Bloomberg News

Bersani Preaches Spread-the-Wealth Before Italian Vote

February 21, 2013

Italy's Democratic Party Leader Pier Luigi Bersani

Pier Luigi Bersani, leader of Italy's Democratic Party, has proposed raising taxes on wealthy Italians to finance breaks for lower income families, while populist rival Beppe Grillo and former Premier Silvio Berlusconi have focused on providing stimulus by challenging the rigor imposed by European Union budget rules. Photographer: Alessia Pierdomenico/Bloomberg

Pier Luigi Bersani is traveling from Palermo to Naples with a spread-the-wealth message to fend off populist rival Beppe Grillo in two poor regions pollsters say are vital to gaining control of Italy’s Senate.

With outright victory at stake in the Feb. 24-25 parliamentary election, Bersani, 61, is set to appear in Naples, capital of the southern region of Campania, after speaking to thousands in Sicily’s biggest city yesterday. He has covered the length of the Italian peninsula this week to rally voters in the three must-win regions of Lombardy, Sicily and Campania.

Victory in Campania and Sicily, two of Italy’s poorest regions, is in doubt as former comic Grillo’s anti-austerity message resonates with recession-scarred voters. Bersani drew cheers from flag-waving supporters in Palermo’s Piazza Verdi when he said he’d push to get more out of the wealthy. Still, his base of union supporters may not be enough to stop Grillo from carrying Sicily.

Victory by Grillo in Sicily is “a concrete possibility,” said Roberto D’Alimonte, a professor at Rome’s Luiss University who does political analysis for Sole 24 Ore, Italy’s leading business newspaper.

Bond Yields

The yield on Italy’s benchmark 10-year bond was 4.475 percent at 10:24 a.m. in Rome, up five basis points. That compares with a euro-era record of 7.261 percent on Nov. 25, 2011, when a market rout of Italian debt risked tearing apart Europe’s single currency.

Bersani needs 158 senators to obtain a stand-alone majority in the upper house, and must win Lombardy, Sicily and Campania to reach that number, according to Eurasia Group calculations based on a Tecne poll for SkyTG24 published Feb. 7. He needs a sweep in those regions because he’s going up against three rivals, including Grillo and former Premier Silvio Berlusconi, who are each capable of picking up seats across the country.

Berlusconi, running second to Bersani in opinion surveys when a polling blackout began 12 days ago, is projected to win in Veneto, the fifth-largest region in terms of seat allocation.

Blaming Politicians

Bersani’s support has been sapped by Grillo, 64, as voters blame established parties for an 18-month-long slump, Italy’s fourth recession since 2001. Bersani and Berlusconi both backed the fiscal-austerity program imposed last year by Prime Minister Mario Monti that deepened the economic contraction. The two politicians, resuming their rivalry for the campaign, are selling different recipes to exit the crisis.

“There are very serious problems that can’t be solved by waving a magic wand and pulling a rabbit out of a hat,” Bersani said at the rally in Palermo. “These problems are resolved in just one way, with commitment and a communal effort in which he who has more must accept giving more. There’s no other way.”

Bersani has proposed raising taxes on wealthy Italians to finance breaks for lower income families, while Grillo and Berlusconi have focused on providing stimulus by challenging the rigor imposed by European Union budget rules.

Bersani is up against an experienced performer in Grillo, whose four-decade career before politics spanned stand-up comedy, yogurt advertisements and anti-corruption activism. Grillo, who says Italy should renegotiate its debt with bondholders, won renown in Sicily during a regional election four months ago by staging euro-skeptic rallies and stunts such as a 2.2-mile swim from the mainland to the island.

“Grillo continues to gain strength,” Ferdinando Pagnoncelli, president of polling company Ipsos, told daily La Stampa Feb. 19. In Sicily, Grillo voters are “changing in quantity and quality” and broadening his party’s constituency, Pagnoncelli said.

Poll Results

Bersani had 33.8 percent support in an SWG Institute survey published Feb. 8. That compares with 27.8 percent for Berlusconi, 18.8 percent for Grillo and 13.4 percent for Monti. In Italy, bonus seats are awarded to allow one party the chance for a majority without winning 50 percent of the votes. In the Chamber of Deputies, those seats are allocated in one parcel to the winner of the national vote, while in the Senate they are doled out in each region individually.

Up for grabs in Sicily are 25 seats, with 14 going to the winner and the rest handed out on a proportional basis to other candidates. Sicily was the third-poorest of the 21 regions recognized by Italy’s statistics agency, with per-capita income of about 17,189 euros ($23,000) in 2011. Campania, south of Rome on Italy’s west coast, was the poorest at 16,601 euros.

Rich Region

Bersani was in Lombardy Feb. 17 for a rally in Milan, the country’s business capital, near the base of the Alps and the border with Switzerland. Per-capita income in that region is 33,484 euros, more than twice the level in Campania.

Grillo has said Italy should consider exiting the euro and defaulting on its 2 trillion-euro ($2.7 trillion) debt, which at more than 120 percent of economic output is Europe’s second biggest after Greece. In May, his candidates were elected mayor of Parma and other cities as voters punished the traditional parties over tax increases, budget cuts and rising unemployment.

“For Sicily, it really depends on voter turnout,” Renato Mannheimer, head of polling company Ispo Ltd, said at a press conference in Milan Feb. 14, citing the last surveys that gave Grillo about 20 percent and 32 percent each for Bersani and Berlusconi. “It doesn’t seem likely that” Grillo “can rise to that level, even if it’s true that there are many undecided voters.”

To contact the reporters on this story: Chiara Vasarri in Rome at cvasarri@bloomberg.net; Andrew Frye in Rome at afrye@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net


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