Italy’s Compromise Government Faces Uncertain Future, Plays Into Berlusconi’s Hands

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MAX ROSSI / Reuters

It’s a solution that came after all other avenues were exhausted. On April 29, more than two months after the Italian elections, the country’s Parliament is expected to give life to a coalition government. Led by Enrico Letta, a high-ranking member of the center-left Democratic Party, Italy’s new administration will be dependent on support from former Prime Minister Silvio Berlusconi, a man many in Letta’s party regard as the enemy.

Indeed, the deal comes only after efforts to find another solution exposed deep rifts in the Democratic Party. After an election in which no party was able to secure a clear victory, Pier Luigi Bersani, the party’s leader during the elections, fervently opposed any compromise with the sex-scandal-plagued media mogul, only to resign his position last week after repeatedly trying and failing to get his parliamentarians to vote for his candidates for the Italian presidency. “On any issue of relevance, the party is split,” says Roberto D’Alimonte, a professor of political science at Rome’s LUISS University. “Letta might get more support from Berlusconi than his own party. That’s the paradox.”

The deal follows weeks of political brinkmanship in which the Democratic Party struggled to strike a deal with the Five Star Movement, a surging protest party headed by the angry comedian Beppe Grillo, who doggedly rebuffed efforts by Bersani to draw him into a coalition. Grillo, who doesn’t hold elected office, has condemned the government-forming deal as a corrupt pact between unpopular political parties, one that plays into Berlusconi’s hands. His parliamentarians have pledged to stay in the opposition — positioning themselves as an alternative in future elections.

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In the meantime, the pact yields a new government that will only survive through compromise. With the Democratic Party having proved that it is incapable of holding the line, Berlusconi will be able to easily claim to control the government’s largest block of support. Recent opinion polls put Berlusconi’s party well ahead of his opponents, so there’s little question that Letta’s government will be heavily shaped by the desires of the former Prime Minister. Indeed, in an interview on April 25, Berlusconi indicated that his support would be dependent on the adoption of a series of measures, including the rollback and refund of a controversial property tax instituted by Mario Monti’s outgoing administration. “It’s not so important who will lead this government,” Berlusconi said. “We’ll sustain the measure of any government that can pass the provisions that we desperately need to exit from the economic crisis that the politics of austerity have put us in.”

For the moment, the emergence of the possibility of Letta at the head of a coalition government has calmed markets that had been skittish in the early days after the election. At 46 years old, Letta is young by the standards of his country’s aging political class. But he’s also a veteran politician, well known in Brussels and in other European capitals. First appointed minister in 1998, he spent the past 15 years alternating between terms in government and spells in oppositions to Berlusconi. “We’re talking about a politician who is young, but also experienced,” says Guglielmo Vaccaro, a parliamentarian in the Democratic Party and a close Letta adviser. “It’s really what we need.” In cooperating with Berlusconi, Letta will also be well served by his family ties; his uncle is a close confidante to the former Prime Minister.

Indeed, in addition to Berlusconi, Letta will draw much of his support from Giorgio Napolitano, Italy’s President, an important, but largely symbolic role more akin to that played by the Queen of the U.K. After being re-elected for an unprecedented second term, Napolitano has thrown his weight behind a coalition government, urging the country’s politicians to put aside their differences and cooperate. With the Italian public screaming for results, all members of the coalition will want to have something concrete to show from their participation. “There is a potential convergence to a reform program that could deeply change the Italian economy and launch growth,” says Franco Bruni, an economist at Milan’s Bocconi University. “The country is very conscious that things do not work.”

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According to Vaccaro, Letta’s government is likely to draw its agenda from a report written by a group of elder statesmen charged by Napolitano with charting a future for the country, focusing first on items all members of the coalition can support. “We’ll work on things that unite us, which are many.” says Vaccaro. “If we work on all the things on which there is agreement, we can start moving forward right away, and for the next couple of years we won’t have a moment to breathe.”