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People from all walks of life are appalled and fascinated in equal measure by the stratospheric political career of the tycoon and three-time Italian Prime Minister Silvio Berlusconi.
Michael Day provides an in depth look at the life and crimes of the shameless media mogul until his nine lives ran out and he faced definitive conviction which signaled his irreversible decline. He tells the story of a bright and ambitious man from a lower-middle class family who shook off his humble origins and rose to become rich and powerful beyond most people's dreams—a multi-billionaire whose Mediaset company remains one of Europe's largest television and cinema conglomerates. Along the way, amid the election victories, business triumphs, and womanizing, he became bogged down by his hubris, egotism, sexual obsessions, as well as his flagrant disregard for the law.
And yet how and why did Italy and Italians put up with him for so long?
With the 78-year-old's legal woes ongoing, including further trials for bribery, after a recent nine-month community service stint, Being Berlusconi: The Rise and Fall from Cosa Nostra to Bunga Bunga is well-timed to mark the final chapters of a notorious—and astonishing—life and career.
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The Rise and Fall from Cosa Nostra to Bunga Bunga
By Michael Day
Palgrave MacmillanCopyright © 2015 Michael Day
All rights reserved.
STARTING AS HE MEANT TO CONTINUE
Milan, Italy's gritty design and finance hub, is the City where people get things done: they graft, they sell, they make and design, they earn. It's not like Rome, the beautiful capital, in which locals sit around waiting for the tourists to come and drop money in their laps, and where Italy's gilded and venal political class line their pockets and enjoy long lunches. Milan-born Silvio Berlusconi understood the potential of both his hometown and the Eternal City — that is, money and power, respectively. And he cashed in spectacularly.
If becoming a hedonistic multimillionaire politician were easy, then we'd all be at it. It's a testament to Berlusconi's genius as a businessman and politician — and key to his popular and vicarious appeal — that he started with very little and rose to become Italy's richest man and dominate its politics for two decades.
Like many exceptional individuals, his background was anything but. Berlusconi's father, Luigi, worked as a clerk in the one-branch Rasini bank in Milan. His mother, Rosella, was a housewife, although, by most accounts, she ruled the roost. According to friends of the family, it is from his mother that Silvio Berlusconi got his get-up-and-go. His affectionate nature was probably due in large part to a loving bond with his father, Luigi.
Berlusconi recalled the day his father finally returned home after a long absence during the Second World War. Young Silvio waited anxiously at Como railway station, north of Milan, before finally seeing his father get off the train. He remembered racing along the platform to embrace his dad. "That moment has remained in my memory as the most agonizing and the happiest of my life," he once said. Some reports suggest Berlusconi's high opinion of himself was probably thanks to both parents, who eschewed any criticism for constant praise and adoration. "Our Silvio is better than all of them" was the message drummed into him in his impressionable early years.
He was born in 1936 in what was then the city's northern edge. Today the area, Isola, is Milan's most up-and-coming neighborhood. Trendy bars and shops buzz in the shadow of skyscrapers that are continually sprouting up in the giant construction site around the nearby Garibaldi railway station. These days when he's in Milan, Berlusconi, the former real-estate magnate, no doubt casts a wistful glance at the gleaming edifices. "If I were just starting up now," he might tell himself, "I'd make a killing." Who would doubt it?
Young Silvio's parents packed him off to a strict Catholic boarding school in the city at the age of 11. Berlusconi rose at 7 every morning to study mathematics, history, philosophy, languages and religion, with the rosary after lunch. He always obtained good grades. It didn't go unnoticed, however, by the Salesian priests who ran the establishment, that his religious conviction was somewhat lacking. A school friend recalled how Berlusconi would drift away during prayers; his lips "moved mechanically; his thoughts were clearly elsewhere."
This was probably the earliest recorded evidence of the vexed relationship with religion that has marked his career. Berlusconi's political instincts have told him that in Vatican-influenced Italy, he needs to keep the Church on board. But playing at being a good Catholic has always been at odds with his libertine personal philosophy. The result has been numerous shows of fake piety — until finally, toward the end of his career, the documented tide of sleaze that engulfed Berlusconi was such that any religious posturing became pointless.
Back at the prayer sessions in the Sant'Ambrogio Salesian Institute, the young Berlusconi probably had business in mind. In his early teens he was already doing the homework of slower or lazier classmates in return for their pocket money. This conservative educational institute probably drummed into him the anticommunist rhetoric that he would continue to spout for the rest of his life. And it was at this boarding school that the future tycoon met lifelong friend Fedele Confalonieri. More than sixty years on, Berlusconi and Confalonieri — who now runs the mogul's TV empire — remain as thick as thieves. Berlusconi's second wife would compare their relationship to that of two brothers. The friendship also set a pattern that has seen Berlusconi stick by key associates with unswerving loyalty — loyalty that is mutual and underpinned, no doubt, by a shared knowledge of where all the skeletons are hidden.
Confalonieri, the dour straight man to Berlusconi's vaudeville act, shared with his school friend a passion for music. By the age of 16 the pair were putting on improvised shows, with Confalonieri on piano and Berlusconi twanging the double bass and crooning standards made popular by Frank Sinatra, Nat King Cole and Yves Montand.
By the late 1950s, when Berlusconi had to pay his way through Milan's Statale University, he was earning extra money as a singer and host on Mediterranean cruise ships, putting his natural charm to good use, effortlessly entertaining large groups for hours at a time with songs, jokes and patter. With his hair slicked back and his winning smile never more than a couple of seconds away, the young entertainer made up for his short stature (he's just five feet five inches) with his boy-next-door good looks and easy charm. Confalonieri has attested that Berlusconi never had any difficulty wooing the ladies.
Berlusconi graduated in law in 1961, with top honors. His thesis on the contractual aspects of advertising even won an award from a local advertising agency.
* * *
And so, in the early 1960s, Berlusconi, the ambitious young graduate, found himself in the right place at the right time. The postwar expansion of the Italian economy was in full flow. And Milan, the country's business capital, was the hottest spot of all. Thanks to the city's entrepreneurial spirit, good links with the rest of Europe and an abundance of cheap labor arriving from the poorer south of the country, there was money to be made — and Berlusconi knew it.
After graduating, Berlusconi sold vacuum cleaners for a while. But it occurred to him that selling property would be easier — and a lot more profitable. He just needed enough cash to get things going. He managed to convince the head of his father's bank, the tiny Banca Rasini, to guarantee the loan needed to build his first apartments in Via Alciati in Milan. His famous powers of persuasion were next in evidence when he sold the first Via Alciati property to Confalonieri's grandmother.
His next project was a step up in size and ambition. A planned complex in Brugherio outside Milan would provide homes for several thousand people. The investment needed for this project was an order of magnitude greater than he'd needed for the Via Alciati apartments. Berlusconi again managed to get his hands on the cash, but this time it was less clear from where — or from whom — the money came, thus setting a pattern for the next ten years.
The would-be real-estate mogul founded a company, Edilnord, from which to base the venture. Once again, the little Rasini bank helped out, but its assistance wasn't enough for a property development of this size: additional funds flowed in from a Swiss company, FRA of Lugano. This firm's real proprietors have never really been identified. And it was at this point that the whispers began: rumors concerning the origins of Berlusconi's investments. When large, opaque cash flows are involved in Italy, the word "mafia" inevitably surfaces.
But Berlusconi just got on with selling the properties, and the tycoon's sales patter was more than up to the task. The Brugherio apartments were not in a very attractive spot. It was a swamp. There were few amenities in the vicinity, but plenty of factories and industrial plants. Plus, the economy was cooling a little by 1964, when the properties went on the market. Still the mogul made a success of it — his key break came when he sold a block of the apartments to a pension fund investor before they were finished. Within five years, Berlusconi had found owners for 1,000 new homes.
The property development that really made Berlusconi's name, however, was Milano 2. Even its name indicates the confidence — some would say presumptuousness — of its creator. It wasn't, in fact, another version of Italy's neoclassical finance capital. Nonetheless, its selling point was its nominal status as a self-contained satellite "town," with its own security and homes for 10,000 people. It had its own shops, schools, a church, a cinema, a central piazza and its own artificial lake. Milano 2 apartments, on the eastern outskirts of the city and not far from the small Linate airport, were marketed as homes "in Milan without the smog and the traffic." They were also well away from the student protests and riots, and the sense of dread that occupied Italy's big cities during the 1970s — Gli Anni di Piombo (the years of lead), a time marked by violence and deadly terrorist attacks as far-left and far-right activists fought viciously over their bankrupt ideas. Milan's burgeoning but anxious middle class, their numbers swelled by a boom in design, advertising and telecommunications, liked the sound of Italy's first gated community and snapped up the properties as the complex grew over the 1970s.
But where did the money come from for this vast real-estate venture? Bank of Italy inspectors, intrigued by the tsunami of cash flowing into Berlusconi's project, discovered labyrinthine account arrangements and various companies within companies that resembled a series of Russian nesting dolls. The Economist had a go at unraveling the nature — and provenance — of the investments. At one point the august finance journal warned its high-powered readership to concentrate ("what happened next is complicated ...") as it sought to explain the fiendishly clever and complex financial web that Berlusconi and associates had woven in order to conceal the identities of those funding Milano 2 and those profiting from it.
In one part of its special report, The Economist noted that Berlusconi's name was "nowhere to be seen" in the company filings of the main developer, Edilnord, or in the filings of Sogeat, the group overseeing the commercial part of Milano 2. At that time, strict currency exchange laws meant that profits made in Italy on behalf of Swiss investors had to return to their country of origin. The report noted, however, that Silvio Berlusconi, his brother, Paolo, and the mysterious Swiss company behind Edilnord all had bank accounts at Banca Rasini, the single-branch institution in Milan where Berlusconi's father had worked for most of his life. It would later emerge that some senior figures in Cosa Nostra, the Sicilian mafia, also held accounts there.
To cut to the chase, the Bank of Italy officials' probe suggested that both Edilnord and Sogeat belonged to Berlusconi. Suspicious of what was happening, they sent in the finance police, the Guardia di Finanza, whose officers found that between 1974 and 1978 the two companies made profits of 5.74 billion lire ($3.8 million), which had not been returned to Switzerland as the law demanded.
It fell to Massimo Maria Berruti, a young captain in the finance police, to interview Berlusconi on October 24, 1979. The property magnate explained that he was simply an external consultant to the two companies, although it was increasingly obvious to anyone who'd studied the evidence that the two companies and the mysterious "Swiss investor" were, as The Economist described them, "Berlusconi's alter-egos."
Despite strong evidence that Berlusconi had violated exchange-control regulations on a huge scale — a crime that could invite a long jail sentence — no legal action was taken against him. Berruti made his report, which was signed off by a finance police general, who soon after became a member of the secret P2 masonic lodge — a subversive society to which, as we'll see, Berlusconi himself had links. Not long after, Berruti himself quit the Guardia di Finanza. Deciding it was time for a raise, he went to work for Berlusconi — the first of many to choose the tycoon over the state. Berruti would be sentenced to eight months in jail in 2001 for aiding and abetting Fininvest, Berlusconi's holding company, in the corruption of public officials.
Although substantial evidence emerged that Berlusconi was the immediate source of the Milano 2 investment, as well as its beneficiary, the probe didn't explain the provenance of the original funding. But already, a great many people had their suspicions. Opaque investments and unexplained circular flows of money through shell companies at home and abroad suggested that Berlusconi was using highly disreputable sources — namely, the Mafia — to kick-start his burgeoning real-estate empire. It was a suspicion that was to grow ever stronger over the coming years.
* * *
How Berlusconi paid for his Milano 2 and Brugherio apartments wasn't the only cause for concern. The Brugherio development wasn't supposed to exceed five stories, but upon completion it was eight floors high. The Brugherio official who had been in charge of town planning, Edoardo Teruzzi, was, strangely enough, brought onto Berlusconi's payroll as project manager. He later dismissed the illegal height of the development, which boosted Berlusconi's profits considerably, as a "misunderstanding" that was easily resolved by Berlusconi's company "paying 200 million lire and offering to build a nursery school for free."
Milano 2 didn't have Brugherio's downside of being situated in a grim industrial zone, with few or no facilities. Its well-heeled inhabitants would be able to jog by its lake and use the new town's swimming pools and shops, while private security kept out the riffraff. The thunderous din emitted by aircraft landing and taking off from nearby Linate airport was another matter, though. Berlusconi even managed to sort that out, however, when it became apparent that the noise was repelling potential buyers. He persuaded parliamentarians in the notoriously corrupt Christian Democrat Party — the centrist Catholic political movement that would implode 15 years later in the massive "Tangentopoli" bribes scandal — to propose new flight paths that spared Milano 2 residents the worst of the noise, while making life suddenly very unpleasant for thousands of people in other towns and villages in the region.
Berlusconi combined this re-routing coup with a second masterstroke, establishing a hospital, the San Raffaele, right by Milano 2. Thus, when his emissaries went to Rome to cajole slippery deputati and senators into altering the flight paths, they were able to do so ostensibly for the sake of the sick. In reality, the San Raffaele would be a private, profit-making clinic; not a single brick had been laid when Berlusconi's minions were making their cynical diplomatic sorties to the Italian parliament. The San Raffaele would be developed by another shady character in Milan society, Don Luigi Verzè. The larger-than-life priest was also a real-estate magnate, a friend of Berlusconi, a self-proclaimed philanthropist and a crook. Much of the medical research in the hospital he helped establish would be highly respected. But Don Verzè's hubris and greed would also see the hospital enveloped in a scandal involving slush funds and the suicide of a senior official that even tainted the Vatican.
Back at Milano 2 the first 200 residents could sleep tight. The flight routes were changed for their benefit — and that of thousands of potential Milano 2 homeowners. The petition signed by 3,000 outraged residents in the nearby town of Segrate was ignored, as were concerns by Alitalia pilots that the new routes would make takeoff and landing more dangerous. Ironically, another community to complain of being "bombarded by noise" as a result of the altered flight paths was Brugherio, the location of Berlusconi's first big property development.
Berlusconi didn't lose much sleep over this, however. Research published by the Polytechnic University of Milan declared that the final flight paths represented the best compromise in terms of minimizing environmental disturbance; it subsequently emerged that Berlusconi himself paid the engineers who'd written the report. But the future prime minister was sitting pretty, with two huge property developments to his name, and basking in his new nickname, the "King of Bricks."
The decade from the mid-1960s to the mid-1970s had seen key developments in Berlusconi's personal life, too. He'd married Carla Dall'Oglio in 1965. The couple had met the year before, when Dall'Oglio, then a 24-year-old shop assistant, caught Berlusconi's eye in a street near Milan's Central Station. The mogul has never shied from pursuing what he wants, and he immediately turned on the charm. It might not have worked the first time, but soon after, when he spotted her getting on a bus, he jumped in his car and sped after it, determined to get her attention. His persistence paid off.
The couple had their first child, Marina, in 1966. Their second child, Pier Silvio, was born three years later, in 1969. Both would enter the family business. Marina, in particular, soon showed evidence of her father's business acumen, if not his charm.
Excerpted from Being Berlusconi by Michael Day. Copyright © 2015 Michael Day. Excerpted by permission of Palgrave Macmillan.
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Table of Contents
PART I-The Rise,
1. Starting as He Meant to Continue,
2. Dirty Cash,
4. Escape Route,
5. Getting His Hands Dirty,
6. Justice for Sale,
7. The Gory Years,
8. Getting Away with It: Fact and Fiction,
PART II-The Fall,
9. Fiddling While Rome Burns,
10. Berlusconi's Not Well,
11. Rubygate and Bunga Bunga,
12. Final Fling,
13. Blame the Germans,
15. The Devil's Advocates,
16. The Fall,
17. Fading Away,
About the Author,