Italian Elections: End of the Berlusconi Era?

Well the leadership of the EU seems more than happy with having Prodi back:

Silvio Berlusconi may still be Italian prime minister for another two months, but some corners of Europe have all but consigned him to history.

The French and Luxembourg governments and José Manuel Barroso, European Commission president, did not even wait for the official results from the Italian election before congratulating Romano Prodi, the man who barely bested Mr Berlusconi.

Why, the FT asks, where they so keen:

One theory is that, as a former European Commission president, Mr Prodi will provide valuable support for European integration.

In an article in today's Le Monde newspaper, Mr Prodi says that Italian foreign policy should be based on three principles: encouraging a strong and united Europe; developing a solid relationship with the US; and supporting multilateral efforts to solve global problems.

Another school of thought is desperate for the new government to implement much-needed structural reform. No sooner had the election result been declared than Joaquín Almunia, the EU's economic and monetary affairs commissioner, called on Mr Prodi's team to get Italy's budget deficit under control and proceed with the rapid implementation of reforms.

The key issue, of course, is on whose votes Prodi will depend to carry out his reforms. If he has to depend on Bertinoti, then they may not be very 'reforming' reforms to say the least. But he may have other alternatives.

Inside Italy a number of Berlusconi's old allies continue to fidgit restlessly. Manuel Alvarez-Rivera of Election Resources writes:

you may already be aware of this, but just in case I should point out that the Italian news media reported earlier today (Wednesday) that one of Berlusconi's allies, the Union of Christian Democrats and Center Democrats (UdC) came out against the idea of a "grand coalition" government that Berlusconi's been floating as of late: according to them, if the center-left has the means to govern, then they should govern.

and

The UdC definitely wants something. The party's secretary said today that the challenged ballots won't change the outcome of the election, rebuking Berlusconi once again. And on top of that, Fini's National
Alliance is also distancing itself from the fraud allegations.


As Charles Grant, director of the Centre for European Reform in London, says, "it will be hugely significant to learn whether the new government will be capable of structural reform.....Unless there's a real effort to reform soon, a serious debate will start on whether Italy should stay in the euro and that's something that's very important for the EU."