02/14/2014 12:48 pm ET Updated Nov 26, 2014

New Kid on the Block: Matteo Renzi Jolts Europe

Nicolas Berggruen, co-publisher of The WorldPost; President, Berggruen Institute on Governance.

Finally, Europe may be getting the bold leadership it has needed for so long.

Matteo Renzi's politically risky move to push aside Enrico Letta and seek to become prime minister of Italy signals a new generation in a hurry. His impatience to get beyond Italy's stagnation and fight for transformative constitutional and electoral reforms that will make his country governable are an example for Europe as a whole.

This new jolt of energy from the 39-year-old leader comes at a critical moment for the troubled continent since Italy is about to assume the rotating presidency of the European Union for the next six months.

Italy is a case in point of the maxim coined by California Gov. Jerry Brown: breakthrough only comes after breakdown. With Italy buffeted by the mismanagement and manifold scandals of Prime Minister Silvio Berlusconi at the height of the euro crisis in 2011 that led to his downfall, President Giorgi Napolitano appointed Mario Monti as head of a so-called technocratic government. The hope was that, by creating a de-politicized space beyond paralyzing partisan squabbling, the tough reforms on labor markets, pensions and taxes required for Italy's return to growth and long-term sustainability could be implemented.

Despite Monti's competence and even heroic efforts, the pressures of short-term populist politics hemmed in his ability to effect change since he lacked the legitimacy of having been directly elected. He called new elections, which produced the fragile coalition government of Enrico Letta that quickly became paralyzed by the same pressures.

Renzi, who has been the centrist mayor of Florence and who recently wrangled the leadership post of the left-leaning Democratic party away from Letta, decided enough was enough. For Renzi, Italy's only chance is to cut to the chase and reconstitute the country's ungovernable political system.

Showing either his savvy or foolishness (only time will tell) Renzi made a deal with Berlusconi's Forza Italia party, the other major party in Italy, to overhaul the constitution and electoral laws that have led inevitably to gridlock and the inability to govern.

The electoral reform is a bit complex, so bear with me for just one moment. It's the boring rules that always end up generating the most dramatic crises, so they matter.

The Economist offered this very clear and concise explanation of the electoral reforms:

"Candidates would run on closed party lists in which names near the top have the best chance of a seat (men and women would alternate in priority). There would be thresholds to get into parliament (12% for a coalition, 8% for a party running by itself and 5% for each single party within a coalition). If a party or coalition won 35%, it would receive bonus seats to give it an outright parliamentary majority. If not, there would be a run-off second-round ballot."

The idea is that this would force smaller parties to agree to a common program in coalition with others in electoral competition instead of end up as splinter parties in Parliament that could derail majority consensus.

Renzi's reforms would also centralize transport and energy policies, now scattered around the bureaucracy, municipalities and regions, in Rome.

Most importantly, Renzi would transform the Italian Senate into an upper house of regional representatives that is indirectly elected (much like the original U.S. Senate which was indirectly elected by state legislatures, or the German Bundesrat that represents the länder). It would advise on legislation and take the longer and enlarged view on national issues, but would not have the decisive votes, which would remain with the directly elected lower house, or Chamber of Deputies.

As it is now, the Senate and the Chamber of Deputies have equal weight and thus effectively cancel each other out, block initiatives and lead to gridlock.

As Renzi noted when he introduced his constitutional reforms, giving equal powers to each house was a post-World War II design meant to prevent another strong executive like Mussolini from ever accumulating too much power. In practice, it has meant that Italian governance, not unlike in the U.S. today, has more checks than balances. As a result, decisions are difficult to make. Inertia, stagnation and constant turnover of governments has been the rule.

There is, of course, no guarantee that Matteo Renzi, however bold his intentions, will succeed where others have failed.

But he has already provided something that Europe has been sorely lacking: leadership from a new generation with the innovative imagination, energy and will to restructure democratic practices and institutions that have become largely moribund.

As voters head into elections for the European Parliament in May that will shape the future institutions of the European Union, they should take heed of Renzi's venture.

Renzi offers a different vision of what European leadership can be: personal charisma combined with the courage to take on deep structural change. No one can doubt that Europe has stalled under the gray, impersonal and distant bureaucrats who today inspire little confidence in their own citizens.

Mario Monti, who was a European commissioner as well as Italian prime minister, once warned that governance at the European level should be careful not to replicate the dysfunctional politics at the national level of the kind we have seen in Italy. So far, that has been exactly the case. If Renzi's reforms are successful, we can turn Monti's warning into a plea: Europe should emulate Italy.