The Berlusconi's soap opera distracts the country from a much more serious problem

Prospect
March 2011

 

Whether by design or because of prurience, media coverage of Silvio Berlusconi’s alleged antics at his villa in Arcore has crowded out other issues afoot in Italy—with consequences far more troubling for its economic and democratic health.

Frenzied interest in the prime minister’s sex life, and his upcoming trials for corruption, tax fraud and paying an underage prostitute, have distracted from a problem once again on the rise in Italy: organised crime. On 29th January, Giuseppe Pignatone, chief anti-mafia judge in the southern province of Calabria, said that in some parts of the region a staggering 27 per cent of’ the population is now involved in the ’Ndrangheta, the local organised crime group. In Campania, which is the setting for Gomorrah, Roberto Saviano’s bestselling book about the mafia, the figure is 12 per cent; in Cosa Nostra-dominated Sicily, 10 per cent. Pignatone also cited wiretaps of bosses boasting that two or three young people join the local ’Ndrangheta daily.

This is depressing news for southern Italy, though it has long had this problem. More worrying still is mounting evidence that ’Ndrangheta power has become focused in northern Italy, where Calabrian-originated groups command a huge and growing economic presence. Now, a national fiscal reform that has become enmeshed in Berlusconi’s sex scandals could further increase that power.

Passed by one house of parliament, but blocked by a bicameral commission on 3rd February, the fiscal reform, known as “municipal federalism,” will devolve certain tax and spending powers from Rome to local authorities. The reform is the brainchild of Umberto Bossi, head of the separatist Northern League party, the principal ally (for now) of Berlusconi’s People of Freedom party (PdL). The two leaders have reportedly made a deal on federalism: in exchange for PdL support, Bossi will back legislation to ease Berlusconi’s legal woes.

Why does this matter? In devolving power away from central authorities, federalism may benefit all Italian crime groups. But the ’Ndrangheta’s growing northern presence and unique characteristics put it in a particularly favourable position. Unlike the hierarchical military structure of the Cosa Nostra and Camorra, the ’Ndrangheta is a horizontal, cellular aggregation of clans. Its tight family ties have hampered-infiltration by law enforcement and dissuaded the kind of turncoats who weakened the Sicilian mafia. And its fluid structure allows it to bounce back quickly when big players are arrested or assassinated.

This model, which expedites entry into new territories or businesses, first brought the ’Ndrangheta north in the 1970s, when it parlayed the ransom money from kidnappings into bigger drug profits. Milan was attractive because it is Italy’s banking centre and close to Switzerland—a short trip with suitcases of cash—and it proved a fertile ground for expansion. With relatively small investments, ’Ndrangheta families gained control of thousands of businesses suited to money-laundering. Camouflaged by Milan’s honest southern immigrants, the ’Ndrangheta spread below the radar of law-enforcement. It now thrives in the city’s wholesale produce market, construction companies and nightclubs.

Unlike the Cosa Nostra or the Camorra, the ‘Ndrangheta has not sought political power through vote-buying. Anti-mafia judge Alberto Cisterna explains why this makes federalism so dangerous: “Organised crime is not ideological. It goes where the money is. Transferring power and resources to local authorities risks favouring activities of ‘neighbourhood mafia’ whose strength is its obsessive territorial control.” With all its small businesses, a “neighbourhood presence” is indeed the ’Ndrangheta’s strength. When government decision-making and funding comes down to a local level, activity that once required action from a minister in Rome can be done around the corner.

The impact on the healthcare system in Lombardy, where the ’Ndrangheta already operates, should act as a warning. According to Marco Arnone, an economist and crime specialist: “Health spending has quintupled since changes a few years ago brought in private operators. With this huge amount of money and thousands of private companies involved, it is easier to hide things and even easier for the ’Ndrangheta to infiltrate.” Controlling expenses, already difficult in state-run hospitals, will be virtually impossible in profit-making private ones, experts warn.

In the past, in the south, the mafia manipulated politicians in order to consolidate its grip on the economy; today, in the north, the ’Ndrangheta’s economic grip will allow it to manipulate politicians. This is, of course, bad news for Italy’s lagging economy. In 2009 organised crime’s estimated revenue was €150bn, and its (illegal) share of Italian GNP in 2007 was 8.4 per cent. Arnone claims it is a bigger drag on the economy than Italy’s huge public debt: “At least public debt is transferred to the citizens as roads, healthcare or schools. Criminal revenues are unproductive. They leave Italy. They feed other criminal activities.”

Nowhere is this more evident than in Calabria itself, where there is little sign of the estimated €35.8m the ’Ndrangheta grossed in 2008. The schools are some of Italy’s poorest performing. Youth unemployment is high. Infrastructure is crumbling. Respect for the state is low. If Italy and its ministers continue to devote more attention to matters spicier than problems such as Calabria’s, they will only allow them to infect the rest of the country.