Italy votes

2/22/2013

Italy, which has Europe’s third largest economy after Germany and France, holds important elections Sunday and Monday. They will turn on the state of the economy and the attempted comeback of Italy’s notorious former prime minister, Silvio Berlusconi.

The election is important for the future of Italy, the eurozone, and the European Union. Yet Italians are showing disinterest in, and cynicism toward, the election. They are obliged by law to vote, but can spoil their ballots in protest.

Italy’s economy is stagnant. Its gross domestic product is the same as it was in 1999. Investment is weak and foreign investment is nearly nonexistent, largely because of an inefficient bureaucracy and official corruption.

Since Mr. Berlusconi’s departure in November, 2011, Italy has endured a period of austerity under a technocratic prime minister, Mario Monti. With a centrist, reform-oriented political base, Mr. Monti has carried out needed changes in public pensions, but voters have objected to his austerity measures.

Mr. Berlusconi, 76, and his coalition of center-right parties could win the elections, based on Italians’ disdain for austerity and the flat economy. That could be disastrous for Italy; other European nations — particularly Germany, whose continued willingness to help will decide the future of the euro — find the scandal-prone Mr. Berlusconi embarrassing and unwelcome in leadership circles.

Other parties in the contest include a center-left coalition led by a former Communist and minister of economic development. Mr. Monti’s centrist parties and a new group called the Five Star Movement, which favors Web-based democracy, are also in the running.

Probably the best outcome for Italy would be a victory for the center-left parties, which might return the stable Mr. Monti to the prime ministership to form a coalition government. When an economically discontented electorate is faced with a wide choice of parties, the outcome is not easy to predict.

The results, however, are important, for the economic health of Italy, Europe, and, by extension, the United States.