RISE OF TECHNOCRATS
Can the men without party succeed where the pols have failed?
It’s one version of the European dream. In Italy and Greece in recent days, elected leaders have been replaced by technocrats who made their careers outside ofpolitics and even outside of their own countries. Can the men without party succeed where the party men failed? Don’t bet on it.
In Italy, academic economist Mario Monti has been asked by President Giorgio Napolitano to form a government following the resignation of Prime Minister Silvio Berlusconi. Mr. Monti is best remembered for his decade at the European Commission in Brussels, where he served first as the Commissioner for the Single Market and later as Competition Commissioner. Americans still recall that it was Mr. Monti who scuppered the GE-Honeywell merger in 2001 and fined Microsoft €497 million for dubious antitrust violations in 2004. But he also faced down Germany’s politically connected Landesbanken for receiving illegal state subsidies.
Yet if Mr. Monti was steely at the Commission, he was also beyond the reach of political accountability. Not so in Rome, where he will be powerless unless he can win the support of the quarreling crew that brought down the last government. The early signs are that his parliamentary support is tenuous, and it’s far from clear that he can bring the political class along on the tough votes that would be needed, for example, to strike down Italy’s notorious Article 18. Under that law, firms with more than 15 employees are effectively banned from laying off workers. Unions and their fellow-travelers on the left are already warning that the government should not risk social unrest by taking on the likes of Article 18.
Mr. Monti himself made clear the scope of his ambitions over the weekend when he declared that his job was nothing less than restoring the “health of the financial situation,” and “return to growth,” while at the same time “paying attention to social equality.” Would that politics were so easy.
Greece, meanwhile, has handed the reins to Lucas Papademos, also an academic economist by training, who most recently served as Vice President of the European Central Bank in Frankfurt. Early polling suggests he is widely liked and respected. But if Mr. Papademos’s career tells us anything, it is a firm commitment to keeping his head down and avoiding controversy.
Those qualities may be recommendations for an international technocrat. But they won’t serve Mr. Papademos well in Athens, where the past 18 months have proved violent and nasty.
Mr. Papademos’s task is both tougher and more urgent than Mr. Monti’s. Greece is weeks away from a hard default on its debt unless it gets another €8 billion from the EU and the International Monetary Fund before Christmas. To get that money, he needs to get the Greek Parliament to back the latest bailout deal. That’s more than his predecessor, Socialist George Papandreou, was able to accomplish.
Under current plans, Mr. Papademos is only expected to serve until early next year, at which point the two main parties will go right back at it. On such a short time frame, it will be a challenge for Mr. Papademos to do more than keep Greece afloat for a few months.
One final word of caution is in order about the new governments. It was “experts” in Brussels and at the IMF that ordered up the economic prescriptions currently hammering the Greek economy. If Italy and Greece continue down the road of higher taxes without meaningful labor-market reforms and improvements to the business environment, no amount of bureaucratic cleverness will save them—or the euro.
Printed in The Wall Street Journal, page 14