Tuesday, April 11, 2006

Politics, personality, and the Italian elections

Imagine the inverse of the 2000 elections: Al Gore and the Democrats--aided by a bizarre election law and the votes of overseas Americans--capture the Presidency and both houses of Congress, despite an effective tie or even a slight Republican majority in the popular vote. This scenario is more or less what Italian voters awoke to on the morning of April 11. Although projected winners by 4-5 points in the exit polls, the center-left coalition led by former Premier Romano Prodi ended up with a nailbiting margin of exactly one-tenth of a percentage point (49.8-49.7 percent) in the Chamber of Deputies and actually lost the popular vote for the Senate (50.2-48.9 percent). Yet under the "majority premium" clause of the new election law--ironically forced through by the Berlusconi Government over left-wing opposition--the coalition will be entitled to 340-plus seats in the Chamber as opposed to 280 or so for the conservatives, and is clinging to a 2-seat margin in the Senate thanks to the votes of overseas Italians which were counted for the first time. To top off the most extraordinary day in recent Italian history, the Government announced the capture of the country's most wanted Mafioso, who had been a fugitive since 1963, in the midst of the ballot counting.

While Berlusconi has questioned the results and called for a recount, the betting is that the country--exhausted by a bitterly divisive campaign and hammered by bad economic news--will give the new Government a chance to take office and see if it can mend a country "split in half" (spaccata in due) as one headline put it. What happens after that is anyone's guess. There has never been a truly stable left-wing Government in Italian history, a fact surely not lost on Berlusconi or his coalition partners, who were angling to pick up the pieces of his coalition even before the votes had been counted. In theory the best positioned to do so is the outgoing Foreign Minister, Gianfranco Fini, leader of the right-wing Alleanza Nazionale: but his party has never completely shed its Fascist origins, and others, including perhaps Berlusconi himself, will surely contest him for the position.

One likely result of the election is that Italy will return somewhat to the European mainstream, in both foreign and economic policy, as opposed to the defiant pro-Americanism of the Berlusconi regime. Yet to an outside observer, the most striking feature of the elections was precisely their American character. This was true both of the emerging party system--two large, equally sized coalitions albeit comprised of many competing individual parties--and of the voting patterns, with the left piling up large margins in its traditional strongholds in the center of the country (notably Rome, Tuscany, and adjacent areas) and the right doing better in the southern regions and the more enterprise-driven portions of the industrial north. Even the beleaguered exit polls, which predicted an easy left-wing victory only to be caught up in a tense all-nighter, were reminiscent of the Gore and Kerry debacles in the United States. (Many people apparently don't want to tell pollsters that they like either Bush or Berlusconi, for more or less obvious reasons). The paradox of globalization, in which rising anti-American sentiment is expressed through increasingly Americanized institutions, is nowhere better on display.

The tax policy effects of the election are difficult to predict, both because of questions surrounding the margin of victory and internal contradictions in the positions of both parties (see my previous discussions of this issue on March 25 and April 3). Prodi has spoken vaguely of various tax increases, including a 20 percent tax on financial income (now mostly taxed at a 12.5 percent rate), a new successions (inheritance) tax, and more aggressive pursuit of tax evaders. The narrowness of his victory may force him to trim such proposals, although it could also perversely make him more sensitive to pressures from his left-wing fringe, which has never really accepted the "low tax/high growth" formula it associates with the Berlusconi years. The effective collapse of the Government in France, which abandoned a modest liberalization of the labor laws in the face of student protests, is likely to embolden the left in this and other matters.

One thing is certain: few Italians, regardless of political persuasion, are likely to be terribly sad to see Berlusconi go. "The Knight," as he is called, headed the longest-serving Government since 1945 and provided an enterpreneurial, American-style governing model that shook the existing political sytem to its foundations. Yet he never entirely rid himself of the image of being something of a clown, an image that his country--perpetually struggling to estabish itself at the top rank of European powers--could visibly ill afford. Italians, who have an exquisitely keen sense of history, are already debating whether his departure is more like July 25, 1943, when the Mussolini Government collapsed, or September 8 of the same year, when the successor Badoglio Government announced a poorly conceived armistice with the Allies and the Germans proceeded to occupy the North and split the country in two. Let's hope that neither analogy proves accurate.


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