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Italy: An election primer

This week's elections in Italy will not only determine the future of Italy - it will also be key event for Europe and the eurozone. The future of the eurozone depends on whether its third-largest economy can keep its fiscal house in order and resume growth after a decade of stagnation. As expected, Italy’s electoral race has been dominated by internal affairs: jobs, unemployment and pension reforms.

However, the austerity measures pushed through by the Monti government have been heavily criticised - and most candidates tried to reassure citizen that taxes would not have to be increased anymore. At the same time, the outcome of the elections will be a signal for Europe as to whether Monti's technocratic government will have any lasting legacy. But the outcome is far from certain which is largely due to three factors: the return of Berlusconi, a split in the centre-left and a

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Rome view: Mario Monti’s special touch

Did Mario Monti really come to Brussels, see Angela Merkel and conquer the euro crisis? Even though the Italian media (uniformly) and most foreign newspapers – including the NYT and Spiegel – portrayed the Italian prime minister in these semi-imperial terms, it is far from clear that he got what he wanted both at the June 28 European Council and at the July 9 Eurogroup meeting of finance ministers.

Monti’s idea when he went to Brussels was to have the EFSF-ESM act as an antidote to the spread, i.e. using the rescue fund resources to prop up the demand, and hence bring down the interest rate, for bonds of virtuous eurozone countries right on the path of fiscal consolidation and structural reforms (read Italy and Spain).

On paper that’s exactly what he got, but only on paper. To effectively fight the spread, the antidote needs to have access to almost unlimited resources – for

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Still lost in Europe? Italy’s new beginning

At his first press conference as the new prime minister of Italy, Mario Monti said that “Italy must become an element of strength and not weakness of the European Union”. For a long time Italy was lost in Europe. Now, as it faces up to the challenges of the post-Berlusconi era, it has the chance to be a building block of post-crisis Europe.

With all the scorn heaped upon Berlusconi in his last days as prime minister, it is easy to forget that he won the 2008 elections with the largest majority in the history of the Italian Republic. Those that voted for him and his ruling coalition thought the time had come for passing and implementing major reforms. Those that voted against were more concerned that he could remain in power for 10 more years, and might even succeed President Napolitano as head of state.

Neither happened. The reforms dissolved into thin air, as both government and

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A Euro sustainable bond

As the euro crisis makes its latest twists and turns, both confusing and concerning all involved, the debate on whether Eurobonds could be part of the solution to the crisis also continues. Could they be the part of the prompt, effective and courageous decision that any solution to the crisis surely demands?

Over recent months, different solutions and strategies have been proposed. The ‘Tremonti/Juncker’ proposal envisaged a system of bonds issued by a European Debt Agency (EDA), in order to cover up to 40% of EU public debt. The proposal retained an element of moral hazard for indebted countries, and might not exclude a restructuring of the 60% of remaining debt.

This proposal followed on from the “Delpla/von Weizsäcker” project, which put forward an idea of two different bonds, aiming at containing public debt level under 60%. There was also a proposal from Romano Prodi and

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Rome view: Italy’s role in Libya

Yesterday the Italian foreign affairs minister, Franco Frattini, said that the EU should not intervene in the crisis in Libya. This would allow Libya to decide upon its own future – something that appeals to ideals of national ownership, where we are all architects of our own future and development.

Ownership as a principle runs contrary to the habit many donor countries have of teaching the poor how to develop, and contrary to the idea of actively imposing democracy from outside. But it would surely be very wrong to characterise any intervention from Italy and the EU to protect human rights in Libya as paternalistic.

The youths that are demonstrating, the very same youths that in these very hours are dying for dignity and liberty, are making history and they are doing it without us – in fact they are doing it despite us. We are left with only one obligation: do all we can to

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Rescuing multilateralism

The turmoil in the current system represents an opportunity for Europeans to shape a new order that meets their strategic needs.