The Malta Independent 22 August 2026, Saturday
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The two remaining basket cases

Noel Grima Sunday, 1 December 2013, 09:37 Last update: about 13 years ago

The majority of commentators seem to agree that the worst of the crisis is over. So do, predictably, the spokespersons in Brussels and before and after every European Council meeting.

But it would be wise and prudent to reserve judgement and to wait until the real outcome becomes clear in the coming times.

It is true that the fund managers and the world markets have calmed down from the highs of some months ago. It is also true that no eurozone country has defaulted or exited the euro.

But it is also true that unemployment is still unacceptably high in most countries in Europe, that investment has slowed down to a trickle, and that different countries have seen their growth go down to an anaemic level.

It is true that countries like Ireland and Spain have climbed out of the depths of the crisis and, hopefully, will not be a drain on the finances of other member states. But it is equally true that countries like Greece and Portugal seem still mired in the throes of the crisis.

In the face of the most determinedly optimistic predictions coming from Brussels and Frankfurt, two very important countries, both founding members of the Europe Union, are still in crisis situations and in their case this crisis seems to be getting worse, not better.

In France, under President Francois Hollande, unemployment has increased, factories have closed down, and taxes are rising. Businesses have relocated and business people have fled to other countries where they found, such as in the UK, a red carpet awaiting them and their investments.

Nevertheless, France is a great industrial country and foreign direct investment has barely decreased. It has many enterprises that are at the forefront of technological advances.

Anger however is mounting and the public outbursts of the red berets have increased as they build up a tempo that may lead to more public protests, maybe strikes and maybe worse events such as the breakdown of law and order.

Hollande had come up thinking that raising taxes on the rich could help solve the country’s problems. He is now learning that the country cannot take more taxes as the French are already among the most highly taxed peoples in Europe.

On the other hand, he cannot or does not seem to want to cut expenditure except by a few token measures and he faces immediate and massive opposition from his own power base, the trade unions, if he were to try and implement some cuts in expenditure.

So basically, he is between a rock and a hard place. Over the coming months, the situation might develop and deteriorate.

The second country is Italy, which had its own share of public excitement last week with the defenestration of Silvio Berlusconi.

I followed the Senate debate on Wednesday and was impressed and also shocked by what I saw.

I have often remarked how the people who lose a battle, or an argument, many times seem to have better arguments than the ones who win. It was so on Wednesday. The speakers arguing against kicking Berlusconi out of the Senate seemed to have better arguments than the braying crowd clamouring for his blood.

It was Bettino Craxi all over again: that day in 1992 when Craxi resigned and left showered with coins and disdain, so much so that he had to seek refuge in Tunisia where he died.

This was Craxi, the man who for many years had seen the end of the Christian Democrat rule, the man who straddled the world like a Colossus, who proved to be the middle ground between the US and the then Soviet Union.

Yet he became enmeshed in the Tangentopoli investigations and the networks of corruption it unmasked and he, and with him the Italian First Republic, became the most hated objects in the country.

Silvio Berlusconi emerged from that chaos. Till that time, he was the man who had become Italy’s richest person. When he declared he was entering politics his opponents claimed, not without reason, that he faced so many criminal investigations he was in reality seeking immunity, the immunity he lost on Wednesday.

I liked the spunk shown by a 5 Stelle female speaker on Wednesday: “You were prime minister three times, headed the G8 twice, and the presidency of the EU, you won again and again and last time by a significant majority. You could have changed the country. Yet you did nothing of the sort.”

This is the exact picture of the country, now even without Berlusconi to kick around. Italy has lost the pattern of growth it had some years ago when successive governments (CD and Socialist alike) had allowed public debt to grow and grow. It allowed pockets of special interests to dominate the country and to block any attempt to improve the country’s finances. Even pockets of special interests, as small as taxi drivers, could stand up to efforts to reform and block them.

Worse than the taxi-drivers, worse than the trade unions, the politicians of all levels came together to oppose a political system that multiplied pockets of power, from the national parliament to the provinces, to the regions (or is it the other way around?), to the communes and the town councils, each layer with its own layer of officialdom, the notorious ‘blue cars’ with attendant staff, drivers, minders et al. No one wants to be the first victim in the cull. No one wants the reform of his country to start from his perks.

Of course, Berlusconi has a lot to be blamed for. His tussles with the courts are not just his girlie extravaganzas, his bunga-bunga events, his alleged sleeping around with underage girls. The charges against him range from tax avoidance to outright corruption.

He claims the judiciary is trying to bring him down just as they did Craxi until they see him dead, but he has given the judiciary much ammunition to act against him. It is also true that in Italy the judiciary are very much a closed shop and run their own things by themselves, in a manner that is unthinkable in countries like the UK.

Yet with Berlusconi out of the way, the problems remain and Italy is still very much the sick country in Europe. Europe’s darling, its most loved politician, Mario Monti, was a disaster as prime minister. His austerity measures added more pain and misery to the already hard-pressed population. His tax on the second home afflicted many more Italians than thought.

Many people in Italy do work on government contracts. Over the past years, the government has fallen backwards in payments, yet it still demands that taxes are paid on time and there is no system to set off one against the other. The present government by Enrico Letta is trying to remedy this but the going is hard.

On the other hand, as was witnessed on the night immediately preceding Berlusconi’s vote, any time the government tries to bring about a real reform, a sudden move in a parliament still very much against any reform, introduces a last minute addition to a bill and thwarts the government’s reforming intention.

The country cannot wait until the politicians get their act together. Youth unemployment is particularly high and a whole generation of youths is giving up hope. Many are emigrating and Italy is losing their potential.

The country has many unsolved issues, first among which is the massive infiltration by illegal immigrants. These are not just the boat people, but also, rather more, the many non-EU citizens who somehow find ways of entering the country after which they manage to survive in expectation of the rather regular amnesties until they become Italian citizens.

Removing Berlusconi from the Senate may have been a duty considering his alleged infringements, but just on its own it does not solve anything.

Berlusconi, smart fox that he is, became in his own and in his supporters’ eyes, a victim and consistent polls have shown his party (maybe not now that it has split in two) to be far more popular than the fractured Left with its interminable struggle to find a clear leader.

Any election now, even with an electoral reform thrown in, will bring the Centre-Right to power when these do not have a track record, unlike elsewhere in Europe, of reforms and good management.

One talks with Italians of all sorts and the impression one gets is they have given up on hoping for the best for their country.

Speaking selfishly, our country has gained from this as witnessed by the many top chefs who have come here and are opening all kinds of restaurants (and training Maltese working with them).

But speaking less selfishly, we must also learn from the processes and stresses that have brought such a country to its knees. There but for the grace of God, go we.

 

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