Let’s go back a couple of years. Europe’s problem countries used to be nicknamed the PIGS (Standing for Portugal, Ireland, Greece, and Spain). Shortly thereafter, an extra “I” was added to make it PIIGS and include Italy. It is now fair to say that all the PIGS have acknowledged their problems, negotiated a track to come back to fiscal sanity, and are more or less coming back. Even Greece, with its clampdown on the neo-Nazi party seems to be slowly but surely coming to terms with its issues not only economically, but also politically.
Unfortunately, Italy seems to be following its own route which bifurcates; economic policy is on a sound track, thanks to Monti, Letta, Saccomanni, Draghi, while politics is still in the ice age. It is very disappointing that neither Monti nor Letta have been able to propose to parliament a draft new election law in the last two years, and it is no wonder that the initiative is now with the 5-Star movement who says it has published its own draft, but is clearly quite happy with the current version. Except that it is quite likely that towards the end of the year the Supreme Court will rule that law, the famed porcellum, unconstitutional. Add to this that Berlusconi would like elections this year, and that his party appears to be fracturing, and you understand why Italy is in chaos.