior U.S. official to appropriate American oil representatives. Mr. Murphy said this had been done previously and might be useful again.” (Department of State, OCB Files: Lot 62 D 430, Preliminary Notes 1959–60)

4. This report commented on legal, personal, and community relations problems facing U.S. military and civilian employees serving overseas. (Ibid., Overseas Personnel)
5. See Document 227.