I didn’t think anything would ever make me sympathetic to Silvio Berlusconi, but the guy’s Prime Minister of a country that’s being wracked on the shores of the European Central Bank’s hard money policies. Unable to do anything to fix that situation, he’s left to desperately promise to remake the entire structure of the Italian economy and impose fiscal austerity. This isn’t going to end well.
The Italian initiative came as Nicolas Sarkozy, French president and the current chairman of the Group of 20 leading economies, sought to co-ordinate a eurozone response to the turmoil in financial markets, with telephone calls to Angela Merkel, the German chancellor, and José Luis Rodríguez Zapatero, Spanish prime minister.
Telephone calls! Not even a face to face meeting. Not even a conference call!
For countries like Spain or Italy to leave the Euro would provoke a gigantic banking crisis. But if they’re not going to leave, something very different needs to be done in order to make the Eurozone workable.