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Tuesday, December 20, 2011

In Debt Crisis, Gulf Is Yawning Between Italy and Its Politicians


ROME — With its elegant marble floors, ornately carved wooden ceiling and flattering lighting, the central meeting point of Italy’s Lower House is arguably one of the most beautiful political arenas in the world.

Italy's Prime Minister Mario Monti arrived for a conference at the Bank of Italy in Rome on Friday.

But in recent weeks, Italians have come to view those who frequent the hall — known as the Transatlantico and modeled on the great room of an ocean liner — as a pampered elite, as sheltered from the global economic turbulence as the palazzo’s inner courtyard.

On Friday, the month-old government of Prime MinisterMario Monti easily won a confidence vote on a $40 billion set of austerity measures, including tax increases, changes to the pension system and some growth incentives, with 495 votes to 88. After the vote, the prime minister told lawmakers that Italy was at “maximum risk.” He added, “A lot is at stake; we cannot permit ourselves to live the way we did before.” He said that much would depend “on our capacity to present ourselves as united and credible before the markets.”

Yet even as Mr. Monti, a technocrat who has won the confidence of Parliament but not its loyalty, struggles to restore faith in a government asking for sacrifices, he is facing a power battle — and a culture clash — with lawmakers. The prime minister has asked Italians to accept new austerity to reduce the country’s public debt and restore market trust. But Italian politicians, whose salaries rank above the European Union average and who are widely seen as more eager to protect their privileges than their country’s future, have balked at the prospect of belt tightening for themselves.

Last week, lawmakers grudgingly agreed to changes in their pension plan following a public outcry after they blocked an effort by Mr. Monti’s government to cut their salaries as part of the austerity plan.

This has not gone over well with the public. “The gap between citizens and politics is becoming wider and wider,” said Giovanni Sermoneta, 54, a shopkeeper in downtown Rome, echoing a common sentiment. “They can’t think that they can keep on earning $26,000 a month when workers are asked to work until they are 70 with salaries that are among the lowest in Europe.”

Italy’s Parliament has 952 lawmakers, 630 in the Lower House and 322 in the Senate, to say nothing of thousands of local politicians in a country of 60 million. National lawmakers’ take-home pay ranges between $18,000 and about $27,000 a month — which covers salary, a per diem for living expenses and a personal (but not legislative) staff. Their many perks include gold-plated medical insurance, free travel within Italy and often a car and driver. According to the Bruno Leoni Institute, a market-oriented policy research organization in Turin, Italy, the Italian Parliament costs about $2 billion a year, or around $34 per capita.

In contrast, the United States Congress — 100 senators and 435 members of the House of Representatives for a population of 300 million — costs about $2.2 billion a year to maintain, or $7 per capita, according to a study by Antonio Merlo, the chairman of the Economics Department at the University of Pennsylvania. And they can easily be voted out of office. In Italy, the climate of hostility toward politicians is magnified by the fact that voters do not directly elect members of Parliament. Instead, under a 2005 electoral law passed by the government of Prime Minister Silvio Berlusconi, they are chosen by party leaders who then present a list of candidates to the voters.

Mr. Monti, an economist and university professor, has kept his cool in parliamentary debate that has devolved into the carnival-like. Last week, lawmakers from the anti-immigrant and increasingly euro-skeptical Northern League, a pillar of Mr. Berlusconi’s center-right coalition and now the most vocal opposition party, shouted and held up signs calling the austerity measures a “holdup.”

New York Times

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