Wednesday, May 30, 2018

Harakiri Italian Style by Jan Zielonka




Liberals across Europe seem happy: President Mattarella has prevented populists from taking over the Italian government and averted another Euro crisis. Their joy will be short-lived, however.

In my view, Mattarella’s decision is bad for Italy, Germany, and Europe. 

The only political force which is likely to profit is the Northern League – an extreme right-wing party which campaigns chiefly against migrants, and sides with Vladimir Putin and Marine Le Pen.

Liberal democracy will be the greatest victim in Italy and beyond. Centrist parties will be reduced to a political footnote in the next Italian elections. Politics in the coming months will be ever more contentious, if not violent. 

Europe will be even more paralysed, faced with instability in one of its most important member-states. Germany will have to live with the implications.

Lawyers will argue for a long time over whether President Mattarella acted constitutionally by vetoing the proposed government of a coalition of two anti-establishment parties enjoying a clear majority in the Italian parliament. 

The Five Star Movement has already announced its intention to start the procedure of impeachment of the President. This idea is fiercely contested by liberals from the centre-right and the centre-left. It seems clear, however, that the political aspects of Mattarella’s decision will be more important than the legal ones.

The first victim of Mattarella’s decision will be Italian democracy. The president cited concerns about international markets as the prime reason for his veto. This implies that the markets, and not voters, are in a position to determine the future of the Italian Republic. Put differently, elections can be considered valid only if they lead to outcomes welcomed by the markets.

Mattarella did not specify how the verdict of the markets can be established. Should we look at the volatile stock exchange, productivity, trade, investment, or growth? And who is in the position to speak on behalf of the markets? The rating agencies? The International Monetary Fund? The President himself? Markets have a peculiar notion of public interests and they distribute benefits and costs unevenly. The close alliance between states and markets generated enormous inequalities, and when the 2008 financial crisis broke out, ordinary citizens were asked to shoulder the burden.

Politicians should take the markets seriously, and the proposed governmental programme made many social policies without specifying where the money would come from. 

However, democracy has no meaning if it becomes a function of capricious and partisan markets. And it is far from certain whether markets will like the prolonged political instability caused by Mattarella’s decision.

The second victim of Mattarella’s decision will be the European Union. The president told Italians that the proposed government, and especially the proposed minister of finance, could or even “inevitably” would take his country out of the Eurozone. The winners of this year’s Italian elections are clearly no fans of the Fiscal Compact because they believe that excessive austerity hampers Italy’s growth.




This is not an extreme position. Respected economists such as Paul Krugman and Josef Stiglitz share this position, as do many liberal Italian politicians from Matteo Renzi to Emma Bonino. Paolo Savona, the vetoed minister of finance, is one of the most distinguished Italian economists and a former minister in the centre-left government. Savona spent some years studying what an exit from the Euro would imply, but the official position of the governmental coalition did not envisage leaving the Euro, or even calling a referendum on the issue.

Speculation aside, the EU’s legitimacy will always suffer if it is seen as a partisan player in the politics of individual countries. We have seen it in the United Kingdom, Poland, Austria, the Czech Republic, Greece and Hungary. Adding Italy to the list of disruptive powers within the EU will complicate European politics further. The EU cannot prosper without the cooperation of its member-states, and this cooperation will not be forthcoming with the public being told that decisions about their fate are being made in Brussels and not in their respective capitals.

The third victim of Mattarella’s decision will be Germany. Each time there is an earthquake in Europe, Germany is at its centre, as is the case this time. In recent weeks the German press, especially der Spiegel, has published articles that many Italians found offensive, if not xenophobic. The German government kept its calm, but it is far from clear whether it knows how to contain instability coming from one of the largest economies in the Eurozone. 

Is Berlin ready to reach into its pocket and soften the fiscal discipline within the Euro? Can Italy be forced into submission the way Greece was? 

How many protectorates can Brussels and Berlin run in Europe?

There is virtually no chance that Mattarella’s new pick to form a government, Carlo Cottarelli, will succeed in his mission. There will be new elections soon, and all polls indicate that the Northern League will gain the most from them. The same polls show that liberal parties are going to be pushed further into the margins of Italian politics. Democracy is obviously not only about elections, but depriving electoral winners of the possibility to form a government has little to do with democracy either. 

In an atmosphere of distrust and chaos, populists can only thrive. Prepare for an even more bumpy period in European politics. It didn’t have to be this way.

This is the English version of an article originally published in German in Die Zeit on May 28, 2018. It was first published by Open Democracy.

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