Italy's middle classes unite against taxes

Any illusions that Italy would find it easy to sell the pain of European integration to its own electorate were definitively shattered this weekend, as more than half a million of the country's conservative middle classes descended on Rome to vent their displeasure at tax increases in the forthcoming budget.

Heeding the call of the opposition, led by Silvio Berlusconi, the former prime minister, and Gianfranco Fini of the reformed neo-fascist National Alliance, armies of shopkeepers, small businessmen and low-ranking professionals converged on the capital from every corner of the country on Saturday afternoon, turning the streets of central Rome into a huge seething tide of people and bright anti-government banners.

"No government can work against us," Mr Berlusconi proclaimed to loud cheers in the closing rally. "We are the Italy that goes to work and produces, the industrious, patient and responsible Italy that can decide, if pushed, that it's not going to take it any more."

With parliament due to vote this Thursday on the 1997 budget, an unprecedented austerity package aimed at squeezing Italy into the single European currency from the word go, the crowd gave a noisy thumbs-down to an array of proposed tax increases including the "Euro-tax", a one-off levy for next year totalling some 12.5 trillion lire (pounds 5bn). Romano Prodi, the Prime Minister, was depicted in banners as Pinocchio, and his government accused of misleading and mismanaging the country.

It was an extraordinary gathering, made up of the kind of people who normally sit at home and turn their noses up at the kind of people who go out on demonstrations.

Beneath the impeccably proper surface, however, was a wellspring of Poujadist resentment and latent violence. The demonstrators screamed swear words and sexual insults at government ministers and cried for them to be shipped off to Rwanda or the Congo; one small group of unreconstructed Fascists vowed revenge for their brothers "murdered by the servants of the state".

Mr Berlusconi himself railed at the "fiscal dictatorship" of the government and happily encouraged slogans depicting him as a victim of the political and judicial establishment. His attitude made clear that the core purpose of the demonstration was purely political: a show of strength by an opposition that had up to now shown little taste or talent for taunting Mr Prodi's six-month-old admi-nistration, and support for Mr Berlusconi, as his political career is ever more compromised by corruption and business malpractice charges.

The overwhelming success of the demonstration significantly broadened the issue, however. It proved that the country is still irreconcilably split down the middle between the Berlusconi-Fini brand of right-wing populism and the cautious, intellectual pragmatism of Mr Prodi and his struggling Olive Tree coalition. That sense of division, in turn, is a worrying portent of the kind of unrest Italy could see once the 1997 budget really begins to bite.

The great unmentioned subject of Saturday's rally was Europe, but Europe and the price of entry into monetary union was ultimately what it was all about. The subject went unmentioned because the vast majority of Italians, especially the merchant middle class, still believes in Europe; even Mr Berlusconi could not afford to disapprove of the austerity budget in itself, so he chose to complain about the preference for tax increases over spending cuts instead.

Sooner or later, though, open hostility to Europe seems likely to surface and with it all the thorniest issues in Italian politics, particularly the tension between the affluent north and the under-developed south. As the eminent commentator Eugenio Scalfari pointed out yester- day, the 1997 budget is just the beginning and another dose of austerity, probably in the form of cuts in pensions, will come along next year.

"The middle classes will have to choose whether they want to put off our entry into the European Union or else agree to pay the price or it," he wrote, adding that logic must lead them to the latter conclusion. To judge by the mood in Rome on Saturday, logic may not be the prime consideration out on the streets.