He won't be taking office as Italy's "new" prime minister until early May, but the victorious Silvio Berlusconi is already giving hints about his future policy for resolving one of Italy's most pressing problems, the future of the nearly bankrupt Italian airline, Alitalia. Unfortunately, the most recent solutions mentioned appear to be impracticable, unlikely or downright illegal.

        On Friday, at a joint press conference with outgoing Russian president, soon to be   Russian prime minister Vladimir Putin, Berlusconi said the two had discussed the possibility of Aeroflot, the Russian state-owned airline, making a bid for Alitalia, a possibility which seems unlikely seeing that the Russian carrier, one of six companies chosen to present bids last fall, withdrew from the running last November when it became clear that Alitalia's mammoth losses (625 million euros in 2006 alone, more than €1.2 billion now) would totally wipe out Aeroflot's newfound profits, 160 million dollars in 2007.

        Although he had campaigned vigorously against the acquisition and restructuring plan presented by Air France-KLM several weeks ago and approved by the Italian government, Berlusconi also insisted the French-Dutch company was still in the running, although other sources say that having been turned down by Italy's unions, Air France is not likely to return to the fray.

        And Berlusconi's solution of choice - the "let's keep Alitalia Italian" idea - is also reportedly still in the running. Once again there has been talk that a "cordata" of Italian entrepreneurs - the Air One airline, Banca Intesa, Italy's largest bank and several other businessmen. Lufthansa, another former suitor, is also said to be reconsidering but it is hard to tell if there is any substance to this or if it is just another rumor.

        But any attempt to keep the airline from going bankrupt - cash reserves are dwindling rapidly - would require some sort of credit loan or bridge loan -estimates are of €100 to €150 million to keep the airline afloat until an Italian buyer can be found. Unfortunately, the European Union would consider this illegal state aid. Can it be no one has told him this?

        Last week Berlusconi's likely chief of staff, Gianni Letta met with the outgoing govenment's chief of staff, Enrico Letta (the two are uncle and nephew) to discuss the possibility of a bipartisan decree law that would ) to discuss the possibility of an immediate bipartisan decree law that would avoid bankruptcy thereby giving the new Berlusconi government time to come up with a new buyer, one who somehow was unavailable during last year's length negotiations. The government might be willing to risk the EU's wrath (ironically, the decree would bear the signature of outgoing Prime Minister Romano Prodi, a former president of the EU commission), citing a national emergency. But it is unlikely the Italian president Giorgio Napolitano would sign off on such a risky piece of legislation.

        If that doesn't go through, there would seem to be no alternative to a sort of Chapter 11 solution which in Italy would involve the appointment of an all-powerful Commissario who could make unpopular decisions. But that presents yet another pitfall, the so-called "material adverse change" clause which would allow the owners of Alitalia's 74 leased airplanes (out of a fleet of 188) to take back their property meaning keeping the airline flying would become, at best, problematic.