Losing Gamble

As long as the tiny (pop. 12,000) Republic of San Marino in northern Italy could make money selling its postage stamps to philatelists, it was happy. It also picked up a few dollars from tourists curious to see a nation of 38 mountainous square miles which calls itself the oldest republic (1,650 years) in the world. Nobody cared that for the past six years the Republic of San Marino had been Communist-run, the only Stalinist state outside the Iron Curtain.

Two years ago, when San Marino's freespending Reds ran the country's budget into the red, the Communist government adopted a capitalistic trick: it repealed an old law against gambling and granted a nine-year gambling concession to a group of Genoese financiers. The gamblers put up an 800 million-lira casino and a couple of hotels and promised to pay San Marino a cut of a million lire ($1,600) a day. The Communists piously forbade San Marinese themselves to enter the casino, relied upon a steady stream of wealthy, land-owning Italians and foreign tourists. Said San Marino's parish priest resignedly: "At first the parishioners thought the casino a scandal. Then they got used to it, for the price of furnished rooms began to rise considerably. There is hardly a family which does not have a croupier as a paying guest at 20 to 25,000 lire a month. My parishioners live up to the motto: 'Since you eat, why shouldn't I? Therefore let's all eat in the name of the Lord.' " Noisy Tenants. The Roman Catholic bishops of Rimini and Montefeltro (San Marino is almost due east of Florence) called the casino a sink of iniquity. Italy's Demo-Christian government discovered that San Marino had become a haven for Italian tax dodgers and quick divorces. Tough Interior Minister Mario Scelba, who dislikes both Communists and gamblers, put border guards at all roads leading into San Marino, had them politely but slowly examine identification papers of incoming visitors. Said Scelba: "San Marino is an independent state and consequently can act as it likes in its own territory. However, San Marino only occupies the top floor of a big building [Italy], to which the staircase leads through other people's property. If the people on the top floor misbehave and disturb the quiet of other tenants, it is the right of the owner of the building to shut the door." Early last year, Scelba slammed the door. Guards, professing to look for dope, made motorists remove their wheels for inside inspection, sometimes dismantled their engines. Delays at the border often lasted eight to ten hours.

Bitter Pill. San Marino's casino, its hotels and movie houses stood empty. The gamblers from Genoa stopped paying their rake-off to the government. The government had to borrow money to pay its employees, soon was issuing I.O.U.s instead of wages. Three hundred San Marinese applied for immigration visas to the U.S. Then the Communist government quit. Condemning the Communists' "stupid and egotistic policy," the legislature called for a new election, last week set up a bipartisan regency council to talk terms with Italy. Italy wouldn't budge.

Said Gino Giacomini, the republic's Foreign Secretary (and a Socialist): "They offend the dignity and the autonomy of our republic. Dear friend, it is a very bitter pill." The republic had to swallow it. At week's end, San Marino restored its law against gambling, shut up its casino. Demo-Christian Leader Teodoro Lonfernini found a little to cheer him: "We may not have much money, but at least we have had a good housecleaning."

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