Former Italian premier Matteo Renzi’s “big break” has been developing for a while, since the Autumn of 2016 and well before the referendum rejecting constitutional reform that led him to resign three years after his major victory at the 2014 European elections. And today the leader of the left-leaning Democratic Party (PD) presents this break. It is a big one that hits the relationship between Italy and Europe.
In black and white, in a chapter of his book (“Avanti”), Renzi opens a front which will be the object of national and international discussions and assessments.
“This will be the first testing ground of the government in the next legislature, whoever will lead it,” Renzi writes.
The former premier wants to negotiate better conditions for Italy and in exchange for the commitment to reduce the public debt, he is calling for a more flexible use of the deficit. He wants five years with a deficit to gross domestic product (GDP) ratio of 2.9%, just below the official 3% ceiling. This is so Italy can make use of €30 billion in the next five-year-period, aimed exclusively at reducing fiscal pressure to boost growth, which in turn is the only way to reduce the debt. On paper, this would appear to be a perfect exchange.
But we are already in an electoral campaign, and while awaiting clarifications on the real possibility to reduce the mountain of debt, one can hear the echo of propaganda, at least three times: 1) Italy “raising its voice” against euro bureaucrats is a slogan, and a tired one at that. 2) Staying for years at 0.1% below the impassable 3% seems to be too astute respect of the rules. 3) The coming of the Fiscal Compact (Renzi proposes a veto on its introduction in the European treaties) will also have to reckon with the fact that the principle of budget balance was inserted in Italy's Constitution in 2012.
Nevertheless, Renzi’s break is a strong political act, in any way you judge it. It is evident that it will influence the activity of the government in view of the 2018 budget law. It is a fact that it will be noted by the EU Commission, with whom Italy has to discuss its economic policy.
It is furthermore a fact that the sense of the proposal and Renzi's clear criticism of the center-left (“to get rid of (Silvio) Berlusconi it also used Europe, allowing it to enter into our home”) anticipate the option of a possible governing agreement with former prime minister Berlusconi's center-right.
Renzi has defined it as a “progressive manifesto”. Let us see how it will be judged under this profile. Certainly it is another strong bet, both personal and political.
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