Air Date: June 25, 1996 Program 9626

ITALIAN ECONOMY; GLOBAL GOVERNANCE

Guests:
Various Italian citizens
Adele Simmons, President, John D. & Catherine T. MacArthur Foundation


ITALIAN ECONOMY

FREDERICO GALDI: We have calculated up to 56 percent of income from the selling of products taken by the government in one way or another.

JEFF MARTIN: This is Common Ground. In this edition of Common Ground the Italian economy is struggling overall causing the emergence of issues with which Americans are familiar—taxes and immigration.

LUCIO MANISCO: Italy together with other European countries are exploiting North African countries. We create the reasons why people immigrate from these countries into Italy and to other industrialized countries in Europe.

MARTIN: And then later in the program, seeking ways to manage a chaotic planet. The report of the Commission on Global Governance.

ADELE SIMMONS: You have the United Nations. You have multiple-trade organizations. You have international environmental organizations that may be outside the UN framework. So there are many, many actors. And the question is, "How do they all interrelate and interconnect to create some kind of coherent and more effective way of preventing violence, solving common problems, and enabling the survival of the planet?"

MARTIN: Common Ground is a program on world affairs and the people who shape events. It is produced by the Stanley Foundation. I'm Jeff Martin.

The Italian economy is in trouble. Slow annual growth and 11 percent unemployment mean that some young people can't get jobs until they are 26 years old. Far right-wing parties say immigrant workers are the cause of unemployment, while left-wing parties call for a shorter work week to spread the jobs around. Yet, in the northern regions of Italy, the economy is prospering. Businesses are making good profits and providing virtually full employment. Correspondent Reese Erlich traveled to various parts of Italy to bring back this report on the fascinating, and sometimes contradictory, Italian economy.

REESE ERLICH: Some 50,000 people marched through the drizzling streets of Rome to demand civil rights for immigrants. Far right-wing parties are blaming immigrants for Italy's high unemployment and other economic problems. So on this day Italians, Niceans, Senegalese, and other foreigners joined hands to reject such views. They say immigrant workers are the victims of an economy gone bad, not its cause. This Moroccan worker says he and other immigrants are forced to take the lowest paid jobs and receive few of the benefits to which they are legally entitled. They are subject to harassment and discrimination on the job.

MOROCCAN WORKER: All these people were immigrants without documents. We want the Italian government to give us a right to work here and to give us documents.

ERLICH: The Italian government did pass a partial amnesty bill last year that allowed illegal immigrant to regularize their status. But many employers ignore the law's requirement to pay for health care and disability insurance. Some foreign workers are afraid to come forward to claim amnesty fearing retaliation by employers. Government critics say more fundamental changes are needed. Lucio Manisco is a well-known TV journalist and now edits the left-wing daily, Liberazione. He says most immigrants in Italy come from countries bordering the Mediterranean Sea.

LUCIO MANISCO: We would like first of all to follow an economic policy of investment in this country. We take the responsibility that Italy together with other European countries are being exploited—North African countries and other countries of Africa and Asia. Therefore, we create the reasons why people immigrate from these countries into Italy and to other industrialized countries of Europe. So that policy of investments in those countries, creating jobs there, obviously will limit this flow of immigrants. As far as immigrants in our country, we would like to make them equal to Italian citizens. If there are jobs, there are jobs for everybody. If there are jobs, they should not be discriminated against.

ERLICH: While the United States and other European countries have long wrestled with immigration issues, it's a relatively new problem in Italy. Until very recently, poverty forced many Italians to emigrate out of the country to find work. Tom Benatolo is the leader of the Catholic Church organization defending immigrant rights.

TOM BENATOLO: It's sad to say, but many Italians also have relatives somewhere in the world. More or less than 20 million Italians are around in this country. So if there are one of three Italians in residence now, we are 60 million at the moment. It is very sad to see that several people in Italy are against immigrants. The majority of these people have particular guarantees, proper regulation of the system this term. I think they will accept the presence of these immigrants.

ERLICH: The debate about immigration is symptomatic of a wider problem in Italy's economy. Business people say inefficient, state-owned industries and a bloated welfare state stifle economic growth. They complain bitterly about high taxes. Federico Galdi is head of international relations for Confindustria, Italy's federation of industries.

GALDI: The tax burden in Italy is particularly strong on the producers, on industrial companies. We have calculated up to 56 percent of income from the selling of products taken by the government in one way or another. We have a very heavy social burden. In certain cases, more than 106 percent of the salary is paid from the company to the state to cover social costs. Also, the individual burden is perhaps one of the highest in Europe.

ERLICH: Confindustria would like to see lower taxes, reduced spending on social welfare, and the selling off of many state-owned industries. That rubs Angelo Gennari the wrong way. He's head of research for the Italian Confederation of Worker Trade Unions. He says workers desperately need to maintain the social benefits afforded by the welfare state. He has a proposal for solving unemployment.

ANGELO GENNARI: Our answer to that, it is an answer which is probably not global. It is a redistribution of working time. A redistribution of working time and a change in the approach that we have to our working life, if you want. It does not say anywhere that you should always work like you work today, eight hours a day for five days a week. These things are changed over time. Every time they've changed, employers have hollered that it was going to destroy them, and it never did. We passed from a 13-hour day to the 10-hour day and then to the 8-hour day. Now we will have to go below that limit. Of course, there will be some wage sacrifices.

ERLICH: Gennari concedes such proposals won't be easy to pass, because the nature of work has changed drastically in the past 40 years.

GENNARI: Large industries are disappearing and have disappeared. The restructuring and outsourcing and giving out work, Fiat was a place where hundreds and thousands of workers worked together. It was easier to organize. If the Fiat decentralizes itself as it is doing and decentralizes production as it is doing in many, many small firms, always Fiat-owned or at least Fiat-licensed or whatever, it's much more difficult to organize them. But that's what we're trying to do.

ERLICH: Confindustria's Galdi agrees that Italy is moving away from large industry toward small and medium enterprises. He cites the highly successful textile and garment industries that use small, but technologically advanced, factories.

GALDI: One of the secrets of the efficiency of Italian fashion system is that by utilizing this kind of production rather than the big factory with 3,000 workers they are capable of introducing, for instance, new collections in only two weeks. They have invented production of sweaters in gray color. They put the color on only in the last two days.

ERLICH: There is another secret to the fashion industry, at least here in the Emilia Romagna region south of Milan. Emilia Romagna has been run by the Communist party and its successor organizations to the party of the Democratic Left since the late 1970s. Italians call it "Red Emelia." Ironically, the Reds have helped foster some of Italy's most dynamic capitalism. Inside a small textile factory owner Graziano Daviddi proudly shows off his high-tech equipment. One of his textile weaving machines can produce enough cloth in a day to make 300 garments. Upstairs Daviddi explains how his technicians scan a fashionable design into a computer.

GRAZIANO DAVIDDI: They copy the design into the computer—the computer-translated manual language, which is called machine language—and after that they can insert the floppy [disk] into the machine.

ERLICH: Daviddi says he and other entrepreneurs in the area benefit from local government policies. The government doesn't provide economic subsidies. It sets up three bureaus to keep the garment and textile industries competitive.

DAVIDDI: Then we have the Quality Textile Analysis Laboratory. It's allowed to control the quality of the clothes and the final garment. The 45 companies that make up our consortium have the opportunity, for a small fee, to analyze their products. That quality control allows them to give the national/international customer a very high-quality product.

ERLICH: Local government policies not only benefit business people but workers as well. The union movement is quite strong. Wages and working conditions are good. Rosetta works at Daviddi's textile factory folding cloth and checking quality. She's a long-time union member.

ROSETTA: I feel much more comfortable than other places I have been working for. It's different mainly from the environment. Here the people are friendlier, and because I didn't have this kind of environment before.

ERLICH: Elsewhere in the world, when workers unionize and wages go up the employers flee overseas. That's certainly a problem for Italian workers as well. But far more companies stay here, because the Italians have created a niche market not likely to be recreated in the mass garment shops of Asia. Graziano Daviddi.

DAVIDDI: We try to provide a more imaginative, well-presented, and quality product than Asian countries. We can provide specialized needs, because we have more high-tech machines than in other parts of the world—unfortunately for them. We have another great advantage, our Italian designers. They have a wonderful creativity superior to many other. The imagination of our designers and high technology of our machinery makes a well-presented and quality product. Something we are proud to say was made in Italy.

ERLICH: These companies succeed in part because the local administration is helpful, stable, and honest. There have been no bribery scandals involving the garment industry in Red Emelia, although there have been scandals in awarding construction contracts. However, union official Angelo Gennari says everything isn't rosy in Red Emelia.

ANGELO GENNARI: Local political authorities close their eyes to many irregular things. Many of those small and medium enterprises don't pay their taxes as they should. And that's tolerated. In any case, they create jobs. Even if they are jobs that we say in the black in the formal economy, but they are still jobs. On the average, though, an Italian I believe would much prefer to live in the Emilia Romagna region than in Sicily or even in the Lotrio region where we are today. Because, at the same time, those local governments have given a lot of rather good, functioning, effective social services, social infrastructures, to their region.

ERLICH: While other parts of the Italian economy are mired in difficulties, the small- and medium-sized plants in Emelia Romagna are doing just fine. There's virtual full employment and an annual growth rate of 5 percent. Experts point to this region as a model for Italy, but economic differences among the regions of Italy are so great that it will be many years before the entire country enjoys the prosperity visible here. For Common Ground, I'm Reese Erlich.

MARTIN: In a moment, Common Ground continues with a report on the work of the Commission on Global Governance.

ADELE SIMMONS: I think the important thing is to move away from kind of every problem can be decentralized, to figure out which problems are best managed at which level. So you've got to figure out what the problem is, what you're trying to accomplish, and then who can best do that. And the lower the level at which the work can be done, the better.

MARTIN: Printed transcripts of Common Ground and audiocassettes of this program are available. Listen at the end of the broadcast for details on ordering. Common Ground is a service of the Stanley Foundation, a nonprofit, nonpartisan organization that conducts varied programs and activities meant to provoke thought and encourage dialogue on world affairs.

GLOBAL GOVERNANCE

MARTIN: In 1992, former West German Chancellor Billy Brandt prompted the establishment of the Commission on Global Governance in the hope that international conditions were favorable for strengthening global cooperation. Common Ground producer Keith Porter recently spoke with one of the Commission members and has this report.

KEITH PORTER: The Commission on Global Governance met with people all over the world before issuing their findings last year. Their report, titled Our Global Neighborhood, covers values, security, economic interdependence, UN reform, and the role of international law as well as a call to action for the people in governments of the world. The 28 commission members included former Swedish Prime Minister Ingvar Carlsson, former Costa Rican President Oscar Arias, South African anti-apartheid leader Alan Boesak, former World Bank President Barber Conable, former European Commission President Jacque Delors, United Nation's High Commissioner for Refugees Sadako Ogata, President of the International Peace Academy Olara Otunnu, and Earth Summit organizer Maurice Strong. Another member of the Commission was Adele Simmons, president of the John D. and Catherine T. MacArthur Foundation in Chicago.

SIMMONS: All of us have been speaking worldwide to groups and organizations trying to insure that the main ideas become a part of the international debate. Most important, 15 governments have issued a statement basically underlying all the recommendations of the Commission they thought would further the Commission directly. But it's very clear as these 15 governments got together around the 50th anniversary of the United Nations, they read the report and basically as they said what needs to be done in the future, they drew directly on the recommendations of the report.

PORTER: Is there some next step, some next report, or some next creation that will come out?

SIMMONS: No. I think right now you have our report. You have the report of the Ford Foundation-sponsored effort out of Yale on the reform of the United Nations. Much more explicitly, you have a Carnegie Corporation Commission on the Prevention of Deadly Conflict. The work of all of these groups needs to be brought together. Our hope is that there will be a large international summit along the lines of Cairo and Beijing, if you will, around the question of global governance in 1998.

PORTER: What was your specific area of interest or participation in the Commission?

SIMMONS: My feeling was that we needed to understand and recognize the role of these nonstate actors from the international corporations to the nongovernmental organizations that have been working on issues such as nonproliferation, population, environment. Defining the role and clarifying the role and recognizing the important role that these nonstate actors are going to play. There's going to be a very important part of rethinking global governance.

PORTER: People are often scared or turned off by the term "global governance." The summary of the Commission's report says, "Global governance is the sum of the many ways in which the international community manages its common affairs. Traditionally handled between states, it must now include interaction between governments and intergovernmental institutions and others including nongovernmental organizations, citizens' movements, multinational corporations and the global capital market. Interacting with all these forces is the mass media, whose global influence continues to expand."

SIMMONS: They get confused about governance, which is really some kind of international system of sensible collaborative world management to government, and we're not recommending in any way global government. We're recognizing that you have NGOs, you have citizens' groups, you have individual citizens, you have states, you have regional alliances, you have the United Nations, you have multiple-trade organizations, and you have environmental organizations that are international that may be outside the UN framework. So there are many, many actors. And the question is how do they all interrelate and interconnect to create some kind of coherent and more effective way of preventing violence, of solving common problems, and enabling the survival of the planet?

PORTER: You mentioned the nonstate actors. Beyond that, how do you summarize the main points or recommendations from the report?

SIMMONS: We did recommend reforms of the United Nations which I think are very important, including a restructuring of the Security Council. We have recommended the establishment of an international court to deal with basically individual criminal actions. We have recommended that there be some place where groups or individuals whose rights are not respected or valued within their own country have a place to appeal, a right of petition for these people. We have recommended that we think about this question of security of people in addition to security of states. I think we need to be careful that we not simply talk about the decline of the state. I think states are enormously important, just look again at Algeria and Zaire. As the ability of the state to manage basic things such as maintaining economic structures, police, etc. declines, you have more violence and everything collapses. So we need states, but there are all these other nonstate actors that connect with them and work around them and are a part of these systems.

PORTER: When you talk about security of people, do you think that leaders of states get worried about that? Does that make them nervous when they hear people talking about security of people rather than security of states?

SIMMONS: They may. It shouldn't. I don't think the state government in Nigeria is, in fact, a very secure one because the people aren't very secure. While the government may still be in power today or tomorrow, I think most of us sitting around this table can be pretty sure that one or two years from now there will be a new government in Nigeria.

PORTER: There's a lot of talk in Washington about decentralizing or devolutions, sending power out to state and local levels. Talk or action, I don't know which. And also at the United Nations, even in the most recent human development report there was talk about decentralizing being a good thing. When we talk about global governance, and again it may be the confusion between global governance and global government, is there room for decentralizing? I mean is that recognized?

SIMMONS: Yes. I think the important thing is to move away from thinking every problem can be decentralized, to figure out which problems are best managed at which level. If you're looking at the ozone question, that is a worldwide international problem. You need an international convention and some kind of worldwide monitoring of ozone questions. If you're talking about the arms trade, that's a combination of work at the state level, at the regional level and at the international level. On human rights you need general international standards, but the monitoring and the work have to be done at the local level. So you've got to figure out what the problem is, what you're trying to accomplish, and then who can best do that. The lower the level at which the work can be done, the better.

PORTER: You talk about UN reform. Is the United Nations right now a good example of global governance, a failed example, or somewhere in between?

SIMMONS: I don't think the answer is that easy. There are parts of the United Nations that are wonderful, that are working amazingly effectively. The work of the High Commission on Refugees is doing under stress what is hard to imagine and no one ever anticipated. It's terribly important. The number of UN peacekeeping operations that are now in place and effective and making a huge difference such as the troops along the Macedonian border which is relatively new, or Cyprus, which is relatively long-standing. It's something people don't recognize. When one peacekeeping or peacemaking mission fails, that attracts all the attention and no one pays any attention to what's working. So there are many pieces of it. If we didn't have the United Nations, we'd have to invent something like it. There are enormous inefficiencies in the bureaucracy. We need to deal with those, but you don't throw the baby out with the bath water.

PORTER: You mentioned also that the series of UN conferences—including Cairo, Beijing, Vienna, Copenhagen, and others—one thing that has stuck me, and we've covered those on our program, is the rise of the NGO forums and the role that the NGOs have played in those. Is this a model that we think can continue, this co-meeting official site, nonofficial sites? Is it an effective, efficient way of gathering world attention on those both NGO and governmental levels?

SIMMONS: It seems to be working. It is an approach that will probably run its course as people will become exhausted by these summits or summited out to some extent. But to the extent that there are still some huge topics that need to be addressed, I think it will continue to attract attention. I think having the NGOs there is very important. But as the secretary-general of the United Nations said to me at one point, "The NGOs are very important, but how do I deal with 30,000 of them?" They need to find a way to organize so that those who are dealing with them feel that there's less chaos.

PORTER: You mentioned the possibility of another summit. Can you tell us anything more about that?

SIMMONS: We need to do a lot of preparatory work, but I think this is where a discussion of global governance can take place with a broader constituency than just 28 of our commissioners sitting around the table, even though we did hold hearings and listening to people. I think there needs to be a really serious discussion about UN reform and its relation to the broader kinds of global governance that we talked about. I think there needs to be discussions about financial markets and the ways in which capital flows without any regulation can destabilize governments.

PORTER: Right. Adele Simmons, do you have a continued role with the Commission?

SIMMONS: The Commission itself is basically moribund. But I think all of us who are involved in it want to maintain the friendships that we developed and continue to promote the work of the Commission.

PORTER: That is Adele Simmons, president of the John D. and Catherine T. MacArthur Foundation in Chicago, Illinois. She's also a member of the Commission on Global Governance. The Commission report is titled Our Global Neighborhood. For Common Ground, I'm Keith Porter.

MARTIN: Cassettes and transcripts of this program are available. Transcripts are free and cassettes cost $5.00. To order or to share your comments, write to us at the Stanley Foundation, 216 Sycamore Street, Muscatine, Iowa 52761. Ask for Program No. 9626. To order by credit card, call us at 319-264-1500. For Common Ground, I'm Jeff Martin.

B.J. Liederman created our theme music. Common Ground was produced and funded by the Stanley Foundation.


COMMON GROUND

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