Leading Article: For Italy, the joke's over

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The Independent Online
ITALY was long regarded as a country that succeeded in spite of its governments rather than because of them, and indeed managed rather better without them, which was just as well in view of the speed with which they came and went.

The joke is now over. The country's problems have become so serious that Giuliano Amato, the Prime Minister, will ask parliament for special powers to deal with the economic emergency. The lira is tottering and the normal processes of government are proving unable to cope. A marginal but revealing symptom is that joke coins distributed by the Northern League, a movement calling for northern secession, have started to circulate as currency.

The crisis is the result of chronic problems coming up against the political and economic stresses that are afflicting much of Europe. Italian politics have been corrupt for as long as anyone can remember but the recent scandal over public procurement in Milan has blown the problem into the open, damaging many leading figures and turning public cynicism into active disgust. Recent successes for the Mafia have further discredited the entire political establishment. The Christian Democrats have been worst hit and are poorly placed to recover because the end of the Cold War has removed their claim to be the only safe bulwark against Communism. Yet an electoral system that gives representation to too many small parties inhibits the formation of an opposition strong enough to offer real change.

Weak Italian governments have habitually met budget deficits by borrowing and permitting inflation. That option is no longer open because of the size of the deficit, the high cost of borrowing and, until recently, the belief that the Maastricht treaty would demand monetary discipline. There is, however, a positive side to the crisis. It has been brought to a head partly by the praiseworthy efforts of the new government to push through a package of spending cuts and tax increases, to end the debilitating practice of indexing wages, and to privatise the huge, top-heavy and over-politicised industrial groups that dominate the public sector.

Mr Amato is now demonstrating that he does not intend to be deflected. Up to a point his political weakness can be turned to advantage. He leads a fragile coalition of Christian Democrats, Socialists, Social Democrats and Liberals, with a majority of 16 seats. None of these parties wants a new election so soon after the last one of 5 April. They could expect a confused result, bringing dangerous gains for protest groups such as the Northern League. The threat of a new election therefore ought to be one of the Prime Minister's strongest weapons. Yet the reform programme could still fail because the parties and their backers cannot be relied upon to behave rationally. Hence the call for special powers.

Mr Amato also needs to prepare for a French vote against the Maastricht treaty, which would remove a primary argument for monetary discipline in Italy and further weaken the established parties by throwing into doubt one of the few undisputed assumptions of Italian politics - loyalty to Europe. The abyss beneath Mr Amato's feet would then widen, if he had survived even that long. His appeal looks like a last throw.

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