Italy's opposition to reforming the European Union's permanent bailout fund appears to be largely based on political calculations rather than economic concerns, which means that Rome may approve the EU proposal later this year. Failure to ratify the plan would keep the eurozone structurally more vulnerable than need be to destabilizing financial shocks. On June 28, the Italian parliament voted to delay ratifying reforms to the eurozone's permanent bailout fund, which is known as the European Stability Mechanism (ESM). The proposed reform would expand the ESM's involvement in the rescue of failing banks. But parties within Italian Prime Minister Giorgia Meloni's ruling coalition have long opposed the changes, arguing that they'd increase the risk of public debt restructurings. However, upon taking a closer look at how the plan would actually impact the Italian economy, the pros seem to far outweigh the cons, which suggests Rome is more concerned about the...
