1
W. Dulles, Deputy Director
of the power of the Ccoounlet Parties of Prance
and Italy and of measures to counter thea.
I. bacjcgrouto.
On Julyepresentatives of the Department of State, of Defense, ECA, end CIA set with Mr. Averell Sarrinen and with Mr. Gordon Gray in.Kr. Berrimen's office. Tbe purpose cf the roosting was to coneider the implications for the defense estern Europe, of the continuing power of tho Cccounist parties in France and Itely, as evidenced by their popular vote in1 Italianelections and the French elections for the Chaobcr cf Deputies.
At this meeting consideration was given to meaorendn prepared in theof State end by Mr. Saa Berger cf Mr. Sarriaan's office, ruialjslng these recent elections. It was generally agreed that the rosults of these elections bad been diaeppolnting. While the electoral mechanisms had been manipulated so aa greatly to reduce Ccosmniet representation in tbe French Cher.ber and in Italian ounicipalltiea, nonetheless the Communist parties1 hodoting strength, roughly equal. In the ceso cf Italy, to that cf the previous electionsnd, In the case of France, reduced only byer cent over the elections It wos conceded that despite tbe eccnomlcwhich hod been realized in Fren.ce end Itelyesult of American aid end the ECA prograa which nay. well have saved these countries free Communist controlccnomlc aid alone ond even lnprovement in the standard of living wna
by no mentis an adequate answer to tho internal threat. It was felt therefore that consideration should bo given to nev techniques to deprive the French and Italian Ccczauniata of their power, recognizing that these partialontinuing threat to deoccratic government and even to the security of tbeforces in Western Europe.
The general conclusions reached at this nesting wero summarized by tbe Department of State In cables sent to the Embaasioa in Paris and Borne onubstantially as fullova:
Both the Italian and tbe French gorernsentsvidenced over-reluctance to proceed fortnrightly against their local Communist parties.
Tbe results of the recent elections have shown that further efforts are urgently needed to reduce substantially the communist enseal to these countrlea.
3- This rosult cen only be realized if determined actionaken by the reapective governments against tho material sources of communist power while continuing the efforts to alleviate distress on which communist appeal la based.
1*. The United States Government should give consideration to taking steps with these governments so that they wouldore aggressive role In the matter.
5. United Stateo agencies, including tho EGA and CIA, mightaaeistanner to be determined In developing this program. The undersigned, who was about to proceed abroadeneral review of CIA work in western Europe, vne requosted to confer with tho Ambassadors in
Paris and Roma, with Ambassador Katz and. other SCA representatives in Paris and Borne, and to consider with them: (a) Specific actions which the Fre&cb end Italian governments might take administratively or through legislation to deprive the communist parties of their material resources and reduce their power, particularly in the labor movements; (b) How the united States can best proceed in bringing the respective governments to initiate euch action, end (c) How tbe various united States agencies, onoe ouch steps are Initiated by tho
governments, could best lend support to such policies of tho governments and to
ACTICK TAKEN.
During the period July Ik to Augusthe undersigned conferred in Paris
with Ambassador Bruce end members of his staff and Ambassador Katz, end in Borne with Ambassador Dunn and his staff, Mr. Dayton and Mr. Lane of EGA. Without disclosing the precise purposes of the interviews, conferences vere held with key French and Italians.
Both of our Ambassadors and their staffs, and all ECA personnel, extended every possible assistance to the undersigned. In general they vere in agreement with the conclusions which had been reached at the Washington conference on Julynd felt that the time had come tooncrete program against the local communist parties. As an old in tho development of thle program the undersigned was given certain reports which ore appended hereto:
1. Memoranda datednd July id, respectively, prepared for
Ambassador Bruce by Mr. William A. Crawford of his staff, entitled
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(A) "Airti-Ccenunlat Action of tbe Frenchction* which tbe French Government might take to deprive tbe Communist Government of Ita materiel reoourceo and reduce ite power. Exhibit 1.
by Mr. Richard Eldridge dealing particularly withprogram for France. Exhibit a.
memorandum datedrom Aabaaeador Dunn,to Reduce Soviet Activities in Italy." Exhibit 3.
k. Meaoraadua summarizing conferences In Rome with Ambaeeador Dunn, his staff and ECA representatives on specific Eeasures to undemine com-munlst influence. Exhibit
III. ANALYSIS OF THE FRENCH AMD ITALIAN CCWCTIST PARTIES AND SCCPCES CF THEIR ST5SMGTH.
i
The relative Coccunist voting strength in France as shown by thefor the Chamber of Deputies was, and in theelections (which covered roughly two-thirds of the country)(including the "Jennl Socialists who generally presented no separateother free countries of Western Europe the Communists, in tbe meetelections, have shown only the following voting strengths:, BelgiumAustria, less than %,
These figures show clearly that the French and Italian Ccentunlst Partiespecial position in Western Europe end in considering any course of action directed egalDst tbeoo parties it is important to consider the factors which have contributed to build up this strength.
In Franco and Italy tho Communist Partiesosition ofwhich they do not enjoy elBewhore in Western Europe. There axe no social or economic disadvantages toember of these Communist Parties. In fact, for labor there may be certain advantages inember of tho party and of tho cceaaunlBt controlled unions which largely dominate labor in tbe two countries.
While the French and Italian governments claim that in acme instances they are beginning to discriminate against admitting communists to government position these steps are feeble and is largely because the communists have not recently participated in French or Italian governments and hence are not entitled to political patronage.
One of the reasons for communist strength and relative respectabilityhese countries is the important role which the communista played in the French and Italian wartime underground resistance movements. esult. Immediately upon liberation they seized strategic positions, took over building sites and appropriated other prerogatives, particularly in the field of the press and of labor. Thoy have never been dislodged from many of these positions.
Another reason for Communist Party strength in these countries lies In tho fact that they have become the parties of protest against somewhat feeble ;overnmonts of the center. In this respect they assume* the role that in otherEuropean countries is being played by the Socialists. The Socialist
t
Party in France in recent years has lost caste in leftist circles because It has jeen forced to Join in "middle of the road" governments as otherwise any liberal jovernment would have been impossible. In Italy the Socialist Perty is badly
split, one section openly Joining the communists end the other section splintered and unable toigorous role* This situation is illustrated by the remark made to me in Prance by an eminent Frenchman of Socialiet inclination who had held high official positions end who was vigorously anti-Soviet, that if heoung man today he thought It quite likely that he wouldember of the Communist Party aa the Socialist Party offered no strong
The single most Important element of strength of these two Communist Parties
Is the fact that in France tbe ccranmists absolutely control the COT which is the dominant trade union organization, while in Italy they likewise dominate the powerful CGIL. In addition, the communists in both countries have made
the most widely read farm paper in France. In general their press is(though one of the most encouraging eigne over recent years has been the sharp droplmost yj$>in the circulation ofheir chief Paris organ). They have advantages, acquiesced in by tha government, innewsprint and in the use of buildingB which they hold under government favor. The partiesrained leadership, clever direction, and plenty of money and ruthleeeness. They have effectively built up their positions as national pertlee and their leaders have largely succeeded in deluding many of thoir followers regarding their real position as etoogee of Moscow. the great majority of the French end Italians who Join the Communist Party or who vote the ticket ore not militants and do not consider that they areoreign power.
and Washington with equal distrust, for those who are anti-Atlantic Pact, anti-reoraoBcnt, and even for misguided people who think the Communist Party is a
party of peace. Added to all these are the tlald who are "occupation conscious"
and viow communist allegiance as cheap insurance against possible Soviet
aggression. Together theyangerous fifth column behind tho lines of our Atlantic defense forces.
IV, GENERAL CONCLUSICBS.
I conclude that it ohouldajor point of American and of NATO policy to cripple these Communist Parties, to uncover their true intentions, to sow discord in their ranks and promote defection, to deprive then of privilege end respectability, and to drive thorn underground.
The time Is now relatively favorable for action. The reorganization of the French end Italian governments week as they areond the buildup of oilitary strength in Europe which holds out hope of an eventual defense, givesasis for starting action to undermine the Communist parties. There are
iome signs that the Cccnunlst leadership in Franc* (endesser extent in [taly) is today leas powerful and leso assured than itew years pgo and should be vulnerable to attack. They have lost prestige by their losses of seata In the French Chamber and mayors' in tho Italian provinces. The heads of
the present French and Italian governments vill he with us In principle even though reluctant in practice. In France failure to act would give the deGaulllst Party their strongest argument against any government of the parties of the center. In Italyperi had alreadyisposition to move against the Communists. We would he deluding ourselves, however, if wedecisive action by either government. Hence we must not rely solely on government action; we must encourago action by Individual groups of patriotic citizens, hy the press end other media of public opinion.
V. METHODS OF PROCEDURE.
1. Action against the French end Italian Communist Parties must develop and be presented to the people as independent French andt should not appear to come, pressure and our support should bo covert not overt. In general we must Induco the French and Italians themselves to initiate the measures both to deprive the Communist Parties of certain privileges they enjoy and to show them up as what they aretoole of Moscow.
.2. The specific types of action which we should press the French and Italian governments to take should Initially be relatively mcdest and we should not disclose our full hand by presenting an over-all program at the outset. If the initial steps are taken the scope and pace of the program can be accelerated.
3. There should be substantial increase in the covert support given to oeasures to be carried out by individual groups and organizations of patriotic citizens, by the press, radio, motion pictures and like nedia, with financial and other aid from us. (An outline of the type of such covert measures now being carried out or programmed is given in Exhibit (ST)
8 -
fc. ad intensive study should be made of measures to break the strength of the Communist labor unions and to support and develop the non-communist labor unions. Existing measures in this field should be intensified. The -continuing aid of American labor should be sought and their ability to aid effectively in this field should be strengthened.
Consideration should bo given to ways and means whereby the powerin the placing of foreign contracts under the military aid program and ECA, in tho handling of shipping and crews and the selection of ports, forour supplies, can be directed toward aiding the non-communist unions and breaking the power of the communist unions. (This ia on extremely complex problem toave found no clear answer although it was generally felt in Paris and Borne that something along these lines could be done.)
A general over-all program to accomplish the foregoing, to coordinate what is now being done, and totepped up program of action might well be considered by the Psychological Strategy Board in consultation with State, Defense, ECA and CIA, and then coordinated with our Embassies in Paris and Rome, rhe existence ofrogram should Initially be kept secret in order to minimize the effects of Communist counter-measures, to cover our ownand not to disclose the points where we propose to strike.
7- We cannot expect the rather complacent and somewhat feeble French and Italian governments tohole program at once. They may be prepared,with some backing from us tnd If persuaded by our seriousness, to take on, one byeries of measures to cripple the Communist Party. This would be sore likely to happen if the governments were convinced that their present
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complacency regarding local communism would advorsly influence the American attitude toward continuing economic and military aid. Then once we get the two governments startedractical course against their Communist parties, we can expect them to be more forthright in their public attitude andagainst Communism.
6. Certain specific steps which might be taken are set forth inenclosures to this report. These mightasisourse of
Momoranda datedrepared for tha American Anbaasadcr to France, Mr. Bruce, by Uilliao A. Crawford of hie Staff.
A. AJfTX-COMHJNIST ACTIOH OFSCB rXTSP3ME?fT
Before considericg what further aotion the French Government might
take adnlcletrotiToly or through legislation to combat Communist activities
here, it would be well to take stock of wbat action it has already taken
in this field. Such action nay be generally summarized under the following
headings:
of the Internal Security System;
of Communists from Posts of Responsibility inaad the Rational Economy;
of International and Foreign CommunistFronts;
(<0 Prohibition of Soriet and Cooinfora Prohibition of French Communist and Communist Front Demonstrations; (o) Encouragement of National Deviationlsm within the CPF and the Antl- Communist Propaganda.
A brief statement is attached of the action eo far taken by the GcTornment under each heeding, together with recommendaticnfl for further action wherever it would eoem desirable.
of the Internal Security System:
Tho Governaent decree ofallod for thoof tbe French Internal security system, Including the creationerritorial guard. The docree vaa designed to provide the Doane for dealing with the Coiapnmlst fifth column In the eventational emergency. The Government is understood to have done little so for to implement the decree.
-
STATUS; Unsatisfactory.
HECCMMEfIDATION: The Government might be encouraged to expedite action.
of Communists from Posts of Responsibility Inond the National Economy:
In public statements before tbe National Assembly on
andefense Minister Moch declared that lt is the policy
of the Government to remove Communists from "posto oflthough
not from lesser positions. In public administration and the notional
economy.
In pursuing this policy, the Government haa taken various steps, some of which hove been publicized. On Novembert removed four Communists mayors end twenty-nine Communist deputy mayors of Parle communes who had transformed their "mairleo" into Communist propaganda centers. Onpurged tho Commissariat for Atomic Energy of all remaining Coamunlste. Also ont ordered the removal from office of all public servants who stopped work on the"
preceding doy to participate In the Communist demonstrations agalnat Ceneral Eisonhower; and the French oilitary authorities suspended twenty-one workers from national defense plants for the seas offense.
In addition to these public acts, the Ministry of the Interiorthe Embassy that numerous Communists orin key posts in public administration and ths nationalbeen removed from their "
STATUS: Relatively satisfactory.
RECOMMENDATION: tatue roport might be solicited.
(3) Outlawing of International and Foreign Communist Organizations and Frosta:
Over the past year the Government has outlawed the leading international and foreign Communist fronts with headquarters in Paris. These include. In the sphere of trade union activities, the World Federation of Trade Unions; in the sphere of pacifist activities, the Cooalttee of tho World Congress of Peace Partisans (subsequently renamed World Peacen the sphere of women's activities, the International Democraticof Women; and In tho sphere of youth activities, the Worldof Democratic Youth. It Is noteworthy, however, that it has so far taken no action against the French affiliates of these international Communisthe Confederation Generals du Travail, the Com-battants de la Palx et d* la Liberto end tho Conseil actional du Mouvemont do la Palx, the Union dos Fommes Franca'ses, ond the Union de la Jounesao Ropublicolne de France. Nor has lt taken steps to outlaw threo international
CoczsunlBt fronts of somewhat lesser importance: In tho sphere of the. Intelligentsia, the Bureau do Liaison des Intellectuels pour la Defense de la Palx (product of the Wroclawn the sphere of political prlaoners, tho Federation Internationale doa Anciens Prlaonnlers Polltiques; and In the sphere of lav, the Federation Internationale dee Juristea Doaocratee.
The Government has dissolved those foreign Coatauniet groups vhfch vere closely associated with the para-military apparatus of the French Communist Party. In this connection, or. Septembert abolished the Spanish Communist Party bore, together with its organ Mundo Obroro, and on the same date rounded up for expulsion from France two hundred eighty-eight foreign Communists, the majority of whom were Spanish. Ont dissolved tbe Union des Carlbaldlons et Volontalres Itallena dans l'Armeeonmuniat front for para-military action composed of Italian nationals.
STATUS: Relatively satisfactory.
The Government eight be encouraged to take further action with reapect to the remaining international Communist fronts, and possibly initial ectlon with respect to their French affiliates.
(M Prohibition of Soviet end Coelnform Periodicals: On, the'Government ordered the prohibition of the sale and dlatrlbution in France of five leading Soviet periodicals published in the French language. On Januarytimilar order with
respect to tho weekly Comlnform organ. Pour uno Palx Durable, Pour imp Dacocratle Populolro, published in Bucharest. It should be noted howovor that this organ waa subsequently published here In almost Identical form and content under the title Palx et Democratic. In Its new format, It haa been edited by the Communist Deputy Augusts Touchard. STATUS: Relatively Botlsfoctory.
ENDATI0N: As the Government has taken no oteps to prohibit the Comlnforn organ In Its new format, lt might be encouraged to do ecrf -particularly as Touchard waa defeated for re-election onnd therefore no longer enjoys parliamentary immunity.
rohibition of French Communist and Communlot Front Demonstrations: Since the beginning of the year the Government has prohibited the holding of three Ccceunlat-organized public demonstrations. The first waa tbe anti-Eisenhower demonstration scheduled to take place on January 2ft In front of SHAPE Headquarters. The second was that scheduled for Februaryy the CommunlHt front Federation Hatlonale dee Doportos Internes et Roslstants Potrlotes to protost against the arrival In Paris of German military representatives to participate In the discussionsuropean Army. Th* third was the mass "peace" rally sponsored by the Ccnsoll National du Mouvement de la Palx, tho French affiliate of the World Peace Council, which wos to have been held In Paris onTATUS: Satisfactory. RECOMMENDATION: None.
Memorandum prepared by Richard Eldridge The attached memorandum was originally prepared as annotated agenda
of certain considerations which sight justify critical review. They aey be
reeumed In these prepositions:
1. It was Soviet Russian policy and tho conservative reaction of tho
majority of Individual French working families that sharplyduced Communist strength In France. To attribute the weakening cf communism to other lesser factors could leadengorous underestimate of potential communist recovery. In othereversal of Soviet tactlca permitting the French
Communist Party once more to adopt the formula of "national patriotism" and perhaps "European neutrality" might,hort period, restore Communist prestige, lead to another Popular Front government and the collapse of American policy In France. 2. American policy has In effect preserved the traditionally instable French social structure by restoring tho production levelsto political and social stability. ritical moment. Intelligent American action was instrumental in preventing the destruction of the non-communiot center (Jouhoux group) of the French CGT and facilitated the survival of other email groups. American Initiative probably saved Franceajor social revolution during thoW3. But American policy has not and doubtless could not of itself alter the unhealthy French
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structure of nationalistribution; it could not break dovn restraints upon output, trade and prices that have been accentuated since tbe Liberation. It was this unhealthy but long established social structure that fostered the phenomenal growth of Christian and Marxist Socialism and Stalinist Communism during theeriod In which French industry stagnatsd because of Its policies of restricted output,profit margins and low wages. The attached annex of official production indices indicate that French industrial production9 "as leas than0 and not one third more thant seems clear from Socialist and left-wing MRP statements, re-garding the conditions of their participation in oablnets, that no democratic French government can successfullyenuine. large-scale, effort for national defense without maintaining and possibly increasing the presently compressed real wages of the lowest wage groups. It is equally clear that the Socialist Party would commit suicide If it did not thus take account of vorker discontent and Communist competition. It does not appear probable that the general elections1 will eOter thla situation.
An^vlcar. eld to some organizations In the French iebor movement and to soae groups in tbe Socialist Party may have saved these vitally Important elements from virtual elimination. However, aid waa mainly restricted to non-productive forms, namely,
guaranteeing the budget of the governing bodies and Headquarters ofand lesser groups) and meeting the inevitable deficits of tho incompetent management of the Perls Region Socialist Party organ, the Populalre. One half of tho non-comaunlot labor movement, naael7 the CFTC (Christian laboreceived no American aid worth mentioning. Productive stimulation of the healthier regional end lower-rank FO labor unions and Svcitllst Party agencies has been wholly inadequate.
Various measures should bo taken to provide repetitive tests ofthe efficacy of eld or other actions taken In France: The tests should be madeource independent of the agency ornitiating tho action. Too often in the past, glowing but inaccurate reports have been sent to Washington regarding the efficacy of (propaganda) actions undertaken.
American aid and other projects should not be consideredat least in principle, unless initiation and Implementation of specific projects by French organizations Is assured. In general actions undertaken should be lntltiated by French organizations
with American support appearing only subsequently, if at all. iven American proposal is such that no influential French organization or pressure group can be found to initiate and pro-note it, the proposal should be abandoned or revised.
LABOR FRCGRAM IN FRANCS
In any examination of the French labor situation, consideration Bust be given to those major factors that really dominate the labor situation.
The principal factor in the absolute, but not relative, decline ofstrength in organized labor haa been the tactics imposed upon COT by Soviet Russia, nsmely, onti-nationalist actions ranging from support of in-
dependence movements in the overseas territories to opposition against all national and international efforts for the recovery of French economy and French national defense.
A second major factor has been the passive resistance of the French workers to anti-patriotic policies of COT; massive vithdrawalB from tbe communisV controlled CGT took place in thec6-W, while in the rank and file and among the lower union officials much open and considerably mere covertbaa been manifested against OCT anti-nationalist political actions.
Whereas the ubove two fectors have materially weakened communist strength, both in the COT and in the countryhole, other major factors have been predominant in preventing ncn-communist labor organizations frcn acquiring strength:
The so-called "anti-labor" policies of the French government simply reflect, in the oest parliamentary trodition the necessity for parties in power to favor their respective supporters. Formers, tradesmen, artisans and small enterprise, as well as large scale industry, have materially benefited from government policy or leek of policy in many fields. On the other hand, comparablefor tho working class would have necessitated direct action on price, profit.
low wage and fiscal problems vhich the government pextiefl have been politically Incapable of undertaking vithoutaacrificing group interests of their own lupporters.
These considerations indicate the difficulty of utilizing American aidaolution of French national cccnccy problems auch ae tbe highlyof prices end profit margins of the postwar period which haspromoted price
French labor problems may bs divided Into:
Problems of general state legislation aad regulation, including abusive trade practices, fiacal evasion, large scale clandestine capital erporta, and advanced social legislation. (HatIonsIllation and other legislative measures, adoptederiod of Ccmnunist Party cooperetion with the government, have had for effect tbe state delegation of authority to the eomnuniat-doojineted OCT which controls the bulk of consultative plant committees, shop delegates, the hiring and firing of lcnzshorcaun as well aa the maintenance of continued if reduced numbers of conaunists or fellow-travelers in koy-poeitlons of various -icistries, auch as Rational Education, Information, Labor and Industrialetc.).
In this group might also bo classified etate and municipal aid to the CGT. la estimated one billion francs annually of state and municipal aid to CGT has oeen consistently rendered during theperiod during which the CGT oado every effort to disrupt French economy and to undermine the French government. Thia aid takes such forms as the Free CGT use of municipal labor "bourse" buildings
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in tbe principal cities of Frcr.ce and, in acne cesss, of aunicipalwages to full-time regional COT officiols. In nationalizedas Coal, Gas and Electricity, Bailwaye,t has long been onpractice that trade unionists elected to full-time trade unioncontinue to receive their wages and normal promotions from thoenterprise in question. Incidentally this practice is also maintained bysubstantial number of largo private enterprises.
Many other communist "front" organizations receive subsidies from the French government in the form of free use of requisitioned buildings, free or reduced transport rates, etc.
An analysis is being aado of the national and municipal budgets, so asan approximate figuro of state aid to the COT. One estimateyear ago calculated such support at more than one billion
State aid to Force Ouvricro and CFTC is givenesser degree; the unconditional elimination of such old to all groups would therefore be violently opposed bynd CFTC, not to mention th* Socialist Party and the MRP, both of which also receive certain forms of state aid either directly or through intermediary "front" organizations.
Most significant aspect of state influence upon the labor situation has been the adverse offeet of state policies upon real wages. The "government parties" have been generous in subsidies to group interests representing their own constituencies; direct subsidies have been given to agricultural and some' other groups, and indirect subsidies In the fora of subsidized low prices to large consumers of tho products and servicos of nationalized enterprises, such
as Coal and Transport. Subsidies haveeavy burden upon the national budget end have bean largely transferred to the principal tax paying andgroup, namely tbe wage corning class. In addition to indirect subsidies benefitingnterprise, the state haaumber of cases, by decree, delegated governmental regJetory powers to representative industrial groups for the strict control of price, marketing and other trade practices, what may be considered one of the moot harmful subaidios'to agriculture, industry andas been the deliberate postponement of fiscal reform end the failure to col3ect tojws.
In many industries, tho discipline imposed by strong trade associations is now far beyood anything known in France before the war. Whether in marketing or in labor policy, trado associations in key industries now largely dictate the policies of their members and possess strength to impose penaltios which ia Important cases has been fortified by state delegation of authority. Surveys of the notable extension of state delegated euthority since the prewar porlod and of other cartel forms of trade association control should summarize the documentation available in French government agencies. Since low real wagesundamental obstacle to economic expansion and social stability, intelligent long term action in the field of trade practices probably would ba the most effective, if the most difficult, method of bringing relief to that third of the French working class which is underpaid even by low prewar standards.
eneral rule it Is of course obvious that any American actionto encourage French political and social recovery ahould be preceded by
careful review of essential facts of the problem and by consultationFronch groups. The Initiative of Important actions Inand social questions should be assumed by coordinated Frenchwith subsequent American support. In many cases, ability toprocedureost of the practicability of tho action Obviously, all actions should be subject to review andterms of American overall policy in
The folloviag recommendations for possible actions exclude questions relating to1 general elections, to tho "neutralist noveoent" ond to special Marshall Plan matters, such as pilot plants, housing projects and technical assiotance progress.
I. Government
a) Useful changes in legislation, regulations, administration policy, aiming et:
1) Lebor legislation: revision of definition of "representatiTity" of labor organizations to penalize those (communist)and individuals with pest end current record of sabotage of national defense and of reconstruction; elimination ofcontrol.of hiring halls for longshoremen (result of existinglimination of communist control of plant committees and shop stewards In key national defense(plants, traneport and ecessunlcatiecs, etc.).
S) Trade practice*: revision of decrees,elegating atate authority to trade association* for allocation and importation of products and materials, production, price and other controlsiew to imposing minimus, standards in price and possibly labor policy.
3) Rationalized enterprises: reforms in this field ere under way but would benefit from closer American' support. (Separate surreys should be made for transport, cceaunicatlons, coal, gas aid electricity),
-) State end municipal subsidies: This aid is perhaps tbe single most important oource of communist financial strongth ina Large scale national organization and. In the case of CGT, represents an estimated ono billion francs annually.
5) Communist influence in geTernmont and act cm crocus agencies: It remains Important in the Ministries of: Information (brood-casting, cinema, allocation of neveprint and paper to coaaucistith creditresent ccmBuniat possession of state-requisitioned or confiscated printingational Education (partial control of hiring and promotion of teachers, especially technical end secondary schools, strong positionome universitynomy, Labor; utilization of municipal resources in cccmuaiit-dominated auniclpalitles, etc. Surveys of the oxtent of communist influence in each important government agency should be cado and periodically revised.
IT. Political Partis
Consultation and cooperation with the International sections and hey committees of political parties and, through then, with Assembly Commissions would be especially helpful in determining and promoting the prospects of contemplated measures. Useful support can be thus developed in thosee where none would otherwise exist.
III. National Economic Council, Trude Associations,'
In promoting public end private actions, avrious (conflicting) Interests can be identified and contacted in the CKF? (Employers) and similarand effective alllenceo mode for the promotion of specific projects. CGAGCeunes Patrons and other important group Interests artumber of cases prepared to support specific projects listed. (That is, either the entire organization or important subsidiary Churches
The Catholic Church compares fovorably with the Communist Party In the scope and strength of Its organization end Influence. Iteading part in the application of social policies end its cooperation In many forms of Bocial action could be obtained. 7. Labor Organizations.
The notorious ineffectiveness of labor unices in the re-establishmenton-Communist labor movement is tbe result of political pnd social factors partly exterior to labor organizations.
It la however alao due to the character of leadership, and the tendency of Americana ee well as other interested outalde groups to one ourego one French non-Ccnaunlst labor organization to compete with another, rather than toommon frontinimum program against the CGT. Large scsle aid concentrated at top levels sharply decreases leadership Interest In massive increases In membership; it seems certain that not one fourth of American aid
haa been directly used for membership
A curious eopect of American aid has beon that it has ignored one half of the ucn-CcntBunist labor movement in France, namely the (Christian) CFTC. In the June0 Social Security olectione, the CFTC received substantially more votes than FO, although FO received the bulk of American aid.
A review: of past American aid would be difficult to make because various American agencies Indulge in separate unreported actions of as uncoordinated character.
DUM
1
PSCCSAH TO HEEUCE SCVLTT ACTIVITIES IS ITALY
Up to the present time the program and objectives of the Unitedthe reduction of Communist activities and power, in Italy based upon aof propaganda and aasiatance in economic recovery has beenpreventing the Communists froa taking over in Italy. It is now clear,after viewing the results of the recent municipal elections in thaItalyew approach is required toward this problem if ve arein actually reducing Ccmaunlat strength
Vest auras of money are being expended in Italy under the authority of. Government in various ways for propaganda end information with regard to the American assistance toward Italian recovery and alsoiew toItalian public opinion toward an attitude more favorable to the United States.
The time haa come when it would seen appropriate to approach the Italian Governmentiew to inducing it to improve Its propaganda andservicesiew toetter presentation of what the Italian Government is doing along the lines of improving conditions in Italy. The most effective action in influencing the Italian people away from Communian vould be that taken by the Italian Governaent itself and any part we take in that effort should be along the lines of assisting in an Italian program of action without too much evidence of American participation.
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A further steponsider essential would be to review the programs which are now supported either. dollar funds or through counterpart fundBiew to ascertaining the tctal sum available for propagandain Italy as far as the United States Government is concerned. It seems to moreat portion of this available sum would be more effectively used if it were dedicated to the purpose of assisting the Italian Governmentigorous anti-Communist program end in extending the Free Trade Union movement. It seems to me another field which would be appropriate in combating Communism would be to assist the non-Ccmmunlst cooperatives as they are in most cases very close to tha people and operate in close connection with thecenters and also in the agricultural field.
A way should be studied in which the new democratic administrations which have Just taken over In the important northern cities could be assisted in rendering services to their respective localitiesay which would sharply contrast tbe benefits obtained from democracy with the lack of consideration for the people's interests as exhibited by the former Communist administration. There may be many wsyB such as building or improving the public services,housing programs and specific benefits to tbe communitiesimilar nature.
If sufficient funds areost effective way of combating Ccm-muniem is by word of mouth and organizing the democratic political groupsin the industrial centers inay that the workers are approachedersonal basis and made to understand whet the Communist regime is really
t%jf^ ^
of Rational Seviatlonlsm within the CPF and thatho past several years, tho Government has given discreet assistance
to the national deviatiooist movement led by Darius LeCorre within tbe CPF and tho CGT, and to lta organ La Lutte. This movement publicly emerged some voe'ca before the recent national olectlona aa tho Mouvement Commanlet Francala Independant end polled aome twenty-three thousand votes at the elections themselves. Although lt conatltutea ho serious threat to the Party as yet. Itallying-ground for dlssldonts. Tho numeroua attacke which the Communist press has made upon It are an Indication of Its nuisance value.
STATUS: Satisfactory.
SZCOI'WEKTIATIOH: Bone.
Propaganda:
Co Septemberhe CoTemaent established an enti-Communist propaganda organization, "Pali ethich haa done an lapreasive Job in countering Cocaunlet propaganda, particularly with posters. It now propoeee to expand lta propaganda activities through other media.
STATUS: Satisfactory.
BECOMMEPOATION: Nona.
3. hich the Frenchake to deprive the french communist partits material resources and reduce its pcws3.
Short of outlawing tho Communist Party Itself, tho Fronch Government olght rooortumber of measures calculated to reduce Bomewhet Ito power and material resources. In the first place lt sight take steps to implement further the program of ant1-Communist action which lt has already bsen pursuing and which Is outlined In my memorandum of Junelfi. In addition to these measures, there are others necessitating governmental action which might be considered. Seme of those may be briefly ouamarixed as follows:
1. Allocation of Newsprint;
A governmental agency, the Societe Professlonelle des Paplers de Presee, which is under the joint direction of the Federation Netionele do la Prosse Francaloe and the Ministry of Information, is the only authorized Importer and distributor of newsprint in France. Itercentage of newsprint to the Communist press and publications. In accordance with their circulation, at prices below thoso of tho world market. In addition to the newsprint thus made evailablo, the Communists may also Importdirectly from abroad at world market prices.
The Government might consider administratively reducing the allocation of newsprint to the Communist press and periodicals and limiting the amount cf newsprint which the Communists might Import from abroad on the free market.
of Press Equipment:
Tbe Sec lot* Rationale des Entreprlaea de Preeae (SJTE?) Is aagency charged with the responsibility for odminlatering the press equipment and properties of those publications which appeared during the Occupation and were confiscated at the time of the Liberation as collaborationist. The properties In question wero taken over at that tine by the Communists, Socialists and MRP, roughlyrlpartitfi.basls of distribution. The SIG? subsequently formalized the de facto distribution which had thus been effected and has since administered the properties. The Communists are understood to be In heavy debt to SNEP, despite the factecent effort of theirs too-called "nationalin Defense of the Democratic Press" was designed to alleviate the situation.
The Communists are by no means the only group heavily indebted to SNEP. However, the possibility of requiring the Communists to pay up their indebtedness or abandon the properties In question might well merit consideration.
Hew Definition of Representlvlty:
Tbe Communist-controlled CGT could perhaps below byaction amending the Law of February0 on Collective Bargaining. This law sots forth soveral qualifications for so-called trade unionne of which io that of "independence" and another that of the "patriotic attitude under tbe Occupation" of the trade-union in
question. Tho latter qualification plays cloerly into the hands of the Communists, whose so-called "patriotic attitude" was coterminous with the Occupation.
This clause might well be modified to extend "representIt!ty" only to those trado unions whose "patriotic attitude" ia expressed in the principle of unqualified adherence to the national defense under all conditions and at all timee. This would confront the CGT with.the dilemma either of having to renounce its numerous defeatist pledges, such aa that of never fighting the Soviet Union, or its legal claim to. Permanent Trade Union Employees:
Numerous permanent trade-union employees, both CGT and non-CGT, are paid by the State In the aphere of nationalized iaduatry or by aanageeent in tho aphero of private industry, rather than by the trade-unions
The Government might consider whether it would be feasible to remove tbe CGT permanent employees from lta payroll. 5. Social Welfare Beneflta:
Social welfare benefits in nationalized industrloe ere subsidized la port by the State. Moreover, in view of the predominance of the CCT within the trade-unions themselves, they are administered In large part by the Communists. The result Is that the Government thus frequently makes indirect contribution to the maintenance of the CGT, and that the Coa-aunista may use this aeaas for exerting political pressure on the workers.
T.S. No. Copy
Measures might be considered for codifying thisforegoing are merely suggestions for antl-Communist Tho French may well have some of these, as well aamind. Each would require more dotailod technical study beforeit Is feasible or desirable and any relating to laborrequire informal consultation with our uniontho -
There are other possible measures which night well merit attention, such as regulation of the right to atrlke in public services, which is now unlimited, and tho strengthening of legislation on military indiscipline and sabotage, on the law on the prese with regard to defamation, and on parliamentary immunity to prevent the lattor'a servingloak fo? Communist deputies to disobey the law.
Probably none of these acts would be particularly effective or popularly acceptable In itself unless itartroad, methodical governmental program for eatl-Cocmuniat action. If, for example, all non-Communist partiee in the Aaaoably united toonoral piece of legialatlon on intelligence with thepeclflc sanction, such as doprivlng the Communists of newsprint, would be fitting and proper retaliation for their treasonable propaganda and agitation against the action of French troops in Vietnam and Sorea.
Although it wouldeelrablo principle, therefore, that sanctions be generally carried out in support of specific legialatlon directed against
thohey might equally voll ho called into force in retellatloa againat flagrant antl-national acts of tho Coaaunlete, even where no ouch legislation existed at tho moment. Thus, whon the CoBaminlsts lay thom-eelveo wido open on antl-national grounds, such as whon9 Thoroi publicly condoned Sorlet occupation of Franco by asserting that the French people would coos to the aid of floriet troops pursuing an Invader on to French soil, the Government would have boonustifiable position to take vigorous neasuroo against tho Communist Party then and there. It night veil be encouraged not touture occasion of that kind go unheeded.
A,CDC.Sn
EXHIBIT u
To report dated1 entitled: Analysis of the Power of tha Communist parties of France and Italy and of Measures to Counter them.
Memorandum prepared by Allen W. Dulles,eeting held at the American Embassy at Rom on1 attended by the Ambassador and Minister Thompson of his Staff, Minister Dayton and Colonel Lane of EGA, Hr. Dulles,representative of CIA, to discuss measures which might be taken in Italy, particularly of an admlnlstratiye or legislative nature to reduce the threat which the Coosainist Party of Italy and the Coimsunist dominated labor union, CGtX. repreaent for free government and for the defense of western Europe,
A. GENERAL,
Consideration was given to urging the Italian government totrong overt declaration against the Communist Party. There was sor* difference of opinion whet bar it was wise to attempt this at the* set both because it might prematurely alert the Communists and because it was doubtful whether strong wprds, if forthcoming, would be followed by strong action. In general it was the majority view that it would be best to start with specific steps against tha Party and the CGEL, and in particular that the government should be urged to move to eliminata Coresunist Party members who held significant government payroll positions. In this connection it was felt that particular emphasis should be placed
*
on the security factors and that action of this nature should initially be directed against Comunists in the Defense Establishment, in conBaunications, transportation, public utilities, government arsenals, navy yards, and strategic industries.
la Redistribution of government owned ex-Fascist property now in the hands of the CGIL. (It was generally agreed that every effort should be made to get tho full facta as to the precise properties which the CGIL held under government favor and move against those which were of the most strategic importance. It was also felt that if certain of these propertios could bo diverted from CGIL to the non-communist uji.qn,this would be most desirable.)
7. Removal of oomnunlsts from labor employment advisory Consideration by the government of new labor legislationstrikes by government employees. (It waa felt that beforethis point it would be well to appraise tho results of
legislation in this field.)
L>. Acceleration of tho taking by Conflndustria of an anti-communist positionosition more favorable to CIS:..
Promotion of effective government investigation of cases of Intimidation of non-Comrainists by Communists. (The government is already doing something along these lines but more could be done;)
Developmentublic works program to reduce unemployment, (Tho difficulty here is the present inability of the government to finance any ambitious program along these lines. It was felt thatrogram, when feasible, should be tied in with taking tho excess workers off the rolls and putting then into productive activity.)
of social security and insurance legislation.
(It was felt that thisong term project in view of thefinancial position, but worthy of study.)
refusal to confirm the election of Communistspositions in port agencies where tho Minister ofhas control.
C IN THS FIELD OF -
1* Establishmentommission to examine the security fattors
relating to tho employment of Communists, particularly in government
utilities and strategic industries,
2. Investigation of Communist activist "schools" and preparation
for effective legal action against those engaged in the illegal aoveaehtT-
and caching of arms.
D. TH THEF THS PRESS.
Investigation of tho possibility of terminating the lease by the Italian government to tho Conxiunists of the important UESISA printing plant whore the CommunistAvanti* and other Communist sheets are published.
Action to curb tho false and subversive utterances, of the Communist press and other Communist Information media. (This wouldore effective government information program.)
SWQ RET
CFET
S. IH THE FIELD OF GOVERNMENT AMP AP>riNISTRATION.
Establishmentore equitable and effective tax system. (It was felt that this recosr.endation should be viewed in tho light of proposed legislation on the subject.)
Progressive steps to remove Communists from administrative positions in government ministries, in schools and in universities. (It was coneedod that it would be difficult to get the government to-move along these lines, but that it was worth considering.)
Curtailment of governmental financial assistance to communes which contribute financially to communist agencies. (Here the grant by the City of Milan to the CGLL was mentioned as an example. This ioifficult point, buthreat to take action might make the comnuncs nore caroful in the support they give to communist
F. SOCIAL AWJ ECOKOMIC
v>
Consideration of the reor^pnlzationhe social security agenciesiew to curtailing and eventually eliminating Couminist representation,
Examination of the practices of communist controlled cooperatives and communist controlled export-import firms which engage inselling practices whereby they acquire funds for Comunist and Soviet operations in Italy.
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VO^KftET jp^P ^
Original document.
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