Post-war Italy's transition to republic and democratic constitution

Post-War Italy

A TIME OF TURMOIL AND DECAY

Post-War Italy (1946 -- mid 1950s)

Italy is a country in Southern Europe, consisting of the peninsula of Italy, Sicily, Sardinia and smaller islands (Infoplease, 2009). It was first proclaimed a kingdom by Victor Emmanuel II on March 17, 1861. Rome became its capital in July 1871 (Encyclopedia of the Nations, 2009). In the 20th century, the kingdom was ridden with severe domestic social and economic problems, especially in the south. Premier Giovanni Giolitti introduced political reforms, which raised the kingdom's status as a Western power. The reforms, however, did not solve basic problems, like poverty and illiteracy. It was initially an ally of the Central Powers, consisting of the German, Austrian-Hungarian, and Ottoman Empires and the kingdom of Bulgaria. But in 1914, Italy declared neutrality and joined the British and French for an offer of territories through the secret Treaty of London (Encyclopedia of the Nations).

Although Italy received the promised territories from Austria and Turkey under the Treaty, Dalmatia was given to Yugoslavia and Italy was deprived of a share of Germany's colonies in Africa (The Tree Maker, 2009). Italian political leaders went into violent rampage in reaction. In addition to the impact of an already deteriorating economy, the rampage opened the country to new political sentiments and a new leader (The Tree Maker). The Fascist movement pushed its way in Rome through its leader, Benito Mussolini, who became premier in 1922 (The Encyclopedia of Nations, 2009). He set up a Fascist dictatorship, described as a corporate state. It improved Italy's social welfare, employment transportation conditions. In 1929, Mussolini negotiated the Lateran Treaties, which awarded sovereignty to the Holy See over the Vatican State. Roman Catholicism became the official Italian religion, only to be abolished in 1984. Its military conquered Ethiopia in 1935, which boosted Italy's military powers. In May 1939, Mussolini entered into a military alliance with the German dictator, Adolph Hitler, known as the Rome Berlin Axis. Italy remained as a non-belligerent ally until June 1940. But when Mussolini felt confident about Germany's successes, he declared war against France and Britain, deemed traitors to a previous alliance. He later declared war also against the United States. Italians failed to capture Sicily, which was won by the Allies in July 1943. Nazi leaders took over key positions in Italy, reducing it into a mere German puppet. The King and Marsal Pietro Badoglio unseated Mussolini and a "palace revolution" dissolved the Fascist party. But the Badoglio government surrendered that September to the Allies when they invaded Italy. The government set up by the Allied commission declared Italy a co-belligerent to Germany, which managed to prolong the World War to May 1945 (The Encyclopedia of the Nations, The Tree Maker).

Italy After World War II

A Republic and a New Constitution

At this time, Italy fervently participated in unifying Europe, developing its economy and security, and repelled communist gains in Europe (Martinello, 2009). Between the 40s and the 50s, it negotiated and signed treaties. It recognized then and still recognizes that Italians will have a better future by uniting with their European neighbors in the European Union; remain with the U.S. under the NATO; and cooperate with the world through the United Nations. By the end of the War, Italy was a constitutional monarchy under Victor Emmanuel II who abdicated the throne to his son, Prince Humbert, in May 1946. But in June of that year, Italians voted for a republic with a cabinet government under De Gasperi, who belonged to the Christian Democratic Party, the dominant party in Italian politics. Monarch Victor Humbert II was unpopular for his association with Mussolini. A new constitution was drafted the following year and came into force the succeeding year. But the Christian Democratic Party itself became corrupt after ruling for a long time. It was also eventually voted out by the people (Martinello).

The Marshall Plan

This Program played a major role in reinvigorating economic recovery, modernization and unification of European countries damaged by World War II (The Tree Maker 2009; The Encyclopedia of the Nations, 2009). From 1948 to 1951, it gave out $12.4 billion to modernize these countries' economic and financial systems and rebuild their industrial and human resources. Italy was among the recipients. It required the governments of all recipients to set up their national economic plan and to cooperate with financial and trade flows. Repayment was not required as the Program was not a loan. The Washington government thought that doling out large sums would be a cheaper alternative to rearmament if isolationism or rollback were the choice. The U.S. believed that a prosperous and peaceful Europe would ultimately be a useful trading partner and contributor to its own prosperity and power. At the same time, the Marshall Plan strengthened the U.S. position in the Cold War precisely by strengthening these countries, which were allies in the fight against Communism. The Marshall Plan was mainly responsible for the speedy growth in these countries from 1948 to 1952 (The Tree Maker, The Encyclopedia of the Nations).

Economic Miracle?

Italy's economic miracle during this period amazed Europe and the world (Marinello, 2009). Previous European Economic Community treaties and available capital from the Marshall Plan energized its business policies and capitalism. The U.S. Secretary of State George Marshall devised the European Recovery Program in 1947, also called the Marshall Plan. It allocated $13 billion for the reconstruction of Western Europe from 1948 to 1952. These conditions in Italy promoted and enhanced universal education; modernibed agriculture; rebuilt ports for the 20th century; raised the level of its shipbuilding and steel production to world levels; tapped all Italy's natural resources; and spurred traditional skills to produce and market specialty items in various industries. Italy wanted to show that they could count among industrialized countries. Its system of proportional representation in government was so broad that many small parties surfaced and led to unstable coalition governments. The so-called "royal fascination" remained but more for social and entertainment than political motivations (Marinello).

Behind-the-Scene Realities

Many historians believe that war production was a key factor in the triumph of the Allies (U-S-History, 2009). They not only sent more men and women to the armed forces but also produced more weapons and war machinery than the Axis powers. The Allies were much more prepared for the fight. Scientific inventions and discoveries also contributed to shortening the War. The Office of Scientific Research and Development organized its resources for the purpose. The government also devised or improved equipment and tools, such as radar, rocket launchers, jet engines, amphibious boats, long-range navigational aids, and instruments to detect submarines. Large quantities of penicillin were produced for a diversity of diseases and DDT for jungle insects. (U-S-History).

Post-War Monetary Stabilization

Italy was divided and razed by combat in most parts, with substantial damage on the economy (Einaudi, 2009). The lira was down to 30th of pre-War value, compared to only

1/5th during World War I. The administration of the Bank of Italy was divided between two separate commissioners, one in the Nazi Socialist Republic in the North and the other under the Allies in the Kingdom of Italy in the South. The re-conversion of Italy to a civilian economy was considered difficult but did not destabilize the banks, unlike at the end of World War I. They did not have substantial non-liquid assets and the 1936 reform was credited for this. The fall of the lira was the real trouble and led to the recurrence of runaway inflation at the end of 1946 (Einaudi).

Monetary stability was restored between 1945 and 1948 by a consistent and effective plan with four features (Einaudi, 2009). These were halting inflation, limiting State monetary financing, joining the international financing community, and reorganizing banking supervision. In checking inflation, a compulsory reserve mechanism was fine-tuned to the specific requirements of monetary control in the summer of 1947. The task of varying the reserve ratio was assigned to the Inter-ministerial Committee for Credit and Savings under the Treasury Minister. Monetary reform aimed at curbing inflation and price increases. In limiting State monetary financing, the overdraft of the Treasury's current account at the central bank was controlled to 15% of State spending in May 1948. The third goal of joining the international financial community was addressed with the admission of Italy to Bretton Woods institutions in October 1946. Trade and foreign exchange were liberalized. The Italian Foreign Exchange Office was organized to take care of foreign currency transactions. Italy later became part of the European Payments Union, which would be established in 1950. And in reorganizing banking supervision, this function was passed on from the banking inspectorate to the Bank of Italy. The political aspect was turned over to the CICR the technical arm of which the Governor was the head (Einaudi).

Article 47 of the 1948 Constitution guaranteed the protection of savings (Einaudi, 2009). Director General Donato Menichella was credited for his substantial contribution to strengthening the lira. This laid the foundation for non-inflationary growth in the following period. From the end of the War to the early 1950s, the Bank of Italy was credited for attracting and managing international aid, which helped bring the country out of a steep state of emergency and on the path of reconstruction. International aid came from Interim Aid, the Marshall Plan and the World Bank (Einaudi).

Assessing Post-War Conditions in Italy

Political analysts believe that Italy unified relatively late (Hine, 2007). The divide between the North and the South existed even before the initial unification. Polarized society rendered the people-opted parliamentary government unstable. The prevailing sentiment was the fear that Communism or recurring fascism would take over the newly formed Italian democracy. History shows that post-War governments lasted only for an average of less than a year. The electoral system induced the formation of coalition governments. The Italian Communist Party was automatically excluded from government. Problems, which hounded Italian democracy, were unstable coalition governments, lack of favor from the political class, non-aligned electorate, and ineffective management in providing fair and responsive welfare support (Hine).

The Legacy of the Cold War on Italy

Between 1945 and 1947, Italy was ruled by governments of national unity (Bull, 1997). All the anti-Fascist parties, including socialist and Communist parties, participated. In this environment of political compromise, a Republic was established in 1946, a Constitution was drafted in 1947 and an electoral system of proportional representation and universal suffrage was enforced. However, the general elections of April 18, 1948 became a direct encounter between the two electoral and ideological extremes, a miniature of the Cold War. Communism and anti-Communism, dictatorship and democracy, East and West, clericalism and anti-clericalism came into political grips and divided Italy into opposite political and cultural sectors. Anti-Fascism, however, prevailed and served as the legitimate principle of Italy's post-war governments and political institutions (Bull).

Christian Democracy always remained in government, whether alone or in coalition but with full Church backing (Bull, 1997). At the same time, the Communist Party was always present to oppose it. Political immobilism led to clientelism and corruption. Since 1945, power alternated between these opposite parties in government, slowly converging towards the center with each side acquiring the right to govern. This may suggest the triumph of a fully functioning democracy. But looking deeper into the effects of the Cold War in the country, a hidden sphere becomes apparent. Anti-Communist forces saw the anti-Fascist state as quite dangerous within and outside Italy. They considered the legitimization of the Communist Party as a clear mistake. They wanted an anti-Communist rather than an anti-Fascist state. Despite the existence of one State, a second one was created and which was both anti-Communist and secret. Italy developed a dual identity wherein the State simultaneously contained the anti-State. The official culture remained anti-Fascist, covertly anti-Communist and yet essentially anti-democratic and intent on preserving Fascist laws and policies. While its culture celebrated the Resistance, the end of monarchy, the new Republic, democratic institutions and the new Constitution, it also delayed implementing that Constitution. It enforced Fascist elements in it intelligence services and also kept an alliance with secret or outright illegal organizations, like the Mafia and Freemasonry (Bull).

The true legacy of the Cold War on Italy consists of a lack of trust between the State

and its citizens and the presence of invisible networks of power emanating from the Second World War (Bull, 1997). The lack of trust dates back to Italy's unification in the 19th century or the Middle Ages. The Cold prevented the democratic State from raising the level of trust in the country and thus acquire a new kind of legitimacy. This lack of trust by Italian citizens in their State should be considered rational and justified and not only an inherited cultural trait from their past. It was, in fact, their cynicism and mistrust in the State, which sustained them in confronting disappointing revelations of their State's involvement in huge scandals of deception. They found it vastly difficult to remain committed to a democratic system and values not upheld or supported by a supposedly democratic State (Bull).

The invisible networks of power included the Secret Services and the Mafia (Bull, 1997). The Secret Services were considered legitimate and not de-Fascistized after the War. They were restructured and re-organized only after the removal of Communist and Socialist Parties from government in 1947. On the other hand, the Mafia sealed a deal with the OSS in July 1943 but was eliminated by Mussolini. After the World War, close links were set between the Mafia and a Christian Democratic Party wing, led by Guilio Andreotti. Leonardo Sciascia commented that "criminality and power are overlapping terms" and that world power more and more resembled Mafia power (Bull). #