Enter the Dragon

The story so far: in the middle of January, Matteo Renzi pulled his tiny party, Italia Viva, out of the country’s fragile but functioning centre-left coalition because he couldn’t get his own way over how best to make use of its €200bn-plus in post-Covid EU stimulus funding. The result of his walk-out was to deprive Prime Minister Giuseppe Conte of his wafer-thin majority and risk bringing down the whole government in the midst of the worst global pandemic in a century and the worst economic crisis since World War II, even though Conte and his cabinet were widely felt to be doing a reasonably good job.

The thing is, no one had the slightest idea what Renzi was seeking to gain from this bizarre political tantrum – other than get his photo in the papers and top the bill on a few TV talk shows for couple of weeks. Indeed, he was quickly reduced to a mere bit-player in the unwanted drama that he had unleashed as the grown-ups in the room effectively banished him to the naughty step while they got on with trying to sort out the mess he had left behind.

The first step was a parliamentary vote of confidence, which Prime Minister Conte won comfortably in the Chamber of Deputies, but (thanks to Italia Viva who, still in a sulk, refused to play nicely and abstained in both chambers) fell short of the crucial absolute majority in the Senate. After a week of inconclusive arm-twisting, Conte still didn’t have enough Senators on board for an absolute majority, so rather than try and run a minority government, he submitted his resignation to President Sergio Matarella in the hope of receiving a mandate to form a new coalition. This was a bit of a gamble on Conte’s part as there was a possibility, albeit a remote one, that Matarella might call a snap election which would risk the centre-left losing its slim parliamentary majority to the right-wing alliance headed by the left’s arch enemy, Matteo Salvini, the firebrand leader of the far-right La Lega. Conte’s bet was a pretty safe one, though: the President is known as a cautious pragmatist, and when Salvini himself walked out of the previous Conte-led coalition in an attempt to force an election and capitalise on his popularity in the polls, Matarella preferred to give party leaders every possible opportunity to see if a new coalition could be formed first. And with the stakes so much higher this time around, it was no great surprise that he once again adopted this cautious approach, having in any event received only half-hearted demands for an election from Salvini, who even expressed support for the idea of a government of national unity.

So Conte, along with the ruling Partito Democratico (PD) and the Movimento Cinque Stelle (M5S – Five Star Movement), set about trying to form a new centre-left coalition – without Renzi, though, whom (surprise, surprise) neither party was prepared to work with again. On this occasion, though, negotiations failed. But Matarella still shied away from calling a destabilising election that could easily shake market confidence and give the EU a severe case of the jitters in view of the huge sum of money they had recently granted Italy from the EU recovery fund – especially since an election may well be won by Salvini’s hard-right and distinctly Eurosceptic alliance. This left him with no alternative but to find a safe pair of hands with which to entrust the job of putting together a technocratic government suited to navigating the country through the choppiest waters it has experienced in a generation.

After a couple of days’ speculation about whose hands he would choose, Matarella concluded that those of Mario Draghi were probably just about the safest available. So he invited this former Governor of the Bank of Italy and former President of the European Central Bank, who earned the nickname ‘Super Mario’ after successfully rescuing the Euro in the midst of the 2012 European debt crisis, to pick up the baton that Renzi had so recklessly yanked out of Conte’s hands a fortnight earlier.

Mind you, despite Draghi’s formidable reputation as a skilled political operator and his impressive credentials as an academic economist and central banker, his appointment was not greeted with unalloyed delight. Indeed, it was dissatisfaction with Italy’s most recent period of technocratic government led by Mario Monti (ironically during the very debt crisis through which Draghi successfully steered the Euro to safety) that fuelled the rise of both the anti-elite five Star Movement and the anti-EU La Lega whose subsequent political jostlings are arguably at the root of the current crisis. Consequently, Draghi was always going to have an uphill struggle to garner sufficient cross-party support to form an administration.

It seems that Super Mario has not lost his touch, though: despite their initial suspicion of him, Draghi has indeed managed to secure the support of the two main anti-establishment parties, M5S and La Lega, along with that of the Partito Democratico and Forza Italia (Berlusconi’s old party). And most other minor parties of the right and of the left soon followed suit, including even Italia Viva and Renzi – who now has the bare-faced cheek to claim that appointing Draghi had been his idea all along.

All of them have stated their willingness to do their bit in their country’s hour of need amid a veritable chorus of declarations of readiness to put past differences to one side and to act in the national interest. Impassioned declarations of support and solidarity are one thing, though. Actually getting representatives of the various parties around a table, getting them to put their respective policy agendas aside and agree a common way forward for the new government, and then getting them to decide who’s going to hold which cabinet position might require quite a lot more of Super Mario’s legendary negotiation skills and powers of persuasion.

At the height of the European debt crisis, Draghi famously stated that he would do ‘whatever it takes’ to save the Euro. So now the country is watching to see if Super Mario can show the same ruthless determination to resolve the current crisis and continue to live up to his nickname.

Image courtesy of http://www.ft.com

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s