Why is South of Italy Poor?

Is there an economic gap in the South of Italy? Why?

An American tourist is enjoying a once-in-a-lifetime road trip through Italy. The further South of Italy he goes, there seems to be more poverty, more abandoned buildings, and an air of what he thinks is desperation and hopelessness. Just after he gets to Naples, he’s beaten up and mugged for his wallet and phone, and not long after that, he has a brush with the dreaded local mafia.

It felt as if the farther down he traveled, life just looked harder for people. It was as if the country had been divided long ago and had settled on extreme inequality. How was this allowed to happen? You might think we’re exaggerating, but we’ll convince you by the end of this article that the North and South of Italy are two different worlds.

We don’t mean to say that the South of Italy is any less beautiful, or the people any less friendly, but we will say that in terms of economics, something strange and frankly ugly has happened in Italy over many years. And today, things are just as divided as ever. It feels pretty rich if you visit places such as Milan, a megacity in its own right, where a sense of prosperity seems written into the very concrete of the buildings you pass by. Milan is Italy’s richest city. Sure, like any metropolis in the modern world, you can find poverty, crime, and homelessness.

For instance, these neighborhoods:

• The neighborhoods of Giambellino
• the neighborhoods of Lorenteggio

They look nothing like the glitz you can find elsewhere in Milan. Filth and desperation brand many streets in these two close-by neighborhoods. It’s the dark underbelly Italy would rather prefer that tourists never see, but you’d struggle to find any wealthy city in the world that doesn’t have pockets where a criminally wretched inequality is woven into the fabric of hardcore existence.

Still, business is booming in cities like Milan. Prosperity is everywhere to see, despite the odd neighborhood looking like a remnant of the third world. But if you head down to the South of Italy, to what’s referred to as the Mezzogiorno, prosperity will feel like an alien word. Not everywhere, but in many places. We are generalizing, saying the North and South are different, but on the whole, there is a big difference.

The glamor and conspicuous spending of Milan will feel like an alien world once you’ve seen some parts of the South of Italy.

Of Italy’s 60 million-plus population, 20 million - one-third - live in this half, comprising of Abruzzo, Apulia, Basilicata, Calabria, Campania, Molise, Sardinia, and the place you’ve likely all heard about Sicily.

On the whole, they have a lot less money, and in some regions, they have hardly any money at all.

Despite what we’ve told you about Italy’s wealth, some of these regions are the poorest regions in all of Europe. As we said, it’s as if someone decided long ago that this country should be split in half, with the haves living in the north and the have-nots populating the South of Italy. Again, this is in general. Super-rich folks are living all over the Mezzogiorno, but this geographical, economic divide is a real thing.

The Economist's report

As The Economist wrote in 2015, it’s a “Tale of Two Economies.” You can see the difference on paper.

In 2018, the GDP per capita in the South of Italy was just 55.2 percent and 76.7 percent of the Centre and North’s GDPs, respectively.

That’s a massive difference.

Unemployment rates were and still are way worse in the South, and reports on general well-being make the two parts of Italy look like different countries. Plenty of academic studies have been published of late, and the divide those papers talk about is startling. It’s a different world down there in the South, with the studies saying there were and still are vast differences when it comes to:

• life expectancy
• health
• inequality
• poverty
• social capital
• and market potential.

It’s a crisis that seems intractable, but it’s not, not really if people in power did the right thing. It’s gotten worse lately, though, as one recent paper explained, “The Covid‐19 crisis thus inserted itself into the context of an already widening gap between North and South.” You can see the divide everywhere you go.

You can see the inequities in education, in the infrastructure, and in some of the faces of the people who can’t find decent work. There’s quiet desperation and learned helplessness in many areas, which is the reason why the South of Italy has been seeing many of its inhabitants moving out and trying to find work in other countries. Others just move North to find work.

Young folks in the South of Italy

This diaspora movement has been going on for many years, which, as you’ll see later, has had devastating consequences. There are many young folks in the South of Italy saying the same thing.

“There’s nothing for me here…I’m leaving. This government doesn’t give a damn about us.”

The South of Italy is still licking deep wounds from the 2008 financial crisis, while the North has pretty much made a full recovery.

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Mafia in Italy still exists

The South of Italy is still dealing with organized crime groups, such as the Camorra, or the Sicilian Mafia, while the North usually weeds that kind of thing out. Don’t think for a minute these mafias are dead and gone. They’re alive and kicking the crap out of many regions in the South of Italy today. Still, you might wonder why they exist in the first place, which is something important in this article today. We’ll come back to this topic later.

The north of Italy

You name it; the North has it:

• a large banking industry
• some of the largest companies in Italy
• massive chemical firms
• and huge insurance outfits

The North has a healthy automotive industry and a bustling textile trade. It has higher paying jobs, and it has a population who’ve been educated far better than the average Southerner. When Southerners do get the best out of education, they usually skip northwards ‘cos there’s not much they can do with a degree in their dusty hometowns.

Statistically, the North has a much higher voter turnout. 21.9 percent more people graduate from a university in the North. More people are working in high-tech jobs there; there are more kids in childcare, more broadband connections, and it’s above average in terms of how many doctors per 1,000 people there are. These are all markers that academics use to understand the quality of life.

The numbers differ from each region of the South of Italy, of course, but the North-South of Italy polarity, on the whole, is evident all over the place. Before we get into the state of the current South of Italy, where our guy in the intro just had an introduction to some gangsters and lost his wallet to some street kids, we need to explain something about how this Tale of Two Halves started.

How did a country become divided through the middle?

History

It wasn’t always this divided. If you go back thousands of years, the South of Italy was renowned for its fertile soil and the plentiful fish in the waters. When the ancient Greeks settled there, they had a bit of trouble at first with the natives, but they more or less worked things out, and much of Southern Italy (not called Italy then, of course) flourished.

At the time, the Romans up north actually called Sicily and other parts of the South of Italy “Great Greece.” Indeed, Neapolis and Naples became a powerhouse under the majestic Greeks. We won’t go into a full history of the South of Italy because it’s just too complicated. What we will say is that the Romans in the North had control of the South of Italy from time to time but lost control now and again to foreign powers.

For instance, for a long time, it was Muslims that ruled Sicily under the Moors. The Byzantine Empire, the Islamic states, and the Normans all fought over areas of Southern Italy as the Romans in the North were cementing their strength and building magnificent infrastructure. The South of Italy became fragmented, ruled by so many warring factions that the ground for centuries was covered in men’s blood.

In short, it didn’t have the cohesion of the North. There wasn’t a concentration of power like in the North. In the South of Italy, petty tyrants often ruled, making life incredibly difficult for the average person. They pretty much-invented laws as they went along, and they exploited the poor at every opportunity. These people had only really known chaos.

Even when the Romans were in power in the South in the many years before the tyrants took over, they often planted their very wealthy people there to run slave plantations (latifundia). A type of latifundia existed in Sicily until the 20th century, which you will hear about soon. Under the Holy Roman Empire that followed centuries later, super-powerful states formed in the North, such as those of Genoa, Venice, and Pisa, republics that were at the time the richest places in Europe.

For centuries, the Holy Roman Empire was the most powerful political entity around, with trading creating many very wealthy people. We are talking nine centuries of rule here, a long time to create, invent, and build. Meanwhile, the South of Italy was a patchwork of small city-states, forever being fought over and not easy at all for the Holy Roman Empire to conquer.

We are skipping great big chunks of history here, but we have to. We just want you to know that while much of the North and the Center of what we now call Italy was developing, the Southern part was stuck in a cycle of regression. Even when Napoleon conquered the northern and central parts of Italy, he did not have direct rule over the whole South of Italy.

In 1806, he dissolved the Holy Roman Empire and created the Kingdom of Italy with him as King, and then he annexed what was then the Kingdom of Naples as part of the French Empire. Even though Napoleon wanted to develop this part of Italy, many of the people who lived in the South of Italy hated French rule.

They fought against it at times, and then they got what they wanted in 1815 when Napoleon fell from power. All those regions of the South of Italy were handed back to the previous rulers, but then chaos reigned once again. The South of Italy seemed to be stuck in some kind of eternal disaster, a groundhog’s day of internal turmoil.

The South of Italy never got very developed, despite Napoleon’s intentions. It was always a land of the very rich and the very poor, with an educated Middle Class hardly existing at all. Moreover, its resources over the years had been over-exploited, and that once fine fertile land was not as great as it used to be. With repressive regimes running the roost and hardly any trading or way to make a living, it was at least fertile ground for uprisings.

Risorgimento

Then in 1861, great changes took place under what Italians called the “Risorgimento” (Resurrection). This was supposed to unify Italy. Lots of people in the North were not happy about joining with the South, people they called barbaric and backward. After all, they said, they’ve been living in the past, thinking like peasants, while they’d been creating powerful states at the forefront of scientific discoveries.

The Mezzogiorno, they said, we don’t need. They said you can’t modernize the South since it is too far behind, and by trying to do so, we will put way too much economic strain on the rest of Italy. It should be said that most of the bad things Northerners said about the South were plain falsities, such as calling the people inherently lazy.

This wasn’t true, but such is the mentality of large mobs. Once Italy was unified, the North pretty much ignored it regarding major political decisions, but be sure; the taxes kept being demanded. Southerners struggled, with their soil now almost ruined, their forests heavily denuded, and unemployment rates sky-high as owners of vast estates lived lives of luxury.

The more profitable estates were owned by Northerners, who would put people in charge of them while they were gone. Landless peasants worked on the plantations, so again, this looked like slavery. One thing Sicily had going for it was citrus fruits, which were a huge money spinner, especially after the British had realized they were great for dealing with every sailor’s biggest worry, scurvy.

Northerners owned much of the agriculture, and the Southern peasant farmers didn’t have a pot to pee in, so again there was a lot of disharmony. It seemed all the wealth was in a few hands and those grasping fingers were all northern. On top of this, Southern politicians were highly corrupt, as were the police. Italy might have been unified on paper, but it was just as divided as ever.

At the same time, the South was paying hefty taxes, but it seems the development that could have happened with this money hardly ever went to the South. And so you now have to ask yourself what happens when great swathes of people see no way out of the darkness?

They rebel, is the answer. In Southern Italy, what happened then was the beginning of a secret kind of organized crime. These criminals, mostly peasant farmers in the past, started extorting those who were looking after the landholdings. The plantation custodians were given an offer they couldn’t refuse, and if they refused to pay, they were mowed down with shotguns. The criminals would shoot police if they investigated, but the police were often paid off.

criminal activities in the South

Word soon got back to the North that criminal activity under some mysterious organization was happening. This was the start of the Sicilian Mafia, although it took a long time to figure out anything about them because they were so secretive. These men of honor had rituals right from the start, but everything they did was hidden deep under a thick veil.

Mafia

It took decades for people to understand there was a mafia. Famously, on February 1, 1893, after a man named Emanuele Notarbartolo had taken notice of all this new crime and gone to investigate, he was stabbed 27 times as the train he was traveling on went through a tunnel. The death of this aristocrat is sometimes said to have been the first murder of an official by the Sicilian Mafia. First, second, third, it doesn’t matter.

What matters is that the mafia grew in size and strength, with their many ranks occupied by men who’d had enough of being peasants, had had enough of watching the aristocrats get richer as their kids starved, and had had enough of politicians who were, in fact just as criminal as anyone, but hardly ever went to prison.

Then the Mafia's purpose changed

It sounds like a romantic story, but the truth is, when the mafia got richer and had a good portion of politicians and other officials in their pockets, they didn’t exactly concentrate on making the South a better place. Instead, they exploited people with their many rackets, including protection rackets. Many of these organizations popped up in the South, including

• the Sicilian mafia
• the Basilica
• the Camorra
• the 'Ndrangheta
• the Sacra Corona Unita
• and more

These guys might have been a consequence of abject unfairness, but in more ways than one, they held back Southern Italy from modernizing. They were like termites with guns, appearing anywhere and everywhere, and they were impossible to wipe out, despite many efforts. After WW2, Italy decided it was time to sink cash into the development of the South, but that money, under something called “Cassa per il Mezzogiorno,” never really went to the right places.

Instead, much of it was stolen by corrupt politicians, while the Mafia took much of the rest. The initiative didn’t end until 1993, but at that point, there had already been many, many arrests relating to corruption. The cash was gone, and not much had changed in the South. Many people in the South said that unification was more of a curse than anything else.

They’d have been better off under feudal lords, they said, which was arguably wrong. Still, what had changed over the years? For the most part, they’d remained the agrarian poor while those in the industrialized north lived lives completely different from theirs. Unified, maybe, but Italy was still two different nations.

For years, through the 60s, 70s, 80s, 90s, and 2000s, they struggled to find work while the unemployment rate in the North was only a fraction of the South’s. This was after about $2.6 billion had been invested in the South. As an anti-mafia official once pointed out,

“In the north, you see one factory per kilometer. Here you can travel for 100 kilometers and not see one chimney stack.”

He had watched as roads were only ever half-built, as paid-for factories never opened, as promised hospitals were only ever partly finished, with money from the contracts most of the time filling the pockets of corrupt politicians and gangsters. It seemed that the chaos the South had known for centuries was well and truly still there. Even now, people scratch their heads and ask why things haven’t changed.

Like us today, they blame historical foreign invasions, money-grubbing tyrants, and pervasive corruption, which they say brought lawlessness to the South, and it’s never been fully cleansed. Don’t get us wrong; there is some industry in the South.

It has a thriving tourism industry since it is one of the most beautiful places in the world, but don’t be fooled by the posh hotels and mansions in the mountains; regular people’s lives are often a constant struggle. We think an Italian Archbishop got it right when he told the New York Times: “Here we have the culture of survival or the culture of tears - we are continuously crying - we fix problems as they come, but we don't plan.”

If you know anything about trauma and poverty, you’ll know that children who grow up among both often fail the famous marshmallow test. They are given a choice to take some marshmallows now or more marshmallows later. Rather than wait for more marshmallows later, poor kids almost always take a small amount now; the opposite of richer kids. They don't trust the future.

They don't think about the future. It’s easy to criticize people who live like this when you’ve come from a privileged background, but it’s not easy having confidence in the future when all you’ve ever known is a struggle. You take what you can because tomorrow it might not be there. This is a problem in the South today: a lack of trust in governance.

It can lead to a dog-eat-dog existence and a sense of hopelessness. How can people build for the future when they have no faith at all in the authorities when they know that when they get extorted by criminals, no one will ensure their life isn’t taken if they report it? The South has been in a vicious cycle for centuries, and getting out of it will take a lot more than picking yourself by your bootstraps.

It’s the same with class problems the world over. People should help themselves, but to kick things off, there needs to be some amount of top-down assistance. That’s not happening in many parts of southern Italy, where official malfeasance and Mafia rule make it hard to get out of the traps of poverty.

So, when as an American you visit there today, you might meet the friendliest people you’ve ever met, have the best food, see amazing historical sites and coastal azure waters that are so beautiful you’ll want to cry, but don’t be surprised if today’s addicts, yesterday’s peasants, relieve you of your iPhone and dollars, just as a mafia collection boy walks out of an extorted restaurant with a thick wad of cash in his hands.

Inside, a wife and husband embrace and cry and wonder why no one can stop this from happening. As that anti-mafia guy said, “If you were to go into some of our smaller villages here, you would find yourself immersed in the Middle Ages.” Some of these problems are systemic, and they have been for centuries. “Save yourself if you can and get out,” is what many Southerners say, which is why over the last few years and decades before, rural towns and villages have been profoundly depopulated, leading to the so-called Southern “brain-drain.”.

Now some of these places are like ghost towns, where the aged mill around like relics in a living museum, eminently Instagram-able for the tourists that photograph them but eternally down on their luck, so not exactly thrilled at being gawked at and filmed. This was brilliantly portrayed in the TV show, White Lotus, season 2. Fiction, maybe, but pretty close to the truth.