13.09.2012

Inferno for the proletariat

Toby Abse reviews: Bill Emmott 'Good Italy, bad Italy: why Italy must conquer its demons to face the future', Yale University Press, 2012, pp299, £18.99

Bill Emmott’s Good Italy, bad Italy appears at first glance to be the very first English-language book-length response to the fall of Silvio Berlusconi and the installation of Mario Monti’s technocratic government in November 2011. In reality, on closer examination, it proves to be an updated and expanded version of an earlier book by the same author, which did not appear in English. Nonetheless, this new text contains a number of references to events, such as the corruption scandal that ended Umberto Bossi’s political career, that took place as recently as April 2012, shortly before the book’s publication in June 2012.

Its more general sections are very clearly focused on the present and it concludes with a check list of objectives which would need to be achieved by 2020 if Italy is to move forward. Although the book has been reviewed in the Financial Times and - inevitably - in the pages of The Economist (for which Emmott worked for 26 years, being editor-in-chief by the time of his resignation in 2006), so far Good Italy, bad Italy seems to have been overlooked by the majority of commentators. This is probably because, while it contains much interesting material about the Italian economy, it has only very brief references to the personal life of Silvio Berlusconi. However, Emmott’s opening lines make it quite clear that the whole project arose out of what became a very personal duel between himself and Berlusconi: “This must begin with a confession. For all Italy’s undoubted attractions, it is plain that one man has been chiefly responsible for making this old Asia hand become so engaged and fascinated by his country. His name is Silvio Berlusconi” (pviii).

The feud started with an issue of The Economist dated April 26 2001 with a front cover entitled ‘Why Silvio Berlusconi is unfit to lead Italy’ and a far more thorough discussion of Berlusconi’s murky financial dealings and ongoing legal difficulties than had ever appeared outside Italy. Berlusconi, who had often resorted to the courts in bids to silence Italian investigative journalists, responded with two libel suits against The Economist. The first of these was won by the magazine in 2008, when the Milan court rejected Berlusconi’s claim, although he has appealed against the judgment. The second case was subsequently won by The Economist in 2010, but Berlusconi chose not to appeal, perhaps because by that time The Economist’s claims about alleged financial impropriety were getting less attention in Italy or abroad than his sexual escapades and no victory could have restored his international reputation.

Nor was Berlusconi’s retaliation against The Economist confined to the courts. Il Giornale, the daily paper nominally owned by Berlusconi’s brother, branded the British magazine “The E-communist” and claimed that there was a clear physical resemblance between Emmott and Lenin. Prior to 2001 Emmott, whose principal area of specialised expertise had been in Japan’s economy, had no particular interest in Italy and the issue of his magazine that gave rise to such controversy was researched and written by other journalists on its staff, not by Emmott himself. However, in due course, Emmott, evidently goaded by Berlusconi’s obsession with his periodical, learnt Italian and, after becoming a freelance journalist in 2006, travelled extensively in the country in the course of preparing both the two versions of his book and a forthcoming television documentary.

Emmott’s view of Italy is coloured by both his personal experience of bitter conflict with the Berlusconi camp and his own ideological commitment to a quite hard-line version of neoliberalism - or, as he would describe it, “liberalism”. This means that, whilst he is unquestionably a man of the right, hostile to strong trade unions, nationalisation and most forms of regulation, he does not have any great sympathy for the main manifestation of the Italian right over the last two decades - Berlusconi’s Forza Italia/Popolo della Libertà - and often has something positive to say about some political figures who are nominally on the Italian centre-left or even on the left: for example, Nichi Vendola, the president of the region of Puglia and leader of the Sinistra Ecologia Libertà party. Although Emmott tells us, “I remain unconvinced about how far Mr Vendola’s conversion towards capitalism and globalisation has really gone” (p161), the very fact that Vendola was eager to impress Emmott, whose connection to The Economist would have been known to him, is in itself cause for concern on the left.

Emmott’s notions of ‘good Italy’ and ‘bad Italy’, whilst perhaps slightly Manichean, cannot be reduced to a dichotomy between either left and right or north and south. Some of what he sees as ‘bad Italy’ would be equally abhorrent to anybody analysing the current situation from a leftwing perspective - he is well aware of the deep-rooted problems posed by the Mafia, Camorra and Ndrangheta, by widespread corruption and clientelism, by the concentration of media ownership and by the deficiencies in the Italian legal system, the last of which he has experienced at first hand. It is far from clear whether the reference to Peppino Impastato, killed by the Mafia in 1978, as “a candidate for a city council seat for a similarly non-party list” (p155) rests on a misapprehension or is a deliberate distortion: the young man in question was an active member of the far-left Democrazia Proletaria. Given the rather crass and ham-fisted reference to “the great Marxist philosopher”, Gramsci (p211), ignorance is the most likely explanation.

Emmott is also aware that many problems that superficial observers, both Italian and foreign, label as confined to the south are in fact, in varying degrees, characteristics of the country as a whole. For example, he lambasts an “off the record” statement from “a very senior official at the Italian treasury” in January 2011, that “the Italian economy could be summarised as consisting of the north, which grows by three percent a year, and the south, which shrinks by two percent a year, producing the apparently weak annual growth rate of about one percent” (p169). Emmott points out that it is “nonsense on every level” (p170) - both mathematically, given that the south does not have equal weight to the centre-north in economic terms, and factually, since these figures for growth rates are grossly inaccurate. His impatience for crude scapegoating of the south is also apparent in his section on the Lega Nord. After mentioning the newspaper La Padania and Radio Padania, Emmott remarks: “The only thing missing, however, is a genuine region called Padania that could demand secession on some plausible historical or ethnic grounds. Such a country has never yet existed” (p62).

Emmott’s work is in many ways very useful and informative, particularly in its detailed discussion of individual Italian firms, both large like Ferrero and small like Loccioni - demonstrating that some of the often repeated generalisations about small firms in Italian industrial districts which were valid in the 1980s and 1990s are now out of date. However, its underlying thrust is very aggressively neoliberal. Nobody can deny the brutal honesty of chapter 3, ‘Il purgatorio economico’, whose first subheading (p82) is ‘Burdens and obstacles: (1) labour’. This section mounts a frontal attack on the workers’ statute of 1970, which made it illegal for firms employing more than 15 workers to dismiss them without ‘just cause’, and on the persistence of centralised, nationwide collective bargaining.

Needless to say, Emmott favours a move towards bargaining at a regional and company level and explicitly presents the move away from national contracts in Germany since the mid-1990s as a good model. Moreover, Emmott notes with evident distaste that “In 2010 35.1% of employees were trade union members, compared with just over 18% in both Germany and Japan” (p85), whilst “Back in 1970, all three countries had a broadly similar level of unionisation” (p85).

As one might expect, not only does he advocate regional wage cuts and the destruction of job security for those groups that still possess it, but he also feels that even in retirement the workers are dragging down the Italian economy. Writing about public pensions, Emmott notes: “At 15% of GDP, such spending is also the highest in the OECD, about three-four percentage points higher than in France and Germany, whose public pensions also predominate over the private sort, but almost treble the levels in America or Britain. Average spending for pensions in the OECD area is seven percent of GDP. No wonder that when the Monti government felt obliged in November-December 2011 to cut public spending, their main target was still pensions” (p97).

Although Emmott sees both the ‘super Marios’ - Italian prime minister Mario Monti and European Central Bank director Mario Draghi - as heroes, he does not share the official view expressed by Monti this August, that Italy has “good fundamentals”. Emmott’s argument is that Italy was already in serious trouble in 1992-94 and by and large failed to take the opportunity to make a new start during “the past 20 wasted years” (p4). He believes that the present crisis is “Italy’s second chance” (the title of chapter 1). Whilst he acknowledges that the general euro zone crisis was the immediate trigger for Italy’s current difficulties, he sees their origin as far more deep-seated.

He notes that “Between 2001 and 2010 Italy’s average growth rate was just 0.25% a year; since its population was growing, thanks to immigration, this meant that during that period Italy’s national income per head actually shrank. As The Economist pointed out in 2011 with rigorous cruelty, this meant that of all the countries in the world for which GDP figures are published, only Haiti and Zimbabwe did worse during that decade” (p79). He argues that Italy was not always like this, emphasising that in 1950-70 it “grew at an annual average growth rate in real GDP by 5.8% per year, compared with 8.9% for Japan and 4.1% for the rest of the OECD area” (p74) and that “in 1970-90 its average annual growth rate was still 2.9%, compared with 4.0% in Japan and 2.6% in the rest of the OECD area” (p75). As pointed out above, Emmott blames Italy’s more recent weakness in large measure on the strength of organised labour and comparatively high pensions, although he also makes some reference to the lack of competition and what he regards as excessive regulation.

In essence he believes that Monti’s government has gone some way towards turning things around, but that it will not have enough time to complete the job (“15 months is never going to be adequate” - p259) and therefore a lot depends on what comes next - “the test will be whether whatever coalition of parties succeeds the Monti government decides to continue and extend what Monti’s team will have begun” (p259). It is worth noting that unlike most ‘liberal’ commentators, especially most academic political scientists in UK and US universities, Emmott does not advocate ‘bipolar majoritarian government’ or emphasise the ‘need for alternation’. In discussing the best way of changing Italy’s electoral system, he favours “the single transferable vote method that is used in Ireland”, although he could see some merit in other systems, provided they “discourage bipolar politics and force consensus-seeking instead” (p266).

One might conclude that this very lucid spokesman for the international bourgeoisie realises that a grand coalition is a much more effective method of imposing ever increasing austerity on the workers than either a centre-right or a centre-left government. Whilst, as at least one earlier reviewer has suggested, Emmott’s attempts to apply the categories of Dante’s Divine comedy to contemporary Italian reality are a rather unconvincing literary device, Emmott’s paradiso (‘good Italy’) would certainly be an inferno for the Italian proletariat.