News & Analysis
Does Berlusconi Matter to the EU?
Former prime minister Silvio Berlusconi said on Tuesday Italy would be forced to leave the euro zone unless the European Central Bank gets more powers to ensure lower borrowing costs ... Berlusconi, who announced this month he will again lead his People of Freedom party (PDL) in a national election expected in February, said on a talk-show on state broadcaster RAI that the ECB should become a lender of last resort for the currency bloc. – Reuters
Dominant Social Theme: Berlusconi is concerned about the EU.
Free-Market Analysis: We were told months ago that Silvio Berlusconi was going back into politics. He's easily the most important politico in Italy, so we weren't surprised.
His presence has only become more important when measured against that of the technocrat, Mario Monti. And Monti has said he's resigning.
Monti was never elected prime minister and is not nearly as popular as Berlusconi. Toward the end of 2011, he was "invited" by President Giorgio Napolitano to create a new government after Berlusconi resigned. Berlusconi, unlike Monti, has been elected.
Why does Berlusconi want his old job back? He has claimed he is running only based on a sense of "despair." The despair being that no one else is capable of governing Italy but him! He is, in his estimation (and many others'), Italy's irreplaceable man. He's also in legal trouble and assuming high office should temporarily extricate him from the specter of incarceration (as unlikely as that is).
As one of Italy's richest men he certainly doesn't need the constant drumbeat of personal exposure that the office bestowed on him last time around. Of course, Berlusconi may not mind such exposure as it mostly focuses on his sexual escapades and reveals him to be a 76-year-old with exceptional virility.
Here's some more from the Reuters article excerpted above:
"If Germany doesn't accept that the ECB m Reuters must be a real central bank, if interest rates don't come down, we will be forced to leave the euro and return to our own currency in order to be competitive," Berlusconi said in comments reported by Italian news agencies Ansa and Agi.
The 76-year-old media tycoon has made similar remarks in the past about the possibility of Italy, or even Germany, leaving the euro, but has often at least partially rectified them later.
Berlusconi is already campaigning hard for the election with a spate of television interviews in an attempt to close the wide gap with the center-left Democratic Party which is polling at above 30 percent, some 14 points above the PDL.
The dominant social theme here, so far as we are concerned, is that "Berlusconi is not fit to run Italy." We continue to have a feeling that the power elite that, in our view, wants to run the world is not comfortable with Berlusconi. Monti was their first choice. It hasn't worked out.
But Berlusconi has been subject to unprecedented legal and press attacks. Can this be any coincidence? If Berlusconi actually does become prime minister again, one wonders what statement this is making.
Did the powers-that-be running Europe decide to make the best of a bad situation? Or is Berlusconi running in spite of the disapproval of the top men of Europe?
We note he is coming out in favor of the ECB assuming more power but in a sense this could be mere verbiage. There are certain things he has to say.
Is Berlusconi on the "outs" with the powers-that-be? ... If Berlusconi isn't fully on board with the European experiment, his re-election, if that occurs, could have a significant impact on the EU's future.
Conclusion: Certainly he remains one of Europe's most charismatic and unpredictable pols.
Posted by Danny B on 12/19/12 08:07 PM
"if interest rates don't come down, we will be forced to leave the euro and return to our own currency in order to be competitive,"
The word is "survive" not, compete. Italy is the tenth largest economy and the third largest bond market. They carry far too many bonds for GOV to survive. Investors know this and interest rates are not going to come down.
Posted by taxesbyanyothername on 12/19/12 07:39 PM
He is one of the PTB. He just doesn't play well with others. Unless of course they are nubile.
Posted by laceja on 12/19/12 06:34 PM
Well, there's immunity and there" Immunity. If he runs and gets reelected, I can well imagine he will be much easier for the PTB to manipulate this time around.
Posted by hctroubador on 12/19/12 04:17 PM
There's also the little matter of the immunity that comes with office that might be of interest to the Bunga-Bunga King :)