it, and I am told that feeling in the army against Italian
 
participation is formidable and vocal. The newer, and
 
increasingly strong, element in the Fascios led by Ciano,
 
Grandi, Balbo and Muti is strongly opposed. So is the
 
Royal Family. The entire Church is openly against it; so
 
are the financial and commercial interests, and every
 
ordinary man and woman with whom one can talk. Popular 
 
feeling is not pro-Ally, but it is anti-German.  
 
     The economic situation is constantly deteriorating.
 
The price of living is rapidly rising; salaries are not.
 
Taxes are sky-rocketing, and public complaint is by no
 
means stifled. Everywhere one hears "Italy cannot stand
 
a new war".
 
     And yet there is no doubt in any one's mind that if
 
Mussolini gives the word, the Italian Army will enter the
 
war on the German side. I am told that if this takes 
 
place, and if Germany is not victorious quickly, mutinies 
 
will occur in the Army, and uprisings among the civilian
 
population, with an eventual breaking down of the present
 
structure of Government.
 
     I am told also, that with this in view, the more
 
liberal Fascists are rapidly working out a program of
 
cooperation with those institutions in Italy (which
 
Mussolini has so largely disregarded) such as the Church,
 
the Royal Family, the Financial and Commercial Corpora-
 
tions (in the Fascist framework), and the local municipal 
 
authorities, to serve as a leverage against any war
 
policy by Mussolini.
 
     But I believe that the decision will be made by
 
Mussolini alone. He lives very largely nowadays in
 
                                   retreat.