Silvio sees sense shock

Actually I rather think Silvio has had sense thrust upon him. After the recent budget when all the cuts were backloaded until after the election he has recanted and introduced a new budget in the amount of €45bn with serious cuts to planned expenditure for 2012. The basics of the budget have almost certainly been written by Angela Merkel.

The important thing now is whether the reformed Silvio is more credible than the old one. The Italian for budget is the word for manoeuvre, and there seems plenty of room for manoeuvre at present. Nobody even knows for certain whether this budget is on top of the last one or instead of it. And the detail is far from definite. If the markets don't believe in this new attitude Italy will be in trouble. An interim non-political team of technocrats appointed by the President would be almost inevitable.

For myself I would require a lot more detail before trusting this. It was done in a hurry to please the markets and it is far from clear that the political will exists on either side of the spectrum to carry it out.

The mood in Italy is hard to read at the moment. It seems the people are reluctant to suffer cuts, but at the same time increasingly resentful of the political class. Highly popular on the Internet is the Senate lunch menu, leaked by the Italy of Values party. It shows how the senators are dining at around a fifth of the cost of a meal in central Rome (see it here). Voters are beginning to demand transparency and that, at least, is a start.