Plain Talk

With the air of a sorely tried progressive educator who has at last concluded that his students' delicate egos could stand a bit of bruising, the U.S. began to tell off the bad little boys of the EGA class. First to get a tongue-lashing was Greece, where Ambassador Henry Grady warned Premier Sophocles Venizelos that continued ECAid would depend on improved economic and political behavior. Last week the Greeks were joined by two more victims of the new American candor--the Republic of Korea, which was" told to check inflation, and Italy.

The strictures to Italy were delivered by James D. Zellerbach, chief of the EGA mission in Rome. He did not threaten to discontinue aid, but many a complacent illusion was destroyed, nonetheless.

An Unsold Rug. The zoo-odd Italians, including Premier Alcide de Gasperi, who had gathered to hear Zellerbach speak at a luncheon celebrating the second anniversary of the Marshall Plan, expected only a good meal and some of the pleasantly flattering remarks customary on such occasions. The familiar praise, however, was concentrated at the beginning of the speech. After that, Zellerbach's clipped, nasal voice began to tick off in unusual fashion some of the things that he thought were wrong with Italy.

Monopoly-minded Italian businessmen, said Businessman Zellerbach (Crown Zellerbach Paper Corp.), had. grown soft through lack of domestic competition, hence were too soft-shelled for competition in tougher international markets. It was largely their fault that exports to the U.S. had declined from $90 million in 1948 to $45 million in 1949. To remedy matters, suggested Zellerbach, businessmen must emphasize smaller profits on larger volume, and realize that "antimonopoly action is an integral part of the recovery program . . ."

But the government, too, was dragging its feet, Zellerbach continued. A system of taxation which puts 43 taxes on a man's morning cup of coffee "tends to discourage business initiative and increase costs." Another obstacle to economic progress was the Italian bureaucracy. "A friend visited me," recounted the EGA chief, "and noticed a rug made here in Italy. He asked me to send samples and prices. After a month or two of trying to get all the necessary permits . . . my secretary gave up in despair, and the samples were never sent. Undoubtedly, much business has been lost for Italy in this manner."

As serious as anything else, however, was the Italian national habit of dismissing all economic problems with a reference to Italy's population problem. Said Zellerbach, "Large population can be a challenge as well as a problem." If Italy's 1,800,000 unemployed and 2,000,000 underemployed could get work at normal wages, the nation's home market would be increased by at least 10%.

"Don't Bother." Zellerbach's blast brought pale Alcide de Gasperi out of his chair with a barbed answering speech. Commiserating with Zellerbach on his highly taxed breakfast coffee, the Premier added: "This, on the other hand, gives us some reason for pride that early in the morning we are already in a position to pay 43 taxes while hearing criticism . . . that we are paying too little taxes." As De Gasperi spoke, an aide began to translate for Zellerbach, word for word. The Premier smiled, halted the process: "Don't bother, Mr. Zellerbach understands Italian perfectly. I've noticed that every time he wanted to understand, he understood."

Then De Gasperi went on, "All of us praise bureaucrats who are near us, while seeing evil in distant bureaucracies. I fear it is the same in America; they will easily see distant bureaucrats, but not those close at hand."

Many Italians shared De Gasperi's annoyance. But on second thought, some agreed with Rome's financial daily, Il Globo: "Minister Zellerbach has uttered frank words because he has taken to heart the well-being of our country . . . Criticisms from a friendly person who authoritatively represents a friendly nation . . . are undoubtedly precious."

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