JULY 29, Benito Mussolini's birthday, was a day for much soul-searching here about Il Duce's dubious legacy. Indeed, 40 years after the hapless dictator's tragicomic exit from the world stage, Mussolini continues to be a subject of considerable controversy. Unlike Adolf Hitler, who is the object of almost universal disgust, Mussolini is not without his admirers. They are particularly numerous in the long-neglected south, where Il Duce is credited with draining the swamps, building schools and highways, and jailing Mafia kingpins. In fact, it is still common to see slogans such as ``Mussolini lives!'' on whitewashed walls of impoverished southern villages.
But if Mussolini built the autostrada and made the trains run on time, he left his present-day countrymen with a deep skepticism about central governments.
Ironically, it is only now, 40 years after the death of this ``Caesar of the carnival,'' that Italians have created a truly coherent government and finally exorcised Mussolini's ghost.
One example of the new political coherence here is the longevity of Prime Minister Bettino Craxi's five-party coalition government, now two years old and almost certain to become Italy's longest-surviving democratic government in October. Another factor in Italy's renewed political respectability has been the warmth and goodwill that former President Sandro Pertini infused into his largely ceremonial office. Mr. Pertini was succeeded early this month by Francesco Cossiga, also notewothy for his ethical rectitude.
The political stability brought by Messrs. Craxi, Pertini, and now Cossiga has been accompanied by an unexpectedly strong economic upturn, with real growth at 3 percent last year, helped by a remarkable improvement in labor productivity. Similarly, large Italian corporations, such as Fiat, Olivetti, and Pirelli, have risen sphinxlike from the economic disarray of the last decade to look remarkably healthy.
Such export-led growth would have come to naught, however, if Italy's raging inflation -- long the highest among major industrial nations -- had not been brought under control.