The South Tyrol Success Story: Italy's German-Speaking Province Escapes the Crisis

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Durnwalder could be accused of double standards, in his desire to promote modern art but only when it attracts well-heeled tourists and isn't off-putting to Catholic voters. But the consummate political survivor is used to walking a thin line. For instance, when he talks about his younger days, when he was nicknamed "Brother Norbertus" and already had one foot in the priesthood, he hopes that the story will convince moral conservatives to overlook his womanizing younger days.

But the governor, contradictions and all, is also an embodiment of modern-day South Tyrol, an old farming region at a crossroads -- between isolation and globalization, deeply rooted folk beliefs and secularism.

If Durnwalder quits politics, the conflicts will become even more visible. The SVP now has only a very thin majority in the provincial parliament. Parties from the nationalist German-speaking and right-wing Italian camps threaten to shake the tectonics of the political landscape in South Tyrol.

Even Durnwalder's avowed supporters, like businessman Michael Seeber, have become critical of the long-time governor, arguing that he is jeopardizing the future of his homeland with his blend of "South Tyrolean state socialism" and feudalistic behavior. Seeber, the most successful industrialist in Durnwalder's realm, owns a company that is building cable cars for the 2014 Winter Olympics in Sochi, supplies light-rail urban transit systems for cities worldwide and makes wind turbines.

The Limits of Growth

"We here in South Tyrol have reached the limits of growth," says Seeber. "It's time we finally opened the doors and acknowledged that we are part of a united Europe. And that the decisions are now being made in Brussels, where they won't be paying as much attention to our small population of 500,000 people as they do in Rome."

Of course, crafty Luis Durnwalder knows this too. But South Tyrol is still part of Italy, and Italy is still trying to stave off a national bankruptcy with rigid austerity programs. For now, the governor's biggest concern is finding ways to prevent Rome from imposing new burdens on his province.

At the last budget meeting in the spring, Durnwalder effectively told Italian Finance Minister Giulio Tremonti that when it comes to rescuing the government's finances, South Tyrol could only offer Rome the following piece of unfortunate news: We have no money, we are unable to print money and, therefore, we can give you almost nothing.

The words Durnwalder used were an Italian translation of a famous quote in South Tyrolean dialect. It was originally said by Andreas Hofer, a Tyrolean patriot and military hero who was executed in the city of Mantua in February 1810.

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• Part 1: Italy's German-Speaking Province Escapes the Crisis
• Part 2: Paying for the South
• Part 3: Traditional Region at a Crossroads