Can Italy's 'political serial killer' change EU course on austerity?

Rome - In June 2013, Matteo Renzi was still pretending that his greatest ambition was to serve a second mandate as mayor of Florence, a mid-sized town of less than 400,000.

A year on, he is rubbing shoulders with the likes of Barack Obama i at G7 i summits, and is emerging as the biggest counterweight to German Chancellor Angela Merkel i on the EU political landscape.

A historic win in last month’s European Parliament elections, where his Democratic Party (PD) took 40.8 percent of votes - the best-ever result for the Italian left, and the highest score ever recorded by a single party since the Christian Democrats in 1958 - has given him a strong hand to challenge Berlin-backed austerity policies, as Italy takes on the EU’s six-month presidency on 1 July.

“He has meticulously planned his rise to the top for the past 10 years. Not many people, be it in politics, journalism or business, have the same tenacity, drive and determination that he has displayed,” says David Allegranti, a political reporter from Florence who has written two books on Renzi.

In February, the 39-year-old became Italy’s youngest-ever prime minister, beating by a few weeks Fascist dictator Benito Mussolini, who took the post in 1922.

It was the crowning of a career in which Renzi ruthlessly steamrolled rival after rival, starting from his own centre-left camp.

Lapo Pistelli i, who employed a young Renzi as a parliamentary assistant in the mid-1990s and was trashed by him in 2009 primary elections for the Florence mayoralty, has called his former protege a political “serial killer”.

The two men have since made up, with Pistelli serving as deputy foreign minister in the current government.

Victory at the polls

A former boy scout who has selected Nelson Mandela and a pious Florence mayor from the 1950s and 1960s who is on track for sainthood, Giorgio La Pira, as his political heroes, over the past 12 months Renzi has fulfilled his ambition of “sending to the scrap yard” the post-communist elite that dominated Italian left-of-centre politics for the past 20 years.

The only blip in Renzi's recent career was losing to former PD leader Pier Luigi Bersani i in primaries that selected the centre-left prime ministerial candidate for February 2013 general elections. But Bersani mishandled that campaign, squandering a 20-point-poll lead to end up in a draw with conservatives led by former premier Silvio Berlusconi i.

That opened the door to Renzi’s comeback.

With Bersani out of the picture, he wrestled control of the PD in December, getting elected party secretary with almost 70 percent of the votes, after convincing diehard activists, who doubted his left-wing credentials, that he was their best chance to achieve victory at the polls.

He then pounced on party colleague Enrico Letta, a soft-spoken moderate who had a lacklustre 10-month stint as prime minister before Renzi dethroned him in a swift palace coup. In January, the newly-installed PD leader was insisting that he harboured no ambition to take over the top job.

Three months later, Renzi claimed another top-level political scalp. Buoyed by a government pledge to cut taxes for low-paid workers - implemented two days after the elections - the PD won almost twice as many votes as the anti-establishment Five Star Movement of comedian Beppe Grillo, who had set his sights on winning the top spot in Italy’s EU elections.

“Renzi’s political savviness and capacity to anticipate the moves of his rivals puts him a class above his predecessors,” says Gustav Hofer, a documentary maker who, along with his partner Luca Ragazzi, has shot “What is Left”, a semi-satirical investigation of left-wing identity in modern Italy that is being shown around Europe.

Hofer and Ragazzi have many reservations about the PD leader, who has been criticised at home for running a one-man show, backed by an inner-circle of advisors that ill-tolerates criticism of the controversial electoral and parliamentary reforms that the government is trying to rush through parliament.

The European game

But Hofer expects him to do well in Europe. “With Hollande being so weak, and Cameron stuck on his nationalist positions, Renzi is the best placed leader to push for a bit more solidarity and a bit less austerity,” he says.

The Italian premier is a key player in delicate negotiations among EU leaders on the next president of the European Commission, who also needs the EP’s endorsement. The assembly’s socialist group, where the PD is the largest delegation, has expressed readiness to support Merkel’s candidate - former Luxembourg premier Jean-Claude Juncker i - if he accepts a looser interpretation of EU budget rules.

“Whoever is running to lead the EU commission should first tell us what he intends to do for growth and jobs. Rules must be applied with a minimum of common sense,” Renzi said last week, while his point man for the EU presidency, undersecretary Sandro Gozi, suggested that the EU had “worried a lot about the Stability Pact”, forgetting that “its full name is ‘Stability and Growth Pact’, not just ‘Stability Pact’”.

On Monday, German Vice-Chancellor Sigmar Gabriel echoed Italian arguments by suggesting that countries adopting reforms that are costly in the short term, but beneficial in the long run, could win some form of budget discipline exemption. But his proposal was immediately shot down by Merkel’s right-hand man, Finance Minister Wolfgang Schaeuble.

Daniel Gros, the German-born director of the Centre for European Policy Studies (CEPS), a Brussels think-tank, thinks Renzi could get his way as long as he delivers on his domestic reform pledges.

“If he manages not just to announce them, but also get them approved by parliament and implemented on the ground, he would have a lot of cards in hands,” Gros says.

He agrees it is a question of reinterpreting, rather than changing EU budget rules.

“Between the Stability Pact, the Fiscal Compact, the Two-Pack and the Six-Pack there are so many of them that you only need to put one against the other to find some margins to allow a country to do a bit less budget consolidation in a given year.”