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Berlusconi on Very Shaky Political Ground

The Italian prime minister is caught between domestic opposition to his reforms and euro zone worries about Italy's debt.

by
Andrea Loquenzi Holzer

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October 31, 2011 - 12:01 am
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While the European leaders united in Brussels have given a green light to the Italian government’s reform program aimed at curbing Italy’s infamous debt crisis and fostering its economic growth, Silvio Berlusconi is facing one the most serious internal political crises since he took office in 2008.

His governing coalition was originally made up of three parties and 174 senators (while the opposition had 158), but it has already suffered the defection of former ally Gianfranco Fini — now leader of “Futuro e Libertà” — who was almost forced out of the post of speaker of the house back in July 2010. At the time, the casus belli had to do mainly with justice reforms, but Fini had also accused Berlusconi of being too permissive with his other ally, Lega Nord leader Umberto Bossi.

More recently, however, apart from convincing sarcastic European politicians such as Angela Merkel and Nicolas Sarkozy on the goodness of his intentions, Berlusconi also had to reach an agreement with Bossi’s Northern League Party on several different issues of domestic policy. One of the most pressing being Italians’ retirement age, which is now set at 65 years; Berlusconi would like to raise it to 67. The rationale behind this that there are not enough taxpayers in Italy to sustain the unemployed population, which is also aging fast (youth unemployment is rapidly reaching 30%).

That is why the Italian government has asked European politicians to create the conditions that are necessary for sound structural reforms, a sustainable public finance, and more flexibility in the job market (firms should be allowed to dismiss workers more easily, if necessary). The last point, in particular, had provoked the outraged reaction of Italian trade union leaders. Italy has three different (and powerful) trade unions: the Cgil, the Cisl, and the Uil. Given the absence of any form of Thatcherism in Italian politics, these unions can pretty easily mobilize masses and organize strikes.

Susanna Camusso of Cgil has been particularly critical about flexibility in the job market and employers’ rights to lay off workers: “[T]he prospects for this country will be renewed only once we will be able to go ahead with the only sensible dismissal: the one of the government in charge,” she said during a meeting Friday, October 28. Raffaele Bonanni of Cisl gave the same advice: “[Y]es, we can start discussing job market related problems, but only at one clear condition: we absolutely do not want to talk about layoffs.”

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