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After ratings agency Standard & Poor's downgraded Italy's credit rating a notch on Monday night, Prime Minister Silvio Berlusconi immediately went on the offensive. The appraisal of the country's economic state seemed to be "dictated more by media reports than reality," he said. The Italian government is already balancing the budget, he added.

In reality Berlusconi has only just begun working on savings measures -- a reaction to massive pressure and repeated market fluctuations. His behavior demonstrates the leader's intention to cling to the populist style of governing until the bitter end. But the powerful media mogul's stance also betrays the limits of European Union influence on its indebted member states -- at least those that haven't yet been forced to accept a bailout.