A shaky coalition: how far to the right? - new Italian government

Commonweal, June 3, 1994 by Leo J. Wollemborg

In Italy's general elections last March, the Italian Left missed its best opportunity in fifty years to gain national power. Instead, a political newcomer, media magnate Silvio Berlusconi, and his three-month-old, right-of-center party, Forza Italia, emerged as the largest political force. Compared by many to Ross Perot in the United States, Berlusconi appealed successfully to the millions of middle-of-the-road, patriotic-minded voters who felt politically homeless as huge corruption scandals devastated the Christian Democrats, the Socialists, and the other traditional governing parties.

The new Berlusconi government, the first right-of-center coalition to win national power since World War II, has pledged to create a million new jobs within a year. Its program calls for fiscal incentives, mainly for small and medium-sized enterprises, and for freeing private concerns from the state regulations and red tape that weigh down the Italian economy. There are some two hundred taxes and levies, many of which cost more to collect than they add to the treasury. Experts close to the new government want to do away with most of them, as well as to overhaul the present income tax system. There are now a dozen different income tax rates, ranging from 10 to 51 percent. The plan is to replace them with a flat tax rate of 33 percent for everyone, but to include generous deductions for those with low incomes. The big question is whether this plan and the new government's desire to loosen the state's grip on the economy will run into the same problems that Ronald Reagan's did in the United States (bigger deficits) or that Latin American governments have experienced in downsizing state-owned companies (higher unemployment).

Thanks in large part to its still efficient party machine, the former Communist party (now known as the Democratic Party of the Left, or PDS), retained its role as the biggest opposition force. But this was small consolation and has led to much soul-searching and pressure for changes in the PDS's leadership and policies. The party now seems determined to conclude in the not-too-distant future the long march of Italian communism toward Westernization by unambiguously endorsing the free market and Italy's participation in international alliances led by the United States. Meanwhile, the Christian Democrats (CD), renamed the Italian Popular party (PPI), have been weakened further by internal splits that followed the party, s poor electoral showing. A splinter has joined the Center-Right coalition supporting the new government. Other former CDs may soon move in the same direction, as Berlusconi continues his campaign to woo the Catholic vote after setting up a new cabinet post for family affairs.

Over the short term, the main troubles for Berlusconi seem likely to come from within his governing coalition. The secessionist-minded Northern League has peaked in popularity, even in its strongholds in the Po Valley. But its leader, Umberto Bossi--who is now under criminal investigation for possibly illegal campaign funding--has toned down but not given up his demand for a greater role in the government nor his plans for turning Italy into a confederation of separate republics rather than into a federation of autonomous regions. The third partner in the coalition, the National Alliance (NA), includes the neo-Fascist Movimento Sociale Italiano and minor rightist groups. Its leader, Gianfranco Fini, seems content for now with having his party recognized as a responsible, democratic force, one fully entitled to a share in the national government. But he can hardly afford to ignore the vocal sectors of the NA that proudly claim to be the heirs of Mussolini. Too often the Fascist blackshirt shows through the double-breasted grey suit Fini drapes over the NA. Fini himself hails Il Duce as the greatest statesman Italy has ever had. He further contends that the NA's nationalism "is democratic and European-minded," although he opposes the Maastricht Treaty because it "promotes European integration." Fini claims that Istria and Dalmatia, transferred to Yugoslavia after World War II, "are still Italian lands," although he stops short of endorsing those neo-Fascist representatives who demand the return of the territories before Italy agrees to accept Slovenia (which now holds the territories) as a member of the European Union.

Prime Minister Berlusconi has sought to avoid acrimonious polemics with his coalition partners, but he has firmly upheld Italy's national unity and pledged to exclude from cabinet positions NA representatives who have not clearly disowned Fascist ideology and practices. Berlusconi has made clear also that he will not renegotiate treaties whereby Italy accepted the transfer of Istria and Dalmatia. Berlusconi is determined to win for Italy "the greater role on the international scene that she deserves," notably in the Mediterranean and in the Middle East. He will press this message when President Bill Clinton visits Rome this month to mark the fiftieth anniversary of the liberation of the city by U.S. troops.