Italy Economy Real Time Data Charts

Edward Hugh is only able to update this blog from time to time, but he does run a lively Twitter account with plenty of Italy related comment. He also maintains a collection of constantly updated Italy economy charts together with short text updates on a Storify dedicated page Italy - Lost in Stagnation?


Wednesday, October 18, 2006

Prodi's Rating Slips

I am not particularly a political commentator, but I think that politics is such a basic part of macroeconomics in Italy that it is hard not to follow political events closely, so I am not exactly sent over the moon by the news that Romano Prodi's popularity rating seems to be waning (already) and doubly not when I discover that at the same time Massimo D'Alema has consolidated his poition as the most popular member of the Italian cabinet. When we think about the tough decision and tough reforms which lie ahead this certainly doesn't seem to be the most promising of starts. Anyone else got anything to add?

Prime Minister Romano Prodi's popularity among voters has slipped six months after winning the most tightly contested elections in modern Italian history, according to a poll by IPR Marketing.

The number of Italians that ``have faith'' in Prodi as the country's leader has dropped to 49 percent from 53 percent in September and 58 percent in July, IPR said. The Rome-based pollster surveyed 1,000 adults on Oct. 16. The previous two surveys were carried out Sept. 13 and July 12 respectively. No margin of error was given.

Massimo D'Alema, the foreign minister, is the most popular member of Prodi's cabinet, followed in joint second place by Antonio Di Pietro, the former prosecutor turned minister for public works, and Giovanna Melandri, who heads the newly created ministry of sport, the poll showed.

3 comments:

marco said...

In my opinion the decline in Prodi's popularity might have two main causes:
-6 months after the elections, it's pretty difficult to feel the dramatic change in policies promised by Prodi. Some expected he would take the Italian political life of Italy by storm, but this hardly happened.
-In the past weeks, his (very likely and totally unappropriate) involvement in the redesign of Telecom industrial strategy was far from clarified, leaving the clear impression he did not behave like a Prime Minister should behave.

Edward Hugh said...

Hi Marco,

Yes, you are probably right. What I am trying to get across is the fragility of the political situation given the economic difficulty. What is worrying is that D'Alema seems to be mainting popularity while Prodi is losing it, since most of the reforms Italy needs will be proposed by Prodi and opposed by D'Alema.

What Italy needs is a broad coalition of the centre with an agreed agenda, not like the one in Germany, which is able to agree to take immediate action but which fudges all the long term issues.

But I really don't expect to see this in Italy, especially since the German one looks set to fall apart with Merkel's popularity also plummeting.

Basically the politicians are beholden to the voters, and with a median age of 44 many of the voters are in the older age groups, and as Paris points out in another post, the older voters don't favour reform.

This is why I am so pessimistic on the debt.

And meanwhile S&P's just cut Italy's rating. Post to come.

Edward Hugh said...

Incidentally Marco, I just read this in the FT:

"Pollsters attribute the change in public mood partly to the budget, which the government says will benefit most taxpayers but which opposition politicians have portrayed as a leftwing assault on the middle classes."

This is, in a way, what I feared. Spending money is never unpopular with electors, only paying for the spending. Promising to cut taxes is popular and raising them isn't.

If we look at Hungary we can see an opposition which seems to be prepared to attack the government's austerity plan, without really addressing the fact that they themselves would have to do something similar to cut the 10% pa public deficit. Merkel's party also benefited to some extent from the unpopularity of the Schroder reforms, and now she herself is suffering attrition.

So the big problem in Italy is "who will have the moral authority" to carry the reforms through, and meantime what we will probably see is fudge and rising instability.