865.51/6–447
Memorandum of Conversation, by the Director of the Office of European Affairs (Matthews)
Ambassador Tarchiani called this afternoon at his request and read from another private telegram which he had just received from de Gasperi through their private channels (see memorandum of conversation of May 20, 1947). The cable, which was sent before our [Page 915] public statement of June 2,1 welcomed the assurances which Ambassador Dunn had given de Gasperi (see Dunn’s telegram no. 1322, May 28, 8 p.m. and telegram 1323, May 282) and expressed the hope that a public statement would be made by our Government in support of de Gasperi’s new Government. Mr. Tarchiani said that this statement had now been made and that he considered the one which we had issued a very good one, striking just the right note under the circumstances. De Gasperi’s cable went on to say that as a result of conversations between Tasca, our Treasury Attaché, and Campilli, the Italian Minister of Treasury, it appeared that Italy’s balance of payments for the current year would be in deficit to the amount of some $200,000,000. To meet this de Gasperi urged the importance of further financial assistance in addition to the measures proposed, such as suspense account payments, return of Italian assets in this country, et cetera, now under discussion with Lombardo.3 Specifically, he wanted to know whether (a) the $100,000,000 Eximbank credit to Italy could not be made available in its entirety to the Government for utilization this year and whether (b) a further $100,000,000 might not be obtained from the $500,000,000 now earmarked for China. Ambassador Tarchiani had been asked urgently to inquire as to the possibilities of obtaining this further assistance. He emphasized that neither Sforza nor Lombardo nor anyone else know of this personal appeal from de Gasperi and that it must be kept entirely secret. He asked me to look into the matter and let him know the possibilities within the next few days. He said that he naturally did not expect anything approaching a “commitment” in such a brief space of time but would like to know whether or not either or both of the suggested measures were within the realm of possibility. I said that I would look into the question and endeavor to let him know. I asked on what basis post-UNRRA relief for Italy had been figured in arriving at the $200,000,000 deficit. He replied at the “conservative” one of $100,000,000, adding that of course any allotment over that figure would correspondingly reduce the deficit.
He said that de Gasperi has now agreed that elections should be held on the 9th of November and emphasized the importance of them. He said that the new Parliament would be elected for a period of four years and the new Government would be formed on the basis of the November elections. He could not overestimate the importance of doing all that could be done to improve Italy’s lot before then and to prevent the Communists, with their apparently unlimited funds, from winning.
Mr. Tarchiani thought that when de Gasperi goes before the Constituent Assembly on Saturday he would come through with a small [Page 916] majority which should be adequate. He denied the accuracy of stories reporting that the Communist Partisans were taking to the hills to start disorders. On one road a total of 10 Carabinieri had been stationed but that was all the precautionary measures required in all Italy. The demonstrations in Home had been quite orderly. In de Gasperi’s earlier negotiations, however, the Communists and Socialists had fought bitterly against being excluded from the Government.
I said that as he knew the Italian peace treaty would be voted on by our Senate tomorrow and I asked whether, if we succeeded in obtaining Senate consent to ratification, he believed the Constituent Assembly in Italy would likewise ratify before adjournment on June 24. He said that he felt it would and that he had had Sforza’s assurances to that effect. He reverted to his statement to the Secretary on May 16 as to the importance of our issuing a statement promptly on ratification. The statement, he said, should emphasize: (1) the fact that while the treaty is being ratified in the interests of general peace and reconstruction of Europe, its terms did not represent the wishes of the United States which had favored a more generous treaty and (2) that through the usual processes and through the United Nations it is subject to modification.