Dear Boland,
The year that is drawing to a close finds Italy little better off than she was twelve months ago. Her finances are in a state of chaos. A few weeks since when there was a question of calling in the old bank notes the demand for foreign currency was so heavy that the Swiss franc jumped to 250, the dollar to 800 and the pound to 2,000 lire. As the project had to be postponed the Swiss franc has receded to around 170. Prices of foodstuffs, curiously enough, follow the foreign currencies upwards while the trend downwards is always much slower. In an attempt to halt the rising cost of living the authorities fixed a price ceiling to be effective until the end of January. The effort failed miserably for a few days later meat jumped to 900 lire the kilo, butter 1,300 lire and eggs 35 lire each, the highest prices yet reached and these are unrationed goods. Many rationed articles can only be had through the black market. The police have now started a campaign against the black marketeers who in return have threatened to go on strike the result of which would be serious for the population as about 50,000 of them are operating in Rome, furnishing foodstuffs which the Government cannot supply, at competitive prices. Similar conditions prevail throughout the Peninsula which frequently result in riot and bloodshed when workers find their wages insufficient to buy food for their dependents.

The running of the Italian Foreign Office has become somewhat complicated since Nenni took over. Almost all the old heads of Divisions from the Secretary General down have been replaced by men of a more supposedly republican outlook. Some of these have not the same experience or general grasp of things. The chiefs of Missions abroad are also being recalled. New men are being sent to Paris, Washington, Moscow, Brussels, Ankara and now I hear that Babuscio is to be replaced by the Counsellor of the Italian Embassy at Paris, one Giorgio Benzoni of whom I know little or nothing. He is however a career man, about 50 years of age, who entered the service over twenty years ago. Nenni wishes to get rid of all Mission Chiefs who were too intimate with the Royal House or the Vatican. Much to the confusion of his subordinates he issues orders and counter orders so that they know not where they stand. He is also worried by his political situation. He is the nominal leader of the Socialist Party and the principal exponent of 'fusion' with the Communists. At the last elections these two parties together with the Actionists formed the Left 'bloc' and, in Rome, obtained nearly 50% of the votes. Then, it was found that while the Socialists voted indiscriminately for the three parties the Communists voted only for their own.

The Speaker of the Constituent Assembly, Sarragat, also a Socialist is a bitter opponent of Nenni. He wants an independent Socialist party somewhat on the lines of the British Labour Party. The issue is to be decided at a Convention which is to be held in Rome towards the middle of next month. At the Provincial Conventions held some weeks ago, preliminary to the annual gathering, Nenni had a decided advantage but his adversaries are not without hope. Should Sarragat win Nenni will be obliged to relinquish his post as Minister. The Christian Democrat Party is also divided into left, right and centre. Its left wing struggles for a more aggressive social policy and the breaking up of the big estates and distribution of untenanted land whilst its right wing is composed mainly of the land owners. The centre consists of decent living men with no very clear idea of what is expected from them and whose intelligence would not perhaps be equal to that of our County and District councillors. De Gasperi told me once that he has the greatest difficulty in finding men to fit key positions. Fascists who held important posts saw to it that competent substitutes would not be forthcoming and as many of the former are now in prison or in a concentration camp the lack of a trained personnel is everywhere felt. The more intelligent body of the electors are therefore drifting towards the Uomo Qualunque (Common Man) Party which has an aggressive though not a highly esteemable leader. Its policy is not yet very clearly defined but it criticises and attacks all round and consequently appeals to the honest as well as the dissatisfied voter. It is described as Fascist by the Communist and Socialist papers but that is how they refer to most parties outside of their own. At the recent Local elections it rallied considerable strength and is likely to forge ahead of the Christian Democrat Party which may be compared at the moment to an elephant floundering in a morass.

A week after becoming Foreign Minister, Nenni announced that early in the New Year he would visit Washington to discuss financial, trade and other matters with the American Government. This brought no response from the other side of the Atlantic until it became known a week ago that the Secretary of State had extended an invitation to De Gasperi, ignoring Nenni altogether. The Socialist papers could not hide their resentment at what an American journalist has described as a kick in the pants. About the same time it was reported that James Dunne, the new American Ambassador to Italy had declared at a dinner given him by the Italo-American Society in New York that he would support the Italian Socialist or other Democratic party so long as it was anti totalitarian. This was naturally a slap at Nenni's campaign. To-day's papers state that Togliatti¹ has addressed an urgent message to the Prime Minister asking if the report of the Ambassador's speech was correct as if so it would mean that he would be interfering in the internal politics of the country by supporting one party in preference to another.

Although the Municipal elections took place nearly two months ago Rome is still without a Mayor and is likely to continue so until the Spring when new elections are to be held. There are eighty Municipal councillors of which thirty nine belong to the Communist Socialist bloc. At the first and second statutory meetings of the Council nobody was able to obtain a majority of the members present. At the third meeting a Christian Democrat was elected Mayor by a majority of one but he retired an hour later when he found that the ten Assessors chosen, i.e. the members of his Cabinet, had only four from the right parties as against six from the left. As the City could not continue without a Government a Commissioner has now been appointed. In view of the general political, financial and social disorder that seems to exist all round it is a marvel that things are not worse.

Anticlericalism appears to be widespread in Italy to-day and is undoubtedly financed from abroad. Rome has three admittedly anticlerical weeklies and half a dozen pornographic sheets and all the large cities have their own organs of the same nature. Many of these are believed to be directed by ex-priests who were disciplined and cashiered because of their excesses in both the pro-Fascist and the anti-Fascist camp. It was a Benedictine priest who obtained permission for the Fascist police to raid St. Paul's monastery here where they arrested 80 persons some of whom were massacred at the Ardeatina Caves. Franciscan priests hid the Mussolini remains that were stolen from the Milan cemetery. Scorza, the last Secretary of the Fascist party was recently traced to a Jesuit College where he dresses in clerical robes. Federzoni, Rossoni and a number of other leading Fascists are known to be hiding in Monasteries where they wear the clothes of the Order. On the other hand Nenni and many of the leftist leaders were sheltered in Houses dependent on the Vatican during the German occupation. That is now forgotten in the Communist campaign to associate the Church with Fascism, and hasten the collapse of organised Society in Western Europe.