Friday May 16 2008
All times are London time

Search Quotes in the FT.com site
FT Logo

April 29th, 2008

Berlusconi is back and so is Silviospeak

To the 23 official languages of the European Union can be added a 24th – Silviospeak.
Yes, Berlusconi is back and once again turning heads and headlines across Europe.
The incoming Italian premier has yet to form a government but has already irked Brussels on two issues: his defence of lossmaking airline Alitalia and the nomination of a Italy’s European commissioner.
The billionaire businessman helped wreck talks to sell Alitalia to Air France/KLM by holding out the prospect of an Italian takeover. Now, if local businessmen do not stump up the cash, he could just nationalise it, he said on Tuesday.
He invented a new word – “zignare” - to describe the hectoring of the Commission, which is anxious to ensure that the airline does not receive any more government subsidies, disadvantaging its competitors.
“If they continue hectoring, we could take a decision in which Alitalia could be bought by the state - by the state railway,” Berlusconi told a news conference. “It’s a threat, not a decision.” Some suspect it may also be a joke since the railway lacks the resources to take on the airline.
Jacques Barrot, the EU transport commissioner, has expressed doubts over whether an emergency 300m government loan complied with state aid rules. The Commission on Tuesday said that nationalisation would not pose a problem as long as the state did not pay above market rates for the 50.1 per cent of Alitalia it did not own. Given the lack of private buyers a market rate could be difficult to gauge.
Italy gave Jose Manuel Barroso, Commission president, a further headache on Tuesday when Franco Frattini, its commissioner, asked for his leave of absence to be extended until May 15. He took time off to campaign with Berlusconi and is expected to become Rome’s foreign minister.
Barroso last week said that if he resigned Italy would lose the sensitive justice and home affairs post, which temporary fill-in Barrot would retain. The new Italian would take Barrot’s transport portfolio. Rocco Buttiglione, Berlusconi’s last pick, (cd xref to beeb or our story) had to withdraw in 2004 after offending the European parliament with remarks about homosexuality and the role of women.
Patience with Italy is strained in Brussels. After his time spent with Berlusconi, it might be wise for Frattini not to return.

April 8th, 2008

Tremonti and the serpent’s egg

The first time I interviewed Giulio Tremonti, he was in shirtsleeves and a pair of bright braces, puffing confidently on a cigar in Milan. At that time he was finance minister in Silvio Berlusconi’s centre-right Italian government, and there’s no denying it, he looked every inch the part.

Now, as Italians prepare to vote in their April 13-14 election, Tremonti is playing a more populist tune. He’s just published a book, Fear and Hope, which lashes out at globalisation and condemns “the dictatorship of the market”. He also calls for a “new Bretton Woods”. Today’s Tremonti, some may think, has more in common with his protectionist political opponents on the Italian far left than with the Tremonti of 2003.

In truth, Tremonti was always fairly suspicious of globalisation, once remarking that Europe would end up in the pot of a Chinese cook if it wasn’t careful.

All this matters because opinion polls suggest Berlusconi will win the election and, being a creature of habit, he will probably appoint Tremonti as finance minister, just as he did in 1994 and 2001. Then what will happen?

Tremonti can’t single-handedly rip Italy out of all the free trade commitments by which it must abide under European Union rules. However, it is not difficult to imagine Berlusconi and Tremonti lining up in support of French President Nicolas Sarkozy’s calls for “community preference”, an anodyne phrase behind which lurks the threat of higher import tariffs on non-EU goods.

Perhaps this is one reason why European Commission president José Manuel Barroso warned in his recent Financial Times interview that protectionist forces were on the rise in the EU, including on the centre-right. A victory for Berlusconi and Tremonti, far from signalling a triumph for the spirit of dynamic Italian entrepreneuralism, would strengthen the defensive, inward-looking forces of Europe.

The UK and other free trade advocates such as Finland, the Netherlands and Sweden need at this point to consult their copies of Shakespeare’s Julius Caesar. In Act II Scene I they will find that Brutus, when looking for a reason to justify Caesar’s assassination, said that the point wasn’t Caesar’s actions so far, but the future danger Caesar represented. “And therefore think him as a serpent’s egg/ Which, hatch’d, would as his kind grow mischievous,/ And kill him in the shell.”

So the message to Tremonti must be: Giulio, wear those braces if you must, but we can’t let the serpent’s egg of protectionism grow to full size.

February 6th, 2008

Hair-raising times ahead for Berlusconi?

It is difficult to find anyone in Brussels who is enthusiastic about the likely return to power of Silvio Berlusconi in Italy. When you mention his 2001-2006 premiership, and especially the way he ran Italy’s European Union presidency in July-December 2003, you sometimes see that rarest of sights - a Eurocrat shuddering in revulsion.

But if Berlusconi wins the elections forced by the collapse of Romano Prodi’s government, I predict interesting times ahead. Not because Berlusconi will once more make himself an outcast by comparing German members of the European parliament to Nazi concentration camp guards. Rather, because it is in Brussels that his massive conflict of interest, between his political role and his position as Italy’s pre-eminent media tycoon, may at long last be challenged.

(more…)


More FT Blogs and Forums

  • Economists' Forum Leading economists and the FT's chief economics commentator, Martin Wolf, debate the big issues

  • Clive Crook's blog The FT's chief Washington commentator blogs about intersection of politics and economics

  • Gideon Rachman's blog The FT's chief foreign affairs commentator on world issues and his travels

  • Westminster Blog By our UK Parliament writers

  • The Undercover Economist Tim Harford's blog on economics in everyday life

  • Willem Buiter's Maverecon The LSE professor blogs on 'economics, politics, ethics, religion, culture, free and open source software (FOSS), and whatever'

  • John Gapper's blog FT chief business commentator talks about business, finance, media and technology

  • FT Alphaville Instant market news and commentary for finance professionals

  • Management Blog A forum for the latest thinking about the issues that preoccupy managers around the world

  • Dear Lucy Columnist Lucy Kellaway and readers solve your workplace woes

  • FT Tech Blog Our San Francisco and world correspondents look at the intersection of technology and business