For global markets stung by more than three years of Europe’s debt crisis, the outcome here could not be more important. With a bigger borrowing burden than any of its neighbors save near-bankrupt Greece, Italy remains one of the biggest wild cards in the long-term viability of the euro. Should its next leader veer too far from the austerity and economic reforms pushed through last year to pull Italy back from the brink of financial collapse, analysts fear a dangerous return of market panic just as the continent’s woes appear to be finally bottoming out.
Enter Bersani, a mechanic’s son from Emilia-Romagna, the “red region” of the Italian left, whose economic policies have become more market-friendly than many of his right-wing rivals. In fact, industrialists here now credit the current leader of the Italian center-left with being one of this nation’s free-market pioneers.
While serving in left-leaning cabinets in the 1990s and 2000s, the cigar-chomping 61-year-old surfaced as a powerful advocate of reforms considered key to modernizing the business climate in long-stagnate Italy. Bersani took on the country’s energy and telecommunication monopolies and challenged sacred rules that limited competition in the sale of everything from savory focaccia bread to diapers.
He has nevertheless raised eyebrows with investors by striking a coalition deal with more strident leftists as well as for openly suggesting he would move to fine-tune, if not overhaul, at least some of the budget-cutting measures pushed through last year. Such changes, he has said, would include higher taxes on the rich to lessen the burden on the poor.
In an extensive interview this month with The Washington Post, he additionally suggested that, if elected, he would push to renegotiate strict European limits on budget deficits and debt in a bid to simulate growth.
Yet Berlusconi, who represents the center-right, has proven a far more outspoken critic of new taxes and spending cuts than Bersani. The 76-year-old media tycoon has blasted the reforms made after he was forced from office in November 2011 as diktats from Europe’s fiscal disciplinarian, German Chancellor Angela Merkel.
Even interim Prime Minister Monti — the fiscally tough technocrat chosen by Parliament to replace Berlusconi who is seeking a full term — has recently said some of his own measures went too far while others did not go far enough, suggesting any winner here would tinker with the formula that allowed Italy to escape financial collapse last year.