In the 1990s, some 6,000 businesspeople and politicians were implicated in a billion-dollar government graft scandal. Such familiar figures as Bettino Craxi, former head of the Socialist party, and Giulio Andreotti, a seven-time prime minister, were accused of corruption.
Hoping for a renewal after all this exposure of greed, Italian voters in March 1994 turned to the right wing to head their government. In overwhelming numbers, voters elected a former cruise-ship singer turned media billionaire, Silvio Berlusconi, as their new leader. His Forza Italia (Go, Italy) party formed an alliance with the neofascist National Alliance and the secessionist Northern League to sweep to victory. These elections were termed "the most critical" for Italy in 4 decades. The new government was beset with an almost hopeless array of new problems, including destabilization caused by the Mafia and its underground economies. When the Northern League defected from the coalition in December 1994, Berlusconi resigned.
Treasury Minister Lamberto Dini, a nonpolitical international banker, replaced him. Dini signed on merely as a transitional player in Italy's topsy-turvy political game. His austere measures enacted to balance Italy's budget, including cuts in pensions and health care, were not popular among the mostly blue-collar Italian workers or the very influential labor unions. Pending a predicted defeat in a no-confidence vote, Dini also stepped down. His resignation in January 1996 left beleaguered Italians shouting "Basta!" ("Enough!"). This latest shuffling in Italy's political deck prompted President Oscar Scalfaro to dissolve both houses of the Italian Parliament.
Once again Italians were faced with forming a new government. Elections in April 1996 proved quite a shocker, not only for the defeated politicians, but also for the victors. The center-left coalition known as the Olive Tree, led by Romano Prodi, swept both the Senate and the Chamber of Deputies. The Olive Tree, whose roots stem from the old Communist party, achieved victory by shifting toward the center and focusing its campaign on a strong platform protecting social benefits and supporting Italy's bid to become a solid member of the European Union. Prodi followed through on his commitment when he announced a stringent budget for 1997 in a bid to be among the first countries to enter the monetary union.
The year 1997 saw further upheavals as the Prodi government continued to push ahead with cuts to the country's generous social security system. In the autumn of 1997, Prodi was forced to submit his resignation when he lost critical support in Parliament from the Communist Refounding party, which balked at further pension and welfare cuts in the 1998 budget. The party eventually backed off with its demands, and Prodi was returned to office.
In December 1999, under Prime Minister Massimo D'Alema, Italy received its 57th new government since 1945. But it didn't last long. In April 2000, former Prime Minister Giuliano Amato, a onetime Socialist, returned to power.
As 1999 neared its end, Rome rushed to put the finishing touches on its many monuments, including churches and museums, and everybody was ready for the scaffolding to come down before the arrival of 2000. Italy spent all of 2000 welcoming Jubilee Year visitors from around the world, as its political cauldron bubbled. One particularly notable clash in 2000 pitted the church and social conservatives against more progressive young Italians, as the pope lashed out at the World Gay Pride rally held in the summer of 2000. His condemnation sparked much debate in the media, but the actual event went off without a hitch and, in fact, was labeled as rather tame when compared to more raucous Gay Pride rallies elsewhere around the globe.
In May 2001, with right-wing support, the richest man in Italy, billionaire media tycoon Silvio Berlusconi (owner of three private TV networks) swept to victory as prime minister. Calling for a "revolution" in Italy, Berlusconi promised a million and a half new jobs, pension hikes, epic tax cuts, anticrime bills, and beefed-up public works projects.
In 2002, Italians abandoned their long-beloved lire and began trading in euros along with their neighbors to the north, including France and Germany -- a total of 12 countries (but not Britain). As the new currency went into effect, counterfeiters and swindlers had a field day; one elderly woman in Rome who was cashing a benefit check, unwittingly paid the equivalent of 600 U.S. dollars for a cup of cappuccino. But in general, the transition went relatively smoothly, especially among businesses.
Unlike France and Germany, Prime Minister Berlusconi proved to be a valuable ally of the United States when it went to war against Iraq in 2003. Berlusconi has attacked "Saddam apologists" who want to try to regain power through terrorist activity. A great deal of Italy, however, does not take the position of its prime minister and is highly critical of the way the U.S. has handled the war in Iraq.
In the Italy elections in April of 2006, Berlusconi was ousted by a narrow vote, losing to Romano Prodi. The new prime minister faces difficult challenges in that he may have a hard time keeping together nine parties that range from moderate Catholics to Communists.
