Whither Italy's attempted 'revolution'?

A general view of central Rome's Piazza Campo de' Fiori street market in March 2010

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It is a clear, cold winter's morning in Rome, and on the cobblestones of one of the city's historic squares, stall owners are selling flowers and fruit and cheeses and much else.

This is Campo de' Fiori, where there has been trade like this for centuries.

But right now it is hard to do business here.

"There's been a collapse in sales - like nothing before," says Tamara Conti, wrapped up against the chill and wearing a bright red hat.

"In January, we've sold almost nothing." She has three children at home, and she is struggling to pay the bills.

Like many Italians, Mrs Conti is feeling the full force of the country's financial crisis and the new government's austerity programme.

At the same time, a major effort to restructure the economy is getting under way.

There is change in the air, and the possibility of much upheaval.

And in Campo de' Fiori, and in markets all across Italy, there is concern.

"We're becoming poorer. The earnings aren't what they used to be," says another stall owner, Claudio Zampa.

"People are scared - they're afraid. This is an uncertain country."

Mr Zampa's family has worked the market for more than 80 years. But he is urging his grown-up children to leave for Australia.

Italy's new, unelected government of technocrats, led by Professor Mario Monti, took over in the depths of the economic emergency in November.

Italy was being crushed by its towering national debt, forced to pay excruciatingly high rates of interest when it borrowed money.

There was a danger of it enduring a Greek-style economic collapse which might easily have torn apart the eurozone.

'Radical agenda'

Prime Minister Monti immediately announced what he called a plan to "save Italy". This included pension reforms, cuts in government spending, tax rises and an increase in the price of fuel.

But with that austerity comes the danger of making the expected contraction of the economy even more acute.

Italy's economic woes

  • Italy's credit rating was cut by two levels to A- last week
  • The Bank of Italy forecasts the country's economy will contract by up to 1.5% this year
  • The Italian government recently approved a 5.5bn euro ($7.1bn/£4.57bn) package for investment in infrastructure, such as railway lines

People may well spend less if they are struggling to pay higher taxes, or worrying that their jobs might go.

But in parallel with his austerity programme, Mr Monti has launched an effort to stimulate and re-energise the economy.

He is determined to sweep away bureaucratic and other barriers to commercial activity.

He talks of wanting to free up the economy, to re-shape the labour market and create more jobs for the roughly one-in-three young people who are out of work.

And the government's liberalising drive is making itself felt in many areas of Italian life.

Practices that have protected the status of lawyers, taxi drivers, chemists and others are being challenged.

Regulations governing opening hours for shops, bars and cafes have been pushed aside. If they want, they can trade for as long as they like, seven days a week.

It is all part of an attempt to make the country more competitive, more open to business.

And if the government were to be able to put into place all the change it would like to see, if it were to realise its vision for Italy, it would quite transform the economy.

"The agenda is very radical," says Professor James Walston, who focuses on Italian politics at the American University of Rome.

"Italy over the 20th Century, every generation or so, went through a revolution - normally provoked by major external events.

"And I think we're in the middle of one now, provoked by the recession, by the financial crisis, by the euro crisis."

But will the government's attempted "revolution" succeed?

Wave of strikes
Italian PM Mario Monti speaks during a news conference in Brussels in January 2012 The polls suggest most Italians still back Mr Monti's programme

It is already meeting fierce opposition. Truck drivers blocked highways recently in protest at the fuel price rises. And angry trawlermen demonstrated in Rome about the same thing.

All over Italy, there have been strikes by taxi drivers, who were furious at the plans to deregulate their business.

Chemists and lawyers are talking about industrial action too.

And the major unions bitterly oppose any measures that might make it easier to fire workers.

There have also been persistent complaints that the government's programme just is not fair.

The head of the Italy of Values party, Antonio Di Pietro, has accused Mr Monti's team of being too easy on the wealthy.

"They could have been - and should have been - a lot less timid on the banks and insurance and energy companies," he said.

But for now at least, the polls suggest that most Italians still back Mr Monti's programme.

"We absolutely needed changes to be made," said Tamara Conti, the trader in the bright red hat at her stall in Campo de' Fiori.

"We couldn't continue as before. We have to hope that these are the right changes."

Italy is beset by profound problems: a very low rate of economic growth, massive tax evasion, organised crime, and the chronic underdevelopment of the south of the country, to name just a few.

Tackling those sort of issues would take decades of reform, and Prof Walston says obviously this new government is not going to be able to change everything in the year or so that it will have in office.

But he still believes it can make a significant impact.

"Italy doesn't do things gradually," he said. "Italy does things dramatically.

"And there is a good chance that there will be quite a dramatic change in 12 months' time."

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