CHAPTER XI

NEW PATHS

When one watches the building of new structures, when hammers and concrete mixers flash and turn, the occasion is not one for asking the superintendent his opinion about the plays of Bernard Shaw or for expecting the architect to babble discursively on the subject of his preferences between the mountains and the seashore as summer playgrounds.

It is absurd to suppose that I and my life can be separated from that which I have been doing and am doing. The creation of the Fascist state and the passing of the hungry moments from sunrise to the deep profundity of night with its promise of another dawn eager for new labors, cannot be picked apart. I am lock-stitched into this fabric. It and myself are woven into one. Other men may find romance in the fluttering of the leaves on a bough; as for me, whatever I might have been, destiny and my own self have made me one whose eyes, ears, whose every sense, every thought, whose entire time, entire energy must be directed at the trunk of the tree of public life.

The poetry of my life has become the poetry of construction. The romance in my existence has become the romance of measures, policies, and the future of a state. These to me are redolent with drama.

So it is that as I look back over nearly six years of leadership I see the solution of problems, each of which is a chapter in my life and a chapter in the life of my country. A chapter, long or short, simple or complex, in the history of the advance and experimentation and pioneering of mankind.

I am not deeply concerned at being misunderstood. It is more or less trivial that conspiracies go on to misinterpret and, indeed, entirely to misrepresent what I have sought and why I have sought it. After all, I have been too busy to hear the murmurs of liars.

He who looks back over his shoulder toward those who lag and those who lie is a waster; it is because I cannot write my life—my daily life, my active life, my thinking life and even my own peculiar, emotional life—without recording the steps I have taken to renew Italy and find a new place for her in the general march of civilization, that I call up one after another the recollection of my recent battles over measures which submerge men, over policies which bury, under their simplicity and weight, everything else I might have lived.

Two fields of my will and action, of my thoughts and my conclusions, stand out as I write and as I record my life itself.

I think of all of them in terms of utter simplicity, stripped of complex phrases. I have seen the futility of those who endlessly speak streams of words. These words are like armies enlisted to go away forever into the night, never to return from a campaign in which the enemies are compromise of principle, and cowardice, inaction, and idealism without realism.

There are those, no doubt, who regard me or have once regarded me as an enemy to the peace of the world. To them there is nothing to say unless it be to recommend my autobiography to them for careful reading. The record of facts is worth more than the accusation of fools.

From the first, I wanted to renovate from bottom to top the foreign policy of Italy. Let it be remembered that I was fully conscious always of the history and the economic and spiritual possibilities of my country in its relation to the world. Such a renovation, such a remaking of policy, was absolutely new for us. It was destined to meet serious preconceptions and misconceptions before it would be clearly understood and appreciated, not only by Italians, but by those responsible for the foreign policies of various nations.

I was fully aware that a new spirit, one of new austerity and dignity, imposed by me to govern every large and small action of my ministry, might create the impression that I wanted to fight to a finish old international political tradition, organization, and existing alliances and the status quo.

What an error! To inaugurate a firm stand does not mean to revolutionize the course of international dealings. To demand a better appraisal of Italy, in accordance with a correct audit of our possibilities as a powerful and prolific nation, was only to re-establish our rightful position.

My problem was to open the eyes of the responsible elements in the various European governments and chanceries. They had gone on rather blindly considering Italy to be in its unstable position after the war.

To open these eyes, sometimes with vigorous calls for attention, was not always easy. I spent months and years in bringing about a realization abroad that Italy’s foreign policy had no tricks in it. It was always straightforward, and swerved not. It was always vigilant. It was based on an accurate appraisal of facts, squarely faced, and it demanded equally that others should face facts. This understanding has contributed, naturally, to bringing Italy higher on the horizon of the world’s eternal dawn of new events.

A speech on foreign policy delivered by me in the Italian senate in the spring of 1928 reviewed our entire national and international situation, and the part that Italy has played in the many little or great events of world life. It set forth a clear review of my work. It summarized the concrete success won by my ministry. It brought out that we had correctly insisted upon new appraisals of Italy’s part in the world.

But, before this concrete and tangible result was reached, let no one believe that the steps were light and easy. I knew well enough how many would look toward Rome with suspicion, as if it were an irresponsible centre of disturbance. Enemies of our country and of Fascism tried in every way in their power to strengthen, by bad faith, by twisted interpretations, and by false news, all the errors in foreign judgments of what I was trying to do.

But truth usually comes along behind any simple, clear policy and overcomes the obliquity, the conventional mentality, the spirit of opportunism, and the lie-barking of the yesterdays.

There is no country in the world in which foreign policy, though carefully carved out and approved by the nation, is not subject to internal attack based on ignorance or bad faith. Therefore it was no surprise to me to find that even when I had calmed the internal political situation and had established for us the main points of the general policy of Italy within and without, there were those who began an offensive of criticism.

One of them was Count Sforza, who in October, 1922, was in Paris as Italian ambassador.

This man, loquacious and irresponsible as a minister in the past governments, had been a nuisance to the country. He had linked his name with the Adriatic situation, humiliating for our nation. This former minister, an amateur in everything that concerned any perplexity of foreign policy, showed himself so vain that he could not sense the delicacy of his position in Paris. While in Italy events of historic character were maturing, homesickness for lost power made him a bad servant of his own country. He even went to the point of trying to create difficulties for the Fascist government in the French capital. Already political groups there were unfavorable to if not envious of, any new solidarity in Italy. Count Sforza at once began to criticise openly my declaration on foreign and internal policy, my political method and my concept of Fascist Italy. I sent him a telegram, and this is what I said:

“I must interpret as a not quite amiable and rather an awkward gesture, your decision to hand in your resignation before having officially known my orders as to foreign policy, which I will disclose in the Chamber of Parliament; orders that will not be merely a sum of sentiments and resentments, as you wrongly think. I bid you now formally to keep your place and not create difficulties for the Government. In this moment, the Government represents the highest expression of the national conscience. I am waiting for a telegraphic answer and I reserve my later decision as to you.

Mussolini.”

To this telegram Count Sforza made an elusive answer. So I called him to Rome and after some explanations which revealed our two minds to be in complete antithesis, I relieved him of office and dismissed him from his place. It was time that the central authority should no longer be debated by those who occupied inferior positions. Italian political life needs command and organization and discipline. Our representatives abroad were sometimes shown to have a cold, isolated, autonomous life, far removed from their primary duties toward their country.

This first strong gesture of mine was a clear signal; it undoubtedly served as an example and admonition for many others of our diplomatic representatives, who tried to withdraw themselves, with subjective attitudes, beyond the supreme authority of the state.

Having closed this breach in our diplomacy I dedicated all my energies to the solution of those political problems which would determine our future. I found facing me a situation already distorted and prejudiced by the crass errors of preceding governments. I found a series of peace treaties which, though in some respects full of defects, nevertheless constituted as a whole an unavoidable state of fact squarely to be met.

Still palpitating and open in Italy was the wound of the Rapallo treaty with Jugoslavia. I wanted to medicate that and heal it. On the delicate ground of treaties I explained my position and suggestions in a speech about foreign policy delivered in the chamber, November 16th, 1922. I said then, as I always say, that “treaties, whether bad or good, must be carried out. A respectable nation can have no other programme. But treaties are neither eternal nor irreparable. They are chapters of history, not epilogues of history.” Speaking of foreign policy in relation to the different groups of powers, I summarized my thoughts with this definition: “We cannot allow ourselves either a plan of insane altruism or one of complete subservience to the plans of the other peoples. Ours is then a policy of autonomy. It shall be firm and severe.”

In November, 1922, I met, at Lausanne, Poincaré of France and Curzon of Great Britain. Let it be said that I re-established then and there, on my first personal contact with the Allies, our equality. There were some clear and precise interviews; some went on to a rather vivacious tune!

For the time had come for Italy, with its record of sacrifice and with the weight of its history, to enter into an equality of standing in discussions of an international nature side by side with England and France.

During my brief stay at Lausanne I held conferences also with the Foreign Minister of Rumania and with Mr. Richard Washburn Child, Ambassador of the United States in Rome, and chief of the United States delegation at the Conference. I eliminated also the question of the Dodecannes.

To sum up my trip to Switzerland; these were the results:

First, we made clear to foreign diplomats the new prestige of Italy.

Second, we gave examples of our new style in foreign policy at the moment of initiating a direct contact between myself and responsible diplomats of the world.

In December of that year, I made other important declarations to the council of the ministers about our foreign affairs. I examined again the Treaty of Rapallo. I began a solution of the problems of Fiume and Dalmatia, making that solution fit in with the situation created by the preceding treaties to which I had fallen heir. For the second time I met Lord Curzon, and then I went on to London, where I stayed for several days. On that occasion I was received with the most generous hospitality and found that I was listened to with respect by the English political world.

Already the question of the Allies’ debts was on the table. I had discussed this with Mr. Child and with the British ambassador in Rome. I had a plan that I do not hesitate to claim was one of the most efficacious for the solution of that problem. My plan aroused a certain interest among the Allies, but some divergencies of a secondary character, and particularly the design of France to occupy the Ruhr, killed that which in my opinion was the most logical solution of the debt question, combined with the problem of the German reparations. It was a solution which might have permitted a quick and powerful restoration of world economy.

Always before me in my foreign policy is the economic aspect of international problems. That was why in 1923 I concluded a series of commercial treaties, with a political background, with a number of nations. It amuses me to be called an anti-pacifist, in the light of our record of treaty-making for peace and for fair international dealings.

These commercial treaties were very helpful in settling our economic position. In February of 1923 I signed the Italian-Swiss treaty, concluded in Zurich; I ratified the Washington treaty for the limitation of naval armaments. Other commercial treaties were concluded with Czechoslovakia, with Poland, with Spain, and, finally, with France. I took the first steps to renew commercial relations with Soviet Russia.

Our record in international affairs discloses a sleepless vigilance to build peace and make friends. More peace, more friends. We yield nothing of our autonomy, nor do we allow our power to be used as a pawn by others. We are idealists in the sense that we endeavor to make and keep peace by building and maintaining, brick by brick, stone by stone, a structure of peace founded on realities rather than on dreams and visionary plans. I have insisted upon being strong, but I have labored to be generous.

For an efficient foreign service, the world requires some housecleaning in its diplomatic machinery, which has grown stale, over-manned, and bureaucratic, and filled with feeble, petty conspiracies to gain place and promotion.

I then began, in the reorganization of our consulates, an elimination of foreign functionaries. That work was long and wide-spread, because it was necessary to rebuild our old consular organization. The renovation, complex as were its problems, was completed with unswerving insistence.

In the midst of this complex task of foreign policy and machinery, and while I was studying the solution of the Adriatic problem, there came the news that the Italian military mission in Albania had been treacherously ambushed on a road and massacred in its entirety by bandits from the border. In this tragic happening there were wiped out brave General Enrico Tellini, Surgeon-Major Luigi Corte, Artillery Lieutenant Mario Bonacini, and a soldier, Farneti. The Italian military mission was in Albania, together with other foreign missions, with a well-defined task, laid out by definite international agreements. The offense to Italy and to the Italian name hit the sensibilities of Italy squarely in the face. History furnishes other examples of such outrages and points to accepted standards. I made myself the interpreter of the righteous wrath of Italians everywhere. I at once sent an ultimatum to Greece.

I demanded an apology. I demanded payment of fifty million lire as indemnity.

Greece turned to us a deaf ear. Pretexts and excuses met my request. There was an attempt by Greece to find allies to aid her to slide away from my demands. I would not play that base game. Without hesitation I sent units of our naval squadron to the Greek island of Corfu. There the Italian marines landed. At the same time I sent a note to the powers. The League of Nations declared itself incompetent to judge and solve the incident. I continued the occupation of Corfu, declaring clearly that Italy would withdraw from the League if we could not obtain there a satisfactory attitude. This was not a mere matter of insult by words; it concerned the lives of Italian officers and soldiers. It was impossible to believe that I could allow this tragic page to be turned over with nothing more than some bureaucratic gesture.

There has been so much misrepresentation and nonsense as to this outrage and the settlement of our demands that I may do well to state the simple facts, which any school child can understand and digest.

The case, when brought for judgment to the Conference of the Ambassadors, received, as was to be expected, a verdict favorable to the Italian position.

Greece gave me all the satisfaction that I had asked. The indemnity was paid. I offered ten millions of this indemnity to the Greek refugees. Thereafter, having obtained full satisfaction, I recalled the squadron from Corfu. The book was closed.

But that month was indeed one of tragic happenings. The new Fascist style of foreign policy had satisfied the sensibility of all the Italians, but I admit that it had hurt the feelings of many foreign elements which saw in my foreign policy something out of the ordinary, disturbing to many and preventing plans opposed to the rights of Italy. I allowed nothing to deflect me. I made important declarations to the senate, both as to the Greek incident and on the question of Fiume. I said then that the most painful inheritance of our foreign policy was Fiume, but that nevertheless I was treating with Jugoslavia to solve, with the slightest possible damage, the very grave Adriatic situation inherited as a consequence of the Treaty of Rapallo.

The senate approved my policies and my acts.

In January, 1924, I was able at last to conclude with Pasic, the great Serb statesman, and with Nincic, the Jugoslav minister, a new treaty between Italy and our neighbor. As a consequence of this treaty Fiume became Italian. Other moves, continued in 1925, brought to signature the Nettuno Conventions, which regulated all the relations of good neighborliness between the two states. It remains for Jugoslavia to ratify.

At the end of all this diplomatic work on a wide field we definitely lost Dalmatia, we lost cities sacred to Italy by the history and the very soul of the populations which live in them. These had been assured us by the pact of London. No better settlement was possible than the one that I, with the good-will and the eagerness that I and Pasic and Nincic put into the negotiations, was able to draw up.

Though there is yet no Jugoslavian ratification of the Nettuno Conventions, our borders are well guarded and sure. Jugoslavia may show its good will; in any case we now can look calmly into the eyes of our troubled neighbor.

The foreign programme in 1924 obtained in the senate three hundred and fifteen favorable votes against six, with twenty-six absent. In December of that same year I had an interview with Chamberlain, new Foreign Minister of the British Empire. In the many events of international character I have always found him a friend of Italy and of Italians.

In 1925 I had to undergo a lively struggle with the government of Afghanistan. In the capital of that distant country one of our countrymen, an engineer, Piperno, who had gone there to work and study, had been slain, as a consequence of some events of internal character. The Afghan government refused to pay an indemnity to the family of Piperno. I had to send something of a demand. Though it was a definite claim for satisfaction, I did not close the door on the resumption of good friendship with the distant state, and indeed, the King of Afghanistan later had in Rome the warmest and most sympathetic of receptions.

The clouds come and pass away, and new clouds come into our skies. A new cloud showed in the anti-Italian propaganda, laid down by Germans in the region of our eastern border. In February, 1926, when the Fascist policy had made its justice, its weight and strength felt in the mixed-population zone of the High Adige, I had to speak clearly as to the problem of our relations with those Germans behind the Brenner Pass. I made two straight-from-the-shoulder speeches that shook many a timid and selfconscious plotter or sentimentalist. These are not practised in the habits of a school of courage and strength. I dismissed on that occasion another ambassador, Bosdari, who, at the centre of an event as significant as was this, one concerning deeply the relations between the Italian and the German people, was not able to behave as we might expect an ambassador of a power like Italy to behave.

The frank speech that I made on that occasion—it was cut from the same cloth as that I used in similar circumstances against the policy of Seipel, Premier of Austria—undoubtedly cleared our relations with the German population behind the borders.

This question of the High Adige, however, was framed in a wide vision of our relations with all other states. It was just at that time that I had a series of important interviews with the Bulgarian, Polish, Greek, Turkish and Rumanian foreign ministers.

Thanks then to this intense political rhythm, Rome became every day more and more a centre of attraction for important political activities and political exchange. The loyal character of my foreign policy, followed and appreciated by all Italians, has given Italy more consideration from other nations. A loyal policy is the one which scores the greatest success. Ambiguities and vagueness are not in my temperament, and consequently they are strangers to any policy of mine. I feel that I can speak with firmness and dignity, because I have behind me a people who, having fulfilled their duties, now have sacred rights to defend and for which to demand respect.

I have sent forth messages of brotherhood and faith to the Italians who live beyond our borders; I did not give them the name of emigrants, because in the past this word has had a humiliating meaning, and it seemed in some way to imply an inferior category of men and women. I have been able, I am glad to say, to protect my countrymen without wounding the susceptibilities of other peoples. This protection is founded on international law and on good sense in all exchanges between nations.

Italy on its part has accorded the greatest hospitality to all those who for business, for religious faith, for pleasure, or even for curiosity have wanted to visit our soil. I have taught Italians to show appropriate respect for foreign representatives in our country; it is never admissible, in fact, for diplomatic controversies to be twisted or troubled by angry popular demonstrations against embassies or consulates. Such disorders belong to an old democratic habit which Fascism has clearly outgrown. There have been delicate moments in Italian affairs during which resentment and protest might easily have been exhibited. I have always held these protests within the limits of Fascist dignity, though often they have been exaggerated in the foreign press. This is no slight undertaking, even for one who has imposed upon himself the task of giving order and discipline to the Italian people.

The foreign policy of Italy as directed by me has been simple, understandable, and rests on these main points:

First, mine is a policy of peace. It is founded not upon words, gestures, and mere paper transactions, but comes from an elevated national prestige and from a whole network of agreements and treaties which cement harmony between peoples.

Second, I have not made any specific alliances with the great powers. Instead, I have negotiated a series of treaties which show a clear and decisive will to assure to Italy a prosperity in its relations with all nations, especially with those of great historical importance, such as England.

Nor have I failed to work out a whole series of treaties with minor powers, so that Italian influence could have its part in general progress. Albania is one case. Hungary and Turkey are others. To assure harmony on the Mediterranean, I have established accord with Spain; to make possible a greater development of our industries and of our foreign trade, I resumed independent commercial relations with Russia.

Stupid indeed are those who fail to see that I have taken a serene, respectful attitude, but not a humble one. The League of Nations and some of the diplomacy inspired by the Locarno treaty are witnesses of that. I made reservations, after meditated discussions, and because of my well-grounded beliefs regarding the disarmament pacts, I noticed some absurdities in them.

I have bettered and completed the consular organization and I have put in it a series of new men born with and grown out of Fascism. They have suffered the passion of the war and the passion of our rebirth. In the meantime I did not fail to bring Fascism also to our colonies, I wanted to extend the standards which demanded discipline and insured full harmony for all Italian initiatives. These must be concentrated from now on in the representatives of our policies.

A sense of new life and pride fills not only the Italians in Italy, but all our countrymen scattered about the world. Italy now enjoys the respect of those nations which evolve and put into effect world policy.

My colonial policy has simple affinity with my foreign policy. Even taking into consideration the virtues of our colonizing peoples, even remembering all the fine human material we have given for the development of entire regions of the African and American worlds, before the war and after, we had failed to realize the potential possibilities of our colonial programme. We had failed to bring it to vigor and fruitfulness.

We missed then that legitimate satisfaction which should have come to us as of right and from duty fulfilled during and after the war.

Colonial development would not have been for us merely a logical consequence of our population problem, but would have provided a formula for the solution of our economic situation. Even now, at this distance of ten years from the war, this problem has still to find its full solution. Our colonies are few, and not all open to extensive improvement. Eritrea, which is the first of our colonies, has not undergone any change. Somaliland has been augmented by British Giubaland, following a diplomatic accord.

Lately, thanks to the wise policies of Governor De Vecchi, we have pacified all Somaliland, and considerable Italian capital is moving toward that colony of ours, to be used for definite objects and to provide work for Italian labor. The Libian colony—which includes Cirenaica and Tripolitania—was reduced during the war to the occupation of the coast and some of the principal cities. Fascism, on assuming power, found grave conditions. These also have been cleared up. Our policy of military occupation, and of course of economic penetration, has assured us the full and uncontested domination of Cirenaica as far as Giarabub, and of Tripolitania as far as the border recognized by treaties of international character.

There is a great fervor of rebirth in both colonies. Tripoli has become one of the most beautiful Mediterranean cities. A congress of medical men has adjudged it a health resort. We have found water for the city and water in the hills for irrigation. I made a visit to the zone of Tripoli, and that gave me a conviction as to all the possibilities for improvements that can be extended to the entire colony. There are zones in Garian which can compete in production and fertility with the better zones of southern Italy. The same can be said about the high plain of Cirenaica. In this last region I have abolished a curious form of parliament created by the weakness of our former governments. Now the governors enjoy complete influence and complete responsibility for the welfare of nations and Italians. These regions are pacified. Immigration continues to go there. Capital goes; laborers go.

These two colonies alone cannot solve our population problem. Mark this well. But with good-will and with the help of the typical colonizing qualities of Italians, we can give value to two regions which once were owned by Rome and which must grow to the greatness of their past and contribute to the new and greatly expanding possibilities of our general economic progress.

Into these labors to rebuild Italy’s peaceful position before the world, and to develop as duty dictates every colonial possibility which may help to solve our population problems, I have put my days and some of my sleepless nights. But it would be absurd to suppose that life was quite so easy for me as to allow me to stop with international and colonial questions.

Let us turn to the amazing and dramatic financial situation.

A leader of the Liberal party in parliament, Peano, six months before the March on Rome, had defined the deficit of our budget by a figure of more than six billions!

The financial situation was then, according even to the declaration of our opponents, desperately serious. I knew what a difficult inheritance I had received. It had come down to me as a legacy from the errors and weaknesses of those who had preceded me. In fact, I fully understood that with such an important leak in the hull of the Ship of State, any great voyage of progress would be impossible. Finance, then, was one of the most delicate and urgent problems to be solved, if I wanted to rebuild and elevate our credit abroad and at home.

There were many demands due and waiting; necessity had turned the printing presses to the production of new paper-money, driving down and down the value of Italian currency. An irresponsible and demagogic policy had been followed, which had brought about complex makeshifts. These not only affected the soundness of the budget, but also were undermining all our economic life and the whole efficiency of the state.

I had to deal a smashing blow to useless expenditures, and to those who sought tribute from the treasury. I had to rake up tax-slackers. I had to establish severest economy in every branch of state administration. I had to put a brake on the endless increase of employees. Furthermore, the obligation of settling our debts to foreign powers was staring me in the face. Even if our resources were limited, this supreme act of wisdom and honesty had to be performed.

It goes without discussion that for states as for individual citizens, when a debt has been signed and acknowledged it must be paid, and faith must be kept as to obligations undertaken.

For this work I picked a capable man; I appointed as Minister of Finance the Honorable De Stefani, a Fascist and a Doctor of Political Economy. He was able to curtail expenses, repress abuses, and create new sources of revenue and taxes; in this way the budget was almost balanced within two years.

I demobolized all the economic organization left over from war time; I eliminated the useless bureaucracy of the new provinces, still burdened by the debts and indemnities of war. I settled all these with an issue of bonds, quickly subscribed.

Before launching a policy of severe economy, I wanted to do full justice to the invalids of the war. I fixed, with special privileges and without regard to economy, the obligations that the state was to assume in their favor and in favor of the orphans and widows of those who had died in battle. After having repaired in this way a cruel wrong, and fulfilled a duty toward those who had given their life and their blood to the country, it was easy for me to strike at certain forms of exaggerated and sudden wealth derived from war profits. There is no doubt that I have been very harsh in this matter. But why not? These unjust pocketbook privileges represented an offense against those who had suffered for the war, suffered not only in misery or death, but also in loss of money and property.

While striving to eliminate all that burdened the economy and finance of the state, I tried to promote individual production to the greatest degree. I had to respect honestly accumulated wealth, and make everybody understand the value, not only economic but also moral, of inheritance transmittable in families. Because of this, though I had approved a tax reform of great importance, I restored many basic rights, such as the right of succession.

It was made clear that I would never approve subjecting inheritance to a taxation which had almost assumed a socialistic character of expropriation. Interference with succession strikes a blow at the institution of the family. I aroused controversies, but at last my decision was understood and accepted by the people.

Who knows better than I that the discipline displayed by the Italian people has been worthy of my admiration and of the respect of the world. We have no great natural resources. Nevertheless our citizens subjected themselves to the pressure of taxation so thoroughly that toward the end of 1924 minister De Stefani was able not only to announce to the chamber the balancing of our budget, but also to foresee a surplus of one hundred and seventy millions for the fiscal year 1925–26.

I consider that the corner-stone of all governmental policies is a wise and strong financial policy. And now, supported by the soundness of the budget, this policy was an accomplished fact. The state, through able administration and the disciplined patience of Italian taxpayers, was able to face all its obligations, to liquidate its liabilities and, in 1925 and 1926, to discuss with Washington and London the complex problems of war debts.

We were out of the hole.

We did not stop with the central government. The state, now self-assured, with its finances reordered, was able, by the strength of its example, to give precise rules for the restoration of the finances of the self-governing units in communes and provinces. But even that was not enough; we had to review the financial situation of many a corporation and industry. Generally, this included all those industries which were quoted on the stock exchange.

By one of those phenomena of national and international speculations, which are not infrequent in modern life, many of our industrial stocks and even government bonds had risen to figures which were hyperbolical and inconceivable, if one considered the relation that should exist between the value of our lira and its purchasing power in regard to gold.

Even in Italy, a wise and honest country, in which excessive speculation was never rampant, and in which the stock exchange was never the object of excessive and unchecked interest from any class of citizens, there arose a madness for stock exchange gambling. Many people, naturally, lost their heads. They shattered patrimonies, caused scandals, provoked bankruptcies; but this was not sufficient to stop the sudden craze for speculation. The Minister of Finance then decided to take steps to watch and to limit the activities of the exchanges. It was necessary to take really serious measures, which of course would run counter to old and rooted business traditions. Perhaps they were too sudden and too unexpected. They provoked in the middle and financial class an opposition which created a disturbance in all markets.

I was following the course of these events. This sudden opposition created by economic and not by political causes might, as was shown afterward, become a real danger, but it gave me a very important field for experience and observations. I brought a counter offensive and tamed those who made the attacks. A more rational policy was instituted but we conceded nothing to the speculators. After a while De Stefani resigned. Volpi succeeded him. In the meantime, after this first difficulty had been dealt with, I concentrated my attention on the war debts.

After settling the state budget and balancing it, I knew that I had come to the task of making an agreement with the United States of America and with England on the reduction of our war debt. I sent a delegation to Washington. The leaders were Count Volpi and the Undersecretary of Foreign Affairs, Grandi. I feel that the negotiations were carried on with great ability. We arrived, I believe, at an agreement that satisfied the American public and safeguarded the interests of Italy.

On January 27th, 1926, by an analogous agreement, with slight modifications due to the different relations that existed between us and England, we were able to settle also our English debts. America and England ratified the agreements; and so did we, with pride, because it is our constant, firm rule, in all our private or public affairs, to keep faith with our given word and to pay to our full ability the last cent we owe, without wailing or complaint.

Then came a gesture of spontaneous national patriotism: our people by public subscription and without the help of the state paid the first installment due the government of the United States!

I believed then that the security of the budget and the agreements of Washington and London would be sufficient evidence to reassure our industrial, commercial and banking classes as to the soundness of the financial policy of the government. I hoped that it would lead to a gradual revaluation of all our currency and credit in national and international markets.

Unfortunately, all which appeared to me to grow out of convincing logic did not follow. In the first six months of 1926, we were losing an average of ten points in relation to the pound. The pound sterling naturally was towing all the other privileged currencies in such a way that, at a time when our credit should have been on the upgrade, we were witnessing an opposite phenomenon. Our private economic life was getting thinner and less stable; it was becoming fickle and inconstant, through a gradual inflation which might delude many industrial centres of northern Italy, but was certainly not satisfying to the middle class and to the Italians who saved money.

It was necessary to give a point of support to this gay finance. It was inconceivable that an orderly, quiet, disciplined state, which had no public agitation as a liability and which worked with tenacity, faith and pride, should abandon these wholesome forces and assets to the mercy of shark speculators and parasites, eager to enrich themselves on the depreciation of the lira, ready to accept willingly or even to quicken a general bankruptcy so as not to be obliged to settle their private debts, or to face their obligations toward depositors in their banks. A betrayal of the Italian people was being plotted by a class of unworthy citizens. It was a serious betrayal and an injury to moral character, because a ruined people cannot readily be born again in the credit of the world.

I studied for a long time the complex phenomenon of state, private, and individual finance. I was making a comparison between our own economic phase and the situation of analogous countries. I was watching closely the statistical data of our commercial balance. I had in my hand all the evidence for a sure and positive judgment, and was ready to say the word which would influence, in a clear and decisive way, the economic life of Italy.

Thus it happened that in August, 1926, in a square of a beautiful town of central Italy at Pesaro, I made a speech which was to become famous and which was destined to mark the beginning of the revaluation of the lira and our starting-point toward a gold basis.

I had decided for some time to speak out with candor to the Italian people. Foreign exchange had revealed a weakness in our credit abroad. Instability every day, under a régime of giddy and disastrous finance, was a sign of underground work. I had to put speculation back to the wall with a slam. I had to face and defeat that part of a certain class who would have pushed the nation toward bankruptcy. The government could not ignore them or their machinations. It was not only a matter touching the financial future of the country; the very flag of the Italian people was being jeopardized. In fact, in certain situations, even the soundness of a currency can assume the dignity of a flag and must be defended by every open means. One cannot entrench oneself behind ignorance when the patrimony and the dignity of an entire people is being threatened.

Fascism, which had put discipline into the nation, had to put its firm hand on that class of short-sighted speculators who wanted to bring to nothing the value of our currency. Fascism, which had won on the political line, now faced, as I could well see, a defeat if it did not intervene energetically in the financial field.

In this plot against us were joined all the strength of the international anti-Fascists spurred and aroused by our eternal foes, inside Italy and out. I understood that combined with this problem of honesty and rectitude, there was also a problem of will. So I spoke. Here is the essence of my speech:

You must not be surprised if I make a political declaration of definite importance. It is not the first time that I have addressed to the people directly, without any official apparatus, my convictions and my decisions. I must always be trusted, but especially when I am speaking to the people, looking into its eyes and listening to the beating of its heart. I am speaking to you, but in this moment I am speaking to all Italians and my voice for obvious reasons will certainly have an echo behind the Alps, and overseas. Let me tell you that I will defend the Italian lira to the last gasp! I will never subject the marvellous Italian people, which for four years has worked with ascetic discipline, and is ready for other and harder sacrifices, to the moral shame and economic catastrophe of the bankruptcy of the lira.

The Fascist régime will resist with all its strength the attempts to suffocate Italy being made by inimical financial forces. We will squash them as soon as they are identified at home. The lira, which is the sign of our economic life, the symbol of our long sacrifices and of our tenacious work, will be defended and it will be firmly defended—and at any cost! When I go among a people that really works, I feel that in speaking this way I interpret sincerely its sentiment, its hopes, and its will.

Citizens and Black Shirts! I have already pronounced the most important part of my speech, destined to dissipate the fogs of uncertainty and to weaken the eventual attempts of troublesome defeatism.

My sentences were like whip-lashes for all the speculators hidden in the bourses. The great financial institutions understood that it was not possible to adopt independent policies without having to reckon with the government. Speculators perceived that they had fallen into a trap.

On the other hand, I did not want to confine myself to words. In the council of the ministers on September first, I adopted measures which were to guarantee my financial policies. These measures can be summed up: transfer of the Morgan loan of ninety millions of dollars to the Bank of Italy; regularization of the accounts between the state and the Bank of Italy; reduction of two billion, five hundred millions of the circulation on account of the state; liquidation of the autonomistic section of the Consorzio Valori.

To all this was to be added a broad simplification of taxation with abolition of certain taxes and a new form of protection for thrift and for banking activities.

In November I floated a loan that I called “The Littorio.” It was intended to facilitate cash operations and to give some elasticity to the budget. Since there was a very heavy floating debt, represented by treasury bonds, I decided upon redemption of these bonds and their inscription in the great book of the public debt. These provisions had without doubt a harsh character; they were full of sacrifice. But when the moment and its discomfort had passed, we were able to start on a policy of wise severity; our lira began to climb gradually on the markets of London and Washington and our credit rose again in every part of the world.

To be sure, the passage from a giddy to an austere finance which I had inaugurated with the Pesaro speech was not without its difficulties. Failures and heavy losses were brought about. Business deals begun while the lira was at one hundred and thirty to the pound were closed with the lira at ninety. All this brought with it unavoidable losses which hit hardest those who were the least strong and resistant financially.

The difficulties in returning to a position of financial dignity and austerity were notable; reconstruction was as difficult as inflation had been easy. We had to reduce the budget and state bonds to their simplest expression; we had to start a policy of demobilization of our debts to be able to know our complex financial burden and to determine exactly the interest that had to be paid every year.

But the situation has been cleared and bettered. In order to have a sounder, readier, more agile organization, I had decided on the unification of all the institutions issuing paper money. Only the Bank of Italy has the power to issue paper money; the Bank of Naples and the Bank of Sicily returned to their original functions of guardians and stimulators of the agricultural economic life of southern Italy.

When, after a year of notable difficulties, the financial situation of the budget and of Italian economy had been cleared, I was able to address myself, in 1927, to the new gold basis of the lira, on concrete foundations. In December, 1927, at a meeting of the council of ministers, I was able to announce to the Italian people that the lira was back on a gold basis, on a ratio which technicians and profound experts in financial questions have judged sound.

I felt the pride of a victor. I had not only led the Black Shirts and political forces, but I had solved a complex and difficult problem of national finance, such a problem as sometimes withdraws itself beyond the will and the influence of any political man, and becomes subjected to the tyranny and mechanism of mere material relations under the influence of various and infinite factors. Only a profound knowledge of the economic life and structure of a people can reach, in such an insidious field, conclusions which will be able to satisfy the great majority.

To-day we have a balanced budget. Self-ruling units, the provinces and the communes, have balanced their budgets too. Exports and imports and their relationship are carried in a precise and definite rhythm—that of our stabilized lira. Through solidity and certainty, Fascist Italy is creating a new Italian régime, while the necessary complement of our general policy and the essence of our state organization is being supplied by a new corporative system.