Italy's Law of Averages

With no regional, national or European elections in sight, and no football cup to stir up popular pas­sions, 2003 looks set to be a very average year. But has Italy ever had an average year? The most excitable ­and one of the most exciting nations on the continent will display its usual combination of stamina and anar­chy, realism and ingenuity. But it must also decide what it is: a full-fledged democracy, or a modern-day signoria, under the rule of one man.

Silvio Berlusconi is going to be, for the tenth year running, the man of the year. After winning the general election in 1994, losing his job as prime minister that same year, and winning again in 2001, he promised to solve his spectacular conflicts of interest within 100 days, and to free the Italian economy. In 2002, neither happened. But if the world downturn could explain the lack of success in the economic field, nothing can excuse Berlusconi's delay in sorting out his business interests. He owns most of Italy's private television and controls pub­lic television; he owns the largest advertising company, the largest film distribution company, the bestselling news-magazine, as well as assorted newspapers and fi­nancial firms. One of his own lawyers chairs the judicial­ affairs committee in the lower house. The chairman of his team, AC Milan, heads the football league.

Most foreign leaders do not care about all this, and Berlusconi – with his pro-American stance – will have more days in the sun. But foreign investors do care. And many Italians, including some centre-right voters, are uncomfortable. According to Eurobarometer, 59% are not satisfied with their political system, and only 38% are satisfied (in only two other EU countries, Greece and Portugal, does dissatisfaction outweigh satisfaction).

The left, to be fair, did not do much to help when it was in power between 1996 and 2001. It did not provide Italy with a much-needed law about conflict of interest.

Neither did it free public television from political control. But Berlusconi is a magnificent catalyst, and in 2003 he will help the scattered centre-left to unite once again, bringing together neo-liberals and post-communists, free-marketers and anti-globalists. Romano Prodi, for­mer prime minister and now President of the European Commission, will carefully watch events from Brussels, getting ready for his return to Rome in 2004.

Fear of judicial persecution will affect Berlusconi's agenda (and peace of mind), as it did in 2002. His allies will keep quiet, but they will become increasingly uneasy. Moderate Pierferdinando Casini, the speaker of the lower house, and a rising star, will keep one eye on Quirinale, the residence of the state president, and the other on Palazzo Chigi, the prime minister's office. His rival for the top job – and another man to notice – is Gianfranco Fini, Deputy-Prime Minister and leader of the right-wing National Alliance. Roberto Maroni, a capable Labor Minister, will outshine his boss, the Northern League's leader Umberto Bossi. Treasury Minister Giulio Tremonti, one of the centre-right's eggheads, may have problems keeping his job: Italy's economic woes will not go away in 2003. These are the men to watch.

With a budget deficit close to 2% in 2002, and a ratio of public-sector debt to GDP at 11 %, the Treasury does not have much money to give away. The government will not be able to build much-needed infrastructure (for example, the autostrade are ageing fast), to revamp defence and to experiment with e-government (although elec­tronic identity cards will start to appear). Nor will it have the political strength to reduce pension expenditure, the highest in the EU. Inflation is unlikely to go down: in 2002 it was 2.3%.