BEIJING - Has Italy reached a dead end? Will it rekindle a global crisis? These may be extravagant questions at a time much larger and more important countries, China and the United States included, face tough choices. But Italy is different. Elsewhere, the way out looks treacherous, but at least possible - while for Italy it is not clear where even to start, since everything has been reduced to a heap of rubble.

In the United States, a crisis of identity and ideology splits the country and has given birth to the ''Tea Party'' movement and its influence on the political debate. Amid the risk that a US debt default would lead to global disaster, there was and there still is a way out: a political compromise and a great reconsolidation. The US must realize that the current threat is much worse than wars in Iraq or Afghanistan, and as in those wars, the country must unite around the president, whether he's right or wrong. It is unclear what America will do, and a solution is difficult given the internal split. Nevertheless, a solution is not impossible.

Here in China, problems arise from the triple challenge of reforming the political system, making necessary changes to state industries, and curbing a new, sometimes scary defense policy. These are deep structural changes. A part of the party fears the loss of power and privileges, and is almost in arms against those changes. Addressing such challenges is difficult, since they can also start potential social conflicts. We don't know if the government will succeed or not, but reforms are possible and one can guess their timing and patterns.

Even Germany is in the midst of an identity crisis. Europe's biggest economy must take a leading role, but after three wars fought around its ambitions, or the fear of them, now it is afraid of the tasks required, and does not know how to move forward. The old parties, the Christian Democrats or the Social Democrats, seem worn out, while the new and rising Greens, hold positions which are at times quite unrealistic. Here, too, the possibilities of a political transition and of shouldering greater responsibility within Europe are enormous challenges. It is not clear if they can be overcome, but we at least understand what must be done.

In Italy, everything is different: it is a spaghetti bowl, as so many foreigners say, where one can't see the key to the problem, and the difficulty of the challenge is incomputable.

This would be irrelevant if Italy's problems had the economic dimensions of Greece or Portugal. But Italy is the most fragile of the large countries: The Italian debt is as big as that of Germany, and if Germany took it on, Berlin would just go bust.

In Italy, many argue that it is like the 1992 crisis, when there was the collapse of the party system of the first republic. Yet, now, it is very different and more serious.

The international picture today is much more unstable and confused. Then, there was the clear collapse of the Soviet Union and the American victory. Washington dominated the world politically, economically, and spiritually, and all Italians had only to convert to true and sworn pro-American and set their sails to the new winds. But today the scene has changed - who counts and will count more: America, Germany, or even distant China? With a political class that forgot foreign policy for almost 20 years, straightening the sails according to one state is already difficult, with three it is absolutely impossible.

Against this international backdrop, which is alienating and uncertain for Italian politicians who are unable to go beyond their borders, the Italian situation appears to have no way out. An Italian crisis could be triggered by its economy and its public finances, which are near the point of fracture, and from there it could extend to the institutions and the spirit.

Economic Minister Giulio Tremonti just days ago appeared to be the last barrier before the landslide. Now, because of scandals affecting two people close to him, he seems to be the weak link in the chain. He is alone, alienated from political parties that supported him. Prime Minister Silvio Berlusconi's party has turned its back on him almost publicly, and the Northern League, his old trump card, is regrouping around Interior Minister Maroni.

It is just the tip of the iceberg. Then, there are a myriad of differences with 1992. Today, unlike then, there is the euro, which unlike the old lira can't be devalued. Nor is there an opposition lurking in the corner: then there was the former Communist Party and the newly established Northern League, both eager to prove their mettle. Now the opposition is pulverized and has no idea what to do if it were in charge of the government.

Back then, elections were held according to proportional representation, so the end of the top tier people like former premiers Giulio Andreotti or Bettino Craxi, opened the gates to their lieutenants, such Romano Prodi and Giuliano Amato who were free to then climb up the political ladder replacing their former political bosses after their fall.

Today, because of present electoral law, parties are de facto possessions of their party leaders, their lieutenants have no freedom. Therefore, a crisis for Berlusconi or opposition leaded Pier Luigi Bersani would collapse their parties and does not open space to people who are behind them in party organization.

The combination of all of these elements stops everything. President Giorgio Napolitano could perhaps declare a national emergency, forcing the resignation of controversial premier Berlusconi, but then the new team would not have the votes in parliament to govern. Nor does Berlusconi seem willing to step aside to lend his votes to support another person's government.

Napolitano might even call for general elections, but the old parties would still win the polls even at the cost of the triumph of abstention. Moreover a parliament sitting a thousand people is ridiculous now more than ever. In America, with a population five times that of Italy, representatives both at the Senate and the Congress add up to about 500.

Proportionally, in Italy, a hundred would suffice! Too few? The comparison does not hold with the US? Perhaps, but 300 should be more than enough. The practical solution should be the wholesale of state assets, which could greatly improve state accounts and boost markets' trust. New policies to stimulate growth should be designed and put in place. But for all of this a strong new government should hold the fort, and even the prospect of this is missing now.

Nor are there social or institutional forces that can take the lead. The unions are a shadow of themselves, as is the judiciary. The association of industrialists is scattered, and the best companies have diversified abroad and have become mostly uninterested in homeland issues.

In 1992, all these players were present and active. Today there is only the Church, which has no great desire to return to the front line, except for some bizarre nostalgia for the Catholic Party, the Christian Democrats' revival.

In 1992, even with all these elements in play, Berlusconi launched Forza Italy and removed from the political refrigerator the far-right National Alliance, hitherto alien to parliamentary calculations. He then promised a political revolution and renewed in part the parliament's profile. Today, without active political and social actors, there should be a plethora of new parties and initiatives, but none looms on the horizon. Even formations born out of protest such as those headed by Nicky Vendola and Antonio Di Pietro are disunited. The two newly elected mayors, Pisapia in Milan (Vendola's) and De Magistris in Naples (Di Pietro's), proclaimed, just after their victories, their independence from their leaders.

Then, what is next for Italy? It is a question still left unanswered, even theoretically. This uncertainty is profound, beyond Berlusconi's weaknesses, tumbling like an avalanche on the crisis of the Italian debt, which in turn could mortally hurt the euro and thus knock out the rest of the global economic balance.

These calculations seem excessive in Italy, where there is no serious sense of alarm, and nobody talks about the end of the world.

Cynics say that a problem without a solution is not a problem. But that is just a silly pun, and to ease the present situation, the government, on vacation until September, has suspended the auction of government bonds, which could trigger the crisis, until September. In this way, like at school, problems are put off until September, as if after the summer break things will easily solve themselves.

But the world may not allow Italy - almost on a mental holiday, even before the summer break - to rest. In fact, the stock market will continue to trade those banks considered at risk because they own many of the ''poisonous'' government bonds. An attack on those stocks, which might spread like a wildfire, is not impossible from now to September, when few are buying and selling and many are distracted.

It will take time to fix the Italian problems, but perhaps there is no time. When Italy begins a rapid dive to the bottom, every rescue effort will be impossible. The time to act in some way, in any way, should be now. But the Italians, heading for the hot August sun, are on vacation. Yet if Italians do not act, maybe the world will need an invasion of Italy much more than years ago it needed an invasion of Iraq.  (2011-08-04 Asia Times)