Tangentopoli

In Tangentopoli, Manuel Delia examines Italy's 1990s corruption scandal that toppled its First Republic, revealing a system fueled by kickbacks from public contracts and compromised governance. The investigation, Mani Pulite (Clean Hands), exposed deep political rot, drawing parallels to Malta's current challenges, where political financing and corruption scandals echo those of Italy's past, highlighting the urgent need for transparency and reform to safeguard democratic integrity.

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Italy's modern republic had not existed for 50 years before its citizens started speaking of it as the "first" republic, implying it was defunct. It was the early 1990s, and a team of prosecutors had gathered evidence of rot at the very heart of the country's governance. They called the project of investigating and prosecuting wrongdoing in public life "clean hands." All other hands were dirty. It is perhaps helpful to remember what the wrongdoing was.

In its basic form, it involved private businesses working on government contracts, paying kickbacks to politicians funding their party's political campaigning. Everybody did it: politicians from all parties running municipalities, provinces, regions, Christian Democrats, Socialists, Communists, and sundry others.

Almost none of the politicians pocketed any kickbacks or used the money for profit. A contractor would build a road or a bridge, and a small portion of the fee paid by the council would go to the mayor's political party. Strictly speaking, the donation would be against the rules, so it was passed quietly in cash to convince the public to vote for that party again.

The public had long known this had been happening. To some extent, they accepted it as the system, just how things work. Also, political controversies usually emerge when parties disagree, which is most of the time. However, since all parties worked this way, this wasn't an issue that came up with any frequency in political discourse.

When the clean hands prosecutors decided to clamp down on this, the public realised what happened when they weren't watching. Competition for public contracts became less about getting the best value for money for taxpayers and more about getting the most significant kickbacks for political parties. Bidding for public contracts became an auction of bribes. It also became an opportunity for organised crime to syphon off public money, laundering the proceeds of their more violent activities like drug trafficking and extortion into the concrete they poured into road projects they never finished.

Bettino Craxi and Silvio Berlusconi

Political parties became dependent on the money coming from these kickbacks. They needed it to pay salaries, organise election campaigns, and even exist. Their need for the funds overrode any sense of propriety and decency. They pressured the governments they ran to give contracts to their most generous donors. When they knew the donors were fronts for organised crime, they pretended not to and ensured the police held back. They became in thrall to the criminals.

The word for 'kickback' in Italian is 'tangente': a diversion of a portion of public funds flowed back towards the decision-makers who spent them. When they decided to stop it, they called the system that ran their country Tangentopoli: the city built on kickbacks, the party system that relied on corruption, and the surrender to criminals.

Those who benefited from the system sucked everybody else into it. Honest politicians who entered public life for the right reasons found themselves unable to raise the money to get elected without joining the kickback system. Businesses that wanted to compete for public contracts found they could only win if they paid up. Political parties couldn't function if the money stopped flowing. Everyone shut up. And organised crime flourished, sucking up the profits while no questions would be asked of it.

Eventually, the system collapsed. It wasn't replaced by a political paradise free of corruption. Quite the contrary, Italian politics pushed back on law enforcement and systemically sought to undermine it. The son of the Tangentopoli revolution was an unlikely figure: Silvio Berlusconi, who used politics principally to avoid being prosecuted for corruption. When the first Italian republic collapsed because the lines between business and holders of public office had been so blurred, the second republic was dominated by an individual who personified the merger between business and holding public office.

The lessons for our time and our country from that trip back to Italy in the last decade of the previous century are here.

Political parties here are primarily funded from kickbacks paid by contractors. Contractors pay back a portion of public money spent on them for public contracts or a slice of the profits they make from exploiting public land or the air they are permitted to fill with their towers and concrete monsters.

Businesses find they cannot beat them, so they choose to join them instead. Paying taxes on time is insufficient to acquire the right to succeed in our economy, particularly in the economic areas where the government enjoys influence. If you need a permit, a license, and especially a purchasing contract, you need to make it to the list of friends, which is a euphemism for the list of donors.

Some ministers are not above enriching themselves, but that is not quite an essential job requirement. But to be re-elected and maintain and renew the party's power, money needs to come from somewhere, and it is incumbent on them to get it.

Everybody does it, so it's not a subject often discussed in political discourse. However, it would be a false equivalence to ignore that the opposition PN now officially believes that secret private funding of political parties should be replaced by transparent public financing. The fact that this wasn't an official policy up until now gives an inkling of the political courage required to promote it. It also contrasts with the ruling PL's hostility to the idea.

State funding of anything is inherently unpopular, let alone the funding from your tax money of a political party you profoundly dislike and disagree with. However, the absence of state funding does not save you money. Whatever you may believe, even party gatherings you won't be caught dead attending, party advertising you don't look at, and party TV stations you'll never watch don't come free. If your taxes are not funding them, someone else is paying for their costs. Though you're told the money comes from commercial activities conducted by political parties or small €5 donations by party supporters at telethons, that's mostly a fudge, sometimes a flat-out lie.

It is primarily businesses that are funding your democracy through informal taxation and unaccounted flows of money hidden from view. They consider them an operational expense, something they have to live with, like utility bills and the more formal and transparent taxes. And for business to make sense, they will need to recover their informal expense somehow. That's what you pay for. You pay for more expensive public contracts paid to the less efficient, more expensive, and more generous funders of political activity. Your taxes go into the pockets of the less good—some in the pockets of criminals hidden in the silence of systemic bribery that runs our country.

This is Tangentopoli. So far, we haven't been smart enough to look to dismantle it, and we've been even less savvy to think ahead about what might come after it. And yet, with or without our foresight, something, at some point, has got to give.

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