Prime mover? Mario Draghi and the Italian presidency

Hey, Ryan Reynolds here for Mint Mobile. You know one of the perks about having four kids that you know about is actually getting a direct line to the big man up north. And this year he wants you to know the best gift that you can give someone is the gift of Mint Mobile's unlimited wireless for $15 a month. Now you don't even need to wrap it. Give it a try@mintmobile.com Switch upfront payment.

Of $45 for a three month plan equivalent to $15 per month. Required new customer offer for first three months only. Speed slow after 35 gigabytes if network's busy, taxes and fees extra. See mintmobile.com hey, Ryan Reynolds here wishing.

You a very happy half off holiday because right now Mint Mobile is offering you the gift of 50% off unlimited. To be clear, that's half price, not half the service. Mint is still premium unlimited wireless for a great price. So that means half day.

Yeah.

Give it a try@mintmobile.com Switch upfront payment.

Of $45 for three month plan equivalent to $15 per month. Required new customer offer for first three months only. Speed slow. 135 gigabytes of network busy taxes and fees extra. See mint mobile.com.

Hello and welcome to the Intelligence from the Economist. I'm your host, Jason Palmer. Every weekday we provide a fresh perspective on the events shaping your world. Striking oil or discovering diamonds should be a blessing for a country, but history suggests otherwise. We look beyond basic economics to discover why so many resource rich African countries remain persistently underdeveloped. And for all the melting pot options among American restaurants, you won't find many Native American restaurants. A new generation of chefs is changing that. On the menu. Expect blue corn, bison and when the licensing is figured out, beavers. But first. Today, lawmakers in Italy are carrying out the first daily ballot to determine the country's next president. Rumors abound that the frontrunner is Mario Draghi, currently Italy's prime minister and a pretty successful one. He's overseen a stellar vaccine rollout and serious reforms that have sparked much needed inv investment. Mr. Draghi's steady hand has had a calming influence on a famously fractious political landscape. But his potential move into a very different role might change that.

Mario Draghi is a former president of the European Central bank, where he earned the title of Super Mario because of his perceived role in the rescue of the euro at the height of the euro crisis.

John Hooper is the Economist's Italy and Vatican correspondent.

And that has given him an immense prestige both in Europe and of course, in his native Italy.

And next on his list of high powered jobs could be the presidency. What does that role involve?

The role of an Italian president can be very, very important. He there's never been a she can dissolve parliament, can name the prime minister, though the prime minister then has to win the confidence of Parliament. So the Italian president is not an entirely ceremonial officer, like for example, the German head of state, but nor is he a French or American president.

And is it clear that this is a job that Mr. Draghi wants.

He has come as close as he decently can to saying that he would like the job. At a press conference before Christmas, he said, I am, if you like, a nonno, a grandfather in the service of the institutions. And a lot of people saw that as him basically saying, I'm available and I'm the right kind of person, because you have to be over 50 to be a president of the Republic. And all the recent presidents have been quite a lot older than that, and they've all been grandfathers. So it was a pretty broad hint.

Okay, so we assume he's got his fingers crossed. Then. What happens now? What do the elections look like?

The elections are not unlike papal conclaves, but with lots more cardinals, more than a thousand, because all of the national lawmakers get a vote, as do delegates from the regions. The elections are also like the papal conclave in that the voting is secret and you're not meant to campaign, so there are no real candidates and you're more selected than elected, if you like. The fact that the voting is secret also means that you can get some real surprises in these elections. And his path to the presidency is certainly not clear. Silvio Berlusconi was in the running for the job, Italy's former prime minister, notorious for having been convicted for tax fraud and having been the host of the bunga bunga parties. But he dropped out of the race. But by the time that he had done that, he had made himself into the candidate of the right. And by default, therefore, Mr. Draghi has become, if you like, the candidate of the left. And the difficulty with that is that first of all, the left does not have a majority in the electoral college. But the left is also split over the issue of whether Mr. Draghi would be a good thing or not. But that's particularly true of the left leaning Five Star Movement, where there are deep reservations not only about Mr. Draghi's image as very much a member of the establishment, but also concerns that if he goes, it could prompt an early election.

In the sense that if he were to win, he stops becoming prime minister and becomes president, leaving that post open.

Yes, indeed. And what is very unclear is whether anybody else could hold together the very broad coalition that has supported Mario Draghi and whether that person would have the sufficient authority to not only keep those parties in the government, but get them to agree to the kind of reforms and investments that are needed in if Italy is to get its share of the European Union's post pandemic recovery fund. Because Italy is going to be receiving 200 billion euros of money from the fund that is intended to restimulate the European economy after the pandemic. And Italy for two decades now has been a drag on the rest of the European Union. The hope is that this money invested well will close the gap between Italy and the other big economies of the union.

And what about the alternative? If the conclave doesn't select him, how do you see things playing out then?

Well, he will have lost a lot of faith in doing so. And it may be wondered whether, in fact, he would want to carry on as prime minister, and if he did, whether he would have the authority that he enjoyed before. All of which puts a big question mark over Italy's immediate future.

And so what do you think the chances are that by the end of the week it will be President Mario Draghi?

Well, looking into my crystal ball, I see a slim, dark former central banker. I think he is the probable winner of this election. But I also see other possibilities. In particular, I see the form of a woman. Italy has never had either a female head of government or a female head of state. And a lot of people feel it's about time that that was rectified. So if either right or left could come up with an acceptable candidate to the other side, a woman, I think that she would have quite good chances of snatching this prize from Mr. Draghi.

John, thanks very much for joining us.

My pleasure.

There's something that looks like a paradox going on in many African countries. Economies are underdeveloped, even where there are plenty of minerals or oil. It's an example of what economists call Dutch disease, or rather the economist first called it that in 1977, and now economists do, too. When a country's natural resources go up, the value of its currency goes up, the cost of its other exports goes up. It's one source of income at the cost of another. In Africa, what's surprising is that it's been going on for decades, and basic textbook economics isn't enough to explain that.

So I traveled to Sierra Leone and then within the country up to the Far east near a town called Koidou. And I went out there to talk with men who were working in what are called artisanal diamond mines.

Kenly Salmon is an Africa correspondent for the Economist.

But in reality, having scrambled through the brush after a long drive on rutted roads, there wasn't much that one might think of as being artisan about it. Instead, groups of men without shoes, often in pretty ragged clothes, whacking these basic shovels into red earth. And you just use shovels? You wear bare feet for this? Bare feet, yes. Why? Getting the money is difficult to buy. These men who labor so long hours, you know, at a minimum six days a week, told me that they worry that they may not earn enough from digging for diamonds to send their children to school, and their children might end up working in similar conditions. One in particular told me that he was the third generation to be doing it. And these men and many others like them in parts of sub Saharan Africa that rely on raw materials for their living are in a way quite representative of a number of African economies more generally, which also rely on commodities and raw materials to pay their way in the world.

So how widespread is that? How dependent are African economies on commodities?

Well, the United nations defines a country as commodity dependent. If commodities make up more than 3/5 of that country's physical exports, about 60% and fully 83% of African countries meet that threshold. Despite some efforts to diversify. That's up from 77% a decade ago. Some of these countries are producing agricultural commodities like tea, but most of them are relying on mining or on pumping oil.

And what's wrong with that if that's where the money is?

Well, that's right. There is money, of course, in minerals, but unfortunately, often that comes with problems. One, for example, is that there's more to fight over in countries that are rich in gold or diamonds or oil. And that can encourage politicians to kind of grab power or keep a hold of it through authoritarian regimes. And resource rich countries also tend to have more and longer conflicts and civil wars. At the moment, jihadists and the Sahel are using control of some gold mines to help fund their fight. And in Sierra Leone, diamonds fueled a bloody conflict that lasted for 11 years. But there are other more economic problems, too. Commodity prices tend to leap and fall quite dramatically, leading to booms and busts. And that can make economies really difficult to manage for governments in the regions. And sadly, oil and minerals in particular don't tend to create A lot of jobs in Sierra Leone, which is a country of 8 million people, only about 8,000 people work directly in any of the commercial mines.

So if the benefits are few and the risks, as you say, are so great, how has this reliance become so widespread?

Well, one of the explanations is relatively straightforward economics. When countries export commodities, that can push up the exchange rate as money floods in, and that makes other exports much less competitive in international markets. So that makes it just very difficult, almost mechanically, for countries to diversify their exports. But of course, it isn't just the economics. There are a number of other factors. Back in colonial times, many countries in Africa were treated primarily as sources of resources. And that set a pattern that's both been perhaps hard to break, but also which plenty of leaders have followed. And then more recently, we've seen really high commodity prices from the early 2000s until about late 2014. And that spurred exploration and some big discoveries of oil and gas in places like Ghana, Mozambique and Senegal. Other minerals, like gold, saw an exploration boom as well. And this pattern isn't finished. Africa is relatively underexplored compared to many other parts of the world.

Right. But it doesn't have to be a dominant part of the economy. You mentioned there had been efforts at diversification.

Yeah, that's right. The importance of natural resources to GDP for the continent as a whole has actually fallen over the past decade. And the share of commodities and goods exports, again for the continent as a whole has come down a bit as well. And of course, broad averages can obscure some of the other progress that's been made on diversifying economies. In Malawi and Botswana, for example, services have grown strongly. Many island states in Africa have strong tourism industries, and even manufacturing is rebounding and is a really big priority for a number of countries everywhere from Ethiopia to Senegal. But there is still, I think, really a long way to go to break free of resource dependence.

A long way to go, presumably because it suits the leaders of some of these countries just fine that there's all this mineral wealth coming through.

Yeah, I mean, of course there is, you know, wide variation. And some leaders, there's no doubt, are trying very hard to diversify. But. But I think it is often overlooked that some African politicians simply aren't that keen on diversifying. Commodity revenues tend to go through state coffers. That makes skimming cash off easier. And with oil and mining in particular, there are usually only a few big companies involved. So dodgy deals can be a bit easier to manage. And then, in a sort of less corrupt sense, relying on commodities is also just a bit easier even for lazier governments. Mining and oil companies know how to dig and pump and will often pay upfront for licenses. So they're an alluring source of quick cash. Whereas diversification may have longer term benefits, but is likely to be harder in the short run.

But as you say, the full diversification is a long way off. I mean, how should governments set the compass?

Yeah, I mean, that's right. It is a challenging process, but kind of one basic principle, especially for countries that export commodities that run out like oil or minerals in the ground, is to try to turn those riches under the soil into wealth of another form, such as educated people or highways built infrastructure. The World bank now argues that even if a country's exports remain commodity heavy, if it diversifies its wealth from non renewable resources under the ground into things like educated people, then that too is real progress. In Sierra Leone, I think it's fair to say that at least among some of the people in government there, there's a strong recognition that if the gains from almost a century of mining had been invested in its people to a greater extent than has been done, then the country would be in a lot better place today.

Thanks very much for your time, Kinley.

Thank.

You.

For more analysis like this from our international network of correspondence, take out a subscription to the Economist. Get a great introductory deal@Equality.com IntelligenceOffer the link is in the show notes.

We've got hominy with chili. We have things like blue corn mush. We've used a lot of rabbit, a lot of elk, a lot of antelope, a lot of ven, a lot of bison, of course, a lot of lake fish.

Sean Sherman opened his restaurant Owamni in Minneapolis, Minnesota last year to showcase Native American cuisine.

Food is something that was pretty much taken from us, you know, when I was really looking for what my ancestors were eating and what they were storing and how are they preserving foods and all these questions, there was really nothing out there. I just started researching a lot of ethnobotanical books. I started talking to elders. I started really just kind of filling in gaps with my knowledge as a chef and understanding how food works.

He's one of a new crop of chefs turning to indigenous dishes and creating new recipes to revive a traditional way of cooking.

Indigenous restaurants have opened up from time to time since about the 1980s.

Elise Burr writes about foreign affairs for the Economist.

But now it seems like Native American food is going through a bit of a culinary renaissance, and chefs like Shawn Sherman are gaining a Little bit of a celebrity status.

So what is Native American cooking like?

So some chefs only use ingredients found in North America before Columbus made landfall. So you won't be able to order chicken, beef, pork, wheat, or cane sugar. But others, like Lois Ellen Frank, who is a caterer and a food historian, don't think that chefs should be limited to the foods available to their distant ancestors. So she will incorporate foods introduced to the Southwest by the Spanish, like wheat and watermelon. And there's been a bit of a debate over fry bread, which is a food often found at celebrations.

Wait a minute. What's the food and what's the debate?

Well, fry bread is a pillowy, deep fried flatbread, and you can serve it sweet or as a taco. Legend has it that it was invented by Navajo women when the US government forcibly moved their tribe in the 1860s. So, confined to a new, desolate place, they were now reliant on government rations. So Navajo women invented fry bread out of those. Some chefs refuse to serve it because they think it represents colonialism and modern day health struggles. But others see it as sort of a symbol of survival and ingenuity. So we've seen fry bread be divisive before. In 2017, the Miss Navajo pageant ditched the portion of the competition where contestants cook fry bread. Now contestants will make other dishes, like a red sumac berry pudding.

And you mentioned that these kinds of restaurants had popped up since the 1980s but had failed to catch on. Why is that?

Right? It has a lot to do with history. I was speaking to Krishnendu Ray of New York University, and he explained that the foods of a lot of immigrant groups in America caught on because immigrants would come and they would settle into a city and they would open up restaurants for each other, and eventually other people would come and say, hey, this food is pretty good. But that didn't really happen for Native Americans because until the 1970s, the majority of Native Americans did not live in cities. By the time Native Americans move to cities in large numbers, Professor Wray says that they were sort of too late and too few to have a booming restaurant scene.

But this time around, you say it's different. Native American cuisine is coming back with a vengeance.

Whether or not Native American restaurants will really catch on remains to be seen. But I think this time is different because America is in the middle of a racial reckoning. President Joe Biden's stimulus package included a large increase in funding for tribal governments and programs aimed at helping Native Americans. And I think that racial reckoning applies to food too. You can see that because Owamni, Sean Sherman's restaurant has been fully booked every night since it opened.

We should have Native American restaurants in every single region, especially in areas like the US Or Canada, to really, you know, pay homage and showcase the vibrancy and the beautifulness of all these diverse cultures out there there.

Cuz there chefs like Sean hope to see Native American food on every menu across North America.

Elise, thanks very much for your time.

Thanks for having me, Jason.

That's all for this episode of the Intelligence. If you like us, please us. A rating and a review and see you back here tomorrow.