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EU faces double whammy of political turmoil in Italy, Spain

Aug. 2, 2013 at 5:58 PM   |   Comments

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BRUSSELS, Aug. 2 (UPI) -- Europe's southern eurozone faces the double whammy of political turmoil in Italy and Spain where both governments are at risk of being toppled by corruption scandals.

EU officials were reported in urgent consultations with Italian and Spanish counterparts after a tax fraud verdict against former Italian Prime Minister Silvio Berlusconi put the ruling coalition on the precipice.

Meanwhile, Spanish Prime Minister Mariano Rajoy was in fighting mode after facing charges he accepted illegal payments. Opposition leader Alfredo Rubalcaba said Rajoy "cannot rule the country unless he explains his involvement" in a corruption case linking him to a ruling party slush fund case.

Moves for a vote of no confidence in Rajoy were afoot in the Spanish Parliament.

Of the two rolling scandals, Italy's crisis was closer to claiming the ruling coalition as its biggest casualty as speculation lingered on whether Berlusconi, 76, would go to prison. His advanced age and strong political connections suggest Berlusconi could emerge largely unscathed from the latest twist in his political career.

Berlusconi still leads the People of Freedom party, which forms part of the coalition.

In a video message, Berlusconi complained of "judicial harassment" while in the background senior politicians including President Giorgio Napolitano and Prime Minister Enrico Letta appealed for calm -- political shorthand for extricating Italy from the crisis created by the court verdict upholding Berlusconi's tax fraud conviction.

Meanwhile, in Madrid, Rajoy appeared before lawmakers to rebut charges of corruption amid a looming threat of a no-confidence vote.

The scandal has angered Spanish voters, struggling amid a severe recession and high unemployment.

Protests and clashes between citizens and police have frequently disrupted life in the Spanish capital and other cities.

To calm protesters and pacify lawmakers, Rajoy admitted he erred in trusting the ruling Popular Party former Treasurer Luis Barcenas but denied he had any part in it.

Barcenas is in custody as he faces allegations he operated a slush fund that made payments to Rajoy and others.

"Justice will show there was nothing illegal in my own behavior or that of my party," Rajoy said as he rejected calls to resign.

Rubalcaba says he isn't going to withdraw a censure motion against the prime minister.

Rajoy's claim Spain is moving toward economic recovery occupied the least space in the media as it concentrated on critics' accusations and Rajoy's rebuttals.

So far, Rajoy has been spared a meaningful threat to his premiership because of the ruling Popular Party's clear majority in Parliament. But discontent within the party is growing and some party stalwarts are beginning to see Rajoy as a liability, a view shared in Brussels by eurozone analysts who fear the crisis in Madrid will undo gains made in saving Spain from collapse.

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