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### Viewing cable 08ROME840, ITALY: BERLUSCONI HITS STRONG HEADWINDS

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
08ROME840 | 2008-07-03 16:04 | 2010-12-23 21:09 | SECRET//NOFORN | Embassy Rome

`

    VZCZCXRO9503
    PP RUEHFL RUEHKW RUEHLA RUEHROV
    DE RUEHRO #0840/01 1851654
    ZNY SSSSS ZZH
    P 031654Z JUL 08
    FM AMEMBASSY ROME
    TO RUEHC/SECSTATE WASHDC PRIORITY 0560
    INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE
    RUEHFL/AMCONSUL FLORENCE 3107
    RUEHMIL/AMCONSUL MILAN 9450
    RUEHNP/AMCONSUL NAPLES 3254
    RHEHNSC/NSC WASHDC

` `

    S E C R E T SECTION 01 OF 02 ROME 000840

    SIPDIS
    NOFORN

    E.O. 12958: DECL: 07/02/2033
    TAGS: PGOV IT
    SUBJECT: ITALY: BERLUSCONI HITS STRONG HEADWINDS

    ROME 00000840 001.2 OF 002

    Classified By: Ambassador Ronald P. Spogli for reasons 1.4 (b) and (d).

    SUMMARY
    -------

    ¶1. (C/NF) After a very strong first month in office, PM
    Berlusconi's political honeymoon has been upset by
    prosecutors accelerating proceedings in criminal cases
    pending against him. These proceedings, leaked wiretaps, as
    well as the probability of further leaks have Berlusconi
    insiders concerned. The political furor over legislative
    proposals to block these investigations has distracted the
    public and Italy's politicians from progress on needed
    reforms but has not reduced Berlusconi's popularity,
    according to recent opinion polls. The strong prospect that
    legislation will be approved granting Berlusconi criminal
    immunity by the end of July may reduce his legal risks, but
    his political standing and ability to accomplish his national
    agenda could suffer setbacks. END SUMMARY.

    A SURPRISE CHANGE IN THE LEGISLATIVE AGENDA
    -------------------------------------------

    ¶2. (C/NF) Soon after his May 8 swearing in, PM Berlusconi
    started delivering on campaign promises to reduce taxes and
    increase public security, propelling his approval ratings
    above sixty percent and earning him the grudging support of
    many opposition voters and even parts of a normally hostile
    press (REF A). On June 17, Berlusconi attached an amendment
    to a security decree pending in the Senate that would freeze
    trials on "lesser crimes" committed before June 30, 2002 (REF
    B), a provision that would reportedly suspend at least one
    case against Berlusconi. The press aggressively attacked
    Berlusconi for attending to his personal affairs; Democratic
    Party (PD) leader Walter Veltroni announced the end of
    dialogue with Berlusconi; and several Forza Italia (FI)
    members of parliament told Poloff they were confused by
    Berlusconi's timing when there was much on the political
    agenda yet to be accomplished. Commentators were ready to
    declare Berlusconi's honeymoon over.

    ¶3. (C/NF) The Senate ultimately approved the amendment
    freezing certain criminal cases as well as the underlying
    decree, passing it the Chamber of Deputies for consideration.
    The self-governing Superior Council of the Magistracy (CSM)
    objected, suggesting the provision was unconstitutional.
    President Napolitano gave the CSM an unusual rebuke by
    telling them they were speaking out of turn and that
    pronouncing on constitutionality was the purview of the
    Constitutional Court. Berlusconi has since introduced a
    modified version of a 2003 law, known as the "Lodo Schifani,"
    that would give the top four institutional figures in Italy,
    including Berlusconi, criminal immunity for the time they are
    in office. Passage of at least one of these measures is
    possible by the end of July. Berlusconi is also consulting
    with coalition partners on a bill to restrict the use of
    telephone intercepts.

    ¶4. (C/NF) Council of Ministers Undersecretary Paolo Bonaiuti
    told Poloff July 1 that discussion of these provisions has
    diverted the public's attention from legislative progress on
    Berlusconi's domestic agenda. However, a poll released July
    2 indicates that 51 percent of Italians would vote for
    Berlusconi if elections were held now, versus 47 percent who
    actually voted for him in April. 45 percent support (an
    additional 10 percent are indifferent) the temporary freeze
    of less important criminal cases, including those pending
    against Berlusconi.

    CHANGE CAUSED BY A NEWLY FULL LEGAL CASELOAD
    --------------------------------------------

    ¶5. (S/NF) The press reports there are at least three criminal
    cases pending against the PM. The reason for the timing of
    Berlusconi's moves became clear when prosecutors announced
    that Berlusconi could be required to testify eight times in
    July. Simultaneously, audio files of wiretappings of
    Berlusconi and other politicians were leaked to the press and
    published on the internet. Council of Ministers
    Undersecretary Gianni Letta told the Ambassador July 2 that
    additional embarrassing wiretappings could be released in the
    next few weeks.

    ¶6. (C/NF) Though the timing for the hearings was a surprise,
    the cases against Berlusconi are not new. In one case
    potentially coming to a head in the next few weeks,
    Berlusconi is accused of offering British corporate lawyer
    David Mills a $600,000 bribe to hide potentially

    ROME 00000840 002.2 OF 002

    incriminating evidence. In another trial, Berlusconi is
    accused of fraud related to film rights for his private TV
    network, Mediaset. In the case currently receiving the most
    press due to leaked telephone intercepts, Berlusconi is
    accused of trading political favors with former state
    television (RAI) director Agostino Sacca, though much of the
    evidence surrounds Berlusconi's recommendations that certain
    showgirls should get greater airtime. (NOTE: Berlusconi would
    not be required to resign in the event of a criminal
    conviction, though he would likely come under considerable
    political pressure to do so. Convictions are not considered
    definitive until they are upheld on two appeals. In Italy,
    that can take several years. END NOTE.)

    ITALY'S JUDICIARY: FOR MANY, A BROKEN SYSTEM
    --------------------------------------------

    ¶7. (C/NF) Transcripts of telephone intercepts related to
    criminal investigations are frequently leaked to the press,
    resulting in significant embarrassment to those involved and
    calls for reform of Italy's fiercely independent judiciary
    and of the practice of wiretapping. Rarely, if ever, is the
    source inside the judiciary who leaked the transcript
    discovered. Though Italy's judiciary is traditionally
    considered left-leaning, former PM and FM Massimo D'Alema
    told the Ambassador last year that the judiciary is the
    greatest threat to the Italian state. Despite fifteen years
    of discussions on the need for comprehensive judicial reform,
    no significant progress has been made. Italians, by and
    large, consider their judicial system broken, perhaps beyond
    repair, and have very little confidence that the system
    actually delivers justice.

    WITH A LONG RECORD OF PURSUING BERLUSCONI
    -----------------------------------------

    ¶8. (C/NF) Berlusconi's legal troubles date back to before his
    entry into politics, though FM Frattini recently noted that
    Berlusconi has never been convicted definitively for
    anything. Berlusconi frequently complains that prosecutors
    time the announcement of investigations to damage him
    politically: "justice by the clock." For example, Milan
    judges announced they were investigating Berlusconi for
    accounting fraud on April 26, 2005, the day Berlusconi was
    requesting a parliamentary vote of confidence. Only a month
    earlier and days before local elections, investigators
    announced they would charge Berlusconi with bribery involving
    film rights for his media company. Though there are several
    more examples, the most celebrated is the announcement
    Berlusconi was being investigated for tax fraud on the eve of
    the 2001 G8 Summit in Genoa.

    COMMENT
    -------

    ¶9. (C/NF) Berlusconi's legal woes have dogged his fifteen
    years as a politician, though he has never received a
    conclusive conviction. With even some opposition members
    decrying the apparently political timing of the magistrates'
    most recent investigations and supporting judicial reform, it
    seems that politically motivated investigators may have gone
    too far. More importantly, President Napolitano's implied
    support for a bill conferring criminal immunity on, among
    others, Berlusconi means Berlusconi's legal problems could
    soon be laid to rest for the duration of his governing
    mandate. Despite this and buoyant opinion polls, additional
    revelations over the next month have some of his advisers
    worried. In short, Berlusconi has run into headwinds, and it
    is unclear if they have shifted back in his favor. In the
    extreme, it is possible to imagine a scenario where
    Berlusconi could lose considerable popularity and his ability
    to implement reforms, or even his power to govern. END
    COMMENT.
    SPOGLI

`