Political horse-trading über alles

The ludicrous state of Italian politics is depicted nicely in this post (scroll down to the first post on September 25):

The left is so sure to win the general elections which will take place next spring that it has repeatedly announced "blood and tears", in the words of Romano Prodi, the undisputed leader of the left, meaning that new taxes will be introduced and the existing ones will be raised, even by fifty percent, according to Fausto Bertinotti, leader of Communist Re-foundation. Taxes are already at around fifty percent, so this means they could go up to seventy-five percent to finance his starry-eyed projects (high unemployment benefits, free housing and free transport for the unemployed, an open borders policy to favour immigration, requisition of untenanted houses and so on). All this while Italy is in the middle of an economic crisis owing also to the unfair competition from China. Italian economy has always been based on small and medium businesses, and lots of them are closing down every day. The rising price of oil makes things worse. I don’t know how people can vote for higher taxes, but many hate Silvio Berlusconi so much that they want to see him out of office, even some of those who voted for him. To make things worse, Marco Follini, the leader of UDC, a tiny party and a splinter of the old Christian Democracy, has been waging for months a relentless war against Berlusconi in an attempt to oust him from power in favour of Pierferdinando Casini. Casini for his part has kept rather quiet, except asking loudly for a sign of discontinuity from Berlusconi, which in political parlance means the latter should move over and make room for him. About Casini I don’t know much, except that he’s very handsome and would look well among the good and the great that regularly meet for some reason or other. And he was a Christian Democrat, like Prodi. So the choice as prime minister would be between a Christian Democrat (Casini) and a Christian Democrat (Prodi). No matter what, we always find ourselves with a Christian Democrat in the end. Maybe you will understand why for years I refused to take an interest in Italian politics. Too complicated. Meanwhile, as the victory of the left next year seems as inevitable as autumn rains, I’m trying to get adjusted to it telling myself that after all there can’t be more than twenty-four hours a day of leftist propaganda on the media, and those we’ve got already.

Now that's depressing. All the political horse-trading is clearly one of the reasons why the economy is a shambles: the current (supposedly pro-buisness) government is making a mess of the economy (and the opposition promises to do the same) to keep all coalition members happy. Therefore, Antonio Fazio is still at the helm of the central bank because the Lega Nord appreciates his goal to keep banks Italian (and the fact that he is devoutly Catholic), and the political pandering to the provincial ideal of maintaining "national champions" is the source of this infuriating proposal:

Italy's centre-right government is preparing special measures to protect its biggest state-owned companies against hostile takeovers even as it continues to privatise the groups, budget documents showed on Tuesday.
The measures would enable the companies to create new categories of shares or issue financial instruments that would let the state block takeovers by taking part in capital increases. The measures, included in the government's draft 2006 budget, do not mention specific companies but are most likely to be applied to Eni and Enel, the oil and electricity groups that are the twin giants of the Milan stock market.

And though it is nice to see that taxes are going to be lowered for airlines, the reason for that is clear: prolonging the death throes of Alitalia.

Alitalia SpA is expected to receive benefits totalling 70-80 mln eur a year from government aids and a tariff review in the air transport industry, deputy transport minister Mario Tassone said in an interview with the daily Il Giornale.
Tassone said that the measures, which involve among others an overhaul in flight and airport fees, will benefit the whole sector to the tune of 170-180 mln eur.

Why do we continue to cling to the anachronism of a national airline? When will we finally let Alitalia be dismembered and sold off, and permit the private sector to provide its cheaper and more efficient service, as should have been done decades ago?
The real question though is why the Italian people (in general) are so ignorant of economics that they fail to realize that these policies are not just bad ideas in theory, but place real costs on our everyday lives.