An Italian in Frankfurt

After the public blessing of the German Chancellor Angela Merkel, it is paved the way for Mario Draghi to the European Central Bank Presidency. Hoping that he will restrain himself from raping clerks or inviting underage escorts to private parties, Mr. Draghi is supposed to enter in office at the end of the Trichet’s presidency  in October 2012.

Mario Draghi, PhD at MIT

“Super Mario” will chair the European monetary policy for about 8 years, he now has the chance to become the most powerful Italian in Europe. In the whole world even, I would say.

It is not yet fully easy to understand why an Italian would sit at the most influential seat in Frankfurt. Actually, the natural candidate for that position was Axel Weber, now professor of economics at the University of Chicago Booth School of Business, and former  President of the Deutsche Bundesbank. Mr. Weber had to renounce to the candidacy at the ECB because of a conflict of interests. While serving the federal bank, he kind of committed to move to the Deutsche Bank, a private bank which supposedly has to be controlled by the Deutsche Bundesbank.  Germans cannot stand any mix of controller and controlled, they take monitoring as a serious thing.

It may be funny to notice that the curriculum of Mr. Draghi, the unique line which could have precluded his nominee, was that of the nationality: ITALIAN. Why would Europe trust an Italian? Are we responsible? Are we transparent? Well, recently the Bild Zeitung, a popular German publication referred at “Super Mario” as “the most German of the remaining candidates”.  But let’s have a look at the reasons why the current Governor of the Bank of Italy is the fitting candidate to the ECB presidency.  First of all, we have to say that despite his Italian nationality, he has always been cautious with inflation and strict against creative finance.

Moreover, his professional achievements clearly speak for themselves. After graduating at La Sapienza, in Rome, under the guidance of one of the most influential Italian economists, Federico Caffè, he went to Boston for a PhD at the MIT. His doctoral essays have been supervised and discussed with Modigliani and Solow, not exactly the last of the least. Mr. Draghi has been appointed Professor of International Economics at the University of Florence (1981-1991), Executive Director at the World Bank in Washington D.C. (1984-1991) and afterwards he joined Goldman Sachs International as managing director.

Throughout his career, included the appointment as Governor at the Bank of Italy, he has been collecting  a long list of appraisals, for professionalism, competence, and dignity.  Apparently there is room for meritocracy even for Italians, out of the nation’s borders.

“Super Mario” will surely need all of his powers to succeed as a central banker. Not only he has to give crucial guidelines for monetary policy, fiscal stimulus, and public finance, he also has to face with requests and needs of ministers, governors, politicians, and head of states who will push for their local or private interests. So, good luck Mario. Welcome to Frankfurt.

It just now come to my mind that there was already an influential Italian in Frankfurt. Lorenzo Bini Smaghi, PhD at Chicago, has been a member of the ECB Executive Board since June 2005.

Mr. Bini Smaghi has all my appraisal, not only because he has long been working with professionalism and a substantial lack of individualism, but mostly because he is sponsor and President of the Fondazione Palazzo Strozzi, an institution which promotes cultural initiatives and offers the rare opportunity of enjoying contemporary art exhibitions in Florence. Moreover, he is linked to my hometown, San Casciano in Val di Pesa. If I remember correctly, his parents were living in Cerbaia when he was born. As a consequence, I feel like we are sharing some common roots.

Lorenzo Bini Smaghi, PhD at Chicago

Mr. Sarkosy kindly noticed that two Italians in leading positions at the ECB are kind of disproportionate. France almost formally asked Mr. Bini Smaghi to resign in order to free a seat in the Executive Board. Even though the Cerbaiotto has just confirmed his intention to conclude his mandate ending in 2013, an eventual appointment at the Bank of Italy or at the IMF may convince him to abandon Frankfurt. Unfortunately, the Italian diplomacy and influence on international affairs is far from being as strong as the French one. France has been chairing both the ECB and the IMF in the last period, but it is frankly unthinkable having two Italian at the presidency of the two leading financial institutions. Sorry Mr. Bini Smaghi.


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