Italy wanted a leader who implemented reforms, whose reputation would inspire confidence both at home and in the eurozone, and who could break out of the political turmoil. And Italy got that leader. The technocrat Mario Draghi, who placed other technocrats in the most important ministerial posts. They came up with far-reaching plans to reduce bureaucracy, speed up the administration of justice and digitize Italy. Reforms necessary to get billions of euros from the European corona recovery fund.
The support that Draghi asked for from parliament and received – initially – was encouraging. With the exception of the post-fascist Fratelli d’Italia, all parties agreed. Even the EU-skeptical Lega Nord and the critical Five Star Movement supported the new government and provided ministers, though the former was a strategic choice and the latter grumbled.
Campaign time liquefies everything. The prospect of elections next spring and the rising popularity of Fratelli caused Lega Nord and the Five Star Movement to establish themselves. Party political interests took precedence over national interests.
Draghi’s refusal to make concessions to individual parties, which had not improved the effectiveness of the reforms, is to be applauded. That it ultimately led to a breach of trust and the end of the most effective Italian government in a long time is deeply regrettable.
The question is what will Italy get in return. In any case, a summer of turmoil, during an energy and inflation crisis and a war in the region. Three crises that are inextricably linked. In any case, the country will be virtually paralyzed until the autumn – when the budget for 2023 should actually be approved quickly.
The polls point to a right-wing and nationalist coalition of Fratelli, Lega Nord and Forza Italia. The question then is whether and how the reforms that the European Union wants to see in exchange for the 205 billion euros from the corona recovery fund will be realised. The first signs are not favourable: Lega, for example, was already opposed to the liberalization of the taxi industry, Forza to the reforms of the judiciary.
The question is also whether European unity with regard to Russia will continue to be guaranteed. Draghi rapidly reduced dependence on Russian gas. In public buildings, for example, the air conditioning should not be lower than 25 degrees. Until the war in Ukraine, Silvio Berlusconi, party leader of Forza Italia, regarded Vladimir Putin as a friend, and the Italian Public Prosecution Service was investigating Russian party financing of Lega Nord.
The skyrocketing Italian debt remains a cause for concern. Draghi, former CEO of the European Central Bank, gained the confidence of investors. Without him, the uncertainty increases: the German-Italian interest rate spread widened immediately on Thursday.
No European recovery without a strong Italian recovery; the Italian economy is still the third largest in the eurozone. With rising energy prices, inflation and a war in Ukraine, instability in Italy is a crisis that the European Union cannot cope with.
A version of this article also appeared in the newspaper of 25 July 2022