The fall of the Draghi government has caused sweating in Brussels and Berlin. What’s next for the Italian patient? And how can the country be kept on the right course – from the point of view of the EU bureaucracy?
by Pierre Levy
On July 21, the Italian government fell. Its boss, Mario Draghi, was dropped by three of the parties that formed the majority and handed in his resignation. While President Sergio Mattarella had tried a week earlier to reject his resignation in the hope of a combination at the last minute, this time he had no choice but to accept his resignation. Peninsular voters will go to the polls on September 25th.
To say that this event is causing cold sweats in Brussels and major European capitals is an understatement. “A veritable storm” is now the phrase popping up in the corridors of the European Commission and in the mainstream press. In an editorial by Le Monde (July 21, 2022) stated:
“The timing could not have been worse for Italy, the eurozone and the European Union as a whole.”
The decapitated golem: what if Germany left the EU?
“The storms are increasing,” the French daily continued. And she recalls the context: a country whose economy has suffered significantly from COVID-19; which is burdened with a significant national debt; which is being hit by sharp increases in interest rates on bonds; suffering from soaring inflation and facing gas shortages from Russia, on which it is particularly dependent.
It is true that the entire European Union is affected – to varying degrees – by these threats. But this is especially true for the EU’s third largest economy. Besides Spain, Italy is the biggest “beneficiary” of the economic stimulus package managed by the European Commission: Rome has been promised 69 billion euros in grants and 123 billion euros in low-interest loans. But only a small part of this sum has been transferred so far. Because Brussels – like the other countries – makes a payment in tranches, depending on the progress of the “reforms” that each member country has promised in return for the grants.
In Italy there was a man who embodied the guarantee of compliance with the European “recommendations”: Mario Draghi. After his time as head of the Italian Treasury and then at Goldman Sachs, he was President of the European Central Bank from 2011 to 2019. In European legend, he is described as the magician who saved Euro 2012 from speculative attacks. To say that his presence at the head of the Italian government was strategic for Brussels is an understatement.
Political chaos in Italy after Draghi’s resignation
Now the party “The Brothers of Italy”, which is often described as “post-fascist”, sees the election intentions until September at the top; with the possibility of leading an alliance that would unite two other right-wing forces: the Lega, and Silvio Berlusconi’s Forza Italia. It is true that none of these parties advocates leaving the EU or the euro; and “the brothers of Italy” make no secret of their Atlantean attitude. But it doesn’t matter: if such a coalition were formed, all Brussels’ hopes would collapse, even before such a government took office for the first time. With a second Orbán – and this time within the eurozone – the building blocks for the break-up of the EU would be in place.
It’s not that far yet. But to appreciate what’s at stake, one must consider the convulsions in Italian politics over the past decade. An important turning point was 2018: In February of that year, a wave of elections described as “populist” swept across Italy. This led to an unthinkable coalition of the two big election winners: the Five Star Movement (M5S), classified as “left-wing anti-system”, and the Lega, led by Matteo Salvini, often labeled as far-right.
After a moment of panic in Brussels, the team calmed down before being rocked by contradictions. In the summer of 2019, the head of government, Guiseppe Conte, who is close to the M5S (and whose leadership he will later assume), carried out an alliance reversal: he linked this movement with the Democratic Party (“PD”, often described as “centre-left”) – a team that seemed unlikely. And he served the Lega in return.
After Draghi’s resignation: “We are heading for a catastrophe”
In February 2021, however, Conte had to realize that his new majority was no longer sustainable. The very EU-friendly President Mattarella discreetly set out to form a majority that included almost all parties in parliament – with the exception of “the brothers of Italy”. A bit as if a “grand coalition” were formed in Berlin, ranging from the left to the AFD. So at the top Dottore Draghi, as Italy’s savior in the EU.
His “miraculous” appearance is reminiscent of the theater coup of November 2011. At that time, Silvio Berlusconi ruled the country. While the media mogul was by no means anti-European, under popular pressure he struggled to implement the drastic “reforms” imposed by Brussels – reforms made all the more severe as Italy was falling prey to speculative attacks at the time. In reality, behind the scenes (at an EU summit) Brussels, Angela Merkel and Nicolas Sarkozy orchestrated this creeping coup. And even then there was a miracle figure who took over the leadership of the government in Rome: former EU Commissioner Mario Monti. Monti and Draghi have at least three characteristics in common: they have never been elected, they have close ties to the business world and, above all, they have been key figures in the European Union.
This quasi-putsch, operated from outside, had far-reaching consequences within the Italian people. From this period stems hostility to European integration in a country previously thought to be particularly “europhilic”. Similar to when the French and Dutch no votes were disregarded in the 2015 referendums on the draft European constitution – in the end a corresponding treaty (the so-called Lisbon Treaty) was enforced.
How the EU lets its citizens suffer from the consequences of a failed Russia policy
European leaders are more than concerned about Italy’s “backslide”. The daily newspaper La Stampa even believed he had found the reason for the relapse: the political crisis in Rome was controlled from Moscow – a claim widely adopted by Western media. This “explanation,” which ignores the country’s political contradictions, is hardly credible. But even if it were true, the pro-EU press is in no position to resent this alleged interference, having given both hands hailing Monti’s parachute launch, which was effectively piloted from Brussels.
The beginning panic of European politicians can also be explained by the contrast between Mario Draghi, who was one of the most determined defenders of the Ukrainian side against Moscow; and the parties that have just brought about his downfall and that may be involved in the future government that will emerge from September’s elections: the Lega and Forza Italia on the one hand, the M5S on the other, all becoming one “Pro-Putin” compliance allegations. And this in a country whose public opinion has been described as the least anti-Russian in the EU.
Under these circumstances, one understands the excitement and advice of Le Monde at the end of the aforementioned editorial:
“It’s up to the pro-European Italians to mobilize and the EU to act with tact to prevent this nightmare scenario.”
So the EU is being asked to get involved again. But please this time “with tact” …
more on the subject – “Super-Mario” leaves the political stage: will the EU and the euro follow?