
Former Italian prime minister Matteo Renzi has pulled the plug on the country’s ruling center-left coalition.
Renzi, now a senator, has withdrawn his 48 lawmakers and three ministers (one junior) from the coalition ostensibly over a spending dispute. He wants to use Italy’s €200+ billion share of the European Union’s €750 billion coronavirus recovery fund to invest in infrastructure and the green economy. The other ruling parties prefer to use the bulk of the money for short-term stimulus.
Renzi has also proposed to tap into the European Stability Mechanism (ESM), set up in the wake of the euro crisis, to help pay for Italy’s increased health-care spending, something Prime Minister Giuseppe Conte has resisted. ESM funding would come with strings attached. Countries are free to spend their share of the coronavirus recovery fund however they see fit.
Renzi’s proposals have merit. Italy is failing its next generation. It needs structural reforms — which ESM support would require — to catch up with the rest of Europe. Spending €200 billion to prop up the Italian economy in the short term is a wasted opportunity.
But expecting the other ruling parties to meet his terms, when Renzi’s is by far the smallest of the three, is unreasonable. Throwing Italy into a political crisis when it is still suffering one of the worst outbreaks of coronavirus disease in the world is irresponsible.
Conte must now find a new majority in parliament, perhaps with members of former prime minister Silvio Berlusconi’s Forza Italia, or call early elections. Read more “Renzi Picks the Wrong Fight — Again”