DURING one of his regular visits to Italy, the Italo-American economist Dr Francesco Modigliani was asked this autumn about the possible negative effect on the Italian economy of continuing political uncertainty. No problem, replied the distinguished economist, the Italian entrepreneurial classes long ago learned how to live, thrive and prosper in the face of apparent political chaos.
Professor Modigliani is probably right. Italy's huge economic clout - it is a G7 member, with the world's fifth largest economy - has never in the post-war era been matched by a similar political clout. Nor does that trend look as if it is about to be reversed in 1996.
Italy began 1995 in political limbo and seems destined to end it in the same limbo. On January 1st, 1995, Italian state president Oscar Luigi Scalfaro was deeply involved in the process of finding a successor to media tycoon Silvio Berlusconi, whose right wing coalition government had been brought down just before Christmas by the exodus of his onetime allies, the federalist Northern League.
Come January 1st, 1996, President Sealfaro will again be deeply involved in resolving a government crisis, since the interim "technical" government of former banker Lamberto Dini will resign on or before New Year's Eve.
Mr Dini originally entered politics at the invitation of Mr Berlusconi, and served as his Treasury Minister for the seven short and turbulent months of Mr Berlusconi's 1994 government. As an alleged "technician and alleged "neutral", Mr Dini was one of the few realistic options open to President Scalfaro last January.
The Italian Head of State felt that, after the social and marketplace turmoil prompted by the Berlusconi regime, Italy's overwhelming requirement was to re-establish international credibility, especially on currency markets where the lira had been doing its own version of Disneyland's "Thunder Mountain". By and large, Mr Dini has done well, surviving two "no-confidence" motions mounted by his former sponsor, Mr Berlusconi, to re-establish for Italy an image of credible continuity based on a commitment to tackle Italy's runaway public finances.
Initially, few commentators would have predicted that Mr Dini would last beyond the summer. His cryptic government programme promised that he would introduce a hard-hitting mini-budget as well as reforms to pensions, local electoral legislation and current affairs broadcasting.
As the months passed and as Mr Dini realised nearly all his aims, that mini-budget became the 1996 Annual Budget, thus allowing Mr Dini, ably supported by President Scalfaro, to extend his mandate to December 31st, the date by which the 1996 Financial Bill has to be ratified by parliament. All of that, too, notwithstanding the fact that Mr Dini and his cabinet are non-parliamentarians with no electoral mandate whatsoever.
One issue which Mr Dini did not resolve was that of equal access to current affairs broadcasting, which is perhaps not surprising when one recalls that Mr Berlusconi, via his three nationwide channels, controls 43 per cent of Italian television.
Lest anyone have doubts about the power of that Berlusconi television empire, let them consult the results of a June referendum where a majority of Italians voted not to reduce the number of commercial interruptions allowed during the screening of feature films, thus condoning Italy's breach of European Union directives on the matter.
Now, why would Italians want to have more rather than fewer interruptions during their favourite Clint Eastwood movie? The answer is simple. Mr Berlusconi and his television channels mounted such an effective, one-sided campaign that people actually believed that the Berlusconi empire's liquidity would be threatened by a possible reduction in revenue if fewer commercials were allowed.
MR BERLUSCONI'S use or abuse of his televisual power is certain to remain a key issue in 1996 when even Italy's forthcoming term of European Union presidency (January to June) cannot indefinitely delay an early general election. That EU presidency, however, may breathe another three or four months life into the Dini government since President Scalfaro seems unwilling to dissolve parliament and hold elections in mid-presidency.
When the elections come, they will be contested by at least two forces - a centre right coalition featuring Mr Berlusconi's Forza Italia party in alliance with the neo-Fascist Alleanza Nazionale opposed to a centre-left coalition formed around the ex-communist Democratic Left (PDS) and led by ex-Christian Democrat economist Romano Prodi. Mr Dini and/or the former prosecuting magistrate Antonio Di Pietro (of Tangentopoli fame) could yet provide a third centre-centre alternative.
Before those elections are held, however, Mr Berlusconi will have his day in court, charged with corruption and bribery relative to monies paid to tax inspectors by companies controlled by his Fininvest Group.
Indeed, 1996 seems set fair to be the Year of Trials, with Mr Berlusconi, seven times prime minister Giulio Andreotti and former SS captain Erich Priebke all due to make courtroom appearances which will generate fierce controversy and bitterness.
Life senator Andreotti's trial on charges of mafia collusion opened in the autumn of this year, but has so far been delayed with the inevitable procedural wranglings. In 1996 it will get down to deadly serious business, including testimony from former mafiosi.
Erich Priebke, accused of involvement in the reprisal killing of 335 Italian men and boys at the Fosse Ardeatine near Rome in March 1944, will probably stand trial some time next autumn. His trial will introduce a whole generation of young Italians to the horrors and trauma of a second world war experience when Italy was the pulverised theatre of two wars - the global war between the Allied forces and those of Nazi Germany and the "civil war" between pro-Fascist and anti-Fascist Italians.
All in all, 1996 seems set fair to provide more than its share of confusion and controversy. Just as well that Italians know how to cope. Buon Anno.