The Alitalia debacle is an interesting case study on the landscape of modern European politics.

At the time of writing this article, the situation is such that the Italian carrier could fall under the equivalent of the American Chapter 11, that is one step short of bankruptcy.

The airline has been on the market for the last few months and a number of bids were put forward, including a symbolic expression of interest by an intellectual trying to make a point.

At the end of the day, it all boiled down to three realistic options, namely the offers put forward by Russian Aeroflot, Air France KLM and an Italian conglomerate led by Air One.

Air France KLM, the world's largest airline, was chosen as the preferred bidder and negotiations have been taking place since then. Last week, the French said they no longer felt there were the conditions for a takeover given the requests that were being put forward especially by some of the trade unions.

Given the proximity of the general elections, the Alitalia saga became one of the central topics in the campaign.

One political force is arguing that the French offer is the best possible solution given the circumstances. They argue that, although they would have preferred Alitalia to remain "Italian", there was no feasible alternative.

On the other hand of the political spectrum, another political force states that it will resist the Air France KLM deal and that an Italian consortium should be formed to take over the ailing company. Given such a case study in any public policy class, students might tend to argue that the "lefties" are resisting "foreign ownership" and "government intervention" while the economic liberals traditionally on the right want the market forces to move on.

What is ironic is that exactly the opposite thing is taking place in Italy.

Walter Veltroni's Partito Democratico, born to bring together the mainstream progressive movement, is in favour of the Air France KLM solution, despite resistance from some of the affiliated trade unions.

It is Silvio Berlusconi and his Popolo della Libertà that want Alitalia to remain "Italian" and are ready to use state power not to allow the market forces to function. This is the same Silvio Berlusconi who time and again argues for less state intervention. It is clear that the Cavaliere is steadily shifting towards a stauncher form of populism.

The trends in Europe are interesting to observe and compare with the current situation and, most importantly, things yet to come in Malta.

I have noted that the Maltese government has finally announced that it will make its plans to change the vehicle registration tax public during the next few weeks.

I look forward to reading the proposals and seeing whether they will meet expectations in terms of consumer and environment protection.

Dr Muscat is a Labour member of the European Parliament and vice president of the Economic and Monetary Affairs Committee.

www.josephmuscat.com