“Ah, Pisa , you the scan­dal of the peo­ples of that fair land where si’ is heard.”

– Dante

Washington’s flir­ta­tion with default engen­dered end­less hand-wring­ing about the par­lous state of our polit­i­cal sys­tem. But by Ital­ian stan­dards, Con­gress and the Pres­i­dent are doing just fine.

Last month, while GOP “defund Oba­macare” vig­i­lantes near­ly caused the mas­sive spend­ing and bor­row­ing machine that is our fed­er­al gov­ern­ment to seize up, Italy’s gov­ern­ment served up a sump­tu­ous feast of dys­func­tion, replete with sex scan­dals, res­ig­na­tions of cab­i­net min­is­ters, and an abortive attempt to top­ple a gov­ern­ment inca­pable of governing.

At the cen­ter of it all was the redoubtable Sil­vio Berlus­coni – show­man, entre­pre­neur, and polit­i­cal impre­sario who has dom­i­nat­ed Ital­ian pol­i­tics for two decades despite (and per­haps in part because of) the whiff of scan­dal that he con­tin­u­al­ly emits.

Berlus­coni seems to be per­pet­u­al­ly on tri­al, var­i­ous­ly accused of bribery, per­jury, defama­tion, tax fraud, and sex with under­age pros­ti­tutes. Wikipedia reck­ons that he has been tried 30 times over the past quar­ter cen­tu­ry. For his oppo­nents, this is evi­dence of cor­rup­tion of almost unfath­omable breadth and depth; for his sup­port­ers, it proves that judges, pros­e­cu­tors and oth­er polit­i­cal ene­mies are out to deprive him of man­dates that Ital­ian vot­ers have repeat­ed­ly giv­en him. He has served as Italy’s prime min­is­ter three times since 1994, though he does not occu­py the office today. Only Ben­i­to Mus­soli­ni and the less­er-known Gio­van­ni Giolit­ti have held that post for a longer peri­od of time since Italy became a nation-state in 1860. A poll tak­en over the sum­mer found that 43 per­cent of Ital­ians believe him to be a vic­tim of polit­i­cal persecution.

Berlus­coni has some­times been con­vict­ed but usu­al­ly slips the noose either on appeal or because his gov­ern­ing par­ty adopts laws that negate his con­vic­tions or oth­er­wise spare him legal con­se­quences. All of that changed on August 1, when Italy’s court of last resort affirmed a low­er court’s guilty ver­dict and sen­tence of four years impris­on­ment.  Because of his age, he will not go to prison. Instead, he was giv­en the choice between house arrest and com­mu­ni­ty ser­vice. He chose com­mu­ni­ty ser­vice. Giv­en his pen­chant for the eccen­tric, one can only imag­ine what form that ser­vice might take.

Now the Sen­ate must decide whether to expel him. The pre­car­i­ous gov­ern­ment, led by the Demo­c­ra­t­ic Party’s (PD) Enri­co Let­ta, is press­ing for his imme­di­ate removal. A Sen­ate com­mit­tee last week vot­ed to report an expul­sion mea­sure to the full Sen­ate. The com­mit­tee vote was 7–6. The full Sen­ate vote may occur lat­er this month.

If the Sen­ate does vote him out, it could spark a revolt of his Peo­ple of Lib­er­ty (PDL) par­ty that would bring down the gov­ern­ment and force new elec­tions. Berlus­coni tried and failed to engi­neer such a coup dur­ing Sep­tem­ber.  If he suc­ceeds this time, Berlus­coni would hope to lead his par­ty in those elec­tions, although he could not him­self stand for office. If he were to pre­vail, the new Par­lia­ment could be expect­ed to undo his expul­sion and repeal the law that bars him from hold­ing office. He could then, incon­ceiv­able as it might sound, com­mence his fourth term as prime minister.

The Berlus­coni dra­ma, how­ev­er it plays out, is at best a dis­trac­tion from the eco­nom­ic hard­ship fac­ing mil­lions of Ital­ians. The Ital­ian econ­o­my is sick.  It con­tin­ues to shrink.  A recent study found that invest­ments have lost more (27.6 per­cent) in recent years than dur­ing the inter­war depres­sion of 1929–1934 (12.8 per­cent).  Its over­all unem­ploy­ment rate stands at 12.5 per­cent, while unem­ploy­ment among 18–24 year olds exceeds 40 per­cent.

At the cen­ter of this hard­ship is gov­ern­ment debt and frag­ile banks. The two are inter­twined. Banks have loaded up on Ital­ian debt, which stands at 127 per­cent of the nation’s eco­nom­ic out­put. The per­ils of this debt reached cri­sis pro­por­tions in Novem­ber 2011, when inter­est rates on Ital­ian bonds soared to unsus­tain­able lev­els. The gov­ern­ment could not afford to roll over exist­ing debt at this high­er rate. They need­ed Euro­pean author­i­ties to bail them out. Ger­man Chan­cel­lor Angela Merkel and then-French Pres­i­dent Nico­las Sarkozy made clear that the price of Italy’s res­cue was Berlusconi’s resignation.

He stepped down, replaced by an unelect­ed “tech­ni­cal” gov­ern­ment of bankers and aca­d­e­mi­cians, head­ed by Mario Mon­ti. The Euro­pean Cen­tral Bank reward­ed Italy’s new gov­ern­ment by pour­ing 102.8 bil­lion euro ($138 bil­lion) into the country’s banks between 2011 and 2012 alone.  Pri­vate banks in Italy and else­where eager­ly swapped their dodgy Ital­ian bonds for euros and the bor­row­ing cri­sis sub­sided, with rates drop­ping to more man­age­able levels.

The ECB’s action spared the banks and the gov­ern­ment, at least tem­porar­i­ly. It did lit­tle for the real econ­o­my, which con­tin­ues to founder. Banks con­tin­ue to lend to the gov­ern­ment, but not to small busi­ness­es, which remain starved for the cap­i­tal they need to expand and cre­ate jobs.  Many fail.  Instead, the euros that the ECB pro­vides are chan­neled into obscure cir­cu­lar trans­ac­tions between banks and government.

What Italy requires is a gov­ern­ment that can say no: no to banks, to labor unions, to gov­ern­ment work­ers, to pen­sion­ers, whose ben­e­fits con­sti­tute 14 per­cent of GDP and 57 per­cent of social spend­ing. Italy needs banks that will lend to ail­ing busi­ness­es, labor reform that will give employ­ers more free­dom to hire and fire, a small­er gov­ern­ment and more fis­cal­ly sound health care and pen­sion systems.

The Mon­ti gov­ern­ment, unelect­ed and tech­no­crat­ic, was thought to be the gov­ern­ment that could say no. Instead, the polit­i­cal cri­sis wors­ened as the government’s aus­ter­i­ty mea­sures proved a polit­i­cal and eco­nom­ic dis­as­ter. Ital­ians chafed under high­er tax­es, par­tic­u­lar­ly the rein­stat­ed prop­er­ty tax on pri­ma­ry res­i­dences, which Berlusconi’s gov­ern­ment had repealed. After lit­tle more than a year, elec­tions were called.

Most observers were con­fi­dent of the results: the Demo­c­ra­t­ic Party’s (PD) can­di­date, Pierre Lui­gi Bersani, and Mon­ti would togeth­er win a suf­fi­cient num­ber of seats to form an elect­ed Cen­ter-Left gov­ern­ment. They were wrong. They bad­ly over­es­ti­mat­ed pub­lic sup­port for Mario Mon­ti. His Civic Choice par­ty won just 10 per­cent of the vote and not near­ly enough seats to help form a gov­ern­ment. They bad­ly under­es­ti­mat­ed the resilien­cy of Sil­vio Berlus­coni, whose PDL par­ty came with­in a whisker of best­ing Bersani, and of come­di­an Beppe Gril­lo, whose protest can­di­da­cy drew the sup­port of 25% of vot­ers. Under Italy’s arcane elec­tion laws, the PD was award­ed a House major­i­ty, but no one could form a gov­ern­ing coali­tion in the Sen­ate. Beppe Grillo’s deputies (Gril­lo him­self could not stand for elec­tion because of a pri­or crim­i­nal con­vic­tion) refused to join forces with either major par­ty, deny­ing both a Sen­ate majority.

Fran­tic nego­ti­a­tions cul­mi­nat­ed in the for­ma­tion of a bizarre gov­ern­ment in late April (two months after the elec­tions were held): a wob­bly coali­tion of Berlusconi’s PDL par­ty with that of the Cen­ter-Left PD. Enri­co Let­ta was named prime min­is­ter, and the Cab­i­net min­istries divid­ed between Letta’s PD par­ty and that of Sil­vio Berlus­coni. It would be as if half the Cab­i­net were appoint­ed by Barack Oba­ma and the oth­er half by Mitt Rom­ney, who would, through their respec­tive par­ties, joint­ly gov­ern. That hasn’t worked out in Italy any bet­ter than it would here.

The new gov­ern­ment had two major oblig­a­tions: pass a law repeal­ing the tax on pri­ma­ry res­i­dences and con­tain­ing nec­es­sary off­sets and adopt a new elec­tion law under which new – and hope­ful­ly, con­clu­sive – elec­tions could be held. It has done neither.

Instead it has stag­gered and fal­tered, con­tin­u­ous­ly threat­ened that Berlusconi’s deputies would bolt, bring down the gov­ern­ment, and force new elec­tions under exist­ing rules. Berlus­coni active­ly seeks his moment.

It is hard to see how Italy can resolve its prob­lems, whether or not Berlus­coni man­ages anoth­er improb­a­ble come­back. They are stub­born and sys­temic. Pen­sion­ers, pub­lic employ­ees, labor unions, banks and oth­ers all depend on the largesse of a gov­ern­ment that must con­tin­u­al­ly bor­row to make good on its promis­es. The gov­ern­ment has to say no to some­one: either its peo­ple or its cred­i­tors. But with­out cred­i­tors, it can’t make good on promis­es it has made to its peo­ple.  Its cred­i­tors demand fis­cal rec­ti­tude and aus­ter­i­ty, its peo­ple want more spend­ing, more gov­ern­ment stim­u­lus.  The polit­i­cal sys­tem seems inca­pable of pro­duc­ing a gov­ern­ment that can escape this conun­drum, leav­ing the econ­o­my adrift.

None of this, we are told by some experts and elect­ed offi­cials, can ever hap­pen here. Our gov­ern­ment will nev­er be forced to say no, nev­er be caught between the rock of cred­i­tors and the hard place of vot­ers demand­ing promised ben­e­fits.  The dol­lar is the world’s reserve cur­ren­cy and the Fed­er­al Reserve can pro­duce them in inex­haustible quan­ti­ties.  Our cred­it­wor­thi­ness is bet­ter served by abol­ish­ing statu­to­ry lim­its on gov­ern­ment bor­row­ing than by reduc­ing our depen­dence on debt.  And while manda­to­ry spend­ing con­tin­ues to grow and we will begin to lay out an esti­mat­ed $2 tril­lion in new and expand­ed health care enti­tle­ments over the next decade, we are assured that no fis­cal cri­sis looms, no ben­e­fits need be reduced, no hard choic­es need be made.  Our gov­ern­ment, we are assured by some, will nev­er have to say no.

Mean­while, the 77-year-old Berlus­coni last month report­ed­ly secret­ly wed his 28-year-old fiancee, Francesca Pas­cale, at a chapel inside his mas­sive Milan vil­la. Reports of the wed­ding sur­faced last week after a Bul­gar­i­an actress decried the rela­tion­ship as a sham and alleged that Ms. Pas­cale is a lesbian.

The source of the wed­ding sto­ry, Domini­can mod­el and singer Mary­thell Polan­co, tells us that Berlusconi’s third mar­riage hasn’t put a stop to his bun­ga bun­ga par­ties, the sorts of affairs that led to his recent con­vic­tion for hav­ing sex with an under­age pros­ti­tute. “It’s the one thing they can’t take away from him,” she said. “Bun­ga bun­ga will nev­er end. As long as there is Berlus­coni, there will always be bun­ga bunga.”

Ital­ians can, I sup­pose, take com­fort in that. But they deserve bet­ter.  Italy needs lead­ers with the seri­ous­ness and courage to con­front their nation’s press­ing fis­cal and eco­nom­ic prob­lems.  So do we.