What’s wrong with Berlusconi?

With Silvio Berlusconi’s latest government in power for nearly six months now,  Silvio-bashing seems to have abated a little. Even his arch-nemesis, The Economist, has quietened down, although it did raise a murmur a few weeks ago, when Berlusconi claimed that he had no idea that his government’s proposal to postpone all trials involving white-collar crimes would affect a number of cases in which he is the defendant..! So a summary of a few reasons why he might not be the best man to lead Italy does not quite fit the current news cycle. Nonetheless, I think the issues remain salient, while on a personal note, writing this down helps organise a long stream of thoughts.

The three overriding “themes” I’d narrow these various thoughts down to, although there’s a lot of overlap, would be: 1) Lack of competence (or will) to do what Italy really needs; 2) Legitimisation of damaging practices that have been the norm in Italy; 3) Regression on non-economic matters.

1. Lack of competence (or will)

Italy is the sick man of Europe, no question. GDP growth has hovered just above zero for years, and some say that the country would officially have been in recession had it not been for the centre-left government’s crackdown on tax-evaders in 2007 which brought in some hard-needed cash. Although the current credit crunch might affect some countries more adversely in the short-run, say the UK, Ireland or Spain, because construction booms have come to a sudden halt, or because they are more sensitive to interest-rate fluctuations, in no way do they have the same endemic barriers to economic growth as Italy. In addition, Italy is saddled with the second highest public debt in the rich world, which according to an estimate I heard (sorry, no reference, as I can not remember where), costs each Italian citizen €1,200 per year in interest payments alone.

I’m no economist, but I do know that a country with limited natural resources needs at least some of the following to prosper: to not have public debt of 110% (!); a solid infrastructure; a well-educated workforce; good public and private investment in R&D, especially in science, engineering and technology; and an environment which makes it relatively easy to do “business” efficiently (1. reasonable regulation, reasonable business costs; 2. open, honest, easy-to-deal with, transparent institutions, public bodies etc.) which in turn fosters business confidence and encourages individuals to set up businesses, expand existing businesses, or attracts investment from abroad.

Italy does not fill the bill on any of these fundamentals. War and Peace is a comic strip compared to the volumes it would take to describe all of Italy’s deficiencies, but a few of the most disconcerting problems are: 1) overcrowded universities that are understaffed with underpaid professors who teach antiquated courses; 2) totally negligible investment in R&D; 3) over-regulation, over-regulation, over-regulation, making it prohibitively complex or expensive to get a permit of any sort, start up shop, invest, expand, build, buy a property etc; 4) over-protected sectors resulting in overpriced and inefficient services.

As a result, Italians are poorer, miserable, don’t think it’s going to get better, and hoards of them are leaving the country. Not, as in the past, for any job, but for better jobs i.e. it’s primarily the well-educated who are leaving, exactly the sort of people who are needed to help re-build the country.

What Italy really desperately needs is wholesale reform, deregulation, and liberalisation. Berlusconi had a mandate to carry out at least some of the necessary reforms when he was Prime Minister 2001-06, but despite some timid pension and education reforms, did not go far enough by any stretch. No one denies that reforms on the scale required in Italy are tough and require brave and competent leadership, but what pains many Italians is the fact that he probably could if he had really wanted to, and had indeed promised when famously signing his “contract with the Italian people” on national television in the run-up to the 2001 elections, because his mandate was so strong (and indeed, the fact that his was the only government to see out its full term in the history of the Italian Republic is testimony to this).

This time around, the election was fought by the PDL (Berlusconi’s umbrella party comprising Forza Italia and Alleanza Nazionale), and its ally, everyone’s favourite xenophobes, Lega Nord, mainly on a platform of castigating the centre-left, the promise to “save” Alitalia and assuring all that it would never fall into the hands of foreigners (once elected, the government immediately lent the carrier €300 million, severely denting its neo-liberal credentials once more), and in particular, on the good old populist recipe of law and order, especially aimed at immigrant groups.  Scapegoating outsiders is a tried and tested campaign formula, usually employed by smaller extremist parties, or sometimes bigger parties that are struggling (e.g. the Conservatives under Michael Howard in the UK in 2005). Things aren’t going well? Blame the opposition party and outsiders, be it immigrants or any other minority of choice. But when economic growth is at 0%, no new jobs are being created, and people are struggling to reach the end of the month with a few pennies left in their pockets, it seems really odd for a mainstream party to not make reversing this via wholesale reform the centre-piece of an election campaign. So why didn’t they? Presumably, not even hardened “Berlusconiani” would have believed it, seeing as the centre-left had pushed through more liberalisation measures (although still far too few) in less than two years in power than his previous government had managed in five, and would not have bought the premise that things would have been different this time around. So odds would have been better by focusing on issues where his party had a clearer comparative advantage in attracting voters.

That is not to say that law and order is not a real issue. Sure, the PDL did a good job of amplifying people’s fears, not helped much by the recent trend in Italy to report extensively on “Cronaca”. The nastier the murder, robbery or rape, the better (and of course, crimes involving foreigners are first to hit the news, and suspects that have not been caught invariably look foreign). But admittedly, petty crime is on the increase (although violent crime is not) and anecdotal reports from people living in Italy, often with some regret, report on plenty of annoyances and petty (or less petty) crimes involving immigrants. However, the PDL’s rhetoric I think is overblown, and their solutions are never long-term. They promise extensive policing, but serious engagement on the question of immigration? Not quite. I long for the moment that an Italian politician kicks off a serious debate on immigration by stating: 1) as a nation of good people that has millions of emigrants scattered around the world, it is our moral duty to embrace immigrants who are looking for a better life and can contribute to making Italy a better place; 2) the vast majority of immigrants in Italy are hard-working people who have chosen our country in their search for better opportunities for themselves and their families – we should embrace them, not shun them; 3) however, we’re the only country in Europe not to have an immigration policy, and we should put one in place that ensures that immigration is managed and sustainable.

Back to the issue at hand i.e. the notion that Berlusconi does not have the competence or will to do what Italy really needs, I think the focus on law and order, although salient, as discussed, sums this up categorically. Italy needs wholesale, structural, economic reform and yet Berlusconi seems to have thought: “nope, it’s difficult, let’s win the hearts of voters by focusing on something that is easier to preach, and easier to carry out” (indeed, the government has since the elections sent the army out to patrol the streets, stood by as vigilante groups burned down Roma camps, and called for all Roma to be finger-printed). I think Berlusconi simply lacks the will to carry out the really important reforms Italy so desperately needs because in truth he does not really want to. I doubt he doesn’t understand that reform is needed; he is despite everything a clever cookie, and although his entourage largely comprises hoards of yes-men, it does also include some smart career politicians.

This lack of will stems from a combination of two things, I think. First, I think Berlusconi is the consummate populist. He prefers adulation from simple folk who hope a bit of his star-appeal is going to rub off on them or thank him for saving them from the viscous commie scourge, than the more cerebral task of governing for the sake of the long-term future of the country and the difficult choices that would entail in the short-term. Second, I think that he ultimately prioritises his business empire over governing, and for this reason he might prefer the system as it is, for his success is so deeply rooted in it. It’s a system comprising shady backroom dealings in which meritocracy is anathema and the right contacts are imperative, a system where an unfavourable business environment (by normal standards) and legal uncertainty work in his favour because he knows the right people and his business competitors do not. The notion that he prioritises his business empire over governing goes hand-in-hand with the hypothesis that he indeed only got into politics to keep himself and the rest of his clan out of legal trouble and protect his life’s work, the business empire.

2. Legitimisation of damaging practices that have been the norm in Italy

Be it for centuries of bloody foreign rule, war, or feudalism, the net result has been a country that to some extent remains bitter and divided, and in which “each man to himself” and “trust no-one” are many a man’s motto. The problem with this is not that people fail to go giddy at the site of the Italian flag or that everyone counts their change three times to make sure they have not been ripped off when leaving a shop. It’s that it’s actually really counter-productive, as reflected in two ways in particular: 1) a lack of respect for the law and the institutions that represent it; and 2) working practices that do not encourage meritocracy.

It’s more than just a hollow stereotype: Italians are dubiously respectful of the law. Tax evasion is not frowned upon as much as elsewhere; corruption, whether petty or on a larger scale, is disparaged but often considered inevitable. That’s just the way things are, many say. Why should this matter? For one, tax evasion costs the country billions. Beyond that, I’d link it to the argument described above, namely that a successful economy requires a sound and transparent business environment, with clear and efficient working practices, and a knowledge that the law is the same for everyone. And this becomes truer by the day, as companies of all sizes increasingly work across borders, join global supply chains, and adapt to global competition to succeed, rather than simply relying on local markets. Why would companies want to expand, or why would foreigners want to invest, if you can not trust public bodies, and aren’t going to be sure that the law works in the same way for you as for a well-connected local?

Berlusconi’s record of run-ins with the law is extensive, but I don’t actually think it’s that alone which is the issue. From a moral perspective, I don’t actually care that much, to be honest. I’m never aghast when I hear of tales of politicians’ abuse of power, although I’d of course much rather they were all honest and wholesome. Neither am I claiming that Berlusconi or the centre-right are alone on this front in Italy. Indeed, Marco Travaglio, a provocative commentator on Italian politics, recently published a book in which he describes trials involving Italian MPs of the centre-right and plenty of the centre-left, so in no way are the latter beyond reproach. However, what I take issue with is Berlusconi’s total denigration of the law. This is not a man who understands the law and the bearers of it and tries to dodge his way around them. No, this instead is someone who has utter contempt for it. Under trial for false accounting? He decriminalised it, thus legitimising it and presumably paving the way for countless more of it. Convicted of bribery? He reduced the statute of limitations for exactly the crime in question so it would expire before the case reached the court of appeals. Then there’s the constant abuse of the judiciary amidst claims that they are part of a left-wing conspiracy against him, or the fact that he is refusing to accept a ruling by the European Court of Justice that states that he should sell one of his TV channels or at least move it to satellite. If the prime minister himself states that bearers of the law are crooked, ignores and maligns them, and simply changes laws to suit his needs, it really sends out an awful message. Beyond being a slap in the face of those who do abide by the law, it really says to all of those who are tempted to not abide by it but think that they perhaps should, go ahead, don’t declare your income, apply for public funds you’re not eligible for, lie on your permit applications, bribe an official etc. And again, this creates a dreadful business environment, in which transparency, trust and openness will never be the order of the day.

The other point I mentioned, namely working practices, refers in particular to the low level of meritocracy in Italy. The culture within companies as well as public bodies in Italy is still one where hierarchies are rigid, seniority matters more than ability, favouritism is rampant, and where old clientelistic practices of recommendations and favours are alive and well, meaning that positions are often not filled by merit alone. Granted, this has gradually been improving over the years, but the practices are still common, to the serious detriment of efficiency and legitimacy, both in the private and public sectors. As with the case of Italians’ poor respect for the law and lawmakers, one can not blame Berlusconi entirely of course, as he is a symptom rather than a cause. However, again, as someone on top of the food chain, I think he should be giving out the right signals. Instead, his most ardent supporters, family members or right-hand men are assigned important posts that are arguably beyond their ability or experience; women get ahead more easily if they are attractive (think for instance Mara Carfagna, the 32 year-old showgirl, who was made Minister for Equal Opportunities); while journalists who voice their opposition to him on TV may mysteriously find themselves out of a job within weeks. It was recently even reported that a phone-tap picked up a call by Berlusconi to a RAI bigwig asking him to hire some showgirls he had taken a fancy to..!

3. Regression on non-economic matters

All the elements described above in some way relate, even just spuriously, to factors that are detrimental to Italy’s economic revival and indeed contrive to keep it inefficient and stagnant. Below, I’ll briefly describe a few other issues that are more societal in nature, but which I think add credence to the notion that Berlusconi’s leadership is damaging: 1) his influence on the media; 2) his attitude towards women; 3) his attitude towards minorities; 4) Italians’ obsession with a supposed right vs. left ideological battle; and 5) Italy’s standing in the world.

New York’s Freedom House, an NGO which lobbies for political freedom and democracy, a few years ago downgraded Italy’s freedom of press from fully to partly free, making it the only country in Europe to have suffered this ignominy since 1988 (apart from Turkey). This measure stemmed from the fact that in addition to owning three mainstream TV channels and a string of publications, Berlusconi now also controlled the national broadcaster, RAI (which is not guaranteed the same level of independence as, say, the BBC is in the UK). Berlusconi’s supporters would argue that the there are plenty of newspapers and websites that do not support him, and that even RAI is full of supposed raging commies (RAI 3 has maintained some independence and is indeed often critical of the government). However, his own channels are unashamedly biased in his favour, while RAI 1 and RAI 2 have toned down greatly in the last few years (journalists Michele Santoro and Enzo Biagi were even sacked after criticising him). Whatever the extent of this supposed lack of press freedom, the case remains that Italians watch a lot of TV and would have to look quite hard to find instances of criticism or at least somewhat critical analysis of their Prime Minister. And anyway, does it matter? Yes. The merits of a free press as an exponent of freedom of speech have been the subject of many books, and certainly won’t be dealt with in detail here. But it can not be denied that total freedom of press which allows citizens to easily voice or hear opinions, as embraced by all mature democracies, should be a basic human right because, with regards to politics: 1) it helps keep a check on government; and 2) it allows for real two-sided debate, a necessity if fair and balanced consensus is to be reached.

On his attitude towards women, Berlusconi’s staunch supporters would likely say that anyone who says he is sexist lacks a sense of humour. Perhaps, but try saying that to the countless women who have found themselves held back by that most resilient of glass ceilings or have seen male counterparts earn more for the same job or seen prettier young things magically get promoted. Saying that foreigners should invest in Italy because we have hot secretaries; claiming that Zapatero was getting himself into trouble by appointing too many women to his cabinet; or even appointing the admittedly gorgeous aforementioned Mara Carfagna as Minister ahead of many far more qualified people, I think is insulting to Italian women who try to get ahead by ability alone, and puts Italy years behind other developed countries in its pursuit of equality between the sexes.

On his government’s disdain for minorities, I suspect that Berlusconi does not really harbour strong xenophobic or anti-immigrant sentiments, but that the various policies described above are part of an effort to keep the Lega Nord happy. The Lega does after all hold the balance of power in the government, as its 8% is the difference between Berlusconi being in power and not. Nonetheless, as things stand, Berlusconi, as head of the government, remains ultimately responsible for the various policies pursued since the election and the populist claptrap blaming Romanians and gypsies for all manner of ills. It is shameful, retrograde, and sadly reminiscent of the 1930s, an era of unparalleled tragedy which we perhaps too soon assumed progress had put beyond reach. I’m still hoping for serious dialogue to help sort ot the admittedly calamitous approach to immigration in Italy, but I shan’t be holding my breath.

On the Italians’ obsession with ideology, I’d say Berlusconi is guilty of fostering this for his political ends. The age of power-politics is over, as we thankfully live in a time of political moderation which seeks to best enable interdependent economies to function together and provide for their citizens. Everyone seems to have taken notice of this, as Labour vs. Conservative, Democrat vs. Republican, CDU vs. SPD etc. become increasingly difficult to distinguish as parties veer towards the political centre. Everyone except Vladimir Putin and the Italians that is. Arguments abound in Italy about the various merits of the left and the right (by both sides) and communist and fascist are still terms in everyday use. Berlusconi laps this up, blaming the communists for all manner of ills, saying they’ll never change and can not be trusted, effectively saying that the centre-left, although it has now abandoned the extreme-left as a coalition partner and has adopted numerous traditionally conservative policies, is no different from the Communist party of old which allegedly sought to ultimately bring down democracy and freedom as we know it. This tactic is far too simple and again smacks of populism. Can’t argue on the issues? Simple, just call anyone who criticises or disagrees with you a Commie, conversation over e.g. think the magistrates or even The Economist, a bastion of neo-liberalism, which he amusingly designated “The Ecommunist”. Although Berlusconi is simply taking advantage of the naivety of many people in Italy who seem to have missed the last 40 years of global history, and think the Cold War is alive and kicking and that the PCI is still a threat at the ballot box, he is, I think, further fermenting this overly simplistic and utterly outdated view of Italian politics. By playing lowest denominator politics that aims simple messages of us vs. them within this context at the electorate, rather than engaging on complex issues, he is lowering the quality of political discourse, to the great detriment of Italian democracy.

As a last point, I’d mention the fact that he is harming Italy’s standing in the world (and that he’s embarrassing!) This might not seem to matter much: we never really had much of a standing anyway, and anyway, how does this affect Italians in their day-to-day existence? However, I do think it matters. One, I think wealthy democracies have a responsibility to actively engage in world affairs. Two, I think being an acknowledged part of a global community should push countries to act more responsibly even in internal matters (although this is very often not the case…) In addition, it’s a source of pride when you see other countries take notice and engage with you. It would be so in Italy especially, as Italians are always concerned about being taken seriously, obsessed with the notion that Italy is seen as nothing more than the country of pretty scenery, mafiosi, pizza, mandolins, bum-pinching, over-protective mothers, vespas, sunglasses worn at night-time etc. but never of real substance. Italy has produced some decent statesmen over the years. In Brussels, where I am at the moment, De Gasperi and Spinelli are pretty well-respected in Euro circles. It would not take much to earn at least a modicum of this esteem. Under Prodi’s leadership, the global community was happy to let us be involved in seeking to reach a solution to the Lebanese crisis in 2007. Instead, we get the court cases, the ridiculous bandana, the Marin Schultz gaffe, dodgy friendships, and so on, and so on, and so on. We might not be an international pariah, but a well-respected member of the international community whose opinion and involvement is often requested on global matters of great importance? Hardly.