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Italy forms new government after 2-month stalemate

Sunday - 4/28/2013, 3:06am  ET

Italian designate-Premier Enrico Letta and Italian President Giorgio Napolitano meet journalists the Quirinale, presidential palace, in Rome, Saturday, April 27, 2013. Italy has finally has a new government, a coalition of Berlusconi's forces and center-left rivals who forged an unusual alliance to break a two-month stalemate following inconclusive elections. Enrico Letta, a center-left leader, will be premier in the government, which marks the latest political comeback by Silvio Berlusconi. (AP Photo/Gregorio Borgia)

FRANCES D'EMILIO
Associated Press

ROME (AP) -- Center-left leader Enrico Letta forged a new Italian government Saturday in a coalition with former Premier Silvio Berlusconi's conservatives, an unusual alliance of bitter rivals that broke a two-month political stalemate from inconclusive elections in the recession-mired country.

The daunting achievement was pulled off by Letta, who will be sworn in as premier along with the new Cabinet at the presidential Quirinal Palace on Sunday.

Letta, 46, is a moderate with a reputation as a political bridge-builder. He is also the nephew Berlusconi's longtime adviser, Gianni Letta, a relationship seen as smoothing over often nasty interaction between the two main coalition partners.

Serving as deputy premier and interior minister will be Berlusconi's top political aide, Angelino Alfano. He is a former justice minister who was the architect of legislation that critics say was tailor-made to help media mogul Berlusconi in his many judicial woes.

The creation of the coalition capped the latest political comeback for Berlusconi, a former three-time premier who was forced to resign in 2011 as Italy slid deeper in to the eurozone's sovereign debt crisis.

On Monday, Letta is expected to lay out his strategy to Parliament, before required confidence votes from the Chamber of Deputies and the Senate.

"We negotiated for the formation of the government without throwing up any stop signs," Berlusconi told one of his TV networks. "That's how we contributed to forming a government in short time" after Letta was tapped Wednesday.

Berlusconi, a fervent anti-Communist, views Italy's left as a personal nemesis, and Letta's Democratic Party has some of its roots in what was the West's largest Communist Party.

Letta expressed "sober satisfaction over the team we put together and its willingness" to form a coalition.

Although Letta strove to fill his Cabinet with new faces, a longtime Italian central bank official, Fabrizio Saccomanni, who also served a stint at the International Monetary Fund, was chosen for the key economy ministry portfolio.

In the role, Saccomanni will have to balance European Union insistence on rigorous austerity to heal Italy's finances with politicians' sensitivities to voters. The public's patience has been tried by spending cuts and higher taxes without seeing the start of any economic revival.

Only a few weeks earlier, the head of the Democrats, Pier Luigi Bersani, resigned from the party post in humiliation and he refused Berlusconi's offer for a "grand coalition" and futilely tried to form a government without the center-right. Letta was a Bersani loyalist.

Bersani hailed the coalition formula as a "necessary compromise" that gives the country "freshness and solidarity."

The No. 3 bloc in Parliament, the anti-establishment 5 Star Movement, is led by comic Beppe Grillo, who ruled out any alliance with the largely sullied political class that has ruled Italy for decades.

President Giorgio Napolitano, who tasked Letta with creating a government out of bitter rivals, called upon the coalition partners to work "in a spirit of absolute, indispensable cohesion" as they work for sorely needed political and economic reforms.

The 87-year-old head of state sounded almost breathless as he expressed confidence the rivals could work together "without conflict or prejudices to find the right solutions" to the country's pressing economic and political problems.

Napolitano didn't name the challenges, but they include fighting unemployment, especially for young people, and corruption sullying much of the political class.

Napolitano said: "It was and is the only possible government," and one "whose formation couldn't be delayed further, in the interest of our country and of Europe."

He reluctantly agreed to be re-elected by Parliament earlier this month for another seven-year term because of the political instability.

Italy's economy is No. 3 among eurozone members, and financial markets have been anxiously watching to see if an effective government could be formed to carry on with outgoing Premier Mario Monti's efforts to keep the country from sliding into the eurozone's sovereign debt crisis.

Some Italian political observers have predicted such a hybrid government might last only a few months of Parliament's five-year term, before collapsing in squabbling.

But the fear of elections, especially after the lightning-quick rise of comic Grillo's grassroots movement, could prove to be strong glue.

Giovanni Orsina, deputy director of LUISS university's school of government in Rome, ventured that Letta's new coalition could "last more than we expect, 18 to 24 months, more or less."

The history professor cited "lack of alternatives, and because I believe Parliament's members are not particularly eager to get back to the polling booth and face new elections."

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