Right now, as Italians settle back into the daily grind after their traditional August holidays, there is a sense of foreboding.

The economy is suffering an acute case of encephalitis lethargica: inflation at nearly 21 percent, industrial production down by 5.4 percent since last August, 1.5 million unemployed, the lira on the run, a projected government deficit of $31.2 billion, and a very bearish stock market. Terrorism from the left and the right is in somewhat of a remission, though corpses do continue to appear; and the more conventional politicos are in their customary disarray.

The government of Prime Minister Giovanni Spadolini is a groggy alliance of five political parties, each eyeing the exits. Few expect the scene to endure. So there is foreboding, but here initially there is always foreboding.

In the meantime, some things are not so bad. As the European edition of Time magazine noted in an impressively knowledgeable report last month: "Italians survive in spite of a vast gap between them and their increasingly weak and ineffective governments. . . . The most astonishing aspect of Italian life today is how well people are living."

Italians lead all Europeans in ownership of second homes. Of the Western Europeans, they import the most French champagne. Only the French guzzle more imported scotch. The world's automobile industry may be in the doldrums, but Italian automobile sales are up 3.7 percent over last year. Nor are the Italians simply spendthrifts. They save a larger percentage of their incomes than any of their neighbors.

What the Italians have done is create a third economy, a submerged economy. The achievement, according to Italy's imperturbable sage, Luigi Barzini, is typically Italian. For as long as there has been an Italy, the Italian people have been presented with the same problem, he writes: "how to survive and possibly prosper in the midst of corruption . . . bloody tyrants, and their greedy courtiers." The tyrant today is not a bloody prince; rather, it is an idiotic rendering of the welfare state, and the courtiers are the greedy pols who nervously attempt to outdo each other in spectacles of generosity with no thought whatever for how this gorgeous gravy train is to be financed.

Then, too, the pols have been smilingly pliant before the demands of the country's top three trade union federations, so pliant in fact that in the 1970s Italian labor became Europe's most expensive--highly prone to absenteeism and to strikes. In response to this new tyranny, the Italians have their submerged economy.

Italian businesses have broken themselves down into their component parts, parts too small to be brought to ruin by the government's predatory labor and tax regulations. This decentralization--often encouraged by employees desirous of stable work conditions--has cut the cost of doing business in Italy and brought about Italy's mysterious prosperity. The state-owned industries lose money. The large corporations lose a little less money. The submerged economy prospers--at least until the government can lay hands on it.

Barzini writes that "Italy has never been as good as the sum of her people." Today the people have moved circumspectly around the snares of the government. The establishment of large efficient factories is impossible in Italy, so well-renowned designers, such as Emilio Pucci, contract their work out to small groups of craftsmen who often live in remote regions. Rome's greatest silversmiths and goldsmiths, the Mortets, create their beautiful artwork in a tiny studio at the back of an obscure courtyard. Later, their creations are gathered up by the great houses of Bulgari, Petocchi and Cartier, who sell them to the world. So vast has this decentralization process become that economists believe Italy's gross national product of $393 billion last year may have been underreported by as much as 30 percent.