By Alexander Apostolides on March 17, 2011

Italy at 150: Lessons of Unification

On the 17th of March 1861 Italy was declared unified. The event was strangely an anti-climax, which left most, if not all political actors in Italy, disappointed by the outcome.

Mazzini, the spiritual father of the ideal of Italian reunification, was disappointed that the unification looked less that his democratic and republican ideal of equals uniting to a greater whole, but more like an expansion (or even conquer) of the rest of Italy by the (somewhat) constitutional monarchy of Savoy/Sardinia based in Turin.

Garibaldi, the person that made the unification possible in 1861 by his conquest of Sicily and Naples and his threat to attack the papal states, was even more disappointed. His successful volunteer expedition to Sicily was subjected to harassment by the police of the Kingdom of Savoy/Sardinia, while the new King of Italy - the Victorio Emmanuelle II, did not want to jeopardise his expanded kingdom in order to free the remaining areas of Italy under foreign control (Venice under the Hapsburg and Rome under the French / Pope). He died disappointed as the troops that hailed him as leader prevented him ever fulfilling his dream of revolutionary unification.

The upper class advisor around the king of Savoy, the Count conde di Cavour was also disappointed. Through foreign policy alliances and great power diplomacy the Kingdom already secured the richest areas of North Italy, and the idea that they would have to share power with the much poorer south was abhorrent. The advisor only consented to the invasion of the papal states to stop a revolutionary ,republican version of Italy to take shape and ensure the supremacy of the Kingdom of Savoy/Sardinia above the Italian peninsula - Turin remained the capital. The idea of so many persons in need in the south and the expectation that North Italians would support them was not at all what Cavour had in mind at the beginning of 1860.

The lessons of the unification are many: Italy is now is a vibrant democracy that has managed to shape one identity out of many parochial identities and it has survived through many problems, including internecine strife. Mazzini need not to have worried as his vision finally prevailed but only after the dark shadow of Fascism. Garibaldy's Italy was completed in 1871, but the nationalistic fervour fed aspirations of greatness that led to its country's ruination in 1943. The northern dominance of Cavour is still in place, and problems not resolved due to the rapidly rapid and rushed unification during 1861 still plague Italy today.

We should see that in Italy's case, as in our own efforts to unify the island of Cyprus, there needs to be compromise of beliefs and ideals by all. The positive that we can take away is that over time one can create a new national identity without needing to reject his previous, more parochial, identity. However, despite nationalism's honourable roots, the ideal needs to be checked by realistic compromise or else it can end up doing a great damage to the nation. Most positively worries that loomed large in 1861 seem very insignificant today - just 150 years after the declaration of unity. However the planning of the day of unity and beyond is essential in the smooth running the unified state, as errors and omissions can get "locked in" and thus plague new country indefinitely.

However perhaps the most important lesson is that people with strong convictions laid them aside: they also laid aside their reservations of whether unification would work and accepted that what was needed most was a great leap of faith, especially from the leading personalities of the day. Solutions need to be based on hopes and not fears, and Italy's story, which stands proudly 150 years to the day, can affirm that.

By Alexander Apostolides on March 11, 2011

Reflecting on the Arabic revolutions

In 1848 there were revolutions across Europe from Portugal to Poland. The whole continent was griped in a euphoric state. The world thought that with the coordinator of the oppression, the Austrian Metternich, gone, then their demands of liberty and representation would be met.

However the successful revolutions turned inwards after their national oppressors where gone. Petty squabbling and inwardness made the European revolutionaries miss the bigger picture: the oppressors co-operated and worked in plans to crush them. By 1949 all revolutions were crushed through a combination of divide and rule and support of oppressive kings to their fellow oppressors under pressure. As a result the revolutionary fervour and the legitimate demands was converted into anarchy. terrorism and communist ideals

History echoes warnings for today's revolutionaries. Tunisia and Egypt are not safe if the Lybian revolution fails, while the mutual defence pact of the Arabic gulf is aimed to allow cross military interventions to crush future legitimate demands.

The fact that Europe fails to intervene under the pretext of colonial echoes (but really due to the incentive of petro-dollars by dictatorial leaders)is a tragedy that will come back to haunt us. Terrorism is in part the side effect unrealised demands of freedom of expression. Short run economic benefits of not supporting change will be wiped out by the result cost of policing increased terrorism.

By Alexander Apostolides on March 03, 2011

Some news just in: Sir Howard Davis quits the LSE

According to the guardian Sir Howard Davis, who I last met on a LSE alumni event 3 months ago in Cyprus, has stepped down. [Although I see strangely that his CV blurb does not show any doctorate or economist training skills... perhaps a typing omission?]

A likeable character and a good administrator will well meaning views of reform, who irked departments by the somewhat imposing way he would bring decisions top down, from the issue of how many masters degrees places would be offered to how phd's would be funded.

However his (too?) friendly approach to business meant that when he was the first chairman of the FSA, where he established the "softly softly" approach that resulted to the FSA being toothless to stop gross abuse by those it sought to control.

His approach with students was love-hate. Most loved his approachable way and his ability to survive frequent roastings that most vice-Chancellors would rather avoid, but his desire to bring controversial business buddies such as chairmen of BP in the board in spite of student opposition was hated.

In the end wikileaks sealed his fate as the eagerness of the school he commanded of getting to bed with Gaddafi was deeper than just Gaddafi's son having studied here, and just having accepted a 1.5 million phd from a Gaddafi affiliated foundation.

All these actions seemed to give increasing weight to those voices in the LSE that said that from a Fabian institution with outspoken minds the LSE was coming to close to giving the justification for the UK state's surprising entente with Gaddafi.

Although such links in the USA would be normal for good universities, his decision to go to detach the school from more embarrassment was the correct one, as the LSE was always special in being the alternative voice, and thus such allegations hurt its central image.

What's happening in the real estate sector?

At least some serious people are thinking of the economy in a rational way [you know who you are - thanks for a stimulating conversation today]. Perhaps unfortunately they are not politicians, technocrats or journalists: although they are exceptions, most, including the credit rating agencies are focusing on issues that are not such a big threat to our future well-being.

In general the real concerns in Cyprus are real fundamentals and not the issue of bank guarantees to Greek debts --> the banks themselves are well handled to deal with that since they have strong liquidity and access to ECB funds if needed to.

Our issues are the fact that unemployment is rising and businesses are closing. In addition the person who I spoke to pointed out that the real estate needs to be given a higher visibility.

Having moved away from a system of borrowing on trust (where two signatures of solvent persons would guarantee your loan) to a system of loans backed by property, we created two issues:
1) The issue of whether prices have bottomed out in the real estate sector both in the housing, business and tourist housing sector.
2) How many developers are practically insolent, and to whom they owe their money.

Strangely enough we had much lower rates of defaults using the trust borrowing system rather than the property system. Although its is partly due to the fact that smaller sums where involved it is my hunch (which i would like to explore further) that the issue was one of not upsetting family bonds and greater due diligence on the solvency of their clients by banks.

Anyone with an opinion on any of these two issues is welcome to comment