Italy’s Opposition Escalates Fight against the European Stability Mechanism

Nov. 18 (EIRNS)—Pressure on Italian Prime Minister Giuseppe Conte (PD) from the parliamentary opposition not to sign the European Stability Mechanism reform treaty—the new EU bailout scheme—increased yesterday, after Finance Minister Roberto Gualtieri testified ESM before the Senate Finance Committee.

Chamber of Deputies Budget Committee Chairman Claudio Borghi (Lega), speaking on the floor, warned Conte that his faction will take the Prime Minister to court for treason if he signs the treaty. And today, Lega party chairman Matteo Salvini said in a press conference that Lega attorneys are studying how to bring the matter to court. Salvini also asked Italian President Sergio Mattarella for a meeting, to argue against his signing a treaty that is deadly to the Italian economy.

In his testimony, Finance Minister Gualtieri said, among other things, that the negotiation on the ESM reform was already concluded last June, after a “point-by-point” discussion. This contradicts statements by Prime Minister Conte, who stated, before the June 21 EU Council summit, that the Italian government was bound by a parliamentary resolution to give a definitive approval only at the end of the negotiation of the entire “package” of the European Banking Union.

Meanwhile, pro-EU sources admit that the “reform” is all about bailing out banks—“all banks.”

For example, Carlo Cottarelli, the former director of the IMF’s Fiscal Affairs Department (2008-2013), who almost became Prime Minister of Italy in 2018, candidly declared that the real purpose of the ESM reform is “to bail out all banks.” In a radio interview yesterday, Cottarelli said that,

“the European Resolution Fund, which is being created, is small and is growing slowly. What they say is: As long as the ERF has not reached a dimension big enough to bail out banks—all banks—we need the possibility for the ESM to jump in with its money to avoid insufficient funds to support the European banking system. My point is, let us suppose that German banks get in trouble and there are not enough funds to bail them out. At this point, the entire European banking system, not just the German system, is getting into trouble.”

He continued, “I don’t think it’s mistaken to say, the ESM can intervene in support of the banks. It is the right thing.”

This admission proves that the ESM must be repealed altogether, along with all the bankrupt institutions of the EU system, starting with the universal bank system, and that the proper response to EU bailout schemes is a Glass-Steagall reform, that would separate speculative private banking from commercial and depository banks. Unfortunately, despite their bellicose statements, the opposition has not yet put this issue up for action. They must do so if they want to win the battle in Parliament; otherwise the denials pushed by the treacherous government, that ESM conditions will not be applied, might be successful in obtaining a majority in the Parliamentary vote.