THE PRESENT SITUATION IN ITALY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP62-00865R000200160001-4
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 8
• Document Creation Date: November 11, 2016
• Document Release Date: July 7, 1998
• Sequence Number: 1
• Publication Date: June 29, 1954
• Content Type: STUDY

25X1A8a
29 June 191.4
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A. Fundamental Weaknesses of Italy
The fundamental ills and weaknesses of Italy are
still actively reflected in the present Italian scene
despite the real advances in the Italian economy result-
ing from United States postwar assistance. These ills
and weaknesses are poverty in natural resources, scarcity
of arable land, overpopulation, maladjustments in the
social and economic structure of the nation, generally
low standard of living, unemployment, and lack of
investment capital.
B. Political Dynamics
The political situation remains highly unstable
because of the failure of the bloc of moderate parties
to win a clear majority in the 193 national elections.
In fact it lost votes to both Right and Left.
Percentage Percentage
of Popular of Popular
Vote 1948
Vote 1957
Communist Party (PCI)
22.7
Left
31.0
3e.Lj.
Nenni Socialists (PSI)
12.7
0
Monarchists (PNM)
2. 8
6.9
Right
12.3
Neo-Fascists (MSI)
2.0
5,,9
Christian Democrats (CD)
1,3.5
140.7
Democratic Socialists (PSDI)
7.1
Center
61.9
x!9.3
Liberals (PLI)
3.3
3.0
Republicans (PRI)
2.~
1.6
Despite their 1953 losses, the Christian Democrats
remain the largest single party and constitute the basis
for any new governments which may be formed before the
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next national elections, normally to be held in 19f=8 but
perhaps to be called sooner.
The present coalition government of Christian
Democrat Mario Scelba, with Christian Democrats,
Democratic Socialists, and Liberals in the cabinet and
Republicans supporting from outside, has a bare
parliamentary majority. Consequently the Scelba
government is in danger of falling whenever any
important issue comes to the fore or party discipline
lapses, although a recent schism in the Monarchist Party
is believed to have improved Its short-term position.
Within and between all parties except the Communist
Party there is constant maneuvering for the formation
of new governments which would embrace either (a) the
Christian Democrats and their Center-Left allies and
less extreme elements of the Nenni Socialists or, (b)
the Christian Democrats and at least some of their
moderate allies and the Right, even including segments
of the Neo-Fascists. Each party has pronounced right,
center and left cleavages within the span of views and
policies it represents. This tendency toward fragmentation
adds complexity to the over-all picture.
C. Policies of the Scelba Government
The Scelba government is strongly anti-Communist and
is generally pro-West in foreign affairs. It has declared
its intention to promote United States objectives and to
diminish Communist strength through both direct and indirect
measures.
1. The three coalition parties combined won 1i98 per cent
of the 1953 popular vote, giving them 303 members in the
Chamber of Deputies out of a total of 590.
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"GKOLUET
1. Foreign Affairs
In foreign affairs the Scelba government, as
did the de Gasperi governments, supports EDC, NATO, and
other organizations of European integration. The
moderate parties have recently begun a campaign to
hasten ratification of EDC, but it is not likely that
Scelba will open parliamentary debate until the late
fall or early winter unless the decisions of the
Eisenhower-Churchill talks speed action.
Public opinion, stimulated by nationalistic
elements, presses to bargain on EDC, presses to make
its ratification contingent upon settlement of the
emotional Trieste question in a manner satisfactory to
Italy, and to have adequate recognition of Italy as a
member of the European Community (including admission
to the UN). There is also sentiment for awaiting
French ratification of EDC before Italy acts.
On its part the Scelba government has under-
taken a vigorous campaign to obtain public approval
of EDC and to overcome public apathy toward it. But
this campaign reacts against the government in Parliament,
where the Communists and Nenni Socialists fellow-travellers,
joined by extreme nationalists of the Right, protest against
United States "interference" in Italian affairs. Especially
in view of these pressures and problems, the Scelba govern-
ment, with its narrow majority, is in a weaker position
than former governments to fulfill United States objectives
for the economic and military defense of Europe.
In a general sense Italy has recently been less
cooperative than formerly with the United States and the
other Western Powers. For example, she has been slow to
complete arrangements on the United States-Italian agree-
ments on military rights and facilities. On the economic
side, there is pressure from the Left and business groups
for expanding trade with Eastern Europe and Communist
China. The Foreign Ministry has reportedly heeded
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demands for trade with Communist China to the extent
of showing interest in sending a trade mission to China,
purportedly to prevent further Communist exaggeration of
the potential of such trade and to have large private
Italian companies establish representatives there.
2. Internal Policies
In domestic policy the primary objective of the
Scelba government is consolidation and defense of
democracy. Scelba has launched the first avowedly anti-
Communist program of any postwar Italian government. This
program embraces both directly restrictive measures and
an indirect approach through solution of basic social and
economic problems, thus undercutting Communist appeal.
Although de Gasperi too initiated certain basic reforms
during his long tenure, his reforms moved but slowly,
and failed to satisfy large segments of the population.
Directly restrictive measures imposed by Scelba
include a ban on trade union activities on government
time or property, evicting trade union headquarters from
government buildings, and investigating Communist Party
subsidies from the proceeds of illegal East-West trade.
An estimated 9 per cent of all labor union offices
using government property have been forced to move and
in Milan the Nenni Socialists have been ousted from
their headquarters in state-owned property. After a
vigorous start, haw ever, at least this part of the active
campaign lost impetus; the government has granted a
Communist request that further eviction be postponed
until new offices can be found.
In the field of indirect anti-Communist measures
the Scelba government has given Parliament tax reform and
housing measures, and measures to continue agricultural
reform in southern Italy. Reform of the governmental
bureaucracy also is underway, and a commission is investigat-
ing the conduct of government-owned industries. Furthermorp,
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long-advocated efforts are being made to counteract
Communist propaganda b giving the educational system
a less clerical complexion. Scelba also considers
ratification of EDC an important factor in his anti-
Communist campaign.
D. The Communist Party and Nenni Socialists
Despite Italy's predominantly Roman Catholic
population, its Communist Party, with an estimated
membership of 1,700,000, is the largest outside the
USSR and China. The Communist and their Nenni Socialist
allies, together accounted for .ZI per cent of the
popular vote in the 1953 national elections--a gain
of 4.4 per cent over their combined voting strength in
1948. In the Chamber of Deputies the Communist seated
143 deputies in 1953, and the Nenni Socialists seated
75. Together they hold 37 per cent of the Chamber's
590 seats.
The combined Communist-Nenni Socialist following
will continue to increase slowly unless basic economic
and social reforms such as those advocated by the Scelba
government are speedily and effectively carried out.
One small but hopeful counter to the general trend of
increasing Leftist strength appeared in this year's
(1954's) local elections, when the Communists lost to
the center coalition their control of some provincial and
communal councils. It is unlikely that the Communists and
their allies will attain dominant power within the foreseeable
future either by parliamentary means or by force.
Decisive gains in Communist strength probably will
be prevented by Scelba's vigorous leadership, increasing
signs of cohesion in the Center Bloc, the Center Bloc's
refusal to accept Nenni's overtures for a PSI-Center
coalition, and voting gains by the firmly anti-Communist
parties of the extreme Right.
E. Catholic Action
Catholic Action is not a political party, but it
nevertheless is an importqnt_f&Qtor in Italian politics.
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because through it the Church is able to act in fields
of public activity forbidden to the Church proper. Its
leader, Luigi Gedda, favors less "democratic" government
and more socio-economic policies related to the Fascist
corporate state, with close ties with the Monarchists
and Neo-Fascists.
F. Labor
The Communists continue to control the Italian
General Federation of Labor (CGIL), whose estimated
membership of 3,000,000 to 3,00,000 far exceeds the
combined strength of the two anti-Communist labor
unions, the Christian Democrat-oriented Italian Confederation
of Trade Unions (CISL) 1 and the Democratic Socialist-oriented
Italian Labor Union (UIL).2
G. Economic Conditions
The basic poverty of Italy and the acuteness: of its
economic and social problems can perhaps be brought
into full perspective by pointing out that while Italy
has a larger population than France, its gross national
product is only about half that of France.
That impoverished economy now is going through a
period of acute readjustment. Production and some real
wages have risen above prewar levels, even though over-
populated Italy is beset by chronic unemployment (10
per cent of the working population) and an annual net
population increase of about 200,000. Thus far govern-
ment efforts to solve population increases through
emigration have proved inadequate.
1. The CISL is estimated to have 1,200,000 to 1,x00,000
members.
2. The UIL is estimated to have 150,000 to 200,000 members.
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Besides increasing unemployment, the Italian
economy is under stress from (a) balance of payments
deficits,(b) a decline in exports while imports continue
at a high rate,(c) a budgetary strain from defense
expenditures and expanded economic programs, and (d)
problems related to the implementation of tax and
agricultural reforms and the development program for the
south of Italy.
The broad economic and social reforms now being
carried forward by Scelba are intended to solve certain
of these fundamental problems and thwart the political
profit the Communists make by identifying themselves with
the unsatisfied aspirations of every dissatisfied group.
H. Armed Forces
On the military side, with United States aid, the
Italian armed forces are slowly evolving into a modern
force. The army numbers about 283,000 and its morale
is generally good, but it has very limited offensive
capability. Goals for NATO have not been entirely met,
particularly for the air force, and there have been
delays in negotiations with the United States for station-
ing United States troops at Italian NATO basis.
The security police are well trained and are capable
of maintaining internal order unless revolutionary action
should be supported from the outside.
I. International Position of Italy
Because of her inherent weaknesses and inability
fully to meet rearmament committments, Italy will continue
for the foreseeable future to remain one of the weaker
members of the Western coalition and a continuing problem for
the United States and Italy's other allies. Italy will
continue to have to rely heavily on United States support.
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