| The secretary general of the Italian Communist Party, Enrico Berlinguer, proposed the “historic compromise” between the PCI and the Christian Democrats, reminiscent of Popular Front governments of the 1930s. After 1975, this policy garnered six regional governments and most big city governments for the Communists, and Parliament could not function without them. Ministerial positions remained elusive, however. The policy of reconciliation cost the party much of its rank and file, and it returned to a more militant stand by 1979. | 1 |
| The international oil embargo caused petroleum prices to sky-rocket, hitting the auto industry hardest. Double-digit inflation began and continued through the mid-1970s. The economic crisis resulted in low investment and high unemployment. At the same time, however, an unofficial economy began to develop and thrive. This economy was based on moonlighting on a massive scale. In this rebirth of “cottage industry,” industrialists saved costs through decentralization, lower wages, and lower health and safety costs; workers made less money but did not declare this income on their taxes. | 2 |
