Room at the Top
By RICHARD BAILEY*
WHAT sort of shape is Italy in as the poli- ticians mill around in search of a new government? On the economic front things have never been better. In the north, industry k booming. Fiat is turning out 1,600 passenger cars a„. day at its Montefiore works, of which between VO.and 600 are exported : after a few .days in Turin urn.) it is hard to imagine what a non-Fiat car looks like. To the north-east, Olivetti has added machine-tool-making to its typewriter and office Machinery business. And State-owned industry is doingWell, too. Italian steel production has doubled since 1951 and is planned to reach 7.2 'Nihon tons a year by 1965. But these are only a few of the more obvious and visible signs of expansion. Behind all this production the national balance of payments is in better shape than it has been for years. Indeed, Italy has doubled her gold and dollar reserves in the last two Years and now follows the US and West The with the world's third largest reserves. 'ne Sterling Area comes some way behind. What is the basis for this prosperity, and does It mean that Italy's troubles are now over? There are three main reasons for the economy's healthier look. The first is the 400 million dollars a Year spent by tourists, of which Italy attracts more than any other country in the world. Then there is the expansion of industry, much of it powered by cheap natural gas, which has changed Italy from a predominantly agricultural country one in which over 40 per cent, of the gross national product comes from manufacturing. And, thirdly, there has been the influx of foreign capital in the form of American aid, World Bank i on,aux and the more humble, but none the less effective, remittances from Italian emigrants. But although conditions have improved enor- 1,1,1anslY in the last five years there are still some very difficult problems. Dr. Danilo Dolci's visit here has brought a sharp reminder of the en- .urmg poverty of the Mezzogiorno. In spite of all the money that has been poured out by the State-run agencies, the level of employment in the south still remains very low. There are said t but be nearly one million unemployed in Italy, out this is a nicely rounded figure that takes no account of all those who only manage a day ltalyOirector of PEP, who has just returned from or two's work a week. Nor does it allow for the over-employment at low wages which the State encourages in order to keep men off relief.
The problem of the Mezzogiorno is one of the reasons for the present troubles of the Christian Democrats. Three different policies are being ad- vocated for the south. The first is that the State, through the Cassa per it Mezzogiorno and other agencies; should do only the bed-rock investment on roads, water and power, and leave private in- dustry to come in and build the factories. This is broadly the view of the Right-wing indus- trialists among the Christian Democrats and of Signor Malagodi, the leader of the Liberals, whose defection brought the Segni Government down. At the other extreme, the Left-wing Chris- tian Democrats and the trade unions claim that the problem is too big and too difficult to solve ex- cept by drastic and unconventional measures. They would like to see the State doing the whole job and not only making the roads, but building and running factories as well. In between the two extremes are those who would like to see the State doing more in the south, but who would like it done through IRI, the miscellaneous group of financial and holding companies inherited from Mussolini's regime, which runs much of Italy's engineering, iron and steel and shipbuilding in- dustries. The trade unions dislike IRI rather more than they do the big private firms. So far IRI has not played any big part in the Mezzogiorno, and few Italians would expect any very dynamic action from it.
The interesting thing is that all these views are held by groups within the.Christian Democrat Party. The chance of any other party forming a government in Italy in the foreseeable future is negligible, so that the big interest in the re- grouping now going on is to see which wing of the party comes out on top. Success will depend not only on winning the internal struggle, but on getting the support of the Liberals, Socialists, Monarchists and other parties as well.
Meanwhile, though the northern half of Italy grows richer, the south gets poorer; and there are other symptoms that all is not well. These have been brought out into the open in the con- troversy over Federico Fellini's film La Dolce Vita. This film, which portrays the dissolute parties of the Via Veneto set and gets in some hard blows at the Church and popular press, is having a tremendous box-office success. At the cinema where it was showing in Turin it took half an hour of jostling, pushing and elbowing to reach the box office, and after that there was standing room only for the first two of the three hours it takes to run the film.
La Dolce Vita gives a picture of corruption and decadence that may be exaggerated and which is, in any case, applicable only to a sec- tion of Roman society. But even gilded mud sticks, and it is not surprising that many Italians are deeply shocked and are wondering just where their country is heading. I saw signs of this above all in the number of people who wanted to know what we in Britain thought of Italy nowadays. `Do you prefer the Germans to us?' one business- man asked me. All of which seems to show, as we in Britain have already found out, that a favourable gold and dollar balance is important, but it isn't everything.
'1 need it for my election expense.s:
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