Rome coalition in peril as Craxi quits in disgrace

(First Edition)

A FORMIDABLE chunk of Italy's post-war political world came crashing down yesterday when Bettino Craxi, one of its most prominent figures, finally resigned as leader of the Socialist Party amid a fresh welter of scandals.

His fall formally opened a leadership crisis which could lead to a split or even the destruction of his century-old party. This in turn could bring down the fragile coalition of Giuliano Amato, the Prime Minister. The government almost capsized itself, badly hit by the resignation of the Justice Minister, Claudio Martelli, Mr Craxi's main rival in the Socialist Party, and by rumours - denied by public prosecutors - that the Prime Minister was under investigation.

The President, Oscar Luigi Scalfaro backed the government, saying it was 'unthinkable' that it should go. The Prime Minister promised urgent measures yesterday to clean up the scandal-ridden political system, because 'the credibility of our government, parliament, our industrial system and our ability to compete abroad are at stake'. There would be strict controls on the civil service and a new code of ethics for politicians. He also urged electoral reform.

Mr Craxi had long been under pressure to resign from his post in the party which he had led to great successes over the past 16 years, ever since his political associates in Milan became embroiled in the big corruption scandals there, but also because he was seen as the main obstacle to a clean-up and rehabilitation of the party which was urgently needed if it were to survive at all.

With six judicial investigations opened against him on suspicion of corruption, extortion and fraudulent bankruptcy, he could no longer cling to the job. He is nevertheless claiming it is all a plot to destroy him, at the same time blaming the rest of Italy's political leadership.

His resignation was announced a few hours before the Socialist National Assembly was due to meet to elect a successor, with no obvious candidate in sight.

In recent months Mr Craxi became the symbol of all that is wrong with Italian politics. But it was not always thus. One admirer once described him as a 'cock among capons'. In 1976 he took over a party that was in danger of being crushed between the two big ones, the Christian Democrats and Communists and later served as prime minister.

What few realised at the time was that his party had adopted the habit of taking rake-offs on public-works contracts that had been practised by the Christian Democrats, and often surpassed them in brazenness and greed. It was all tacitly accepted and no one ever dreamed that they would ever have to pay for it. Now the bills are coming in.

(Photograph omitted)