Brainstorm on Politics and Economics of the EU

If you are asking yourself this question, the following article may give you an answer.

The last Italian electoral campaign has been stuck between the past and the future. The flavour of a past repeating itself was given by the electoral system – an awful region-based system in effect since 2006 that the Parlament did not manage to change – and the presence Mr Berlusconi, still there after twenty years. As well the center-left candidate Mr Bersani and some political leaders backing up Mr Monti were old faces in the political scene, which many Italians wanted not to see anymore. National TV channels have been heavily occupied by party leaders, in particular Mr Monti and Mr Berlusconi. The latter has a long story in using the media during electoral campaign, but this time there was an important difference. This time he was on the frontline, more than ever before. Last December he decided to come back to politics to personally save the disastrous situation of his orphan political party, launching what he called “operation truth”. He wanted to change Italians’ mind about his last mandate as a prime minister, by promoting his point of view during an incredibly high number of radio and TV shows, early morning, day and night. That was very impressive for a man that is almost 80 years old. Whereas in the past he was used to carefully select the TV shows to attend personally, this time he participated to all political TV shows available on Italian media, even the most unfriendly ones. He was not afraid to defend himself even in front of his arch– enemies (for the first time ever), journalist that made their career by opposing the Mr Berlusconi’s regime after 2001. Because of his impressive rhetoric skills and thanks to the extremely unpopular experience of the Mr Monti government, none of them managed to successfully score against Mr Berlusconi and every time he came out stronger than before.

Mr Berlusconi is famous abroad for trials and sexual scandals but not for his genius political abilities. He has dominated Italian politics over the last twenty years thanks to very clever and unscrupulous strategies – to my knowledge he never made strategic mistakes – and a careful control of the media. He began his political career in 1994 as “the new man”, the successful entrepreneur that would make the liberal revolution in a country infested by corrupted politicians and communists. Over time he concentrated more and more the political debate on himself and every election turned to be a referendum in favour or against him. Surprisingly enough, as soon as trials and investigations mounted, he started to successfully play the victim and other parts of the Italian institutional system were thrown into this spiral. Gradually, everything became polarised. Italy split into two groups: good and productive people, that Mr Berlusconi would represent, and the parasitic system of the political left, including journalists and judges. Silvio Berlusconi convinced several people that he has always been persecuted by communist judges and communist journalists and he had never infringed the law. Such campaign has been repeated every day for several years through his three national TV channels and, additionally, the public national TV channels during his time as a Prime Minister. The subtle effect was to poison any political debate. His opponents were incapable of changing the rules of the game and they all fell victim of this scheme. The result was pretty striking: Italian people lost any trust in traditional parties, politicians, newspapers and – even – judges. The question comes natural: he is an old politician, how could he still be so popular? The answer is quite easy. When people don’t have trust in politics anymore, they may choose to vote for who makes the best offer.

During the last two months before the elections, Mr Berlusconi was moving from interview to interview to make his own. He managed to dictate, again, the rules of the electoral game. As it happened in 2006 and 2008, he imposed the main topic of the public debate: the removal of the home property tax. He was successful and his rivals failed again to understand the strong importance Italians give to this very specific tax. Mr Berlusconi made three major proposals. First, he promised to remove the home property tax (re)introduced by the Monti government. In a country where around 70% of households own at least one house and where residential estate is still an important type of family investment, such promise is extremely appealing, especially for old people (who would not be as attracted by cuts in labour costs, suggested by Mr Monti and Mr Bersani). Few days before the vote, millions of people received a letter from Berlusconi that looked like an official reimbursement of this tax for the year 2012. Surprisingly enough, in several cities many people went promptly to the nearer post office in order to ask for further information or –even- the promised refund. Second, he mentioned to be in favour of a complete tax amnesty. Very appealing during times of increasing fiscal pressure – reaching all-time record – and given very high rates of tax evasion, especially in important regions of the South (Campania, Puglia and Sicily were crucial to get seats in the Senate). Third, he tried to convince the 2.5 million unemployed people by proposing a simple policy: firms will be allowed to hire new employees without paying any additional tax or social security cost for 5 years. Berlusconi’s opponents called these proposals empty promises and they focused on convincing people that “there is no money available” for such policies. But many people think that they are all liars and incompetent, so they preferred the most convenient lie. To summarise, Berlusconi managed to get consensus back – but he still lost 6 million votes compared to 2008 – and he achieved victory in strategic regions by targeting some part of the Italian society with surgical precision.

Watching television and mainstream news sources, it looked that Mr Berlusconi was mostly fighting against Mr Monti and Mr Bersani. Mario Monti turned into a full politician at the end of December 2012 and he immediately showed to be very confident under the new role. He was leading a coalition of parties in the center of the political arena, between the center-left (PD-SeL) and the (center-)right (PDL-Lega Nord). Mr Monti is very popular abroad but his charisma should not be overestimated because his style does not perfectly match the preferences of the typical Italian person – he is too cold and intellectual – and, anyway, it was not enough to make people forget the bloody increase in taxes during the last year. Monti is an economist and he suffered from the mistake economists always warn about: never implement half reform. Mr Monti wanted to shift the tax burden from productive inputs, labour, to unproductive factors as residential real estate, pollution and financial speculation. Eventually, his government increased taxes on unproductive factors but other levies stayed unchanged. Overall fiscal pressure became clearly excessive (45 % of GDP[1]) and Italians did not wait long before getting extremely annoyed by the situation.

On the other side, Mr Bersani has been appointed as leader of the centre left coalition (including the Partito Democratico and Sinistra e Libertà) after a primary election at the beginning of December. The victory over his rival Matteo Renzi, the young major of Florence, was only due to being an old powerful member of the Partito Democratico (PD party) but, differently from Mr Renzi, he is not popular outside the party apparatus. His lack of charisma and an incredibly weak electoral campaign brought the PD-SeL coalition to lose the comfortable leading position they had in the opinion pools and arrive to the disappointing final result. For Mr Bersani, the final result was a disaster. Opinion polls and after-vote instant polls predicted Mr Bersani’s coalition 6-7 % ahead of Berlusconi’s at the national level. In official results this difference turned out to be less than 1%. Many commentators agreed that several people were actually embarrassed to admit that they voted for Mr Berlusconi or Mr Grillo’s movement.

While the mainstream politicians were occupying Italians’ spare time through television and radio channels, Beppe Grillo and the people of the Five Stars Movement were dominating the web campaign and gathering thousands of people in public squares in many important Italian cities. No movement member was allowed to participate to any talk show or use the mainstream media. Mr Grillo rejected the offer for a final TV public debate between party leaders. Last autumn two newly elected local council members for Grillo’s party attended some of these TV shows and they have been immediately banished from the organisation, directly by Mr Grillo via his website. Later on, no one else risked to do the same. Beppe Grillo has been accused of being authoritative and to avoid troublesome questions. In fact, he only communicates by blog or by monologues performed in public areas, mostly city squares. The Five Stars Movement became popular mostly because it tried to appear radically different from traditional parties. For instance, election candidates of the Five Stars Movement have been chosen by an open Internet voting (the PD party did the same, not online but through traditional elections). Indeed, the current Italian electoral system does not allow voters to choose any specific candidate, only the party, so that the political parties have full discretion on the composition of the future Parliament. The final list of 5SM candidates was composed of extremely young people and a very good gender distribution, but none of them with any previous political experience. In fact, not having served as a politician in the past was a requirement to participate to the primary elections. The political agenda of the Five Stars Movement basically proposes to destroy the traditional parties, deeply reform the Italian state in order to make the democracy more “open” and “participative”, fight the aristocratic Italian capitalism (economic power strongly connected to politics) and to pursue a quite special version of green economy, turning to a “slow economy” in between science-fiction and the farmer life of our grandparents. For instance, one of their major economic proposals is about stopping new high speed train lines – especially the Turin-Lyon line – and the banning of waste-incineration facilities, considered unnecessary sources of public health risk (unnecessary, because serious door-to-door waste programmes would leave no residuals). Most of the Five Star Movement’s proposals relies on new technologies and they want so solve many of Italian political and economic problems by the massive use of IT technologies. However, this cannot explain the impressive final result (25% of valid votes). Beppe Grillo managed to perfectly capture the Italians’ mood, raging against the parasitic political apparatus. The movement is mostly made of young (below-40) people, a generation that suffered great economic distress and political disillusion[2]. Eventually, the Five Stars Movement obtained most of the votes because of the unique Mr Grillo’s charisma, a mix of humour, hatred and disrespect for the Italian political and economic establishment. This time, many people preferred to vote for Mr Grillo instead of writing insults on the election ballot.

So, after looking back at the climate of the electoral campaign, the Mr Berlusconi’s comeback does not seem so incredible anymore. To complete the “big picture”, I recommend to read another recent article in which I explain the responsibility of the European Union in fostering Mr Berlusconi’s (and Mr Grillo’s) popularity.


[1] http://blogs.wsj.com/eurocrisis/2012/04/18/italy%E2%80%99s-2013-budget-miss-is-no-sign-of-laxity/

[2] http://www.spiegel.de/international/europe/euro-crisis-forces-many-italian-young-people-to-leave-a-848509.html

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Comments

  1. Interesting thoughts.

    The Grillo campaign hit the Italians here at the right time. Brilliant and well-thought through. Tackling the corruptions of the existing mantra of the old Parties is absolutely right. Taking also on the Green Agenda and disposing of – did I read it correctly? – incineration is just absolutely right. We cannot afford the €30 Billions this will cost us in capital investment and then the €40 Biullions in operations and maintenance that will follow over the next 15 years in these monstrosities when we read how a small country like Malta (our neighbour) will be having built a waste to biofuels plant built within the next three years as an inward investment which will save then €400 Million. Not sure about the Railways though! Anyway if the investment saved is put to good use then we welcomed Grillo with open hands.

    What happened to the Monti campaign you hit it on the head – where was it?

    The blatant and over-powering hegemony of the Berlesconi one was far too obvious: Pardoning of taxes not paid would have a great effect on his empire as well as those who have been allegedy involved from the Naples/Sicilian Organisations that may have helped his wealth grow. Is this going to be investigated properly?

    1. Dear Victoria,

      thank you for your comment. About waste incineration facilities, you make a good point: Grillo advocates alternative types of investment like the example you make.

      I dont talk so much about Monti because I did not want to exhaust the reader with too many details. Not so important anyway, because Monti talked a lot on TV but he did not manage to convince people. He was promising tax cuts after having increased all possible taxes. It is hard to explain to people that this is not necessarily inconsistent!

      Finally, about Berlusconi, I do not think that the Mafia(s) played a role in making him rich. He just made sure not to have them as enemies. Justice is investigating, properly I think.

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