Disaster Capitalism, Italian Style

While the world watches the effects of another natural disaster, Italians, especially the citizens of L'Aquila, the city struck by an earthquake in April 2009, are waking up to a new kind of desolation. Italian magistrates have started unveiling the results of the inquiries on the reconstruction that followed the shock, delineating a landscape where the most basic forms of solidarity and compassion seem to have ceased to matter.

In one wiretapping the owner of a building company with a long list of significant public projects can be heard saying "At half past three I was laughing in my bed". 3:32 was the time the main shock occurred, killing 307 people. It was also the time when, according to the magistrates of Florence who are investigating the case, entrepreneurs, politicians and top level bureaucrats started thinking about the large personal gains they could make out of the devastation.

As newspapers continue to report on the inquiry, the scandal of L'Aquila exposes a corrupt system composed of individuals who have learned how to profit from emergencies. Some benefited from the visibility these events provide when promptly addressed, others benefited from the money disbursed to make adequate responses possible. Emergencies such as the one triggered by 2009 earthquake were real. Others were labeled emergencies by decree, turning for example the Expo 2015, the universal exhibition that will take place in Milan in five years from now, into an event requiring urgent action and special powers. The advantage of this scheme is that it allows one to bypass the laws regulating bids and contracts, and to hand over the contracts to a "trusted" network. While the state and politicians are able to demonstrate that they are efficient and the projects are well managed, this comes at a cost.

The most evident cost is economic. As reported by the newspaper Il Corriere Della Sera, projects carried out by firms in this "trusted" network can be increased up to 50 per cent. But the highest cost is the one imposed on social relations. The network operates by feeding a relatively simple structure where power trickles down from top to bottom. It creates jobs and opportunities privileging loyalty and family connections. It does not require anyone to be particularly innovative, just to build or re-build as quickly as possible. Overall, it has rewarded recklessness and mediocrity, propping up the arrogance of the individuals who were part of it. According to Rosario Lupo, the magistrate leading the investigation, "are not just aware their power is almost limitless, they have a kind of impunity syndrome". At the same time this system has increased the frustration and sense of impotence of those who were excluded from it or who suffered because of its shortcomings. The revelations of the corruption now risk undermining the faith of a population who has always demonstrated great solidarity in case of emergencies, as shown by the thousands of volunteers who went to help L'Aquila in the aftermath of the earthquake.

A few years ago Canadian journalist Naomi Klein published a book explaining the mechanisms of what she called "disaster capitalism", a system based on radical policies mixing public spending and privatization, most likely to occur in the aftermath of a conflict or crisis. Italy today seems to be emerging as yet another case to be added to the long list of countries where the system has been applied. With one significant variation. Naomi Klein accused the architects of disaster capitalism, Milton Friedman and other Chicago School economists, to have used natural or man-made disasters to test their theories on monetary and fiscal policies. But in the case of Italy there is no theory to prove. L'Aquila, and other real or supposed emergencies in Italy, simply revealed the state of political and economic elites who have lost their capacity to imagine the future, and tend to fall on well rehearsed schemes. More dramatically, their actions today are eroding the social capital that will be needed by a new generation to build tomorrow's Italy.