Key Berlusconi ally urges him to step aside
Italian Premier Silvio Berlusconi's main coalition ally today urged him to step aside as political uncertainty in the eurozone's third-largest economy rocked financial markets for yet another day.
Berlusconi's government is under intense pressure to enact quick reforms to shore up Italy's defenses against Europe's raging debt crisis. However, a weak coalition and doubts over Berlusconi's ability to push through austerity and reforms have financial markets fearing some type of financial disaster in Italy.
"We asked him to step aside, take a step to the side," Northern League leader Umberto Bossi told reporters as he arrived ahead of a key vote that could force Berlusconi's resignation.
Bossi is the volatile ally who brought down Berlusconi's first conservative government in 1994 when he yanked his support.
With debts of around USD 2.6 trillion, Italy is considered by many as being too big for Europe to bail out, like it has already done for Greece, Portugal and Ireland.
Italy's center-left opposition said it would abstain in Tuesday's voting, to make it clear just how fragile Berlusconi's forces in Parliament are.
If he is backed by less than 316 deputies -- or less than half of the 630-member chamber -- it would be plain that Berlusconi can no longer count on a majority in the lower house of Parliament, even though the government mathematically could still win the vote to approve the 2010 state finances.
Bossi said the man Berlusconi has already hand-picked to be his eventual successor, former Justice Minister Angelino Alfano, should now lead the government.
But it would be up to the Italian president, Giorgio Napolitano, to decide whether to appoint a new leader or dissolve parliament and call early elections.
International financial officials and the markets, meanwhile, fretted over how long it was going to take for lawmakers to approve measures promised by Berlusconi to rein in Italy's galloping public debt.
With that in mind, Italy's borrowing rates spiked today to their highest level since the euro was established in 1999. Higher rates would make it more difficult for Italy to rollover its debts and will mean they consume more and more of its national income. Italy has over USD 412 billion to raise in 2012 alone.
