865.51/5–647: Telegram
The Ambassador in Italy (Dunn) to the Secretary of State
urgent
niact
1048. For the Secretary. The Prime Minister asked me to come and see him last evening and made a point of trying to keep my visit confidential. He received me at the Colonial Office. He informed me that about a week ago he had sent a letter1 to President Truman directly and not through the Italian Embassy in Washington telling the President that Italy was in great economic difficulty at the present time and asking the President to request Mr. Clayton to come to Italy from Geneva in order that the Prime Minister and his advisers might have an opportunity to discuss the economic and financial situation here with a view to the adoption of corrective measures, he hoped, with the assistance of the US. Mr. De Gasperi asked that I inform you of this approach and seek your support to his request. I am also informing Mr. Clayton in Geneva of this approach. I believe it would be very helpful at the present time if Mr. Clayton could come.2
The Prime Minister then went on to discuss the present political situation. He said he himself considered it advisable to broaden the composition of the Cabinet to include some of the other parties of the center and had discussed this possibility with Togliatti and Nenni. Togliatti had appeared willing on condition that the present program of the three-party government not be changed. Nenni … is opposed to enlargement of the government. Mr. De Gasperi said the financial and economic situation was so unstable at the present time that he did not wish to invite a crisis unless he had some agreement among the parties to bring forth another form of government before the present one fell. He said he was afraid of the spiral of inflation and that the fall of the government if it involved any considerable time to find a replacement might result in a financial panic and a real loss of ground in the fight they had been making for return of economic stability.
The Prime Minister then spoke of the lack of confidence in the government. He said he was afraid this was caused largely by his “allies”, but he did not think it was wise to attempt to form a government without them at this time unless the Communists were themselves ready to remain out of the government in order to be free to level their criticism [Page 894] against it. He said he was continuing his conversations but that he had no intention himself of deliberately provoking a crisis. If this were brought about in the assembly that was quite another thing and he would, of course, accept a reversal in that body. He said various persons had been mentioned as head of a new government; that he himself was ready to retire at any moment that he felt an able and efficient successor could be chosen. He spoke of Signor Nitti as one of those mentioned to succeed him.3 His own opinion was that Nitti’s advanced age and his present physical condition would make it impossible for him to carry on the arduous task of Prime Minister in these present times.
Mr. De Gasperi then spoke of possible assistance from the United States. I said that our Government was deeply interested in the Italian situation and wished to be of such assistance as they could but that it was necessary for us to see some effective measures taken by the Italians themselves to put their house in order before we could give consideration to aid for Italy other than the direct relief. I said that after all it was quite impossible for the US to take the entire burden of assisting Italy to recovery and that it was necessary for the Italians to apply themselves to the solution of their own problems and to take the steps necessary to improve the situation before we convince our people and Congress that we could render effective aid here. Mr. De Gasperi said he was only afraid that assistance might come too late and at a time when it would be extremely more difficult to revive the situation than it would be now to preserve it. I told him (De Gasperi) that we all had the greatest confidence in him personally and that we wanted to be of all the help we could and that we were sincerely hopeful that he would find the means of correcting the present situation and take advantage of the spendid attitude and will to work of the Italian people at this present time.
He asked me to explain to our government that Italy was now in an electoral campaign period and that it was most unfortunate to look forward to financial difficulties, inflation and possible hunger in the country at the same time as the elections. Finally, he made another plea that Mr. Clayton come to Italy with a view at least to talking over the situation and asked me also to convey to you his deep concern over the reduction of the post UNRRA relief fund to $200,000,000 which might drastically affect the possible allotment for Italy.4