WSJ: Monti seeks mediator role in Europe

10 May 2012

Prime Minister Mario Monti is jockeying to position Italy as a mediator between Germany and weaker eurozone economies, an effort ultimately aimed at broadening Europe's decision-making beyond the traditional Franco-German axis that has so far called the shots in fighting the crisis.

Over the past few weeks, Mr Monti and other officials in his administration have been courting Berlin on two fronts. They are trying to tighten relationships between the countries' two parliaments. On the ideological end, they are trying to convince German officials that the compromise solution to stoking growth in Europe's weaker economies is investment in big public projects, such as transportation, internet networks or electricity grids, while maintaining fiscal discipline.

Mr Monti is aiming to move in on Berlin at a time when Germany finds itself more isolated in its push for belt-tightening to confront the crisis. France's recent presidential elections cost Germany its biggest ally on austerity, President Nicolas Sarkozy, and will replace him with François Hollande, a Socialist who has called for loosening eurozone budget rules.

Private discussions among top Italian and German officials have also been held. In those meetings, Italy has urged Germany to consider a range of proposals to stimulate Europe's stalled economy, including creating bonds to fund European Union infrastructure projects, and boosting the firepower of the European Investment Bank to fund public investments.

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