Berlusconi holding Italy Hostage

A brilliant article on Berlusconi and the sorrow state of Italy by Tim Sparks can be read HERE

A brief summary below:

Vote me out of jail, or I will bring the country down with me. This, essentially, is the message Silvio Berlusconi—four-time prime minister, owner of the country’s three main commercial TV channels, criminal defendant many times over—has just sent to the Italian government, one that clarifies at last the exact nature of what is at stake in Italy at the present moment: is this a modern state where the rule of law prevails or is it the fiefdom of an institutionalized outlaw?

After a dozen trials, many of which have gone through all three levels of Italian justice (primary trial, appeal, counter appeal), after making ad personam laws to have his crimes de-penalized, or using delaying tactics to have trials thrown out because the crimes alleged in them are time-barred, or facing guilty verdicts at one level and acquittals at another, Berlusconi has finally received a definitive and unappealable criminal sentence at the highest level, for tax fraud in the region of €7 million ($9 million) and for the creation of a slush fund of some €280 million ($375 million). Sentenced to four years in prison, he has benefited from a pardon aimed at emptying the country’s jails, which has reduced the sentence to one year—this despite the fact that, being over seventy, he will be allowed to serve his sentence at one of his various luxury homes. However, as an elected member of the senate, he enjoys immunity from arrest and cannot be forced into confinement until the senate approves his expulsion, a vote that could take place in September. He has now made it clear that if that vote goes against him he will bring the whole house down.

2013 Economic Freedom Report highlight Italy's troubles

The appalling state of Italian economy is no longer getting international headlines but the slide of the county toward third world standards is continuing unabated.
The new 2013 report on Economic Freedom has been published; a full report can be found here and again Italy's ranking is a disaster for a major economy.

On the overall score Italy is ranking 83rd which by itself is an appalling result for a major developed economy, positioning itself below Uganda and Sri Lanka.

But when it comes to Freedom from Corruption Italy manage to score an appalling score of 39 together with Ghana and Macedonia.


Below some extracts from the report delving into an analysis of Italy's shortcomings:

The foundations of economic freedom remain weak in the absence of an efficient judicial framework to provide effective and timely resolution of cases. Corruption, often involving government officials, is a growing concern, severely undercutting confidence and trust in the government.

As per the rule of law and corruption Italy is faring among the worst countries, below the motivation for such low ranking:

Property rights and contracts are secure, but court procedures are extremely slow. Many companies choose to settle out of court. The legal system is vulnerable to political interference. Widespread corruption has bred a culture of lawlessness and tax evasion and has weakened respect for the judiciary. Enforcement of intellectual property rights is below developed-country standards.

And when it comes to attracting investments:

Regulatory complexity causes delays and increases the cost of entrepreneurial activity. Completing licensing requirements takes over 200 days and costs more than the level of average annual income. Serious labor market rigidities constrain job growth, and the informal labor market accounts for a large proportion of employment. Stagflation engendered by the eurozone crisis presents monumental monetary policy challenges.

       
       

Read more about Italy Economy.
        See more from the 2013 Index.

   

OVERALL SCORE BY COUNTRY:

Hong Kong	89.3
Singapore	88
Australia	82.6
New Zealand	81.4
Switzerland	81
Canada	79.4
Chile	79
Mauritius	76.9
Denmark	76.1
United States	76
Ireland	75.7
Bahrain	75.5
Estonia	75.3
United Kingdom	74.8
Luxembourg	74.2
Finland	74
The Netherlands	73.5
Sweden	72.9
Germany	72.8
Taiwan	72.7
Georgia	72.2
Iceland	72.1
Lithuania	72.1
Austria	71.8
Japan	71.8
Macau	71.7
Qatar	71.3
United Arab Emirates	71.1
Czech Republic	70.9
Botswana	70.6
Norway	70.5
Jordan	70.4
Saint Lucia	70.4
South Korea	70.3
The Bahamas	70.1
Uruguay	69.7
Colombia	69.6
Armenia	69.4
Barbados	69.3
Belgium	69.2
Cyprus	69
Slovakia	68.7
Macedonia	68.2
Peru	68.2
Oman	68.1
Spain	68
Malta	67.5
Hungary	67.3
Costa Rica	67
Mexico	67
Israel	66.9
Jamaica	66.8
El Salvador	66.7
Saint Vincent and the Grenadines	66.7
Latvia	66.5
Malaysia	66.1
Poland	66
Albania	65.2
Romania	65.1
Bulgaria	65
France	64.1
Rwanda	64.1
Thailand	64.1
Dominica	63.9
Cape Verde	63.7
Kuwait	63.1
Portugal	63.1
Kazakhstan	63
Turkey	62.9
Montenegro	62.6
Panama	62.5
Trinidad and Tobago	62.3
Madagascar	62
South Africa	61.8
Mongolia	61.7
Slovenia	61.7
Croatia	61.3
Ghana	61.3
Paraguay	61.1
Uganda	61.1
Sri Lanka	60.7
Italy	60.6
Saudi Arabia	60.6
Namibia	60.3
Guatemala	60
Burkina Faso	59.9
Azerbaijan	59.7
Dominican Republic	59.7
Kyrgyz Republic	59.6
Morocco	59.6
Lebanon	59.5
The Gambia	58.8
Zambia	58.7
Serbia	58.6
Cambodia	58.5
Honduras	58.4
The Philippines	58.2
Tanzania	57.9
Gabon	57.8
Brazil	57.7
Benin	57.6
Belize	57.3
Bosnia and Herzegovina	57.3
Fiji	57.2
Swaziland	57.2
Samoa	57.1
Tunisia	57
Indonesia	56.9
Nicaragua	56.6
Vanuatu	56.6
Mali	56.4
Tonga	56
Kenya	55.9
Yemen	55.9
Moldova	55.5
Senegal	55.5
Greece	55.4
Malawi	55.3
India	55.2
Nigeria	55.1
Pakistan	55.1
Bhutan	55
Mozambique	55
Seychelles	54.9
Egypt	54.8
Côte d'Ivoire	54.1
Djibouti	53.9
Niger	53.9
Guyana	53.8
Papua New Guinea	53.6
Tajikistan	53.4
Bangladesh	52.6
Cameroon	52.3
Mauritania	52.3
Suriname	52
China	51.9
Guinea	51.2
Guinea-Bissau	51.1
Russia	51.1
Vietnam	51
Central African Republic	50.4
Nepal	50.4
Laos	50.1
Micronesia	50.1
Algeria	49.6
Ethiopia	49.4
Liberia	49.3
Burundi	49
Maldives	49
Togo	48.8
Sierra Leone	48.3
Haiti	48.1
Belarus	48
São Tomé and Príncipe	48
Bolivia	47.9
Lesotho	47.9
Comoros	47.5
Angola	47.3
Ecuador	46.9
Argentina	46.7
Ukraine	46.3
Uzbekistan	46
Kiribati	45.9
Chad	45.2
Solomon Islands	45
Timor-Leste	43.7
Republic of Congo	43.5
Iran	43.2
Turkmenistan	42.6
Equatorial Guinea	42.3
Democratic Republic of Congo	39.6
Burma	39.2
Eritrea	36.3
Venezuela	36.1
Zimbabwe	28.6
Cuba	28.5
North Korea	1.5

How successful is your country?

Goldman in his recent study notes that the competitive strengths of companies often stem from the advantages of the countries they reside in.

These include a combination of resource availability (food, energy, mining and others), demographics, trade positioning, infrastructure quality and above all, the presence of strong, inclusive institutions that encourage innovation.

So, what follows is Goldman's attempt to map the various success drivers of the world’s countries.

Goldman divides the drivers into four categories:

Innovation
Patents per capita, R&D as a percentage of GDP, venture capital as a percentage of GDP and the birth rate of companies.

Institutions
Confidence in national institutions, days aken to enforce a contract, the cost of starting a business and the GINI co-efficient that measures income inequality.

Resources
Net crude oil exports/(imports) as a percentage of consumption, per capita food surplus/(deficit), copper + iron ore + aluminum surplus/(deficit) and retirees as a percentage of population.

Infrastructure
Transport (airports per capita, railways per sq km), electricity production per capita and internet penetration.
Italy again scores among the worst countries in Europe just after Greece; in brief its institutions are weak, Internet penetration is appalling and when it comes to enforce contracts; it is the worst country in Europe and far behind many third world countries like Nigeria or Kenya who rank much better than Italy on this aspect.


The overall scorecard...





and a close up on Europe... (click image for huge version)


Source: Goldman Sachs

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Italy: A Disneyland for the Mafia

The Italian Parliament has approved Friday a new law with an apt nickname "Processo Lungo" (Long Trial), this is a milestone in the many attempts of the Italian Prime Minister Berlusconi to stall the judicial machine and avoid being sentenced to jail in any of his many trials ranging from bribery to child prostitution.
First let us see what is this Long Trial. It allows the defendant to bring an unlimited number of witnesses, just to give an example if the place where the crime has been committed is a stadium this law allows defendants to bring as witnesses every single spectator in the stadium, a judge cannot refuse to bring those witnesses since the law remove the possibility for the judge to refuse witnesses considered unrelated to the case. A judge is forced to hear everyone the defendant deem relevant to his case, should it be the far relative living abroad or the entire neighborhood.
In Italy thanks to a previous law introduced by Berlusconi which was creatively called Processo Breve (Short Trial) there is a maximum time frame for the trial to be concluded, if for a crime the trial is not completed within a specific time frame (depending from the crime the average time frame is 6-7 years) then the crime is declared expired and the accused can go home.
This new law will make easier to reach the expiry date by effectively stalling the judge decision with an endless list of witnesses. As in previous cases to save Berlusconi's ass the government is bringing the judicial system to collapse, if the penal system was not shining already with lengthy trials and lack of efficiency with this law it will practically stop working.
Good news for the Mafia who has to ability now to bring entire neighborhoods to their trials to ensure a lengthy and safe absolution.