ENRICO LETTA likes to note that he has been prime minister of Italy for just 70 days. He needs many more if his left-right coalition is to fulfill its ambitious agenda. At its head is constitutional reform, perhaps a surprising priority given that Italy’s woes are primarily economic. Its budget deficit is under control, but the public-debt burden is continuing to rise, to over 130% of GDP by the end of the year. Above all, GDP stubbornly refuses to grow. This year in real terms it will be barely above the level of 1999, the year when Italy joined the euro. Labour productivity has hardly risen in the same period. And competitiveness has steadily deteriorated against Germany. When Standard & Poor’s, a rating agency, cut Italy’s credit rating again on July 9th, it said that next time it might slash it to junk.Yet for Mr Letta the pivotal event of recent months was that 8m Italian voters turned their backs on traditional parties in February’s general election and supported Beppe Grillo’s maverick Five Star Movement (M5S). He sees the M5S not as an anti-European or anti-austerity protest movement, but rather as the expression of a seething anger with conventional…
