The Rise and Fall and Rise of Silvio Berlusconi

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Berlusconi's position as a self-made business tycoon is both his greatest strength and greatest weakness as a politician. Through his $12 billion Fininvest holding company, the former cruise-ship crooner now controls Italy's three main private TV networks, its biggest publishing house (Mondadori), a major newspaper (Il Giornale) and a leading soccer team (AC Milan). Forbes magazine ranks him as the world's 14th-richest person, with a fortune estimated at $12.8 billion.

This concentration of financial and media power makes for a potential conflict of interest when combined with the country's supreme political power. "Do you find it normal," Italian author Antonio Tabucchi wrote in France's daily Le Monde, "that in a Western parliamentary democracy, not some South American country, a man who owns newspapers, publishing houses and television stations can act in the public interest and become Prime Minister? Doesn't it seem to you that this sort of power heralds a new form of totalitarianism?"

Berlusconi rejects such talk as political hyperventilation. He notes that he resigned as ceo of Fininvest in 1994, though he remains its owner, and talks vaguely of putting his assets in a blind trust if elected. "My enemies tried to destroy my companies by using judicial, tax and political pressure against me," he told Time in a 1997 interview. "It's political extortion and blackmail. That's the real conflict of interest. They want to influence my political action by attacking my companies."

Indeed, Berlusconi and his companies have come under attack in a dozen or so judicial probes into bribery, corruption and tax evasion charges. But, so far, none of them has stuck: some charges have been dismissed; others have resulted in convictions that were overturned on appeal; still others were struck down by the statute of limitations. None of this has much impact on Italian public opinion. A recent Corriere della Sera poll showed that 39% of the public is indifferent to the conflict of interest issue, while 23% feel that Berlusconi's business interests would help him govern better.

Probably Berlusconi's most serious liability is his alliance with the Northern League's Umberto Bossi. A gravel-voiced, acid-tongued rabble-rouser who once called for the prosperous north to secede from the rest of the country, Bossi spouts an anti-immigrant, anti-E.U. line. He has ceased to call Berlusconi "Berluskaiser," but he recently branded Amato a "Nazi dwarf," and referred to the European Union as "the Soviet Union of the West." Though Bossi is the one who pulled the plug on Berlusconi's first government, Il Cavaliere claims to have won assurances that the League will remain loyal this time. But the prospect of Bossi's participation in government does not leave Italy's European partners overjoyed. Belgian Foreign Minister Louis Michel has even raised the prospect of Austria-style E.U. sanctions against Italy.

Such worries are heightened by the fact that Berlusconi's Freedom Alliance is allied in Sicily with Luigi Caruso, a candidate from the far-right Italian Social Movement, heirs to the Fascist Party. And though Berlusconi's other main coalition partner, Gianfranco Fini's National Alliance, has moderated its stance and moved to the center, its roots in the fascist movement are unsettling to many. Berlusconi's forces counter that the left's alliance with communist groupings is equally unsavory. As for Bossi, Berlusconi's aides say privately that they expect to win big enough to get along without the League's backing. But Bossi has already left a big imprint on the center-right platform, extracting promises to work for a devolution of administrative powers to the regions, and for tougher anticrime and anti-immigrant policies.

Immigration is a recent but rising concern in Italy, where foreign residents officially account for only 2% of the population. In the past few years though, Italy has become a key entry point for immigrants from Albania, Africa, Asia, Eastern Europe and Turkey. Polls show that Italians now consider immigration to be the country's third-biggest problem, after unemployment and crime. These facts have not been lost on Rutelli, some of whose posters promise crackdowns on "the illegal immigration racket."

The real centerpiece of Berlusconi's platform is a promise to streamline state bureaucracy and slash taxes. Berlusconi's plan would cut income taxes across the board by between $25 billion and $35 billion a year. Rutelli is promising to cut taxes by up to $23 billion a year, although he would target them to help the lower income brackets. The problem with both proposals is that the lost revenue will have to be offset by extensive spending cuts to stay within the budgetary requirements of all eurozone countries. That means reining in Italy's profligate pension system, which gobbles up 30% of state spending and groans under the weight of an aging population.

But neither side is saying anything very precise about reforming pensions or loosening up the rigid labor market, which contributes largely to the country's 9.9% unemployment rate. And for good reason: they well know that union opposition could trigger crippling strikes. And as Berlusconi recently admitted to the New York Times, talking about such things during the campaign "doesn't bring us votes."

Berlusconi's candor speaks volumes about his approach to politics. Apart from his general free-market philosophy, the details don't really matter. He seeks power, not for its own sake, but as a matter of personal vindication. "Berlusconi needs love, that's a key motivation," says Giuliano Ferrara, editor of the daily Il Foglio and a former adviser to Berlusconi.

Berlusconi's supporters admit that he stumbled on his first try at governing, but they insist that he has matured as a politician. "He was a dilettante when he entered politics," says Berlusconi ally Pierferdinando Casini, leader of the Christian Democratic Center, "but today he is a pro. He won't make the same mistakes. He has finally understood that running a country is different from running a big company." Buttiglione agrees. "At first," he says, "Berlusconi was impatient with the intricacies of public life. Now he has learned that you can't cut every knot with a sword."

Corriere della Sera's Folli sees Berlusconi, for all his megalomania, as a "key factor" in modernizing Italian politics. "He's the man who has done the most to change the system in the last decade," says Folli. Berlusconi, he adds, has "proved his qualities as a political leader by forging his coalition and leading it with a strong hand. Whether he has the qualities of a statesman remains to be seen." Unless Rutelli pulls off a stunning upset — and that is always a possibility in this volatile country — Berlusconi will soon have a chance to answer that question at the helm of Italy's 59th postwar government. The world will be watching.