Graphic by Moonie Sohn/The Gazelle

Is Renzi’s Reform Agenda Attainable?

FLORENCE — Overcast skies tend to be an ominous sign. As Florence battled heavy rainfall, and with the threat of the Arno river overflowing, the town’s ...

Graphic by Moonie Sohn/The Gazelle
FLORENCE — Overcast skies tend to be an ominous sign. As Florence battled heavy rainfall, and with the threat of the Arno river overflowing, the town’s young mayor ousted the Italian prime minister from office in an intra-party coup. Only 39 years old and already designated by the Italian president to form a government, Matteo Renzi became Italy's youngest prime minister. The young Florentine mayor will be tasked with curing the ills that have plagued Italy. But the real question is whether Prime Minister Renzi can develop and pass effective reforms.
Italy’s dismal economic situation will be Renzi’s main priority. The country’s deficit-to-GDP ratio hovers over the 3 percent threshold, while its debt-to-GDP ratio is over 130 percent. Only 57 percent of working-age people in the country have a paid job, compared with an average of 66 percent in the rest of the OECD. Italy’s manufacturing industry, the second biggest in Europe, has declined by 15 percent, resulting in the disappearance of approximately 32,000 companies. The economic woes have further resulted in Italians leaving the country to find better job prospects. This brain drain costs the Italian state approximately 25.4 billion AED annually.
Thus far, Renzi has only vaguely referred to some measures of economic reform he is willing to take. He has promised labour reforms and tax cuts while stating that he would strengthen welfare protection for the unemployed and increase investment in school buildings. Furthermore, he has promised that the public administration would completely pay off its arrears of unpaid bills. There seems to be little discussion of where the funding for such projects will come from, especially given the fact that Italy’s tax revenue collection decreased by seven percent last July.
Renzi also hopes to reform Italy’s electoral laws. His proposal would, in effect, favor bigger parties and transfer most power to the lower chamber of the legislature to facilitate the creation of a working parliamentary majority. The implementation of such a proposal would have the goal of reducing what happened in the Feb. 2013 parliamentary elections: the emergence of an antiestablishment party, a two-month period with no government while parties attempted to build a coalition and the eventual formation of an awkward coalition government between the center-left and center-right parties.
Mr Renzi also hopes to implement justice reform among other initiatives. But the real question is whether he can pass meaningful legislation.
Mr. Renzi has been compared to both the Tony Blair of the late 1990s and the Barack Obama of the mid-2000s. His speeches warrant the comparisons, rhetorically at least. But Mr Renzi puts himself in a vulnerable position in which only a savvy and experienced legislator could succeed. He will try to work with the same legislators his predecessor attempted to lead.
Complicating the situation, legislators not in Mr Renzi’s party — the Partito Democratico — are well-aware that the new prime minister’s success may come at their own expense. This dynamic ensures that Mr Renzi will have a tough time passing proposed legislation. His arrogant manner will not help either: He broke precedence with an ad hoc speech to the senate and told senators that he hoped to turn their institution into a regional chamber. Out of 320 seats in the chamber, he could secure only 169 votes for his coalition.
Mr Renzi has a large task at hand. He has to ensure that his proposed reforms are effective and move Italy towards prosperity. But effective reforms will be useless if they are not passed by the legislature. Mr Renzi is widely seen as an effective mayor of Florence, but enacting ordinances for a historical town of 370,000 citizens that attracts approximately 10 million tourists per year cannot be compared with guiding a country of 61 million people with deep divisions and a weak coalition. The next few months will show us whether Mr Renzi has the leadership capability to change Italy for the better. And only then will we be able to say definitively whether we’re reading too much into the overcast Florentine skies.
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