According to A. Castagnoli (La guerra fredda economica, Italia e Stati Uniti 1947-1989, Laterza, 2015) between 1947 and 1989, the United States deployed a broad arsenal of economic pressure tools—from conditional aid and trade barriers to embargoes, technology controls, and sanctions. These instruments served not only economic objectives but also the broader geopolitical strategy of containing communism and reinforcing U.S. dominance during the Cold War.
Here are the key approaches:
Conditional economic aid
One of the main instruments of U.S. influence was the Marshall Plan (ERP), launched in 1948. Economic assistance to Italy and other European countries came with clear conditions. U.S. officials made it explicit that any participation of communist parties in government would jeopardize access to these funds. This directly influenced Italian domestic politics, contributing to the exclusion of the Italian Communist Party (PCI) from government coalitions. ERP loans were meant to stimulate economic growth and international trade, acting as a barrier against communism. However, the funds were disbursed in tranches and tied to compliance with political and economic expectations.
Trade policy and tariff barriers
Although the United States promoted global trade liberalization, it maintained protectionist measures to exert economic pressure. The strict enforcement of the Buy American Act (BAA) created significant obstacles for Italian exports and investments. Italy’s ambassador, Alberto Tarchiani, had to intervene to ensure that Italian firms were considered in U.S. procurement, especially by the Department of Defense. Despite the U.S.‘s rhetoric about open markets, Italian analysts observed that these markets were still shielded by tariffs and BAA restrictions. GATT agreements made some progress, but tariff reductions were modest, and exception clauses continued to limit European imports. The “peril point” procedure further restricted the U.S. executive’s ability to reduce tariffs unilaterally.
Strategic embargoes and export controls
In the East-West rivalry, the U.S. used export restrictions to prevent the transfer of sensitive technologies and scarce resources that could enhance Soviet military capabilities. The 1949 Export Control Act gave the Commerce Department authority to approve or deny export licenses. Washington pressured allies, including Italy, to adopt similar restrictions toward communist countries, especially China. The U.S. maintained a full embargo on exports to China to block its access to American technologies essential for industrial growth. After the Soviet invasion of Afghanistan, these controls became even stricter, targeting high-tech equipment and extending to foreign subsidiaries of American companies.
Economic sanctions
The U.S. also used targeted sanctions against countries deemed hostile. In 1986, for example, it imposed trade sanctions on Libya due to its support for international terrorism. However, their impact was limited, as other nations, including Italy, continued to purchase Libyan oil.
Financial and monetary pressure
Leveraging the central role of the U.S. dollar in global finance, Washington could exert influence through monetary and financial policies. High interest rates and other economic decisions often drew criticism from European and Japanese partners during international economic summits, as they had ripple effects on their own economies.
Technology and know-how controls
Italy’s advanced industrial sectors were often reliant on American licenses, giving the U.S. leverage over its development. By controlling access to key technologies, the U.S. could condition industrial progress. For instance, Ambassador Gardner reminded Count Agusta that his company’s helicopter production relied on a U.S. license, hinting that supplying Iran could result in the license being revoked.
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