Last week, Italy’s welfare minister suggested the Euro was responsible for Italy’s economic malaise and urged a return to the Lira. This week, he announced plans to circulate a petition calling for just that, and will soon begin to collect the necessary signatures.  What is the likelihood of his plan being brought to fruition?

On one hand, many Italians are fervently against the Euro, scapegoating it for the nation’s economic problems. On the other hand, as a member of the Euro common currency system, Italy is able to take advantage of extremely low interest rates on the debt it services, saving billions of dollars per year.  A return to the Lira would be accompanied by a rise in interest rates, and increased expenditure on debt service. Italy’s Prime Minister, Silvio Berlusconi, is currently abstaining from the debate, although he is undoubtedly in support of the Euro.  The Economist reports:

The League’s campaign helps to deflect the blame from his government and towards Brussels, which this week began proceedings against the Italian government for running an excessive budget deficit.  Mr Berlusconi may choose not to jump on board the League’s ill-conceived bandwagon, but nor is he rushing to stand in its way.

Read More: That Lovely Lira