World Business: Europe's Businessmen Bureaucrats

SOME of Europe's biggest business executives are on government payrolls.

The companies they run are, variously, monuments of socialist tradition, nationalist pride or the turbulence of the Depression and World War II. In France, state ownership of industry is estimated to be 20% or more. One lingering result of Mussolini's corporate state is that modern Italian businessmen must operate in an economy where more than one-third of business is controlled by the government. In Germany, Hitler's Third Reich started Volkswagen to produce his "people's car," but it made war vehicles instead and is still 40% state-owned. Governments control every major European airline—because every government pridefully feels it must have one, and no one else is willing to lose such money.

Many of these state-controlled companies are now run by boldly unique businessmen bureaucrats, whose management skills are widely and publicly admired by their free-enterprising competitors. Some leaders:

Italy's Manuelli

Italy's biggest steelmaker is a civil servant, but hardly servile. Says bullish-looking Ernesto Manuelli, 56, president of the state-controlled Finsider steel complex: "I have more freedom of action than a man in my position in private business. Presidents of Fiat or Pirelli often have to get their boards' permission before initiating changes. I don't." Several years ago, he rebuffed a government demand that Finsider build a plant in job-starved southern Italy, instead vastly expanded its plants in Genoa before moving down the Boot. Manuelli also publicly opposed the nationalization of Italy's electric power industry this year, arguing that it would only upset the stock market (it did) and "double the public debt." Socialists angrily demanded his scalp, but Manuelli held his job simply because he has done so well in it.

Manuelli is accustomed to political pressures. Rising through various state-run companies, he was picked by the first postwar Italian government in 1945 to head the Ansaldo shipyards, immediately became a target for Communist gunmen who had secreted an arsenal there in preparation for a general uprising. Manuelli cleaned out Ansaldo, but had to go around with a revolver in his pocket and with two "escorts" carrying tommy guns. Since he took charge of Finsider in 1958, its sales have risen 45% to last year's $761 million, and production has gone up 55% to 5,100,000 tons—a remarkable amount for a country that in 1945 produced only 400,000 tons. Rapidly expanding, Manuelli plans to double output by 1966, produce 10.5 million tons out of an expected national total of 15.5 million tons.

But Manuelli is not a buccaneering empire builder in the manner of the late Oilman Enrico Mattei. "I welcome competition," he says. "After all, the more steel we have, the better for Italy."

Finland's Halle