Italy's Monti warns against populism as Berlusconi attacks
By James Mackenzie
ROME (Reuters) - Italian Prime Minister Mario Monti warned against a slide into populism on Tuesday as Silvio Berlusconi attacked his technocrat government, accusing it of failed "Germano-centric" policies that had dragged Italy into recession.
With elections now expected in February, financial markets have reacted nervously to the return of Berlusconi to seek a fifth term as prime minister, just over a year after being forced from office at the height of the financial crisis.
In a possible foretaste of the election campaign to come, the 76-year-old media billionaire laid into Monti's technocrat government, which he said had accepted failed policies dictated from Berlin.
"The Monti government has followed the Germano-centric policies which Europe has tried to impose on other states and it has created a crisis situation much worse than where we were when we were in government," Berlusconi said in an interview on his own Canale 5 television network.
He dismissed the sharp drop on financial markets which followed news of his return, saying the main gauge of investor trust in Italy, the spread between Italian bonds and their safer German counterparts, was "a con".
He also accused Germany of deliberately speculating on the euro zone debt crisis to favor its banks and drive down its own borrowing costs.
Berlusconi's remarks prompted a sharp response from Berlin, where German Foreign Minister Guido Westerwelle said that it was unacceptable "for Germany to be made the target of a populist election campaign."
Speaking on state television on Tuesday, Monti left his own political future open but defended his government's economic record and warned against "oversimplified" election promises that hid the true problems facing Italy. Continued...