At this moment, Mario Monti is the world's most important ex-economics professor. True, Ben Bernanke's monetary-policy decisions will move the needle in the U.S., but the fate of a continent rests on Monti's shoulders. If he can continue to institute meaningful reform, Europe will successfully weather the debt crisis. If he cannot, the vision of a unified Europe will unravel.
Already he has pulled Italy from the ledge by standing up to vested interests taxi drivers, pharmacists and railway workers to increase competition and renew economic vitality. Instituting these reforms took great courage, particularly in a country where leaders have too often proved beholden to powerful lobbies. He has taken painful steps to cut spending, raise taxes and reduce Italy's budget deficit. As a result, the nation's bond yields have tightened significantly, and imminent fears about the monetary union's collapse have subsided.
Monti, 69, knows that growth is what is most important. Reforming Italy's two-tier labor system to foster such growth will be his most arduous task. However, given the courage and dexterity he's displayed thus far, I trust that he's up to the challenge. The stakes could hardly be higher.
Summers is a former Treasury Secretary and current professor at Harvard University