Italy’s “Primus inter Pares” standing vs France and Germany.
While Europe has avoided a recession this year, the elephant in the room is Italy’s ambition to be considered a “primus inter pares”, i.e., belonging to the same league of France and Germany. Regrettably for Ms. Meloni, Italy’s’ prime minister, this does not appear to be the case. Last week in Rome, French and Italy’s political and industry leaders met at the Embassy of France, the magnificent Palazzo Farnese, to celebrate the first anniversary of the Quirinale Treaty between the two countries. The goal of this pact is to enhance bilateral cooperation through a stable and formalised framework for cooperation. On Monday,
however and malheureusement, French and German Ministers Bruno Le Maire and Robert Habeck, Italy’s counterpart were not invited, visited US Treasury Secretary Janet Yellen, US Trade Representative Katherine Tai and Secretary of Commerce Gina Raimondo. Both defended the European Commission’s latest moves to counter the US’ controversial granting of green subsidies through the Inflation Reduction Act (IRA), a US $370-billion subsidies and tax break package. Unless the EU rules regarding the public debt (60% of GDP) and the deficit (3% of GDP) change, Italy with its 147% of debt on GDP will not be able to provide much help to companies headquartered in Italy. With an ongoing war in Ukraine and the need for a more cohesive Europe, such happenings are peculiar and, all together, extravagant. So long for the amitié and the spirit of the Quirinale Treaty.
Italy’s economy is growing more than Germany and France. The EU Commission has released the economic forecasts for 2023 and 2024, which ward off the risk of recession. For Italy this year turns out to be better than expected with a growth of 0.8%, higher than that of France and Germany. But for 2024 Italy will be the laggard.
Italy’s central Government will change the governance and strengthen its leadership on Next Generation EU funds. No veto rights to local entities. The Government will radically change the governance: more powers to the Government and the possibility of changing the managers chosen by Mr. Draghi, Italy’s former Prime Minister and head of the European Central Bank. A 50% cut will be applied across the board on the deadlines for agreements and opinions with local authorities, appeals and expropriations.
Lombardy and Latium regional elections: the center right candidates win. A Waterloo for the center-left. As anticipated last week, both center-right candidates won the governorship of these two critical regions. Lombardy is the crown jewel of Italy’s’ economy: with 18% of Italy’s population and a GDP of US$ 392 in 2022 second only to L’Ile de France, the Parisian region. Latium is politically more relevant as Rome is its capitol. The turnout of voters was, however, particularly disappointing, 40%. Fratelli d'Italia, Ms. Meloni’s party, reaffirmed its political force with 25.2% in Lombardy (it was 3.6% in 2018, 27.6% in September general elections) and with 33.6% in Lazio ( 8.7% in the previous regional elections). This without cannibalising the votes of the allies, the North League and Berlusconi’s Forza Italia. All in all, this round has strengthened the central government and Ms. Meloni leadership. On the other hand, it is a Waterloo for the center-left. In 2015, out of 21 regions, 14 were ruled by center- left governors and only 4 by the center-right. Today it flipped, 14 center-right to 4 center-left.
On the need to amend Italy’s constitution. As explained in our previous Op Ed, Ms. Meloni must promote a constitutional law that convenes a 100-member Assembly or establishes a Commission to amend the constitution. Partial, and often ill-conceived, amendments did not and will not work. In 2001 the center- left, through a constitutional change, provided regional governments with more powers, often overlapping with the central government. A disastrous attempt of devolution. There is, in fact, an all-time-high number of conflicts between the central government and the Regions. More than 2,200 appeals are engulfing the Constitutional Court since 2001 reform. The majority of the conflicts are generated by financian, health-care and environmental laws. Two times out of three it is the central government that challenges a regional law contesting its constitutional legitimacy. A mass of appeals that takes up half the Court's time: around 45% of the sentences from 2011 to today concern the State-Regions dispute.
The rooms and the Fortepiano of composer Richard Wagner when he lived in Venice. Venice is splendid this time of the year and an unmatched host of the iconic Carnival. Tourists plan a romantic visit to Ca’ Vendramin Calergi on the Canal Grande that Wagner rent 1882 intending to stay there for years. Alas, he died shortly after on February 13, 1883.
