Italy is back in the game

Strengthened by a track record as a reformer and liberalizer, earned when he was the EU's powerful commissioner for Competition, the present Italian prime minister, Mario Monti, may achieve something that none of his predecessors of right or left had managed: to unblock the seized-up economy of Italy. Indeed, the recent episode of the sinking of the cruise ship Costa Concordia has turned a media spotlight on the dysfunctional dark side of Italy that Monti wants to change.

It is not just a matter of squaring the public accounts with cutbacks, tax hikes and the revision of pensions. His proposals in this respect have already been passed by parliament. What Monti is now attempting is to pare away severely at the privileges and guild-system exclusion mechanisms that prevail in so many sectors of Italian society, introducing in these sectors a greater degree of competition: liberalized opening hours for shops; open professional fees for lawyers, architects and notaries; a sharp increment in the number of pharmacy licenses, etc. With this multi-front strategy, soon to be followed by a reform of public administrations, he hopes to energize the sclerotic Italian economy.

It will not be an easy job. A groundswell of strikes and demonstrations is rising, to prevent vested interests from being touched: the strike of the truck drivers, who are protesting over the hike in the price of fuel and the unfair competition of drivers from the poor countries of eastern Europe; that of the taxi drivers, who do not wish to see an increase in the number of licenses; and that of workers in the railway services that Monti is seeking to liberalize have been making a heavy impact on the daily life of the average Italian.

The Italian public, however, seems to be broadly in favor of the reformist program being pushed by the man who came forward as the head of a "technocratic" government, which was announced as having a time frame of little more than a year, the promise being to hold elections for a new government in the spring of 2013.

Monti has received the explicit support of Merkel and Sarkozy, who know that - much more so than in Greece - the future of the euro is at stake in Italy, the third-largest economy in the euro zone. It remains to be seen whether or not a sort of triumvirate is now taking shape among the leaders of the EU's three founding countries. But if this possibility is confirmed, it will pose a challenge to Spain, and to Mariano Rajoy, to find a place in this "directory" and exert some influence over its decisions.

In any case, with Monti listened to attentively as Italian prime minister and with the other Mario, Draghi, as president of the ECB, Italy is back in the game in the European Union. But if Monti is where he now is, it is also thanks to the fact that Merkel won the tug-of-war with an unspeakable Berlusconi who always promised reforms and then did nothing, except endanger the viability of the euro.