Berlusconi Prepares a New Italian Drama

Oct. 1 (Bloomberg) -- A political storm brewing in Italyhas the potential to disrupt the calm that has prevailed in theeuro area. Europe’s leaders can only hope that markets willsomehow prevent the currency union’s third-largest economy frombacksliding too far on efforts to keep its debts under control.

Former Prime Minister Silvio Berlusconi initiated thelatest drama on Sept. 27, when he withdrew his support for thecountry’s coalition government. Five ministers from his Peopleof Liberty, or PDL, party then resigned, prompting PrimeMinister Enrico Letta to suggest a vote of confidence will beheld this week. As a result, there’s a significant chance thatItaly will find itself without a government at a time when itshould be passing a budget for next year.