Italy seems continually condemned to disappoint. The economy has barely grown in 20 years. The younger generation is languishing without opportunity: youth unemployment stands at 41 percent. So many chances to reform the country have been wasted – and many by Silvio Berlusconi, who was finally expelled from the Senate last week after being convicted of tax fraud.
The country now has two chances to reform. The first is that Enrico Letta, the prime minister, will be emboldened to push through changes now that Berlusconi has been sent packing. If he still can’t, Matteo Renzi – who is expected to be chosen leader of the centre-left Democrats on Sunday – should force elections and show he is as radical in deed as he is in words.
Look first at Letta. He is an intelligent centrist from the Democratic party. But, since he became prime minister in April after an indecisive election result, he has not achieved much. This is largely because his government had to rely on Berlusconi’s centre-right party. The two groups found it virtually impossible to agree on anything.
True, Letta has started to clean up Italy’s corrupt political system and to unblock the country’s civil justice system, where cases can languish for years. But he was forced to repeal a property tax. This left a hole in the public finances, meaning Letta was unable to cut employment taxes more decisively and so do more to tackle youth unemployment.
Meanwhile, difficulties continue to mount. Although there is some hope that the economy will creep back into growth in 2014, debt has continued to rise this year. It is forecast to end 2013 at 133 percent of GDP – a level right at the edge of what might be considered sustainable.