Can “Super” Mario Draghi save Italy?
After several days of political rowing, President Mattarella of Italy has called on one of the country’s most celebrated international figures, Mario Draghi, former head of the European Central Bank, to form a new government. Draghi now has a fortnight to get his government together – face a vote of confidence in parliament, or give the current Italian socio-political tail-spin crisis another nudge.
As President, Mattarella has extraordinary powers in times of political crisis and hiatus. He can nudge, cajole, and choose who should form the next administration. Italy’s crisis began when former prime minister, Matteo Renzi, pulled the plug on the coalition headed by Giuseppe Conte. Renzi was not happy with the way Conte was handling the €200 billion emergency Covid recovery fund from the EU.
“Really it is a case of Renzi not liking Conte – full stop,” said an Italian official this morning. “They can’t stand each other.”
“Now Renzi appears to have won. He’s put himself at the centre of things – a really unlikely change of fortune. But it is still open as to whether Draghi can win a vote of confidence in the next fortnight.”
Italy is in big trouble from Covid and the unhealthy colour of its economy even before the pandemic struck. It has recorded 90,000 Covid deaths in a population six million smaller than Britain’s. The vaccination programme has moved in fits and starts – though it is far better than that of France, with around 2.5 million Italians receiving at least one injection.
Italy is facing the prospect of a double-dip recession. This is ominous given the underlying incidence of youth unemployment – with up to a quarter of the under 30s with no formal job, and a very high proportion of young men and women single and living in the parental home.
This would have been at the front of President Mattarella’s mind when he announced last night that he was calling on Mario Draghi to form the next government. “We need right away to give life to a new government which is capable of dealing with our social, health, economic and financial emergencies.”
It is not a time to play politics, Mattarella suggested. “We need a high profile government, which shouldn’t be part of this or that political formula. He said he was calling on “all the forces in parliament to give confidence and support to the new executive.”
One of the forces that won’t be giving parliamentary support is the 5 Star Movement. Sounding a suicide note, a spokesman said the M5S caucus would not back a confidence vote in Draghi. This is likely to mean the end of 5 Star in its present form. Founded by the standup comedian and satirist Beppe Grillo, it was a grassroots movement based on ‘anti-politica’ – anti politics. It wanted radical reform, based on crowdfunding and laptop support.
The choice of Draghi to be prime minister is being compared to the selection of another economist, Mario Monti, a former EU commissioner for competition, to head an emergency government in 2011. He had to impose austerity measures in the wake of the 2008 crash and its accompanying peculiarly Italian ills. “The problem is that all Italian technical or unity governments end up in politics,” says my civil servant friend. “The real question is how Draghi handles politics, as he now is a politician for the first time in his life.”
A better precedent, most hope, is the appointment of Carlo Azeglio Ciampi, another former central bank governor who has headed the Bank of Italy and led a very successful emergency government between 1993 and 1994. He then became a highly respected Head of State from 1999 to 2006.
Draghi faces challenges on three fronts. He has to win over parliament to support his government and emergency programme. He then has to tackle Italy’s triple-headed crisis of Covid lockdown, vaccines, and the threat of economic and social collapse. Third, there is Italy’s peculiar position in the EU.
If 5 Star does vote against him, and the breaking news is that the parliamentary party is split top to bottom on this, he needs the support of the Democratic Party, a partner in the last government, and substantial elements of the three big parties in the current centre-right opposition. Matteo Renzi has already pledged the support of his tiny Italia Viva party.
The key element is the League led by the populist, aggressively nationalist, Matteo Salvini, a controversial former interior minister and wannabee prime minister in charge of migrant policies. For the time being, Salvini has said he will back Draghi, whom he says he admires. But Salvini would prefer elections – because he thinks he would win and become PM.
This points to the key role of Forza Italia, under its founder Silvio Berlusconi, now 84 and ailing. It is likely that he would back the new unity government. Even so, a Draghi parliamentary majority is far from assured.
The Covid crisis in Italy is at a strange inflection or turning point. Moves are afoot to start lifting lockdown. However, the vaccination programme is not extensive enough to warrant this in view of many, including the 5Star Movement. Health services are under colossal strain as too much has been put on the hospitals themselves. There is a great deal of local autonomy in public health services and bodies but this varies from region to region with serious deficiencies in the Mezzogiorno, the South.
As for the economy, as Mario Draghi knows only too well, there are few quick fixes.
Then there is the problem on which ostensibly the prime minister and former prime minister, Conte and Renzi, fell out – the €200bn EU Covid recovery fund. Draghi says this will be central to his emergency programme. Renzi accused Conte of being too cautious, and said the fund had to be spent before it was modified or withdrawn. Conte, it has now been revealed, feared that Brussels would impose draconian austerity policies as conditions. He feared, says one source, that “the EU would treat Italy as they did Greece.”
The EU is in a mess over Covid vaccine strategies, and a lot more, boding ill for Italy. Draghi could become the most proven and trusted of the leaders of the senior EU partners. In recent weeks Angela Merkel’s characteristic common sense appears to have gone walkabout over Covid, and the German EU Commission president Ursula Von Der Leyen has proved downright incompetent e in her handling of vaccine contracts and the Northern Ireland border.
Most concerning for Italy is the latest posturing of Napoleonic narcissism by Emmanuel Macron. Italy has seen fit to join France and Germany in downgrading the efficacy and value of the AstraZeneca vaccine, especially for the over 65s. It’s all on pretty spurious grounds, as was explained brilliantly in the Reaction Answer Time podcast last night by Kate Bingham and Professor Brian Cox – now available on YouTube.
At the weekend Italy’s Fincantieri, the shipbuilders, had the deal to become majority shareholder in the big French yards, Chantiers de l’Atlantique, cancelled. Rather, it didn’t get EU approval, and the Macron administration took no time to say the whole thing was off. The French have long aspired to create a pan-European marine equivalent of Airbus. But they have rejected Italian participation in building the new French aircraft carrier and now pushed them out altogether from participation in the big construction yards, a sector in which they have world-beating expertise. It means the much-vaunted tie-up between French Naval Group and Fincantieri in the Navaris group is pretty much dead in the water.
“Navaris is just a piece of paper now, nothing more,” says Italy’s leading defence expert Gianni Dragoni of Il Sole 24 Ore. France wants a multinational EU defence industry, it seems, provided it is based in France and does what Paris wants.
But for Draghi there are more pressing matters. He has to get a government working through the summer, until the June break at least when parliament goes into its pause ahead of the presidential elections. In January 2022, all MPs and senators then choose the next head of state. It’s an increasingly important and powerful post as President Mattarella and his predecessor Giorgio Napolitano have proved. The president has become the country’s supreme fourth official and referee.
Indeed, many Italians hope that it will be Draghi – known to be somethingof an anglophile – who will be chosen to be the Italian Republic’s 13th president this time next year.