tag:theconversation.com,2011:/global/topics/matteo-renzi-9020/articlesMatteo Renzi – The Conversation2018-03-05T13:09:36Ztag:theconversation.com,2011:article/928612018-03-05T13:09:36Z2018-03-05T13:09:36ZItaly election: what we know so far about who could form a government<p>Italy has been a populist stronghold for two and a half decades – that is since 1994, when <a href="https://theconversation.com/silvio-berlusconi-what-to-expect-from-the-comeback-king-in-italys-election-92457">Silvio Berlusconi</a> created his Forza Italia (FI) party. His goal was allegedly to “save” the Italian people from being governed by “Communists” after the collapse of centrist parties under the weight of anti-corruption investigations. Having won the election in the same year, Berlusconi then led a short-lived coalition government, with the support of the extreme-right party the Social Movement and the regionalist populist Lega Nord.</p>
<p>Fast forward 24 years to the <a href="http://www.bbc.co.uk/news/world-europe-43272700">2018 election</a>, and not only is Berlusconi still FI’s leader (and indeed owner), but, together with a renewed Lega, he has again managed to assemble an electoral coalition that could end up in government.</p>
<p>However, this time there is an important twist: yet another populist political actor was born in the meantime and now happens to be the largest single party of all: the <a href="https://theconversation.com/what-is-italys-five-star-movement-69596">Five Star Movement (M5s)</a>. Having entered the Italian political scene less than ten years ago as an anti-establishment force, this group has struck a chord with an electorate weighted down by the economic crisis and fed up with the corruption of mainstream parties. In this election the party has attracted just below one third of the votes by standing alone.</p>
<h2>Rising stars</h2>
<p>A first analysis of the electoral outcome should start with the <a href="http://elezioni.interno.gov.it/camera/scrutini/20180304/scrutiniCI">undisputed winner</a> – that is M5s. There is no denying it has achieved an amazing result, especially given that its performance in leading local administrations in recent years, particularly the city of Rome, has been far from impressive.</p>
<p>Having gained around 32% of the national vote, M5s has confirmed its position as the most successful new party in the history of Western Europe (going from 0 to 25% between 2009 and 2013, and having grown of a further 7% in the following five years). As such, the Italian president, Sergio Mattarella, might well feel compelled to give it a chance to form a government before exploring the alternatives.</p>
<p>However, it is not obvious at this stage who could work with Beppe Grillo’s party to lead the country. A solution will probably turn out to be to reach an agreement with the Democratic Party (PD). But that’s the very party that M5s has long identified as the source of the country’s ills. This would be a complete reversal of the position taken by M5s after the 2013 election, when it refused to even consider such a possibility and went into opposition, forcing the PD to govern with FI.</p>
<p>The difference between then and now, however, is considerable. Back then, the PD-led coalition had emerged from the election with 29% of the vote – the largest share. M5s took 25%. Moreover, this coalition had a much larger number of seats than M5s, due to the electoral law in force at the time. This time round, the PD suffered a crushing defeat (its vote has gone down from 25% in 2013 to 18%) and would be forced into a supporting role if it went in to partnership with the dominant M5S. It’s unclear why the Democrats would want to swallow such a bitter pill. While not impossible (after all, the centre-left has a great ability to shoot itself in the foot), I regard such a solution as very unlikely. It would be tantamount to committing political suicide.</p>
<h2>A right-wing alliance</h2>
<p>Meanwhile, the right wing alliance – made up of Berlusconi’s FI, Matteo Salvini’s Lega and Giorgia Meloni’s Brothers of Italy, is by far the largest coalition. However, the Lega has overcome FI for the first time with an astonishing 17% of the vote (vs FI’s 14%).</p>
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<img alt="" src="https://images.theconversation.com/files/208879/original/file-20180305-65525-y0ef7n.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/208879/original/file-20180305-65525-y0ef7n.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=426&fit=crop&dpr=1 600w, https://images.theconversation.com/files/208879/original/file-20180305-65525-y0ef7n.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=426&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/208879/original/file-20180305-65525-y0ef7n.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=426&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/208879/original/file-20180305-65525-y0ef7n.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=535&fit=crop&dpr=1 754w, https://images.theconversation.com/files/208879/original/file-20180305-65525-y0ef7n.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=535&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/208879/original/file-20180305-65525-y0ef7n.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=535&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Feeling good: Matteo Salvini.</span>
<span class="attribution"><span class="source">EPA</span></span>
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<p>This is very significant since the agreement between the two was that whichever of them came on top would have a right to put forward the prime minister. If the right eventually manages to gain the support of enough MPs to create a government, therefore, Salvini would have to lead it.</p>
<p>Salvini’s radicalism and <a href="https://www.ft.com/content/d9b7a876-1d48-11e8-956a-43db76e69936">harsh rhetoric</a> (particularly on immigration) makes it less likely that anyone would want to give the right wing coalition this opportunity (and in any case, it is not clear at this stage where such extra MPs would come from). But having brought the party from 4% in 2013 to 17% today (the best result ever achieved by the party, and by far) Salvini’s position within the Lega is now unassailable.</p>
<h2>Who governs?</h2>
<p>With the right-wing alliance unlikely to have enough seats to govern on its own and voters so obviously fed up with mainstream parties, it now looks at least possible that, despite their differences, the Lega and M5s may want to explore the possibility of governing together. This would be very difficult for the Lega, as the party would need to ditch its well tested alliance with FI, one that has served it well during many years.</p>
<p>Such a move would be further complicated by the fact that the two right-wing allies (and their minor ally, Brothers of Italy) have fielded coalition candidates together, since, under the new electoral law, one third of the seats are selected from single-member districts (SMDs) according to a plurality rule. It is true that each of the candidates came from one of these parties and, ultimately, is loyal to them, however they have received the support of all right-wing voters. If the Lega ignored this and agreed to join M5s in government, Berlusconi would accuse them of betraying the electorate.</p>
<p>In the end, what we are left with while we still wait for the final results to be confirmed is the certainty that populism continues to dominate Italian politics. Everything else is a question mark.</p><img src="https://counter.theconversation.com/content/92861/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Daniele Albertazzi has received funding from AHRC, The Leverhulme Trust and the British Academy</span></em></p>The Five Star Movement is the biggest party, but forming a government is going to be difficult. Will a right-wing coalition prevail?Daniele Albertazzi, Senior Lecturer in European Politics, University of BirminghamLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/921412018-02-23T13:28:40Z2018-02-23T13:28:40ZItaly election: how populist Five Star Movement is wrecking government hopes for the mainstream<p>Italy faces an election on March 4 – and, after a long decade of austerity and economic difficulties, a strong possibility of further political paralysis. Neither the centre-left, the centre-right, or the populists are likely to command a majority in parliament. Establishing a functioning government won’t be easy, and its make-up will depend on which parties are prepared to put aside their differences and form an alliance.</p>
<p>The populist <a href="https://theconversation.com/what-is-italys-five-star-movement-69596">Five Star Movement</a> (M5S) exploded onto the electoral scene in the 2013 general election, arresting the see-saw alternation between centre-left and centre-right majority governments that had been tentatively established in the 1990s. The vote produced a hung parliament, forcing the two traditional parties to work together in a centrist “grand coalition” to keep M5S out of office.</p>
<p>Now, M5S, <a href="https://theconversation.com/theres-an-election-in-italy-next-year-and-m5s-has-some-familiar-problems-85492">despite recent allegations of corruption</a>, is even stronger. It’s likely to emerge from this election as the <a href="https://www.termometropolitico.it/1289058_sondaggi-elettorali-demopolis-6.html">largest party</a>. But it looks unlikely to secure enough of a majority to govern alone and it continues to refuse to form coalitions with other parties.</p>
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<img alt="" src="https://images.theconversation.com/files/207275/original/file-20180221-132650-25c0wy.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/207275/original/file-20180221-132650-25c0wy.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=134&fit=crop&dpr=1 600w, https://images.theconversation.com/files/207275/original/file-20180221-132650-25c0wy.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=134&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/207275/original/file-20180221-132650-25c0wy.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=134&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/207275/original/file-20180221-132650-25c0wy.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=168&fit=crop&dpr=1 754w, https://images.theconversation.com/files/207275/original/file-20180221-132650-25c0wy.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=168&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/207275/original/file-20180221-132650-25c0wy.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=168&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Statistics from the February 16 Demos opinion poll, organised by party and political spectrum.</span>
<span class="attribution"><span class="license">Author provided</span></span>
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<p>A collapse in support of the two pivotal parties of the centre-left and centre-right means that neither look likely to be able to form a government either. The Democratic Party under former prime minister Matteo Renzi has sunk from <a href="https://en.wikipedia.org/wiki/Italian_general_election,_2013">25% of the vote</a> in 2013 (and an astounding 40.8% of the vote in the 2014 European elections) to 21.9% in polls today. Silvio Berlusconi’s Forza Italia, on the centre right, has collapsed from 21.5% in 2013 to 16.3% today. Both parties are suffering from <a href="https://theconversation.com/matteo-renzi-just-killed-off-italys-centre-left-73492">splits and fragmentation</a>, which have weakened the coalitions they lead.</p>
<h2>A new system</h2>
<p>Faced with this decline, it’s not surprising that, in 2017, Renzi and Berlusconi brought the combined parliamentary strength of their parties together to pass an electoral reform that seemed designed to offset M5S’s electoral popularity by <a href="https://www.theguardian.com/world/2016/jun/20/italian-pm-renzi-electoral-reform-m5s">limiting its seat gains</a>.</p>
<p>The new electoral system (<a href="https://en.wikipedia.org/wiki/Italian_electoral_law_of_2017">the rosatellum</a> – after Ettore Rosato, the Democratic leader in the Chamber of Deputies who first proposed the new law) is a “mixed” system (part “first-past-the-post” and part proportional). It favours those parties willing to ally together behind single candidates to prevent splitting their vote. It also gives an advantage to those parties that are territorially concentrated, such as the Democratic Party (in the central regions) and the Northern League (in the north). M5S, which opposed the electoral reform, has no natural coalition allies and does not yet have a strong presence at local or regional levels.</p>
<p>This electoral engineering will nevertheless come at a cost. It increases the likelihood that none of the parties or coalitions will reach the 40% threshold of the vote that is likely to be necessary to secure a parliamentary majority. This has resulted in a feverish election campaign, dominated – not by debates about policies – but by speculation over possible post-election coalitions. Even an anti-establishment M5S-Northern League alliance is being touted as a possibility.</p>
<p>All of this matters not just to Italy but to Europe. A decade after the eurozone crisis began, the Italian economy is still in recovery. Its sheer size and significance to the eurozone remains a concern to the European Union, which has demanded greater fiscal discipline and reforms to encourage growth and improve productivity. That needs effective government – and one supportive of the EU.</p>
<p>Yet, there is a rising tide of eurosceptism in Italy, fuelled by M5S and years of perceived EU-imposed austerity. Forza Italia, the Northern League and M5S have all toyed with the idea of withdrawing Italy from the euro, meaning only the Democratic Party has unequivocal pro-euro credentials. Yet, even under prime ministers from that party (Matteo Renzi, Paolo Gentiloni), the Italy-EU relationship has become testy and fractious. Governments have become less willing to be the “good European” if it is seen to involve imposing more austerity on an unwilling population.</p>
<p>Overall, the state of play makes for a potent mix. The 2013 parliamentary and presidential elections produced a “perfect storm” and Italy ended up, for some time, without a prime minister, government or president. This time, fortunately, the president is not up for election – and it will be his responsibility to appoint a prime minister capable of governing with a parliamentary majority. The road ahead is however still fraught with uncertainty.</p>
<p>The new electoral system increases the importance of post-election manoeuvring by the parties, and will determine whether a repeat grand coalition government is needed (and possible) to keep out the extremes, or whether Italy will take a step into the unknown with some kind of anti-EU populist governing alliance. Europe will be watching closely.</p><img src="https://counter.theconversation.com/content/92141/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Martin J Bull does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Italy’s political future hangs in the balance – will it see another chaotic grand coalition, or take an anti-EU populist step into the unknown?Martin J Bull, Professor of Politics, University of SalfordLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/734922017-02-23T11:31:24Z2017-02-23T11:31:24ZMatteo Renzi just killed off Italy’s centre left<p>Former prime minister Matteo Renzi has resigned as leader of the Italian Democratic Party (PD) in a move that leaves the country’s centre left in ruins. His party is now split, which gives the far right an opportunity to seize government after the next election. </p>
<p>Renzi’s departure was inevitable. He lost a <a href="https://theconversation.com/is-italy-about-to-feel-the-trump-effect-matteo-renzis-referendum-and-the-populist-threat-68891">crucial constitutional referendum</a> in December and resigned as prime minister shortly afterwards, to be replaced by his former foreign minister, <a href="https://theconversation.com/italys-new-prime-minister-cant-shake-off-the-stench-of-a-stitch-up-70098">Paolo Gentiloni</a>.</p>
<p>Smarting from his defeat in the constitutional referendum, and having had to fulfil his promise to the electorate to resign if he lost, Renzi’s tactics have been fuelled by his determination to return to office as soon as possible.</p>
<p>This meant resigning and getting re-elected as leader of the party before going on to win a general election as the prime-ministerial candidate of the PD. It has been widely recognised since his appointment that Gentiloni is merely a stop-gap PM.</p>
<p>Renzi thought he could achieve all this by June (at the latest September) of this year. The left-wing minority inside the PD had other ideas. Their view was that, with the defeat in the referendum, the Renzi experiment was over and that the party needed to find an alternative direction and a different leader. They wanted to keep Gentiloni in office until the end of the parliamentary term in 2018 while the party found a successor, and for Renzi to stand aside.</p>
<p>Renzi, however, was having none of it. “The minority has the right to defeat me but not to eliminate me,” <a href="http://www.ilfattoquotidiano.it/2017/02/21/renzi-minoranza-ha-diritto-di-sconfiggermi-non-di-eliminarmi-poi-dice-non-saro-direzione-vado-negli-usa/3405195/">he said</a>. He called the party Assembly together, presented his proposals, refused to compromise and then played his ace card: resigning as leader, thus forcing the pace of events. The minority had little choice at this stage but to exit the party (although not all of them announced they would).</p>
<h2>An enduring division</h2>
<p>While the current divisions in the PD were prompted by the referendum, the roots go much deeper – indeed, they go back to the founding of the party itself in 2007.</p>
<p>The PD was born of the Olive Tree Coalition (Ulivo), which brought together in alliance two great political traditions in post-war Italy: democratic socialism (as represented by the Democrats of the Left, heirs of the former Communist Party) and progressive Catholicism (the Margherita, or “Daisy”, heirs of the former Christian Democratic Party).</p>
<p>Between 1996 and 2008, Ulivo produced four governments, including two under Romano Prodi and one under Massimo D’Alema, the first former communist ever to be prime minister in Italy. The PD, coming to life during Prodi’s second government, was a merger of these two great political traditions. Its aim was to provide, for the first time in Italy, a single political force of the progressive centre-left realistically large enough to compete for office with the centre right.</p>
<p>Yet, despite producing three prime ministers (Gianni Letta, Matteo Renzi and Paolo Gentiloni) in the ten years since its founding, and despite winning more than 40% of the vote in the 2014 European elections, the PD has never won a general election with an outright majority. Letta was head of a grand coalition and was replaced by Renzi without an election taking place. Renzi was subsequently replaced by Gentiloni following the constitutional referendum defeat.</p>
<p>The PD has never successfully integrated the two former parties into one. Indeed, the two souls of communism and Christian democracy have persisted in the PD. The division has shaped its factions and political debate, as well as its positions on issues such as education, work, welfare, inequality and institutional reform.</p>
<h2>One-man band</h2>
<p>Renzi’s leadership, in particular, has been a jarring experience for the left-wing of the party. He rose to prominence on the basis of a campaign promising to scrap the old leadership of the PD because of its inadequacies. His has been a very individualistic leadership, based on his own beliefs, charisma and personality, and the PD has, it is said, been effectively replaced by the PdR (“Party of Renzi”). His belief in constitutional reform was shaped, he claimed, by the need to improve the efficiency of the Italian political system. His detractors in the party saw it as a means of increasing the power of the prime minister’s office and therefore of Renzi himself, and they resolutely opposed the reform.</p>
<p>For the minority, therefore, the PD’s main problem had become Renzi himself. And since the prospects of removing him seemed more remote than ever after his latest manoeuvre, the only other alternative was to leave. In this sense, it is the end of the PD as we know it.</p>
<p>The party now faces an uncertain future. Numerically speaking, the loss of the left-wing minority does not look significant. The departing parliamentary deputies will likely number between 20 and 30, and they will probably merge with an existing dissident “Italian Left” group of 17 to construct a new political force in parliament.</p>
<p>Yet, the group includes highly influential figures such as former leader Pier Luigi Bersani. Moreover, in the current party system – based, <a href="http://www.sondaggipoliticoelettorali.it/GestioneDomande.aspx">according to polls</a>, on a rough tripolarity between the populist forces, a more moderate centre right and the centre left – the departure of a small group of dissident MPs means a lot. It consigns to the dustbin the PD’s vocation of a single party majority government and simply recreates the necessity of an alliance between the centre-left and the left to govern.</p>
<p>It also gives a huge fillip to the populist <a href="https://theconversation.com/what-is-italys-five-star-movement-69596">Five Star Movement</a> and the Northern League, which now feel closer than ever to seizing office whenever elections are called. Ironically, therefore, even though Renzi’s hard line is likely to consolidate his leadership of the PD and increase his internal dominance, it may turn out to be a Pyrrhic victory.</p><img src="https://counter.theconversation.com/content/73492/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Martin J Bull does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The former PM has resigned as leader of his party in the hope of returning to the top job. But it hasn’t quite gone to plan.Martin J Bull, Professor of Politics, University of SalfordLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/700982016-12-16T09:20:33Z2016-12-16T09:20:33ZItaly’s new prime minister can’t shake off the stench of a stitch-up<p>Only days after its prime minister resigned over a lost referendum, Italy found itself with a new government and a new prime minister, Paolo Gentiloni. But however smooth the transition was, the turbulent circumstances that led up to it are far from resolved.</p>
<p>The referendum rejected Matteo Renzi’s proposal to rewrite approximately a third of the constitution and recalibrate the dysfunctional relationship between the chamber of deputies and the senate. It was a risky move – and by polling day, it became a referendum on him and his administration, with populist opposition parties the <a href="https://theconversation.com/what-is-italys-five-star-movement-69596">Five Star Movement</a> (M5S) and the <a href="http://www.politico.eu/article/italys-other-matteo-salvini-northern-league-politicians-media-effettosalvini/">Northern League</a> seizing their chance to rail against the establishment.</p>
<p>Thanks to Italy’s weak economic situation, this all drew unprecedented international attention, with European elites especially worried about the potential political and economic shock that a No vote might trigger. But when that vote came, the sky didn’t fall in. The <a href="https://theconversation.com/markets-are-muted-after-italy-referendum-but-instability-simmers-under-the-surface-69922">markets</a> had clearly pre-adjusted in anticipation; minus a temporary fall in the value of the euro, they seemed ready to give Italy time to sort itself out. And so it did. </p>
<p>Renzi kept his promise and resigned immediately. The president, Sergio Mattarella, knew that calling fresh elections was not an option: while the constitutional reform was rejected, the new electoral law for the Chamber of Deputies is already in place, meaning Italy now has two different electoral systems for two chambers with identical powers. Without further electoral reforms, different parties or coalitions could end up majorities in each chamber, virtually guaranteeing legislative gridlock.</p>
<p>Mattarella spent two days in hectic discussions with delegations from all 26 political parties and groupings. Renzi’s Democratic Party did its bit by helping Mattarella identify who would secure the party’s support, and once a clear consensus emerged, Mattarella gave Paolo Gentiloni a mandate; he moved quickly to choose his ministers, who were sworn in on December 9.</p>
<p>By Italian standards at least, this was a remarkably swift transition between governments – at only 17 minutes, Gentiloni even broke the record for the
shortest-ever confidence speech – but it comes with a strong dose of irony and déjà-vu. The referendum may have issued a verdict on Renzi and his government, but what has been installed instead appears to be little more than a refitted version of what Italy apparently rejected.</p>
<h2>Same as the old boss</h2>
<p>Gentiloni is no outsider. He was a member of the Democratic Party’s founding committee in 2007, supported Renzi’s successful leadership bid in 2013, and served as his minister of foreign affairs. His government’s majority is almost identical to Renzi’s, and his cabinet almost a carbon copy, with all but five ministers held over. Even Maria Elena Boschi, who was responsible for getting the failed proposal through parliament and who had promised to resign in the event of a No vote, was not just kept on but promoted. </p>
<p>Gentiloni’s goals are much the same as Renzi’s: electoral reform, sorting out the crisis in Italy’s banks, relief measures to the Italian earthquake zone and securing agreement with the unions on a new public workers’ contract. In his confidence speech, he explicitly embraced the Renzi government’s record and claimed continuity with it. Renzi himself remains leader of the Democratic Party; he has already made it clear that far from retiring, he wants to lead the party into the next election campaign with a view to winning and then continuing his programme of reform.</p>
<p>So while Gentiloni can claim to be a stabilising force in a time of crisis, he’s also viewed as a player in an establishment stitch-up. The transition protects the government from the blow dealt to Renzi, and gives him and his troops time to regroup. As far as the anti-establishment is concerned, it’s almost as if the Yes vote won after all. It’s not lost on them that Gentiloni is now the fourth prime minister in a row to have been appointed without a clear electoral victory; the last leader with that sort of legitimacy was <a href="https://www.theguardian.com/world/2008/may/02/italy.thefarright">Silvio Berlusconi</a> when he was returned to power in May 2008.</p>
<p>Small wonder then that this government has already drawn as much opprobrium as any other in the history of the Italian Republic. The opposition parties took the unprecedented measure of boycotting the parliamentary confidence debate, expressing their views in the piazza and online. Gentiloni was left to speak to a half-empty chamber. Many view the new government as little more than a device to keep the anti-establishment parties out of power – but their chance can’t be far off. </p>
<p>On his blog, M5S leader Beppe Grillo <a href="http://www.beppegrillo.it/2016/12/questo_governo_e_stato_sfiduciato_da_20_milioni_di_italiani.html">declared</a>: “This government has received a vote of no confidence from 20m Italians.” And while it has not been formally acknowledged, politicians and party spokesmen have made it clear that this government’s lifespan will match the time it takes to pass a new electoral law. </p>
<p>Once that’s done, the pressure on Gentiloni to resign and allow fresh elections will be overwhelming. In the end, he’ll most likely go down in history as just the latest steward of a short-lived interim government.</p><img src="https://counter.theconversation.com/content/70098/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Martin J Bull does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Paolo Gentiloni’s government is barely distinct from his predecessor’s, and its mandate is desperately thin.Martin J Bull, Professor of Politics, University of SalfordLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/704402016-12-15T15:17:30Z2016-12-15T15:17:30ZWhy EU rules risk making Italy’s banking crisis a whole lot worse<figure><img src="https://images.theconversation.com/files/150295/original/image-20161215-13679-1i6g9ds.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The coming storm. </span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/pic-208489615/stock-photo-italy-waving-flag-on-a-bad-day.html?src=iHt5JyDUS7e1XpvAm8vzQw-1-66">ESB Professional</a></span></figcaption></figure><p>In the wake of the Italian <a href="https://theconversation.com/italys-no-vote-lights-another-fire-under-the-european-union-69919">constitutional referendum</a>, the country’s banking crisis is going from bad to worse. The European Central Bank (ECB)‘s <a href="https://www.ft.com/content/710e0b76-c132-11e6-9bca-2b93a6856354">decision</a> to refuse an extension to <a href="http://english.mps.it/Pages/index.aspx">Banca Monte dei Paschi di Siena</a> to raise €5 billion (£4.2 billion) has left the country’s third-largest bank facing a government bailout that looks likely to inflict severe pain on many ordinary Italian savers. </p>
<p>As if that were not enough, Italy’s biggest bank, UniCredit, <a href="http://www.bbc.co.uk/news/business-38299542">announced</a> a restructuring plan that requires a capital raising of €13 billion in the first three months of next year. Given the torrid time Monte dei Paschi has had trying to find sufficient private backing, will UniCredit need help from the Italian taxpayer, too?</p>
<p>The problems at Monte dei Pashci and UniCredit reflect the parlous state of the country’s banking system. The economy <a href="https://www.gfmag.com/global-data/country-data/italy-gdp-country-report">has been</a> struggling for a number of years and borrowers have been defaulting, creating a mountain of bad loans. Around 20% of bank loans <a href="http://www.wsj.com/articles/bad-debt-piled-in-italian-banks-looms-as-next-crisis-1467671900">are</a> bad, <a href="https://infostat.bancaditalia.it/inquiry/#eNqVjrEKwjAURX8oJC%2FFWixkSNJXCCZpIWkRl9ChgiAoKOrQjzcITuLgXe7hLPdiX1st0BP0o7Bm%0ARKLjTjSmbYl2Qkm%2FNVFaI9ltep5rPSgMGEU%2FKGUTwPKBBEUCnmD1bTIsMegCNhyIiegCWtwLp2SS%0AEXVHHeVQAQCnZZGrKiELTk2kgfOMOWsgXY9eHKbTdWbz5ddndj%2FOj%2FdL04R%2FJ9gLHtRGGQ%3D%3D">amounting to</a> a staggering €360 billion (<a href="http://www.cnbc.com/2016/11/29/italian-banks-hold-nearly-a-third-of-euro-zones-bad-loans-ecb.html">about</a> one-third of all bad loans in the eurozone). </p>
<p>More than 70% of these loans <a href="https://www.imf.org/external/pubs/ft/wp/2016/wp16135.pdf">are to</a> small and medium-sized businesses. Small firms in Italy tend to have numerous bank relationships, commonly with accounts at four or five banks. Hence their defaults have polluted bank balance sheets across the sector. </p>
<p>I hear critics saying the Bank of Italy, the regulator, was slow to deal with the problem, only intervening within the past 18 months. Individual banks also stand accused of being complicit in rolling over non-performing loans – disguising the true picture. The situation is worse for banks in the south, where economies have been faring even worse. And Matteo Renzi’s defeat in the referendum exacerbates the whole problem by denying the sector reforms to help banks recover bad loans by speeding up insolvency processes, among other things. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/150301/original/image-20161215-13679-1xn48ur.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/150301/original/image-20161215-13679-1xn48ur.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/150301/original/image-20161215-13679-1xn48ur.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=411&fit=crop&dpr=1 600w, https://images.theconversation.com/files/150301/original/image-20161215-13679-1xn48ur.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=411&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/150301/original/image-20161215-13679-1xn48ur.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=411&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/150301/original/image-20161215-13679-1xn48ur.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=516&fit=crop&dpr=1 754w, https://images.theconversation.com/files/150301/original/image-20161215-13679-1xn48ur.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=516&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/150301/original/image-20161215-13679-1xn48ur.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=516&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">Too much good life?</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/pic-259651475/stock-photo-delicious-spaghetti-on-a-fork-close-up-on-black-background.html?src=zHQZNMN6JOJBMYko5oG0iw-1-68">Irene van der Meijs</a></span>
</figcaption>
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<h2>The bail-in problem</h2>
<p>The Bank of Italy <a href="https://www.ft.com/content/3e5b44ec-9207-11e5-bd82-c1fb87bef7af">restructured</a> four small banks last year, but its ability to rapidly resolve problems at bigger banks is hindered by EU <a href="http://eur-lex.europa.eu/legal-content/en/TXT/?uri=CELEX%3A32014L0059">bank bailout</a> and <a href="http://ec.europa.eu/competition/state_aid/overview/index_en.html">state aid</a> rules. These say direct state aid cannot be provided until a bank has looked for private injections of capital, including making investors in a class of bank debts known as <a href="http://www.irishtimes.com/business/financial-services/banks-plan-bail-in-bond-sales-ahead-of-new-european-rules-1.2841766">bail-in bonds</a> take some pain by converting their bonds into shares. </p>
<p>The logic is that these unsecured bondholders should bear the same risks as shareholders, thus reducing the burden on the taxpayer in the event of a rescue. Investors have nonetheless been lured into these bail-in bonds, including those of Monte dei Paschi and UniCredit, by higher returns than other bank bonds, betting they would not end up being converted. </p>
<p>In most countries institutional investors including pension funds and insurance companies are the main investors in unsecured bank bonds. But in Italy there’s an additional problem: households <a href="https://www.ft.com/content/5aabd08c-4916-11e6-8d68-72e9211e86ab">own about</a> a third of the total – 40,000 retail investors <a href="http://uk.reuters.com/article/us-eurozone-banks-italy-montepaschi-idUKKBN1400V8">own</a> Monte dei Paschi bonds, for instance. </p>
<p>When the four small Italian banks <a href="http://www.bbc.com/news/world-europe-35062239">were restructured</a>, the value of their bonds was wiped out. In addition to political condemnation, there were widespread protests and at least one suicide. Particularly when the country is going through such a politically volatile <a href="https://theconversation.com/what-is-italys-five-star-movement-69596">period</a>, the government will be very wary of another bail-in as part of any Monte dei Paschi rescue. Depositors above around €90,000 are also supposed to lose out, though it is hard to see this being politically possible regardless of the rules.</p>
<h2>What comes next</h2>
<p>The ECB decided the request from Monte dei Paschi for a deadline extension for its recapitalisation from year-end to January 20 was a delaying tactic. It said the bank had to sort things out faster – together with the new Italian government, headed by Renzi loyalist <a href="http://www.bbc.co.uk/news/world-europe-38290098">Paolo Gentiloni</a>. This means the world’s oldest bank, established in 1472, now has barely two weeks to find a private solution and avoid inflicting a bail-in on the country. </p>
<p>The recapitalisation plan has three components. The first is a voluntary bond swap – similar to bail-in bonds, except bondholders choose whether to convert their bonds to shares or not. This <a href="http://www.wsj.com/articles/italys-monte-dei-paschi-to-reopen-debt-to-equity-swap-offer-1481494685">has raised</a> around €1 billion from institutional investors, but there has been no take-up from retail investors. They have viewed the exchange as too risky and have been concerned about whether the regulator has fully approved the retail swap transactions. </p>
<p>Second, Monte dei Paschi hopes to get €1 billion from Qatar’s sovereign wealth fund. Finally, a consortium of banks has said it will try to sell the bank’s shares in the open market. They will not be underwritten, however, so there is no guarantee of raising significant funds. </p>
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<a href="https://images.theconversation.com/files/150299/original/image-20161215-13651-w8l3ep.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/150299/original/image-20161215-13651-w8l3ep.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/150299/original/image-20161215-13651-w8l3ep.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=398&fit=crop&dpr=1 600w, https://images.theconversation.com/files/150299/original/image-20161215-13651-w8l3ep.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=398&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/150299/original/image-20161215-13651-w8l3ep.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=398&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/150299/original/image-20161215-13651-w8l3ep.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=501&fit=crop&dpr=1 754w, https://images.theconversation.com/files/150299/original/image-20161215-13651-w8l3ep.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=501&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/150299/original/image-20161215-13651-w8l3ep.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=501&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">The sick old man of Italy.</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/pic-461329066.html">francesco carniani</a></span>
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<p>So even if the capital-raising is successful there is likely to be a shortfall of several billion euros. The question then is what happens next. The government will certainly not let this historic institution fail, despite a <a href="http://www.tradingeconomics.com/italy/government-debt-to-gdp">national debt</a> in excess of 130% of GDP – among the highest in the world. </p>
<p>Failure to resolve the problems would compound financial market jitters surrounding Italian banks. That could lead to widespread failure and the export of similar problems, due to a collapse of confidence, to other fragile eurozone countries. </p>
<p>To unlock an injection of state funds the Bank of Italy would therefore need to decide whether to follow the EU rules and risk the wrath of the retail bondholders with a bail-in – and/or provide guarantees to cover their losses. Ironically, the ECB would then potentially have to provide guarantees, liquidity injections and capital support to maintain confidence in the Italian system. </p>
<p>Meanwhile, all eyes will be on the UniCredit capital-raising to see if it fares any better. It should do: UniCredit’s proposed rights issue requires market credibility that Monte dei Paschi does not have at present. Were it to hit difficulties, however, this crisis will move from major to monumental. Either way, it looks likely to be some time before the problems in Italian banking even begin to look like being resolved.</p><img src="https://counter.theconversation.com/content/70440/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Philip Molyneux does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Problems at Monte dei Paschi and UniCredit are bad enough without bail-in rules to contend with.Philip Molyneux, Professor of Banking and Finance, Bangor UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/698532016-12-05T21:53:59Z2016-12-05T21:53:59ZAs Austria rejects the far-right and Italy votes No, Europe’s future hangs in the balance<p>In a dramatic day of voting that could have major implications for Europe’s economic and political future, citizens from Italy and Austria cast their ballots in two <a href="https://www.theguardian.com/world/live/2016/dec/04/italian-referendum-and-austrian-presidential-election-live">closely-watched initiatives</a>. </p>
<p>The referendum on Italy’s constitution and the presidential election in Austria were <a href="http://www.abc.net.au/news/2016-12-05/austria-and-italy-votes-a-barometer-for-populist/8091694">a barometer</a> of the strength and reach of the <a href="https://www.theguardian.com/world/2016/nov/01/the-ruthlessly-effective-rebranding-of-europes-new-far-right">populist insurgency</a> threatening to upend Europe’s established political order. </p>
<p>Voters in Austria <a href="http://www.wsj.com/articles/austrian-center-left-candidate-van-der-bellen-to-win-presidential-election-projections-show-1480870229">issued a decisive defeat</a> to its far-right candidate. Hours later, <a href="http://www.telegraph.co.uk/news/2016/12/04/renzi-battle-survival-italians-go-polls-vote-seen-referendum/">Italian voters rejected constitutional reform</a> championed by Prime Minister Matteo Renzi, leading to his resignation. It also plunged the country into economic and political <a href="https://theconversation.com/the-no-vote-in-italys-referendum-triggers-economic-and-political-uncertainty-69883">uncertainty</a>.</p>
<figure>
<iframe width="440" height="260" src="https://www.youtube.com/embed/Ila66XIcrSQ?wmode=transparent&start=4" frameborder="0" allowfullscreen=""></iframe>
<figcaption><span class="caption">Matteo Renzi, Italy’s Prime Minister, announces his resignation.</span></figcaption>
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<p>With elections in France, the Netherlands, Germany, and now possibly Italy coming in 2017, the next 12 months are shaping up to be seminal for European politics and the future of the European Union.</p>
<h2>Austria rejects the far-right</h2>
<p>With the possibility of electing the first far-right head of state in Western Europe <a href="http://www.independent.co.uk/news/people/austria-election-who-is-norbert-hofer-the-man-who-could-become-europes-first-far-right-leader-since-a7453646.html">since World War II</a>, Austria’s presidential contest garnered a <a href="http://www.economist.com/blogs/economist-explains/2016/12/economist-explains-0">degree of suspense and international attention</a> otherwise out of proportion for what is largely a ceremonial office in a country of fewer than nine million people.</p>
<p>Those nine million people were given the choice between Norbert Hofer, the candidate of the far-right Freedom Party, and Alexander Van der Bellen, an independent former Green party leader. The contest was a rerun of an election in May in which Van der Bellen beat Hofer <a href="http://www.dw.com/en/results-of-austrian-presidential-vote-too-close-to-call/a-19276128">by 31,000 votes</a>, or less than one percent of ballots cast. </p>
<p>Two weeks after the election in May, Freedom Party leaders, citing a “massive number of irregularities and mistakes”, <a href="https://www.thestar.com/news/world/2016/06/08/austrias-right-cites-irregularities-and-mistakes-in-election-results.html">appealed</a> the result to Austria’s Constitutional Court.</p>
<p>In <a href="https://www.theguardian.com/world/2016/jul/01/austrian-presidential-election-result-overturned-and-must-be-held-again-hofer-van-der-bellen">July</a>, the Court upheld the appeal, annulled the result, and called for an entirely new election. The new vote was supposed to take place in October but <a href="http://www.latimes.com/world/europe/la-fg-austria-election-postponed-20160912-snap-story.html">had to be postponed</a> after defective adhesive was discovered on some of the absentee ballots.</p>
<p><a href="http://www.thelocal.at/20160829/expert-predicts-far-right-to-win-austrian-presidential-election">Predictions</a> were that a Hofer victory would prove the latest example of the rise of European populist, anti-immigrant parties; Freedom Party leaders have warned against the “Islamisation” of Europe and of a coming “civil war” as a result of mass Muslim immigration. But <a href="http://www.dw.com/en/austrias-green-backed-van-der-bellen-wins-presidential-election/a-36635159">exit polls on Sunday</a> showed that Van der Bellen received 53.6% of the vote, a higher proportion than his total in May.</p>
<p>Still, the contest between Hofer and Van der Bellen represented a <a href="http://www.wsj.com/articles/mainstream-hopefuls-lag-as-austrians-vote-for-new-president-1461495458">stunning repudiation</a> of Austria’s mainstream political parties. The centre-left Social Democrats and centre-right Austrian People’s Party have dominated Austrian politics since World War II.</p>
<p>In the first round of presidential voting in April, the two parties finished fourth and fifth, respectively, demonstrating Austrian voters’ staunch <a href="https://www.theguardian.com/world/2016/may/22/far-right-surge-in-austria-signals-end-of-centrist-politics-as-usual">opposition</a> to the country’s centrist political establishment.</p>
<p>Despite Hofer’s defeat, the Freedom Party remains a <a href="http://www.nybooks.com/daily/2016/07/25/austria-freedom-party-populism-lesson-far-right/">political force in Austria</a>. Opinion <a href="https://de.statista.com/statistik/daten/studie/288503/umfrage/sonntagsfrage-zur-nationalratswahl-in-oesterreich-nach-einzelnen-instituten/">polls</a> show that the party is on track to win the most votes in parliamentary elections, which must be held before the end of 2018. This raises the once unthinkable possibility that the party could even head the government one day.</p>
<h2>Italy says No to reform, and to Renzi</h2>
<p>On the other side of the Alps, Italians voted in a referendum on a series of constitutional reforms that would have brought major changes to the country’s <a href="http://archivio.corriere.it/Archivio/i-percorsi/come-si-scrive-costituzione-origini-carta-italiana-112016.shtml">68-year-old constitution</a>.</p>
<p>These would have <a href="https://www.theguardian.com/world/2016/nov/30/italy-referendum-all-you-need-to-know-about-renzis-crunch-vote">included</a> a dramatic reduction in the power and size of the senate, affecting how laws are passed, and the power balance between the central government and the country’s 20 regions.</p>
<p>Proponents of the reforms said they would ease the country’s notorious <a href="https://euobserver.com/economic/119144">legislative and administrative gridlock</a> (Italy has had 63 governments in 70 years) and would facilitate structural reforms to reinvigorate Italy’s <a href="http://voxeu.org/article/italys-productivity-challenge">stagnating economy</a>. Renzi was so confident earlier this year that the measures would pass that he staked his political future on the outcome, promising to resign if the referendum failed.</p>
<p>This turned out to be a serious error. Some Italians used the referendum as a way to protest their perception that Renzi has failed to deliver on promises to turn around the <a href="http://www.oecd.org/eco/outlook/economic-forecast-summary-italy-oecd-economic-outlook-november-2016.pdf">Italian economy</a>. The vote revealed the depth of disillusionment with the prime minister: the No camp <a href="http://www.euronews.com/2016/12/05/rome-reacts-to-the-vote-against-renzi-s-reforms">won with 60%</a> of the vote. </p>
<p>In Italy, the unemployment rate remains <a href="https://www.bloomberg.com/news/articles/2016-09-30/italian-unemployment-unchanged-at-11-4-youth-jobless-down">above 11%</a>. And at around 36.4%, Italy has <a href="http://ec.europa.eu/eurostat/statistics-explained/index.php/Unemployment_statistics">one of the highest</a> youth unemployment (under 25) rates in the EU. Italy’s per <a href="http://data.worldbank.org/indicator/NY.GDP.PCAP.CD?locations=IT">capita GDP</a> and <a href="http://data.worldbank.org/indicator/NY.GNP.PCAP.CD?locations=IT">per capita income</a> are lower today than they were ten years ago.</p>
<p>Opposition from other voters, even ones who acknowledge that Italy needs far-reaching reforms, centred around worries about the concentration of power in the executive.</p>
<p>The Economist, for example, in an <a href="http://www.economist.com/news/leaders/21710816-country-needs-far-reaching-reforms-just-not-ones-offer-why-italy-should-vote-no">editorial</a> that argued that Italian voters should vote No, warned that the proposals would risk creating conditions ripe for “an elected strongman” by consolidating power in the national government.</p>
<p>With Renzi’s resignation, President Sergio Mattarella will now consult with the country’s various political parties <a href="http://www.ibtimes.co.uk/italian-president-now-has-make-crucial-decision-end-uncertainty-1594861">on how to move ahead</a>. Mattarella could announce the formation of a caretaker government, headed by an appointed technocrat, or he could call snap elections next year.</p>
<p>If elections are called, the populist Five Star Movement or the far-right Northern League could make electoral gains. The Five Star Movement <a href="https://www.theguardian.com/commentisfree/2014/mar/06/italians-beppe-grillo-five-star-movement">garnered a quarter</a> of the votes in Italy’s last parliamentary election in 2013, and won <a href="http://www.bbc.com/news/world-europe-36569410">mayoral races</a> in Turin and Rome this year. Current polls show its <a href="http://link.springer.com/article/10.1007/s12290-016-0412-8">popularity</a> reaches <a href="http://www.reuters.com/article/us-italy-politics-5star-idUSKCN0ZM130">around 30%</a>, falling just behind Renzi’s Democratic Party.</p>
<p>The impact on Italy’s financial markets could be severe. Italy’s borrowing costs are almost certain to rise, which will make it harder for the government to service its debt, which is already <a href="http://www.italy24.ilsole24ore.com/art/markets/2016-05-30/assemblea-bankitalia-180208.php?uuid=ADRU9aS">133% of GDP</a>, the highest level in the EU after Greece.</p>
<p>The vote could also affect Italy’s banking system, which has been in a state of crisis for a decade. Major banks across Italy are full of bad loans and in desperate need of recapitalisation. Investors will be wary to step in at this moment of uncertainty. Italy’s third-biggest bank, <em>Monte dei Paschi di Siena</em>, is on the <a href="https://www.theguardian.com/business/2016/dec/05/monte-dei-paschi-shares-fall-italian-referendum-result">brink of insolvency</a>. Its collapse could trigger a banking crisis, which could lead to a financial crisis across the entire EU.</p>
<p>The next year will reveal the direction of Italy’s economic and political future, and whether its membership in the Eurozone becomes increasingly untenable. The short- and medium-term repercussions of the No vote are not yet clear, but any banking crisis could push Italy out of the Eurozone, which could in turn lead to the end of the single currency.</p>
<h2>The rise of the populists</h2>
<p>The Austrian and Italian votes revealed the strength of <a href="https://www.washingtonpost.com/world/as-italys-leader-exits-a-door-opens-for-anti-elite-populists/2016/12/05/9eb4a5d6-ba83-11e6-ae79-bec72d34f8c9_story.html?utm_term=.716aec529175">anti-elite and anti-establishment sentiment</a> across Europe. Despite Hofer’s defeat, he still garnered more than 45% of the vote, evidence that the stigma in Europe of openly supporting right-wing candidates and parties has eroded. </p>
<p>What were once fringe parties – the National Front in France, the Party for Freedom in the Netherlands, the Five Star Movement in Italy, the Freedom Party in Austria, Alternative for Germany – are <a href="http://link.springer.com/article/10.1007/s12290-015-0347-5">now powerful electoral forces</a>.</p>
<p>For decades, <a href="https://www.penguin.co.uk/books/293941/the-european-union-a-citizen-s-guide/">the EU political order</a> has been based on centrist governments, open borders and free trade. But the EU has witnessed a number of shocks and other disruptive political forces over the past two years, including an unprecedented number of migrant and refugee arrivals that <a href="https://theconversation.com/eus-refugee-relocation-plans-desperately-need-a-reality-check-42439">strained its commitment</a> to open internal borders, a <a href="https://theconversation.com/islamic-state-exploiting-europes-porous-borders-and-intelligence-failures-turnbull-56755">wave of terrorist attacks</a> particularly in Paris and Brussels, and the British vote in June to <a href="https://theconversation.com/brexit-is-on-britain-votes-to-leave-the-eu-experts-respond-61576">exit the bloc</a>.</p>
<p>There are today credible fears that <a href="https://theconversation.com/why-is-populism-popular-a-psychologist-explains-61319">populism</a> from either the left or the right could dismantle some of the major accomplishments of European integration, including open internal borders and the single currency. </p>
<p>In Poland and Hungary, right-wing leaders with <a href="https://theconversation.com/how-hungary-and-poland-have-silenced-women-and-stifled-human-rights-66743">authoritarian leanings</a> are already in control of government; 2017 could see them joined by others whose commitment to political liberalism and constitutional limitations is lacking.</p>
<h2>Future threats to European order</h2>
<p>The French presidential election in May 2017 is thus crucial for the EU’s future. Former Prime Minister <a href="https://theconversation.com/french-election-2017-everything-you-need-to-know-about-francois-fillon-69576">François Fillon</a>, who will be the candidate of the centre-right, is likely to face off with Marine Le Pen, the leader of the far-right National Front, in the second round of voting. </p>
<p>A Le Pen victory remains a <a href="http://www.lefigaro.fr/flash-actu/2016/11/27/97001-20161127FILWWW00211-fillon-battrait-le-pen-en-2017-sondage.php">remote possibility</a>, but this year’s electoral surprises — from the British vote to exit the EU and to Donald Trump’s victory in last month’s US presidential election — reveal the danger of discounting Le Pen’s chances entirely.</p>
<p>Despite lower migration this year <a href="http://www.pewresearch.org/fact-tank/2016/09/06/fewer-refugees-entering-europe-than-in-2015-but-asylum-backlog-still-growing/">compared to 2015</a>, Europe could yet face a renewed influx. Following <a href="https://theconversation.com/inside-europes-refugee-deal-with-turkey-is-it-legal-and-can-it-work-56054">a deal</a> with Turkey earlier this year, the flow of migrants and refugees travelling from Turkey into the EU <a href="http://www.migrationpolicy.org/news/paradox-eu-turkey-refugee-deal">drastically decreased</a>. But following a vote in the European Parliament <a href="http://fortune.com/2016/07/18/turkey-coup-death-penalty-eu-migrant/">to suspend talks with Turkey</a> over its potential membership of the EU, Turkish President Recep Tayyip Erdoğan threatened to <a href="http://www.telegraph.co.uk/news/2016/11/25/erdogan-threatens-open-turkeys-borders-europe-protest-eu/">re-open the borders</a>.</p>
<p>If he reneges on the agreement, and Europe faces yet another refugee crisis of the same scale and magnitude as last year’s, Europe’s system of internal borders is unlikely to survive.</p>
<p>Finally, UK Prime Minister Theresa May <a href="http://www.nytimes.com/2016/10/03/world/europe/brexit-talks-march-theresa-may-britain.html?_r=0">has said</a> that Britain plans to begin withdrawal negotiations by the end of March 2017. French President François Hollande and German Chancellor Angela Merkel <a href="https://www.theguardian.com/politics/2016/oct/07/uk-must-pay-price-for-brexit-says-francois-hollande">have called</a> on other EU governments to show a united front. And in a message to other EU countries that might be tempted to follow the UK’s exit, Hollande <a href="http://www.nytimes.com/2016/10/08/world/europe/for-britains-brexit-bunch-the-party-just-ended.html">cautioned</a> they would not be able “to get the supposed advantages without the obligations” of membership.</p>
<p>A series of key decisions and events over the next year could shape the direction and future prospects of European integration in fundamental ways. What happens in 2017 could determine whether the EU is able to survive this current period of crisis in a weakened but still mostly intact state, or whether the European project of economic and political integration was just a moment, a phase in Europe’s long history.</p><img src="https://counter.theconversation.com/content/69853/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Richard Maher does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The Italian referendum and the Austrian vote are shaping up to be a seminal moment for European politics and the future of the European Union.Richard Maher, Research Fellow, Global Governance Programme, Robert Schuman Centre for Advanced Studies, European University InstituteLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/696032016-12-05T17:45:29Z2016-12-05T17:45:29ZThe Italian referendum: No Trump nor Brexit<p>The Italians have delivered an overwhelming defeat to Prime Minister Matteo Renzi. </p>
<p>Initial tallies of Dec. 4’s referendum show a vote of just under 60 percent <a href="http://elezioni.interno.it/referendum/scrutini/20161204/FX01000.htm">rejecting Renzi’s constitutional reform package</a>, with a little more than 40 percent supporting it. Voter turnout was strong, with more than 68.5 percent of eligible voters inside the country participating.</p>
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<p>As he promised repeatedly during the campaign, Renzi has accepted personal responsibility for the bitter defeat and <a href="http://www.ilsole24ore.com/art/notizie/2016-12-04/referendum-primo-exit-poll-%C2%A9ipr-piepoli-rai-si-42-46percento-no-54-58percento-renzi-parla-mezzanotte-230002.shtml?uuid=AD7FeP7B">will resign from office</a>. His resignation is sure to usher in a period of political uncertainty both for the Italian government and for the country’s Democratic Party.</p>
<p>This outcome will also likely create major difficulties for the European Union. Many in the <a href="http://www.vox.com/new-money/2016/12/3/13826150/italy-referendum-banking-crisis">financial markets speculate</a> that the no vote could signal the failure of the euro as a multinational currency. </p>
<p>The challenge now for Italy’s political leadership is to avoid any loss of confidence in Italy’s banking sector or in the long-term sustainability of its public finances. </p>
<p>This challenge is both practical and political in nature. </p>
<h2>What’s next</h2>
<p>The referendum took place at the end of a long period of recession and slow growth that weakened Italy’s banks and pushed government borrowing to record levels.</p>
<p>On a practical level, that means the Italian government has to ensure that the country’s banks have adequate access to capital. The government also has to raise revenues and cut expenditures. At the same time, it has to manage the <a href="http://data.unhcr.org/mediterranean/regional.php">more than 173,000 migrants</a> who have come to Italy this year across the Mediterranean from sub-Saharan Africa. And, it has to reform the new electoral law – written based on the assumption that the constitutional package would win approval – before the end of the current five-year parliamentary mandate in 2018. This is a hugely complex policy agenda.</p>
<p>The political challenge is even more important.</p>
<p>The Italian referendum was not like the vote in Britain on European Union membership or the election of Donald Trump in the United States. Italy did not just go through a populist insurrection. Instead, Italians revealed a deep division about how the country should be governed. </p>
<p>Italians did not reject Renzi so much as they rejected what they saw as a strengthening of the national government and reduction of the powers of the Senate and regional governments. The Renzi team argued that these changes were necessary to make it easier for the government to reform other institutions. Their opponents responded that too many voices were left out of the political process as a result. </p>
<p>This division cut across mainstream parties and divided political elites. </p>
<h2>Values in play</h2>
<p>The referendum forced Italians to choose between a government that is truly representative and a government that can make tough decisions. </p>
<p>Still, both “no” supporters and “yes” supporters would eagerly admit that they want the status quo to change. </p>
<p>Italy has been hard to reform because the government must have working majorities in both chambers of the Italian parliament to pass legislation. </p>
<p>The Italian situation is even more challenging than the deadlock found in the United States. When different parties control the U.S. House and Senate, the president can work to find compromises between the two chambers. Even when the Congress is controlled by a different party than the president, there is still limited room for compromise. </p>
<p>By contrast, if the Italian government loses the confidence of either the Chamber of Deputies or the Senate, then that government falls. That is why Italian governments tend to have such short lifespans.</p>
<p>Renzi tried to break this deadlock by changing some of the basics on how democracy works in Italy. Under the new electoral law written to run alongside the constitutional reform package, leaders of the main political parties would have offered a closed list of candidates for the Chamber of Deputies. If the constitutional reforms has passed, senators would have been nominated by regional governments. Referendum voters rejected these reforms in favor of more direct elections. </p>
<p>While the Italian public agreed on the basics of how they want their democracy to function, leaders from different parts of the country’s political spectrum disagree on what aspects of Italian political and economic life need to be changed, and they disagree on which changes should be prioritized. As parliament turns its attention to reform of the electoral law, it will not be long before the temperature of the debate increases again.</p>
<h2>Political fallout</h2>
<p>Beppe Grillo’s Five Star Movement (M5S) is well-placed to take advantage of the controversies that will emerge as the dust settles on the referendum. </p>
<p>The M5S straddles the divide between the “yes” and “no” voters by promising to reinvigorate the existing constitution once it manages to throw out the country’s ruling elites. The M5S also seeks to cut out the traditional media and political parties by positioning itself as a grassroots movement with a nationwide reach. </p>
<p>There is nothing surprising in the way M5S operates. Populist movements the world over seek to make direct connections with voters. The point is that this messaging resonates with an increasing share of the Italian electorate that hopes to find some way out of the squabbling among elites that the referendum campaign put on display. </p>
<p>The M5S position was simple: Reject them all.</p>
<p>Polls done for Macro Advisory Partners show that as many Italians have confidence in the M5S governing Italy as have confidence in Renzi’s governing Democratic Party. Moreover, that confidence increased as the referendum debate became more intense. </p>
<p>Even when confronted with the difficulties that the M5S has had governing the <a href="https://www.ft.com/content/eab2d7fa-7505-11e6-bf48-b372cdb1043a">city of Rome</a>, they still want to give the party a chance to govern the country.</p>
<p>Italy’s political elites are likely to respond by coming up with some electoral formula to limit the chance that the M5S will emerge victorious in the next round of parliamentary elections. That is when the elites will have to demonstrate their ability to heal the divisions in the country and show their capacity to undertake meaningful and lasting reform. </p>
<p>Failing that, Italy likely will have its populist insurrection. Whether that brings the M5S into power or results in an entirely new political situation remains to be seen. The constitutional referendum was not an Italian Brexit, but that may still come unless Italy’s political elites work hard to avoid it.</p><img src="https://counter.theconversation.com/content/69603/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Erik Jones does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The Italians have rejected Prime Minister Matteo Renzi’s constitutional reform package. Now the real struggle for Italy begins.Erik Jones, Professor of European Studies and International Political Economy, Johns Hopkins UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/699222016-12-05T15:15:30Z2016-12-05T15:15:30ZMarkets are muted after Italy referendum but instability simmers under the surface<p>After staking his career on the promise that he would either <a href="http://www.politico.eu/article/renzi-this-year-i-will-change-italy-or-change-jobs/">“change Italy or change jobs”</a>, Matteo Renzi has resigned as prime minister. With 60% of the popular vote going against his political reforms in a referendum that became all about Renzi’s future, he was left with no choice but resignation. And, following hot on the heels of political upheavals in the UK and US, markets reacted accordingly.</p>
<p>The initial financial shock waves have not been too bad. Milan’s stock market, the FTSE MIB, fell and the euro dipped to lows against the US dollar that were last seen at the height of Greece’s economic crisis (US$1.0505). The euro has <a href="https://www.theguardian.com/business/live/2016/dec/05/italy-referendum-matteo-renzi-markets-spooked-shares-bonds-eurozone-live">since rebounded</a>, as have European stocks more broadly. By banning opinion polls two weeks before the referendum, Renzi left Italian markets confused and the FTSE MIB rose <a href="http://www.borsaitaliana.it/borsa/indici/indici-in-continua/dettaglio.html?indexCode=FTSEMIB&lang=en">in the build-up to the vote</a>. This accentuated the sharp falls when the “No” victory was delivered. </p>
<p>Arguably the rejection of Renzi’s reforms does not signal too much uncertainty. After all, it means sticking with the status quo and not overhauling a political system that has managed for the last 60-odd years. </p>
<p>So Renzi resigns and Italy’s president, Sergio Mattarella, will nominate a successor. They are <a href="https://theconversation.com/italys-referendum-whats-at-stake-and-what-you-need-to-know-69735">unlikely to look very different</a> to their technocratic predecessor, but it is only a matter of time before a general election is called and then we’ll jump on the panic merry-go-round once again. </p>
<h2>Panic on pause</h2>
<p>Meanwhile, uncertainty simmers below the surface – and market stability should be enjoyed while it can. The last few months have shown the world how uncomfortable uncertainty is. Whether it’s <a href="https://theconversation.com/so-what-does-brexit-mean-64980">what Brexit actually means</a> (and whether it will be <a href="https://theconversation.com/explainer-whats-the-difference-between-hard-and-soft-brexit-66524">“hard” or “soft”</a>) or concern over what a Trump presidency <a href="https://theconversation.com/why-markets-have-bounced-back-after-the-election-of-donald-trump-68636">will actually look like</a>, financial markets have made it clear that they <a href="https://theconversation.com/brexit-why-uncertainty-is-bad-for-economies-64334">don’t like not knowing</a>. </p>
<p>Italy’s problem is its banks. A victory for Renzi might have helped a little in the short-term. But the country remains plagued by nearly <a href="https://theconversation.com/how-brexit-opened-up-the-pandoras-box-of-italys-banking-malaise-62329">€400 billion of non-performing debts</a> that are largely held by retail investors. The situation is not helped by a moribund economy which has too weak an SME sector to drive demand for performing loans.</p>
<p>Monte dei Paschi – Italy’s third largest bank – is the current poster child of this failing system. It needs to raise €5 billion and sell off €28 billion of bad loans to stay afloat – albeit still leaking badly. It was part of the way through a complex plan negotiated by Renzi with the EU to raise these funds, but the referendum and Renzi’s resignation throws this into question. </p>
<p>If Monte dei Paschi fails, things will start to get nasty. This would likely lead to a loss of market confidence in Italy’s wider banking system and <a href="https://www.ft.com/content/e588ea6a-b49f-11e6-961e-a1acd97f622d">could trigger a series of market failures</a>.</p>
<p>This would be incredibly bad news for Italians. The term “retail investor” means you and me – individuals who invest as bond holders in the Italian banks rather than save with them. Under EU rules introduced after the financial crisis and designed to prevent taxpayers bailing out failing banks, bond holders need to “bail-in” (lose some of their money) before the taxpayer “bails out”.</p>
<p>In France and Germany, that’s great. There, big institutional investors hold the majority of loans, so if a bank needs rescuing, they’d lose out before the taxpayer. In Italy, however, it’s the retail investors that must bail in. This means ordinary people losing 10-20% of their savings invested in bank bonds, before taking part in the second stage of the rescue as taxpayers. A real double whammy.</p>
<p>There will likely be a fudge – for now – to maintain unity within the EU during this critical period. But the problem won’t be solved. Italy is the third largest economy in Europe and by any measure its economy is in trouble.</p>
<p>The Italian people were focused on what was best for them from a political standpoint, but they could end up paying the price if their banking system fails as a result. And the uncertainty regarding their future leaders means that the outside world can only estimate whether the future of the eurozone is in jeopardy. If the anti-euro <a href="https://theconversation.com/what-is-italys-five-star-movement-69596">Five Star Movement</a> continues to gain ground, it could mean full-blown crisis.</p><img src="https://counter.theconversation.com/content/69922/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>The authors do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Markets haven’t panicked as they did with Brexit and Trump, but Italy faces serious economic issues in the near future.Chris Parry, Senior Lecturer in Accounting and Finance, Cardiff Metropolitan UniversitySurraya Rowe, Finance Lecturer, Cardiff Metropolitan UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/699172016-12-05T14:27:59Z2016-12-05T14:27:59ZA damning defeat for Matteo Renzi but Italy’s referendum is not a populist triumph<figure><img src="https://images.theconversation.com/files/148611/original/image-20161205-19379-sduhbt.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Renzi resigns.</span> <span class="attribution"><span class="source">EPA/Alessandro Di Meo</span></span></figcaption></figure><p>Italian prime minister Matteo Renzi has carried out his promise to resign after losing a referendum on his country’s constitution. This brings an end to a tenure that lasted just 1,000 days.</p>
<p>In a moving speech, Renzi said: “I have lost … I take full responsibility for this result.” His decision marked a break from the post-war norm in Italian politics. Renzi was actually seeing through on his promise. “This time, when you lose you step down,” he said. “You do not carry on as though nothing has happened.” </p>
<p>The 65.5% Italians who voted in this referendum not only rejected the proposed constitutional change, they completely annihilated it. An enormous 59.1% voted No and 40.9% voted Yes, siding with Renzi. Only three regions voted Yes: Tuscany, Emilia Romagna and South Tyrol – two of which are traditional strongholds of Renzi’s party.</p>
<p>The decisiveness of the result has completely shocked the nation. While a No vote was always a possibility, the margin was expected to be close. Back in April, the Yes camp was seen to have an advantage.</p>
<p>In the end, the No supporters seemed to have come from a far wider coalition of voters than expected – including people from the left and even senior figures in Renzi’s <a href="http://www.firstonline.info/News/2016/11/11/referendum-e-pd-i-pretesti-di-dalema-e-bersani-e-lombra-della-scissione/MV8yMDE2LTExLTExX0ZPTA">own party</a>. Indeed, they were so broadly spread across the political spectrum that it has been said there were no winners in this referendum. No single political party can claim the victory. If a winner were to be declared, it would surely be political participation – even Italian democracy – given the extraordinarily high turnout.</p>
<h2>Why No?</h2>
<p>But while many have sought to portray the Italian referendum as the latest battle in the war between populists and the establishment, that would be an oversimplification of what has happened to Renzi.</p>
<p>Yes, this was an anti-establishment vote, but it was not necessarily an expression of populism. The No vote was intrinsically linked to Renzi – it was not a sign of support for any of his rivals, but a rejection for what he stands for.</p>
<p>The trouble was, Renzi was <a href="http://www.nytimes.com/2014/02/17/world/europe/a-berlusconi-reminder-as-italy-faces-another-unelected-premier.html">never actually elected by the people</a> to the job of prime minister. He ousted former prime minister and PD politician Enrico Letta in February 2014 after he lost the support of his governing coalition. Consequently, the people have never really had a chance to vote – or not – for Renzi.</p>
<p>During his short time running the country, Renzi has achieved many important things and put Italy back on the right road. But he has not tackled many of the more urgent questions and issues (such as electoral reform). </p>
<p>Renzi wanted to change Italy but turned this vote into a plebiscite on him and his way of governing. And this, according to political scientist <a href="http://video.repubblica.it/dossier/referendum-costituzionale/diamanti--il-pd-ormai-e-il-partito-di-renzi-ma-proprio-per-questo-ha-perso-il-referendum/261586/261913?ref=HREC1-3">Ilvo Diamanti</a>, was his mistake. By personalising the referendum, Renzi alienated potential supporters of his reform. He made it look like he was playing with the Italian constitution and clearly Italians were wary of changing the rules of the political game. As the <a href="http://www.economist.com/news/leaders/21710816-country-needs-far-reaching-reforms-just-not-ones-offer-why-italy-should-vote-no">Economist recently pointed</a> out, Renzi’s proposed reforms could create “an elected strongman” – a worrying prospect for a country that produced Benito Mussolini and Silvio Berlusconi. </p>
<p>Renzi has also governed in a way that started to bother many – not only those who make up the various opposition parties, such as the Northern League and the <a href="https://theconversation.com/what-is-italys-five-star-movement-69596">Five Star Movement</a>, but also those in his own party. His use of Twitter and his cavalier manner have made him look like a dynamic force on the European stage – a leader who wants to get Italy out of a hole – but at home, his tactics have backfired. For Italian voters, Renzi’s media persona is all too reminiscent of former prime minister Silvio Berlusconi.</p>
<p>The result of the referendum may have been decisive, but the fallout is a major unknown. It will now be up to president Sergio Mattarella to guide the country through this delicate post-Renzi moment.</p>
<p>The markets’ initial worries have so far proved unfounded and this referendum result must not be analysed as part of a wave of populism but rather as a wave of anti-establishment sentiment in Italy. Although it is clear that this Italian result will not help to solve the turmoil in Europe, the referendum – and the Italian political situation in general – are not necessarily the latest example of populist triumph.</p><img src="https://counter.theconversation.com/content/69917/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Felia Allum does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>This was a vote against the prime minister – not a show of support for his rivals.Felia Allum, Senior Lecturer in Italian and Politics, University of BathLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/699192016-12-05T13:34:52Z2016-12-05T13:34:52ZItaly’s ‘no’ vote lights another fire under the European Union<p>How to interpret the <a href="https://www.theguardian.com/world/2016/dec/04/matteo-renzis-future-in-the-balance-amid-high-turnout-in-italy-referendum">outcome</a> of the Italian referendum? Matteo Renzi’s government is clearly the loser – and the prime minister announced his widely expected resignation as soon as the result was in. </p>
<p>The proposed constitutional reform would have given much more power to Renzi by taking it away from the Italian Senate. It was part of a wider package of <a href="http://www.governo.it/approfondimento/1000-giorni-di-governo-renzi/6160">political reforms</a> pushed by his government which can be summed up as the idea that Italy needed to be “unlocked”. The constitutional changes were presented as consolidating this new trajectory, together with a new <a href="https://www.quora.com/Italy-What-is-the-Italicum">electoral law</a> designed to underpin the reformed constitution. The referendum confirmed that 59.1% of voters had other ideas. </p>
<p>Renzi’s government was initially wildly popular but lost support as it became clearer over nearly three years in power that the material conditions of large sections of the population were not progressing but stagnating or, in some cases, getting worse. </p>
<p>Constitutional matters in Italy have traditionally been kept separate from ordinary politics, but not on this occasion. Because the government drafted and submitted the reform proposals rather than the parliament, and Renzi <a href="https://www.theguardian.com/world/2016/nov/17/matteo-renzi-repeats-vow-quit-italian-pm-loses-referendum">said</a> that he would resign if he lost, it became a vote on the government’s policies – and of course its leader. </p>
<h2>Winners and losers</h2>
<p>For weeks, the prospect of a defeat for the government has been framed as another reaction against the establishment – hardly surprising in the context of <a href="http://www.nytimes.com/elections/results/president">Trump</a>, <a href="http://www.bbc.co.uk/news/uk-politics-32810887">Brexit</a> and other populist movements toppling centrists around the world. </p>
<p>Such a reading might be supported by a quick look at some of the components behind the No campaign. The <a href="http://www.politico.eu/article/italys-other-matteo-salvini-northern-league-politicians-media-effettosalvini/">Northern League</a> and Beppe Grillo’s <a href="https://theconversation.com/what-is-italys-five-star-movement-69596">Five Star Movement</a> represent two rather different types of right-wing politics that are prone to frame their messages in a populist way – albeit Five Star is the only one that fully fits the anti-establishment archetype seen in other countries. Yet while the government was clearly the political subject behind the proposed constitutional reform, there was no overarching narrative behind the No campaign. </p>
<p>It was an aggregation of different political and social actors, from mainstream right-wing parties to trade unions and civil society associations. They did not form a coalition or attempt to coordinate their efforts, and for obvious reasons they represented very different parts of society. Revealingly, no new movement, political subject or leader emerged out of the contest. </p>
<p>You also need to look at the <a href="http://www.repubblica.it/static/speciale/2016/referendum/costituzionale/mondo.html">distribution</a> of the vote. As in other countries, we can probably point to a disenfranchised group – though it’s less about class in Italy. We don’t have definitive data on how age affected the voting, but <a href="http://www.rainews.it/dl/rainews/media/I-giovani-e-il-Sud-hanno-bocciato-la-riforma-di-Renzi-la-prima-analisi-dei-risultati-del-referendum-0ebc5b75-8d09-4456-be52-7b52c954d41c.html#foto-2">surveys</a> ahead of the vote indicated that the over 65s were the only group backing Yes; while support for No was strongest among the under 35s. </p>
<p>Given that youth unemployment in Italy is <a href="http://www.tradingeconomics.com/italy/youth-unemployment-rate">dramatically high</a> and the material conditions of younger people are deteriorating, the clear message is that Renzi’s reform package was not seen as addressing this group’s problems. </p>
<p>On the other hand, it is interesting to note that the division between centre and periphery, urban and rural areas, which played a major role both in Brexit and in the election of Trump, does not explain what has happened in Italy. On the contrary, the No vote seems to have prevailed almost everywhere except in the regions of Tuscany and Emilia Romagna, the historic strongholds of Renzi’s Democratic Party. In many ways, then, this was a traditional rejection of an unpopular government. </p>
<h2>Italy and the EU</h2>
<p>The most likely immediate scenario following Renzi’s resignation is that a new government will be formed, led by the Democratic Party under a new leader. It will presumably approve the new electoral law and enact some of the bills behind Renzi’s political programme, and could in theory hold power until the current parliamentary term ends in February 2018. </p>
<p>It might well be that this new government will make anti-EU feeling even stronger. The likes of the Five Star Movement have understood how to capitalise on the growing tendency in this previously pro-European country to blame the EU for austerity and society’s ills. Of course, their chances of winning the next general election depends on how the next government reforms the electoral laws: ironically, the changes that Renzi was proposing would have favoured the Five Star Movement. No one, at this stage, can predict what the next electoral reform will look like. </p>
<p>From this vantage point, however, there is certainly a good chance that Italy is heading for a similar protectionist shift of the kind that looks likely to happen in the US next year. Some financial analysts <a href="http://www.telegraph.co.uk/news/2016/12/04/renzi-battle-survival-italians-go-polls-vote-seen-referendum/">are already</a> seeing the vote as the first step towards an Italian departure from the eurozone. </p>
<p>So while it is too simple to say that events in Italy exactly fit those in other countries, the outcome might well end up comparable. As if the EU did not have enough to worry about with Brexit, <a href="https://theconversation.com/how-marine-le-pen-could-become-the-next-french-president-68765">Le Pen</a>, <a href="https://www.theguardian.com/world/2016/oct/31/geert-wilders-trial-throws-netherlands-divisions-in-sharp-relief">Wilders</a> and so on, this is one more crisis that it really could do without.</p><img src="https://counter.theconversation.com/content/69919/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Marco Goldoni does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The revolt that brought down Matteo Renzi is no carbon copy of Trump et al, but that won’t be of much comfort to Brussels.Marco Goldoni, Senior Lecturer, Law, University of GlasgowLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/688912016-11-17T12:10:34Z2016-11-17T12:10:34ZIs Italy about to feel the Trump effect? Matteo Renzi’s referendum and the populist threat<p>The election of <a href="https://theconversation.com/uk/topics/2016-us-presidential-election-23653">Donald Trump</a> to the American presidency is causing turmoil in Italian politics in the run up to a constitutional referendum to be held on December 4.</p>
<p>The referendum sets the stage for Italy to host the third major anti-establishment protest shock of 2016, before we’ve even had the chance fully to digest the news of Trump and <a href="https://theconversation.com/uk/eu-referendum-2016">Brexit</a>.</p>
<p>The referendum is on a wide-ranging constitutional reform designed by prime minister Matteo Renzi and his government. It took more than two years to navigate through parliament and was put to the public vote once it had failed to win a two-thirds majority in parliament.</p>
<p>Renzi claims the reform will make Italian governments more stable and efficient. But the worry is that Trump’s election increases the likelihood that the reform will be rejected by voters.</p>
<p>That’s not because of the merits or flaws of the reform itself but because of the politics surrounding it. Renzi has effectively staked his all on the outcome of this referendum. In December 2015, with his personal poll ratings riding high, he announced, in De Gaullean style, that if he were to be defeated in the referendum he would <a href="http://www.cnbc.com/2016/04/13/italys-prime-minister-renzi-plans-to-resign-if-referendum-fails.html">resign</a>.</p>
<p>This manoeuvre, which he assumed would convince any waverers to support the reform, turned out to be a catastrophic tactical misjudgement. It effectively turned the referendum into a plebiscite on Renzi.</p>
<p>That provided a theme for the anti-establishment Five Star Movement, which has campaigned vehemently for a No vote purely to remove Renzi from office.</p>
<p>The <a href="https://www.theguardian.com/world/five-star-movement">Five Star Movement</a> has crowed Donald Trump’s election as evidence of a protest movement sweeping the West. It is calling on Italians to seize the opportunity of the referendum to join in. And indeed, support for the reform has consistently declined throughout the year. Polls now show a small majority in favour of voting No – although the large number of undecided voters leaves the outcome in the balance.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/146109/original/image-20161115-31126-1u1wvix.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/146109/original/image-20161115-31126-1u1wvix.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/146109/original/image-20161115-31126-1u1wvix.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=408&fit=crop&dpr=1 600w, https://images.theconversation.com/files/146109/original/image-20161115-31126-1u1wvix.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=408&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/146109/original/image-20161115-31126-1u1wvix.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=408&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/146109/original/image-20161115-31126-1u1wvix.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=513&fit=crop&dpr=1 754w, https://images.theconversation.com/files/146109/original/image-20161115-31126-1u1wvix.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=513&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/146109/original/image-20161115-31126-1u1wvix.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=513&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Monthly average poll of polls, created from a total of 95 polls throughout the year.</span>
<span class="attribution"><span class="license">Author provided</span></span>
</figcaption>
</figure>
<p>Renzi, since the summer, has attempted to <a href="http://www.reuters.com/article/us-italy-referendum-renzi-analysis-idUSKCN11K1GQ">change tack</a> and depersonalise the referendum, separating its outcome from his own future. But the genie can’t be put back in the bottle. Polls <a href="http://www.youtrend.it/2016/07/19/renzi-si-gioca-sullaffluenza-cresce-sale-si">indicate</a> that over half of Italians intending to vote view the referendum as a judgement on the Renzi government and not the reform. </p>
<p>Renzi will surely be thinking of former British prime minister David Cameron, who famously argued that he would not resign if he lost the Brexit referendum, when most observers knew that it would be inevitable. A No vote in the referendum would signal not just the rejection of the reform but the end of the Renzi experiment.</p>
<h2>A very big constitutional problem</h2>
<p>If this is to be Renzi’s fate, the result will be instability, if not chaos. That’s not because the country will immediately go to an election, but rather because it will be unrealistic to do so.</p>
<p>To try and reinforce support for the constitutional reform, Renzi has also carried through an electoral reform of the lower house (the Chamber of Deputies), which came into effect in July. This new electoral law (the <em>Italicum</em>) was expressly designed to reinforce the constitutional reform, which reshapes the Senate, curtailing its powers compared to the Chamber of Deputies – the only house to be directly elected under the new scheme – by ensuring that a stable governing majority would always emerge from the ballot box.</p>
<p>However, if the constitutional reform is rejected, Italy would be left with two completely different electoral systems for the two parliamentary houses. It would provide the basis for two separate majorities in a system where both houses currently have identical powers.</p>
<p>The potential paralysis that this would create makes it inevitable that further electoral reform would immediately have to follow a rejection of the constitutional reform. And if Renzi resigned, it would mean bringing in yet another transitional government to implement such a reform.</p>
<p>This would probably be a “technical” or “institutional” government along the lines of those led by Renzi’s two immediate predecessors, Mario Monti and Enrico Letta. These administrations were installed under the auspices of the non-partisan Italian president with a specific programme of reform to implement, based on the (fragile) support of different political forces in parliament. Yet, the divisions between the parties over the sort of electoral reform needed would cause months of negotiation, instability, lack of direction and possible stalemate.</p>
<p>The elections that would surely follow electoral reform could result in the Five Star Movement emerging as the largest party. Successive <a href="http://www.sondaggipoliticoelettorali.it">opinion polls</a> reveal a situation of tripolarity, with Renzi’s Democratic Party, the Five Star Movement and the centre-right parties (Silvio Berlusconi’s Forza Italia, the Northern League and Brothers of Italy) commanding about 30% of the vote each.</p>
<h2>Trumped?</h2>
<p>All this will have reverberations beyond Italy because of the way Renzi has been able to convince international elites (most notably the European Union and President Obama) that the constitutional reform will increase Italy’s capacity to deliver on the <a href="http://www.bbc.co.uk/news/world-europe-37702921">EU’s economic agenda</a>. Indeed, some of Renzi’s supporters in Italy are arguing that expectations abroad about the reform are now so high that its rejection would send a shock wave through international circles, damaging Italy’s credibility abroad and leaving it at the mercy of the markets.</p>
<p>For Renzi, there is bitter irony in the way this referendum has turned into an impending watershed for Italian politics. He stands to lose both the reform and possibly his political career on a wave of anti-establishment protest when his own emergence as leader of the Democratic Party and then as Prime Minister was precisely on the basis of an anti-establishment programme. He swept to power promising to scrap the old political class (<em>rottamazione</em>) and lay the foundations for a “new politics” in Italy. That was barely two years ago, but Renzi has learnt to his cost that an anti-establishment profile does not last long once in office.</p><img src="https://counter.theconversation.com/content/68891/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Martin J Bull does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The PM came to power as the anti-establishment candidate. Now he could be the next victim of populist ire.Martin J Bull, Professor of Politics, University of SalfordLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/666102016-10-07T11:33:08Z2016-10-07T11:33:08ZThe EU’s Ides of March? Article 50 timing could spell disaster for European unity<p>Theresa May’s announcement that the UK government will formally launch the Brexit process by the end of March 2017 deals a body blow to European leaders struggling to maintain the integrity of project EU. On top of the rhetoric of a “hard Brexit”, the timing seems designed to catch the EU’s champions at their most vulnerable.</p>
<h2>A new president for France</h2>
<p>The <a href="http://europe.newsweek.com/francois-hollande-2017-election-running-emmanuel-macron-socialists-republican-501884?rm=eu">beleaguered</a> French president François Hollande is yet to decide whether he will defend his post in the elections beginning in April 2017. Whether or not he chooses to stand, France is certain to be preoccupied with an unusually open presidential election.</p>
<p>Current polls indicate that if Hollande did stand, he would not survive the first round of voting. The runoff would most likely be a contest between the conservative Republican Party – probably fronted either by former prime minister, Alain Juppé, or former president, Nicolas Sarkozy – and Marine Le Pen of the populist right Front National.</p>
<p>A swing to the right seems on the cards, then, for France. But Juppé might be hard pressed in the face of UK Tory government antagonism to maintain his line that Britain should not be <a href="https://www.ft.com/content/cc4028fa-411f-11e6-b22f-79eb4891c97d">“punished”</a> over Brexit. Sarkozy’s plans to <a href="https://www.ft.com/content/5763950a-84d4-11e6-8897-2359a58ac7a5">reverse Brexit</a> by renegotiating the EU treaties also sound increasingly implausible.</p>
<h2>A game-changing vote in Germany</h2>
<p>Germany’s leaders had made it clear that they wanted the UK to be ready to start Brexit negotiations at the <a href="https://theconversation.com/four-men-who-will-shape-the-way-the-eu-negotiates-brexit-65576">start of 2017</a>. By March 2017, the country will be in the throes of a federal election campaign.</p>
<p>The last election was a <a href="http://www.spiegel.de/international/germany/a-917836.html">quiet affair</a>. Angela Merkel coasted to victory by dint of her reputation as a <a href="https://www.psa.ac.uk/insight-plus/blog/german-elections-angela-merkel-coasts-victory">safe pair of hands</a>. By contrast, the September 2017 election promises to be a potential game changer.</p>
<p>The rapid rise of the populist right Alternative for Germany (AfD) has contributed to an unusually unpredictable party coalition landscape. Informally, the long campaign has already begun, with widespread speculation as to whether or not Merkel will stage a new bid for the chancellor post. If she stands, <a href="http://www.bbc.co.uk/news/world-europe-23709337">“Mutti”</a> (Mummy) will face her toughest campaign yet as she fights to integrate an unusually polarised party and to please a voting base split over her humanitarian refugee policy.</p>
<p>If she stands down as chancellor, her Christian Democratic Party (CDU) will struggle to find a convincing alternative. Finance minister, Wolfgang Schäuble, or Horst Seehofer, leader of the CDU’s sister party the Christian Social Union (CSU), would help to win back right-leaning voters from the AfD, but would probably <a href="http://www.spiegel.de/international/germany/merkel-reelection-chances-remain-good-despite-poor-results-a-1112916.html">alienate</a> a greater number of moderate Merkel supporters.</p>
<p>Merkel has said she will declare her intentions by the new year. By March, then, Germany’s leadership, focused on domestic political survival, would certainly rather not be dealing with a bullish UK ready to open Brexit negotiations.</p>
<h2>Italy on the brink</h2>
<p>Italy will be in no position to step into the breach. The controversial constitutional referendum to be held on December 4 2016 is already viewed as an opportunity for a <a href="https://theconversation.com/italys-looming-referendum-is-giving-pm-matteo-renzi-sleepless-nights-63844">vote of confidence</a> on Prime Minister Matteo Renzi’s government.</p>
<p>Either a “yes” or a “no” vote will bring about institutional and political change; either will spark a strong reaction from the losing side and is likely generate a period of instability. Supporters of the proposed reforms see them as a chance to break the institutional deadlock that plagues Italian politics, detractors highlight a potential for authoritarianism in enhanced government powers and a de facto “presidentialisation” of the system.</p>
<p>Combined with mounting concerns over a <a href="http://blogs.lse.ac.uk/europpblog/2016/07/15/italian-banking-crisis/">fragile banking sector</a>, Italy’s referendum for progress is looking increasingly like a <a href="http://blogs.lse.ac.uk/europpblog/2016/09/27/italys-constitutional-reform-is-ill-conceived/">debacle</a> for Renzi.</p>
<p>With the current leaders of three key member states likely to be compromised, distracted or possibly even otherwise engaged by March 2017, the launch of hard Brexit negotiations may prove more than just an irritant for those in the EU hoping for constructive and cooperative talks.</p>
<h2>Brexit and the EU’s schedule</h2>
<p>If Article 50 is triggered in March, it will also mean that Malta will be holding the rotating presidency of the Council of the EU at the time of the Brexit launch. However, Britain’s longstanding connections with Malta are unlikely to favour the UK’s cause. Given the exceptional significance of the UK’s withdrawal from the EU, the European Commission will play the leading role in negotiations.</p>
<p>The Maltese parliamentary secretary, Ian Borg, has acknowledged this, noting that Malta would not be directly involved in the negotiations over Brexit because that would be handled by the EU’s “technical heavy machinery”. Prime Minister <a href="http://www.timesofmalta.com/articles/view/20161003/local/brexit-complicates-maltas-presidency-of-european-council.626804">Joseph Muscat</a> has reiterated the common EU line that any Brexit deal, while fair, must offer rewards inferior to full membership.</p>
<p>The timing of the triggering of Article 50 may <a href="http://www.telegraph.co.uk/news/2016/06/24/eu-faces-brexit-contagion-as-populist-parties-across-europe-call/">reignite</a> the Brexit contagion first inspired by the UK’s referendum campaign in member states including France, the Netherlands, Denmark, Sweden and Italy.</p>
<p>In these countries and others, a high-profile hard Brexit stance from the UK government may offer momentum to eurosceptic, populist forces seeking a better deal for their own member states. They may even call for their own exit strategy. The question of whether Brexit will ultimately serve to unite or fragment the European Union remains open, but May’s timing strikes a blow for fragmentation.</p><img src="https://counter.theconversation.com/content/66610/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Patricia Hogwood does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The suggested start of Brexit negotiations doesn’t do Britain any favours, nor Germany, France or Italy.Patricia Hogwood, Reader in European Politics, University of WestminsterLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/638442016-08-15T11:18:22Z2016-08-15T11:18:22ZItaly’s looming referendum is giving PM Matteo Renzi sleepless nights<p>European Democracy is in a state of crisis. The <a href="https://theconversation.com/uk/topics/brexit">British referendum</a> on EU membership has just backfired spectacularly on its promoters, Austria’s far-right <a href="https://theconversation.com/a-new-era-may-be-dawning-again-for-radical-right-populists-in-austria-and-europe-61662">Freedom Party</a> recently came within a hair’s breadth of capturing the presidency, and in France, Marine Le Pen’s Front National looks set to make it through to the second round of voting in the French presidential elections next year.</p>
<p>Now Italy is facing its own moment of reckoning with a referendum on constitutional reform, likely to go ahead this autumn. Like Brexit, the decision to hold this vote might end up destroying the man who sponsored it – Prime Minister <a href="https://theconversation.com/uk/topics/matteo-renzi">Matteo Renzi</a>.</p>
<p>The reform is a package aimed at reducing the fragmentation that causes so many problems in Italian politics. The idea is to increase executive stability and the efficiency of the whole system. But Renzi has staked his political future on the outcome having said, earlier in the year, he would resign if the vote went against him.</p>
<h2>The reform explained</h2>
<p>The main proposal is to reform the Senate, which has hitherto enjoyed the same powers as the lower house, the Chamber of Deputies in Italy’s parliament (which is “<a href="https://en.wikipedia.org/wiki/Bicameralism">symmetrically bicameral</a>”). This is thought to be inefficient because it supposedly obliges bills to shuttle back and forth between the two chambers until identically-worded texts can be agreed by both.</p>
<p>If passed, the proposals will limit the Senate’s legislative powers. It will no longer be able to pass votes of confidence in the government and, importantly, it will no longer be directly elected. Instead, a reduced membership will be selected by the regions from among their councillors and local mayors. The president will also appoint five members directly.</p>
<p>Linked to these Senate changes are newly introduced electoral reform laws for the lower house. These will have to be repealed if the Senate reform doesn’t go ahead. The new law introduces a list system of proportional representation for votes in 100 constituencies. The list with the most support nationally (provided it represents at least 40% of the vote) will automatically receive 340 of the 630 seats in the lower house of parliament (if not entitled to at least that proportion anyway). If no list achieves 40%, there will be a run-off between the two most voted lists, with the winner being awarded the 340 seats. The remaining seats will be shared among the remaining lists according to their first-round totals (aside from 12 seats reserved for Italians living abroad).</p>
<p>Those who support this change point out that only single lists are allowed to run, not coalitions of lists. They argue that this, and the fact that a single list is guaranteed an overall majority, will increase the power and stability of the executive.</p>
<h2>Renzi’s problem</h2>
<p>Renzi’s referendum is the latest in a long line of attempts to address Italy’s democratic problems through constitutional overhaul. </p>
<p>His ascent to the premiership, and his career since, have been built on an attempt to cultivate an image as a man able to root out old vested interests in politics. His promise is to usher in a new era of decisiveness in Italian politics. He has framed the vote as a competition between the “old”, poor performing, Italy and the “new” – a message that went down well at first. </p>
<p>Opinion polls in the early months of 2016 suggested a sure win for the PM. But the gap has narrowed considerably. Renzi is vulnerable to defeat in the vote on a number of fronts, and he has lately sought to row back from his pledge to resign if he loses but it has come too late. All the parties of opposition are already lining up on the “no” side. They’ve spotted an opportunity to use this referendum to oust the prime minister, thereby hastening their own return to power.</p>
<p>It is always dangerous for a PM to frame such a vote as a plebiscite on their own performance. That’s especially true for Renzi now that his honeymoon period is over and his approval ratings are running at <a href="http://tradebridgeconsultants.com/news/government/renzi-down-in-the-polls-but-still-best-leader/">about 25%</a>.</p>
<p>Renzi’s authority was also been dented by his party’s poor performance in local council elections in <a href="http://blogs.lse.ac.uk/europpblog/2016/06/22/the-five-star-movements-victories-in-italys-mayoral-elections-a-major-blow-for-renzi-and-the-pd/">June</a>. Now he faces considerable opposition to the reforms from within his own party. On top of that, he is under pressure to manage an influx of refugees and faces a possible <a href="https://theconversation.com/how-brexit-opened-up-the-pandoras-box-of-italys-banking-malaise-62329">banking crisis</a> thanks to Brexit. </p>
<p>Brexit must be giving him sleepless nights for another reason too. Not many Italian voters will have much real understanding of the substance of his reforms and Brexit teaches us that when European voters are presented with the task of voting on complex issues they use it as an opportunity to vent their frustrations about the political establishment. Brexit became as much a vote on austerity and feelings of political inefficacy as a decision about EU membership, and the same could be true in Italy. </p>
<p>For Renzi personally, the stakes are enormous. If he loses, it is difficult to see him continuing to survive as PM for very long. If he wins, then he will be able to pose as the father of a new constitutional settlement. He can continue to dominate Italian politics for a long time to come.</p>
<h2>Rising stars</h2>
<p>Whether the stakes for Italian democracy are actually as high as this implies are to my mind extremely debatable – although, needless to say, they have been portrayed as such by both sides in the campaign.</p>
<p>It’s not clear that the current system really does hold up progress, or indeed that the new one will make things more efficient. </p>
<p>The new electoral law seeks to enhance executive power by providing an absolute seat majority to the most popular list. This marks a crucial difference with the previous system, through which parties could field their candidates as coalitions of lists in a bid to win power. This led to the creation of large, unwieldy alliances designed to win elections but incapable of governing. </p>
<p>Yet the majority premium, together with a 3% representation threshold, gives parties an incentive to continue this practice. The new law will allow them to strike short-term agreements to field combined lists and do nothing to stop them splitting into autonomous entities again after entering parliament. </p>
<p>This has been a feature of all election outcomes since the 1990s. And, given the depth and variety of the divergences separating the Italian parties, it seems naive to think a new law will do much to change things.</p>
<p>Italy’s political elites are currently getting excited or agitated (depending on where they stand) about the prospect of the anti-political, populist, eurosceptic <a href="https://www.theguardian.com/world/five-star-movement">Five Star movement</a> rising to power as a result of the changed electoral system.</p>
<p>The prospect arises from the outcome of the June local elections which, in the larger municipalities were also fought through two-round contests. The Five Stars managed to make it through to the second round in only 20 ballots but, having made it that far, they won all but one contest. </p>
<p>Why? Because as an anti-political party that wins support from across the political spectrum, when it finds itself up against just one competitor (whether of the right or left) only, is in a strong position. In a head-to-head race, it can rely on backing not only from its own habitual supporters but also from people opposed to whichever party it finds itself up against.</p>
<p>In other words, in a straight fight of the kind characterising a run-off ballot, the Five Stars become formidable. So an electoral law originally conceived as a means of excluding them from power might actually assist their rise. The law makes a single-party, Five Star government possible – not to say likely. The current divisions between the parties of the right mean that the chances of the Five Stars being involved in any Chamber of Deputies run-off ballot in the first place would be rather good.</p>
<p>So while it is always hazardous to make predictions in politics, and especially in Italian politics, it seems to me that whatever the outcome of the referendum the symptoms of democratic crisis in Italy will probably persist for some time, whether or not Renzi is in power after the vote.</p><img src="https://counter.theconversation.com/content/63844/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>James Newell is affiliated with the Labour Party.</span></em></p>What should have been a debate about constitutional reform has turned into a battle for the premiership, thanks to a schoolboy error by the incumbent.James Newell, Professor of Politics, University of SalfordLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/585232016-05-09T05:32:53Z2016-05-09T05:32:53ZIran: Europe eyes a new silk road – and squares up to Russia and China<p>The cake is quite big, but everyone wants a slice. Italian prime minister, Matteo Renzi, visited Iran last month accompanied by business leaders from the <a href="http://www.irna.ir/en/News/82038224/">energy, transportation and defence sectors</a>. It was a return visit after the Iranian president, Hassan Rouhani, had made Italy his first destination in Europe on a trip intended to drum up European investments in Iran.</p>
<p>Such investments are now possible thanks to the implementation of <a href="https://www.whitehouse.gov/issues/foreign-policy/iran-deal">the JPCOA nuclear agreement</a> which lifts all UN-mandated nuclear sanctions as well as EU and US economic, financial and banking sanctions over the Iranian nuclear programme. The path is clear for Iran to pursue a new engagement with the world. European businesses are eager to jump in, but it will be no easy trick to challenge the position of Russia and China.</p>
<p>The enthusiasm is obvious. EU high representative, <a href="http://europa.eu/rapid/press-release_IP-16-1366_en.htm">Federica Mogherini, travelled to Tehran</a> last month accompanied by business representatives and seven EU commissioners – including those for transport, energy and industry – signalling the high-level interest. German industrial giant Siemens, the oil and gas company Shell, and French auto makers Peugeot and Renault have <a href="https://www.boell.de/de/2015/08/05/iran-report-082015">indicated their interest</a>. Airbus secured a contract with Iran for the delivery of 118 aircraft just <a href="http://www.airbus.com/presscentre/pressreleases/press-release-detail/detail/iran-deal/">two weeks after “Implementation Day”</a>. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/121552/original/image-20160506-32031-hk36w6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/121552/original/image-20160506-32031-hk36w6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/121552/original/image-20160506-32031-hk36w6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=398&fit=crop&dpr=1 600w, https://images.theconversation.com/files/121552/original/image-20160506-32031-hk36w6.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=398&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/121552/original/image-20160506-32031-hk36w6.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=398&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/121552/original/image-20160506-32031-hk36w6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=501&fit=crop&dpr=1 754w, https://images.theconversation.com/files/121552/original/image-20160506-32031-hk36w6.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=501&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/121552/original/image-20160506-32031-hk36w6.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=501&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Iran’s Airbus order includes the giant A380.</span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/telstar/1485308009/in/photolist-3gfAjM-3gfatn-3gjQAA-eLHuq8-3gjyef-7V1tUy-3gjyxQ-3gf5QT-3gfa96-eLUSkQ-4bk1zN-3gf6iF-bJ3UdP-3gfw4R-bA8CmG-2qdK3-915Tbi-qK6s9L-915UoK-bUws91-9wD4xF-2mF3dF-f2Jgh-7ysK43-fHyKgf-qi2VL-DrgNMm-qi2VP-DTo7bX-9hzQvV-qi2VV-o5jQRq-EUGgD-6iSF1-bUxDXs-bUxuCu-bJQVQe-2SusbP-nLJZfb-nonFRh-9Sqgff-599xVN-qi3hC-dWFkmo-5SX8n-nQz8Sz-im4nd-8pjBNh-4BNooZ-nMQdy8">Todd Lappin/flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by-nc/4.0/">CC BY-NC</a></span>
</figcaption>
</figure>
<h2>Not so fast…</h2>
<p>The Iran rush is tugged back, however, by the persistence of sanctions not related to the nuclear deal and which can very easily apply to European companies. The US, in particular, will retain secondary sanctions which target dealings with Iranians on their <a href="https://www.treasury.gov/resource-center/sanctions/SDN-List/Pages/default.aspx">Specially Designated Nationals List</a> (SDN), a collection of individuals the US deems to be a risk on grounds of terrorism, nuclear proliferation or human rights. According to <a href="https://www.whitehouse.gov/sites/default/files/docs/jcpoa_what_you_need_to_know.pdf">White House guidance</a>, anyone found to have had dealings with those on the SDN list would: “put themselves at risk of being cut off from the US financial system. This includes foreign financial institutions, who would risk losing their correspondent account with US banks”.</p>
<p>European subsidiaries of US companies can get operating licenses for businesses in Iran, but will need to “firewall” their US activities from their foreign operations. This may prove to be a challenging requirement given the intertwined nature of companies and of the banking sector. It remains unclear whether even emails going through US servers could be considered as using the <a href="http://www.iiss.org/en/events/events/archive/2016-a3c2/january-6318/npdp-london-workshop-545e">US to facilitate transactions</a>. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/121553/original/image-20160506-32047-1k9e965.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/121553/original/image-20160506-32047-1k9e965.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/121553/original/image-20160506-32047-1k9e965.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/121553/original/image-20160506-32047-1k9e965.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/121553/original/image-20160506-32047-1k9e965.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/121553/original/image-20160506-32047-1k9e965.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/121553/original/image-20160506-32047-1k9e965.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/121553/original/image-20160506-32047-1k9e965.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Keeping Iran at arm’s length.</span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/aloha75/9282798555/in/photolist-f9hLAX-f9hLag-q43Fbr-f9hLpn-f9x1kd-9ZDH4i-nVbxhF-836uT9-6cQwZo-f9hKGg-2kxifS-yJqmJ-dYPAoj-i3ScT-5YbQSp-6Ay4rP-9t2TyV-f8RJEm-VXccZ-4h2EwT-fsFhxd-68rm1o-53qjaw-k59J1-GxD6Sn-6AGjf5-frP7yv-7jygHm-5BMRpy-4V2xa6-qDho48-o7gExd-x3PPZ-srLwNP-d8M115-bnLsYN-nCRhrF-fJDTjZ-cF1KwA-7BwmUL-5YbRfZ-4D7L5E-axGQrg-2wNJk7-qRmJXk-bDMFWt-8wYofA-bDMFPk-oGwAS5-eCwbHY">Sam Howzit/Flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by/4.0/">CC BY</a></span>
</figcaption>
</figure>
<p>Complicating matters still further for European companies is the extent to which parts of the Iranian economy will continue to be controlled by entities still subject to sanctions. Examples here are banks on the US’ SDN list for carrying out terrorism-related transactions; construction, trading and transport companies tied to the Iranian Revolutionary Guards Corps; or telecoms companies.</p>
<h2>Rivals</h2>
<p>These obstacles will leave European firms struggling to catch up with China, which has <a href="http://www.crisisgroup.org/en/regions/asia/north-east-asia/china/B100-the-iran-nuclear-issue-the-view-from-beijing.aspx">largely benefited</a> from western embargoes. Russia is also well placed in Iran’s nuclear energy market. Both China and Russia are simply less likely to be as affected by the “foreign subsidiary” regulation because Chinese or Russian subsidiaries of larger US corporations are far less common.</p>
<p>Chinese companies had been willing to provide goods that Iran could no longer receive from the West. In 2014, the <a href="http://comtrade.un.org/">Sino-Iranian trade volume</a> totalled US$52 billion (compared to a Russian-Iranian trade volume of only US$1.6 billion and US$10 billion between Iran and the entire EU-28). During nuclear sanctions, China was Iran’s most significant foreign trade partner, exporting capital goods and engineering services and investing in <a href="http://www.crisisgroup.org/en/regions/asia/north-east-asia/china/B100-the-iran-nuclear-issue-the-view-from-beijing.aspx">infrastructure projects</a>. With nuclear sanctions now lifted, China seems to be aware that – whatever the obstacles for European firms – it might face increased competition. </p>
<p>Losing no time, the Chinese president, Xi Jinping, paid a visit to Iran in January, signing a Sino-Iranian “<a href="http://theiranproject.com/blog/2016/01/23/iran-china-issue-statement-on-comprehensive-strategic-partnership/">comprehensive strategic partnership</a>” and announcing 17 agreements in the energy, trade, and industrial sectors. Iran is important for China’s “<a href="https://www.swp-berlin.org/fileadmin/contents/products/studien/2014_S09_gdh.pdf">One Belt, One Road</a>” initiative that would join markets from China to Central Asia and the Middle East. </p>
<h2>Moscow’s interests</h2>
<p>Russian commercial interests in Iran concentrate on the restart of arms sales and the nuclear industry. Russia has made it clear that it was planning to capitalise on the eventual <a href="http://www.al-monitor.com/pulse/originals/2015/04/iran-s300-sale.html">lifting of arms embargoes from Iran</a>. While the UN weapons embargo will only be lifted in five years, states can apply for UN authorisation beforehand. </p>
<p>The nuclear industry is more lucrative in the mid-term. Russia’s state-owned nuclear company Rosatom has held a relative monopoly position on the Iranian nuclear energy market, having built Iran’s only nuclear power reactor in <a href="http://ceness-russia.org/data/doc/TheBushehrNPP-WhyDidItTakeSoLong.pdf">Bushehr</a>, and is currently closely involved in the implementation of the JCPOA agreement. It is unlikely Russia will face serious competition in this sector of the Iranian economy.</p>
<p>But it’s not a one-way street – with economic sanctions gone the prospect of increased Iranian oil supply to Europe could signal tough competition on the European energy market. This comes after the oil price <a href="http://www.nytimes.com/interactive/2016/business/energy-environment/oil-prices.html?_r=0">slump</a> which has strained the Russian <a href="http://www.bbc.com/news/business-29643612">state budget</a>. It means that any hindrance to growth in Iran’s oil infrastructure thanks to continued sanctions might be met with a sigh of relief in Moscow. This does not mean that Russia is desperate to prevent Iran from emerging as an energy competitor. But it does buy time for Russia, and indeed Europe, to prepare for a shift in global oil supply dynamics.</p>
<p>It’s a tough call for European businesses. They can only challenge China’s position in Iran’s capital goods and construction market in as much as the complex sanctions architecture allows them. Russia also stands in a stronger position as far as its “traditional” sectors of interest are concerned. The truth is that banks and businesses are risk-averse, and the ambiguities in US financial legislation will feed this concern. It ensures that the lifting of sanctions is no “free for all”, but a slow, tentative walk through a legal minefield.</p><img src="https://counter.theconversation.com/content/58523/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Moritz Pieper does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The most difficult aspect of trade in “post-sanctions” Tehran, is how to navigate the sanctions still in place.Moritz Pieper, Lecturer in International Relations, University of SalfordLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/371322015-02-04T10:52:19Z2015-02-04T10:52:19ZCorrupt politicians can only look on in horror as Mr Integrity takes Italian presidency<p>Italy has a new president in the form of <a href="http://www.bbc.co.uk/news/world-europe-31073998">Sergio Mattarella</a>, a 73-year-old constitutional judge from Sicily. Mattarella was elected to the role in the wake of the retirement of <a href="https://theconversation.com/italys-ageing-president-resigns-as-country-grasps-at-stability-36230">Giorgio Napolitano</a>, who had held the post for nearly a decade.</p>
<p>The president of Italy has limited powers: he or she guarantees that politics complies with the Italian constitution, but real political responsibility remains with the government. However, the election of Mattarella is important for both the centre-left prime minister Matteo Renzi and his Democratic Party. Mattarella represents integrity, and has made no secret of his contempt for the kind of politics that has bolstered the interests of former prime minister Silvio Berlusconi over the years.</p>
<p>In securing the job for Mattarella, who is a former <a href="http://www.nytimes.com/1994/01/20/world/italy-s-christian-democrats-renamed-seek-popularity.html">Christian Democrat</a>, Renzi has humiliated his main rival Silvio Berlusconi, the former prime minister who is still leader of Forza Italia.</p>
<p>He made the nomination without any consultation, and members of Forza Italia said that this went against the “patto del Nazareno” he had established with Berlusconi. This pact was agreed in 2014 in order to reform voting laws and the constitution. Voting laws need changing, as the current system makes it nearly impossible to legislate.</p>
<p>Italians were expecting Renzi to agree with Berlusconi on the nomination of a candidate who had the blessing of both leaders. However, Renzi opted for a candidate who would be viewed positively by all the members of his own Democratic Party, including those who disagreed with the Berlusconi pact.</p>
<p>Renzi has succeeded in severely weakening Berlusconi’s Forza Italia. In early January 2015, opinion polls put national support for the party at just 13%, and now around 40 out of 142 Forza Italia members of parliament voted for Mattarella as president, despite <a href="http://www.corriere.it/politica/speciali/2015/elezioni-presidente-repubblica/notizie/quirinale-presidente-repubblica-prima-votazione-mattarella-pd-8a6f372c-a792-11e4-b182-cec9e96dbdaf.shtml">Berlusconi being against him</a>. Forza Italia members are clearly starting to realise that Berlusconi no longer has a future in Italian politics.</p>
<p>Sergio Mattarella is an incredibly bold choice for Italy. After holding different ministerial positions, and contributing to the creation of the Democratic Party in 2007, he became a judge of the Constitutional court in 2011.</p>
<p>But he is most commonly associated with his firm stance against organised crime and corruption. He fought the mafia (unlike Berlusconi’s <a href="http://www.theguardian.com/world/2004/dec/12/italy.sophiearie">Forza Italia</a>) and even resigned from his post as an education minister in the Democratic Christian government of Giulio Andreotti in 1990 when a law that would enable Berlusconi to further expand his media empire was passed.</p>
<p>Mattarella’s father Bernardo, an anti-fascist who opposed Benito Mussolini, was one of the founders of the Christian Democratic party. But Sergio only entered politics after the murder of his brother Piersanti Mattarella at the hands of the mafia in 1980, when he was president of the regional government of Sicily.</p>
<p>He went on to promote the “Palermo Spring”, which encouraged citizens to promote a culture of legality and rebellion against the mafia. This eventually led to the creation of associations that enabled them to stop paying protection money to the mafia. Supporting the movement was an unusual stance for a member of his party at the time. Other Christian Democrats in Sicily, such as <a href="http://www.theguardian.com/news/2002/nov/26/guardianobituaries.philipwillan">Vito Ciancimino</a>, who was mayor of Palermo, and businessmen Ignazio and Antonino Salvo – who were close to the leader of the Christian Democrats – were linked to the mafia.</p>
<p>For these reasons and more, Mattarella represents the fight against corruption in Italy. His election follows that of Pietro Grasso, head of the National Anti-mafia Directorate, as president of the Senate in 2013.</p>
<p>Together they have much work ahead. According to the <a href="http://www.transparency.org/cpi2014/results">Corruption Perceptions Index of 2014</a>, which measures the perceived levels of public sector corruption worldwide, Italy was the most corrupt state in the European Union – and it was ranked 69th worldwide. And in 2014, a [corruption ring](<a href="https://theconversation.com/politicians-fiddling-while-rome-burns-35213">http://www.nytimes.com/2014/12/12/world/italy-gasps-as-inquiry-reveals-mobs-long-reach.html?_r=0</a> was exposed in Rome, involving dozens of administrators and civil servants who now stand accused of criminal activities such as vote rigging, usury, extortion and embezzlement.</p>
<p>Famous Italian writer Leonardo Sciascia, who denounced the power of the Mafia in Sicily, said that Mattarella was “<a href="http://www.lefigaro.fr/international/2015/01/31/01003-20150131ARTFIG00079-sergio-mattarella-un-catholique-sicilien-au-coeur-des-institutions.php">tenacious and inflexible</a>”.</p>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/71059/original/image-20150204-28573-1a8fjp1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/71059/original/image-20150204-28573-1a8fjp1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/71059/original/image-20150204-28573-1a8fjp1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/71059/original/image-20150204-28573-1a8fjp1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/71059/original/image-20150204-28573-1a8fjp1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/71059/original/image-20150204-28573-1a8fjp1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/71059/original/image-20150204-28573-1a8fjp1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/71059/original/image-20150204-28573-1a8fjp1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Paolo Borsellino and Giovanni Falcone are remembered for fighting the mafia.</span>
<span class="attribution"><span class="source">EPA</span></span>
</figcaption>
</figure>
<p>On his first day in the Italian parliament, Mattarella received a standing ovation. He said: “In the fight against mafia, we have had many heros. I would like us to remember Giovanni Falcone and Paolo Borsellino”, both anti-mafia Sicilian magistrates killed by the mafia in 1992.</p>
<p>Now that he is president of Italy, he will no doubt be thinking about his brother, of whom he said he would share his values and behaviour in order to “<a href="http://movi100.azionecattolica.it/?p=161">benefit the good of all</a>”.</p><img src="https://counter.theconversation.com/content/37132/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Catherine Gegout receives funding from the British Academy and the European Union. She is a member of International Studies Association.</span></em></p>Italy has a new president in the form of Sergio Mattarella, a 73-year-old constitutional judge from Sicily. Mattarella was elected to the role in the wake of the retirement of Giorgio Napolitano, who had…Catherine Gegout, Lecturer in International Relations, University of NottinghamLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/362302015-01-14T10:14:11Z2015-01-14T10:14:11ZItaly’s ageing president resigns as country grasps at stability<p>Giorgio Napolitano, Italy’s 89-year-old president, has <a href="http://www.independent.co.uk/news/world/europe/giorgio-napolitano-resigns-italian-politics-bids-farewell-to-the-president-who-gave-silvio-berlusconi-the-boot-9976068.html">resigned</a> from the office he has held for nearly a decade. His departure will prompt a secret ballot among parliamentarians to replace him. But this is not likely to be an easy job, since the Italian parliament is currently rife with disagreement and dissatisfaction. </p>
<p>Originally elected in 2006, Napolitano reluctantly accepted re-election in 2013 because a highly polarised parliament could not guarantee the required absolute majority to any successor. <a href="http://www.quirinale.it/elementi/Continua.aspx?tipo=Discorso&key=2688">In his inaugral address</a>, Napolitano warned that his resuming office was only a temporary solution to the problem.</p>
<p>In a couple of weeks, 950 members of the Italian Parliament and 58 representatives of the regions will meet in a bid to succeed in the task that eluded them less than two years ago. The election of a new president is the proof they need to prove that the Italian government is not crumbling.</p>
<h2>What’s the president for?</h2>
<p>Some believe the Italian presidency is little more than a ceremonial role, but the chief of state is actually assigned substantial powers in the <a href="https://www.senato.it/documenti/repository/istituzione/costituzione_inglese.pdf">Italian Constitution</a>.</p>
<p>Presidents can, for example, hand lifelong positions in the senate to up to five people and appoint members to the Constitutional Court. They can also ask parliament to reconsider a bill before it becomes law. Since the constitution came into force in 1948, presidents including <a href="http://www.quirinale.it/qrnw/statico/ex-presidenti/Einaudi/ein-biografia.htm">Luigi Einaudi</a> and <a href="http://www.quirinale.it/qrnw/statico/ex-presidenti/Gronchi/gro-biografia.htm">Giovanni Gronchi</a> jealously guarded their autonomy from the executive power in order to continue fulfilling these functions.</p>
<p>What’s more, Italian governments are traditionally unstable and the political scene notoriously fragmented. There have been 63 governments since 1946, and since the political crisis of the early 1990s, majorities have been more and more fragile, composed of up to 20 different parliamentary groups. Against this backdrop, the president represents a rare centre of institutional continuity.</p>
<p>Napolitano, in particular, has pushed the limits of his authority. He used the highest degree of power on offer to him when trying to bring in effective governance before the debt crisis of 2011-12 and during the hung parliament deadlock that emerged after the 2013 elections.</p>
<h2>In the running</h2>
<p>The prestige of the presidential office naturally attracts some top names to the job and several potentials have been identified in the run up to Napolitano’s departure.</p>
<p>Mario Draghi, president of the European Central Bank, is thought to be a strong candidate, even though he himself <a href="http://www.ansa.it/web/notizie/rubriche/english/2013/01/15/ECB-chief-Mario-Draghi-considering-Italian-presidency_8077406.html">denies being in the running</a>. Draghi is internationally respected and his election to the presidency would reassure the European establishment that a reliable guardian for Italian economic and fiscal discipline was taking the helm. He may find less support in Italy itself though, where growing impatience with austerity policies could act as a major obstacle to his appointment.</p>
<p>Romano Prodi, Italy’s prime minister between 1996-1998 and 2006-2008, as well as president of the European Commission from 1999 to 2004, <a href="http://www.reuters.com/article/2013/04/19/us-italy-vote-idUSBRE93I08I20130419">came close to election in 2013</a>, and could find support again. But Forza Italia’s leader Silvio Berlusconi, Prodi’s main political opponent in 1996-2006, is openly hostile to his candidacy for the role and his veto may be decisive.</p>
<figure class="align-right ">
<img alt="" src="https://images.theconversation.com/files/68991/original/image-20150114-3879-1803inz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/68991/original/image-20150114-3879-1803inz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=900&fit=crop&dpr=1 600w, https://images.theconversation.com/files/68991/original/image-20150114-3879-1803inz.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=900&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/68991/original/image-20150114-3879-1803inz.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=900&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/68991/original/image-20150114-3879-1803inz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1131&fit=crop&dpr=1 754w, https://images.theconversation.com/files/68991/original/image-20150114-3879-1803inz.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1131&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/68991/original/image-20150114-3879-1803inz.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1131&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Romano Prodi came close to election in 2013.</span>
<span class="attribution"><span class="source">Presidenza della Repubblica</span></span>
</figcaption>
</figure>
<p>A low-profile political figure is instead more likely to receive votes from the required number of electors. The moderately left Democratic Party, which is currently the most powerful force in parliament, could draft in one of its former secretaries to take the job, for example.</p>
<p>Potential candidates from these quarters include <a href="http://www.glistatigenerali.com/presidente-della-repubblica/chi-sara-il-prossimo-presidente-della-repubblica-io-punto-su-veltroni/">Walter Veltroni</a>, who has strong ties to new party leader and prime minister Matteo Renzi. Other options include <a href="http://www.glistatigenerali.com/politici/dalla-rottamazione-allusato-sicuro-per-il-quirinale-renzi-punta-su-bassanini/">Franco Bassanini</a>, who made a name for himself in the 1990s for making important reforms to intrusive public bureaucracy. Or <a href="http://www.regione.piemonte.it/governo/presidente/curricul.htm">Sergio Chiamparino</a>, who was a popular mayor of Turin during the <a href="http://www.olympic.org/turin-2006-winter-olympics">2006 Winter Olympics</a> and is now president of Piedmont, is another with a chance at election. A group of parliamentarians allegedly close to Renzi timidly advanced his candidacy in 2013. Now, more electors may back him.</p>
<h2>Lost faith</h2>
<p>Whichever of these men emerge as candidates, it will be difficult to find a president with support from a broad range of sources. In fact, the major leaders won’t even been voting in this election. Both Renzi and Beppe Grillo, founder of the radically populist Movimento 5 Stelle, have decided not to run for a parliamentary seat in 2013 general elections, so won’t be eligible to vote. Berlusconi, for his part, <a href="http://www.nybooks.com/blogs/nyrblog/2013/aug/24/holding-italy-hostage/">lost his seat in the senate</a> after being convicted of tax fraud, so won’t be able to take part in the vote either.</p>
<p>What’s more, the party leaders are all likely to find it difficult to impose their preference on the parliamentary groups when it comes to casting votes since each faces internal opposition to their policy agenda. The secret ballot by which a president is elected will allow members of parliament to express their discontent by disregarding the will of their leaders.</p>
<p>Renzi has been widely criticised by the traditional left for his attempts to give the Democratic Party a business-friendly image, and Grillo is facing growing criticism for the lack of internal democracy in the Movimento 5 Stelle. In Forza Italia, some accuse Berlusconi of taking care of his own interests above those of the party he founded.</p>
<p>The eventual winner will work with Renzi and his ministers on the final parliamentary passage of two crucial political reforms. A new electoral law should introduce a second round between the two largest parties to make sure one has a super-majority of 55% of the seats. </p>
<p>And a constitutional bill could substantially modify Italy’s two-chambers system by transforming the senate into an assembly for the representation of local governments, with no vote of confidence. </p>
<p>But the new president will first of all have to face the growing protests against unpopular recent <a href="http://www.bbc.com/news/world-europe-30447158">labour market reforms</a>, which unions consider a further step towards the total “precarisation” of work.</p>
<p>So Napolitano’s successor will have his work cut out – and Italy’s politics show little sign of fully stabilising any time soon.</p><img src="https://counter.theconversation.com/content/36230/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Andrea Mariuzzo does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Giorgio Napolitano, Italy’s 89-year-old president, has resigned from the office he has held for nearly a decade. His departure will prompt a secret ballot among parliamentarians to replace him. But this…Andrea Mariuzzo, Research Fellow in History, Scuola Normale Superiore di PisaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/286902014-07-03T05:04:41Z2014-07-03T05:04:41ZEuropean austerity was a failure but what comes next may be even worse<p>Even Angela Merkel now seems to agree that austerity has run its course. When Italy’s prime minister, Matteo Renzi, together with other European leaders, <a href="http://www.bloomberg.com/news/2014-06-27/renzi-prods-merkel-into-shift-as-eu-eases-austerity-focus.html">led a fresh charge against the ill-fated policy</a> after the European elections, Berlin caved in surprisingly quickly. </p>
<p>The details remain to be worked out but it seems certain that the conditions of the stability pact will be softened. Most likely a deal will be cut by which investment expenditure for structural reform will not count anymore towards the restrictions imposed by the agreement. This would give crisis countries substantial leeway to increase government spending and stimulate their economies. </p>
<p>Should critics of austerity feel vindicated? There can be no doubt that this represents an important policy change but it may be too early to celebrate. After bungling austerity, European leaders now seem poised to make a mess of its end. </p>
<p>Less than 24 hours after Merkel’s spokesman had made the German green light public, Renzi delivered a major policy speech outlining his vision for the upcoming Italian presidency of the EU. Most importantly, he asked for more financial flexibility and announced a series of structural reforms, including changes to labour market regulations. In the <a href="http://www.camera.it/leg17/410?idSeduta=0251&tipo=stenografico#sed0251.stenografico.tit00040">speech</a> he explicitly cited Gerhard Schröder’s reforms as a model for Italy and others: “Germany has been able to face today’s crisis better and more successfully than any other country because of the extraordinary reforms initiated by Schröder.” This was not merely a gesture of courtesy to Berlin. Renzi’s plans resemble Schröder’s 2003 agenda in important respects.</p>
<h2>Surplus requirements</h2>
<p>The German chancellor had used a two-pronged approach. His government increased public spending and the resulting economic upswing gave him leeway to go ahead with structural reforms. New legislation deregulated parts of the labour market and put pressure on the unemployed by reducing benefits and introducing penalties for those refusing to accept jobs that were offered to them. The reforms allegedly helped to keep German industry competitive and made possible the substantial export surpluses that drive German growth.</p>
<p>Renzi and others believe that the way out of the crisis is for European countries to have their own “Schröder-moments”. However, quite apart from the simple mathematical fact that not all countries can run trade surplus at the same time, there are also important flaws in the underlying analysis of Germany’s economic experience. It is true that real wages slightly declined in Germany between 2000 and 2008 and that this was in part a result of Schröder’s reforms. However, the main reason for the growing gap in costs between Germany and other Euro countries were the increasing costs in the periphery – where economies were booming at the time. Declining wages in Germany played a minor role in this development.</p>
<p>Moreover, it remains questionable whether in the German case there exists a causal relationship between low labour costs and growing exports. Most of the recent growth of German exports <a href="http://blogs.wsj.com/moneybeat/2013/08/29/germany-at-risk-as-emerging-markets-suffer/">comes from sales to emerging economies</a> and not to European partners. This includes countries such as China that have extremely low labour costs. Together with the types of products exported by Germany this suggests that exports are not driven by low costs but by high quality. The secret of Germany’s economic success story are not frugal workers at home but growing demand for high-quality consumer and investment goods in emerging economies.</p>
<h2>Debt and competitiveness</h2>
<p>The version of Germany’s success story that Renzi is trying to emulate is largely a mirage. It is therefore unlikely that he will solve Italy’s economic woes. Still worse, similar plans are bound to aggravate two structural problems that threaten the survival of the Euro: the high levels of public debt in the crisis countries, and their lack of competitiveness compared with Germany and other advanced Euro countries. </p>
<p>Austerity was not successful in reducing debt levels in the crisis countries. But increasing deficit spending in Italy and other crisis countries will raise debt levels, making the aim of debt reduction even more elusive. Once again the confidence of financial markets and the ECB’s commitment to do “whatever it takes” to avoid financial meltdown will be tested. If the ECB fails to put its money where its mouth is, the Euro will collapse for financial reasons. If the central bank honours its commitment and bails out Italy or another crisis country after austerity rules have been relaxed, then the Euro may come to an end as a result of the political backlash in Germany and other parts of the eurozone. </p>
<p>The deregulation of the labour market, the second leg of Renzi’s reforms, is designed to close the gap in competitiveness with other Euro countries. This is urgently necessary because the imbalances in the balance of trade and hence in the current accounts of Euro countries are one of the main structural problems of the currency. However, it is doubtful that Renzi’s reforms can depress wages sufficiently to close the competitiveness gap. Even after Schröder’s large-scale reforms, real wages dropped only marginally – and it is far from certain that Renzi will be able to implement changes on a similar scale.</p>
<h2>Spending review</h2>
<p>What choices is Europe left with? <a href="http://www.slate.com/blogs/moneybox/2014/06/11/economic_austerity_how_it_failed_in_one_chart.html">Austerity failed</a> but it seems that if crisis countries are given more rope they will only hang themselves. The answer to this dilemma may lie in geography. Austerity has to end where it began not where its consequences are felt most harshly. If public and private spending is increased in Germany and other booming Euro countries this would lead to increasing wages and higher costs there. This is a way to reduce differences in competitiveness without having to severely depress wages in the crisis countries. In addition, additional demand from the booming centre of Europe would provide the peripheral crisis countries with an outlet for exports and help to stimulate growth there without adding to the debt burden. </p>
<p>It is unlikely that Germany will decide to go on a spending spree just to help out its European neighbours. But there are several areas in which boosting expenditure would make sense also from a perspective of narrow national interests. German infrastructures are in dire need of an upgrade. A renovation of internet infrastructure is much debated and if the end of nuclear energy and the substitution with green energies is to become a reality, major investments in energy production and distribution facilities will be necessary. </p>
<p>Education is another area where Germany needs to spend more. Already now, schools and universities are falling behind. If Germany wants to remain a world leader in research and development it needs to invest to make sure school leavers and university graduates remain among the best in the world.</p>
<p>Finally, there is the large and growing sector of working poor in Germany. The introduction of a minimum wage was a step in the right direction but much more needs to be done to raise wages and hence consumption in these parts of population. Taken together, similar measure could help to kick-start the Eurozone economy and give stability to the Euro, while laying the foundations for Germany to go from strength to strength over the next decades. </p>
<p>What Europe needs is another round of reforms in Germany, not European leaders imitating German reformers of ten years ago. As Marx once pointed out historical figures tend to appear twice. First as tragedies then as farces. Certainly when Italians imitate Germans it tends to get particularly farcical. But this time may be different. The true tragedy may be still to come. </p><img src="https://counter.theconversation.com/content/28690/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Florian Schui does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Even Angela Merkel now seems to agree that austerity has run its course. When Italy’s prime minister, Matteo Renzi, together with other European leaders, led a fresh charge against the ill-fated policy…Florian Schui, Lecturer in History, University of St.GallenLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/257812014-05-22T13:56:56Z2014-05-22T13:56:56ZEU election: first electoral test for new PM Renzi in Italy<p>In Italy, as elsewhere, elections for the European parliament have always tended to be “second order”. This means that voters see them as less important than the “first-order” elections for the national parliament and thus often use them as an opportunity to cast a protest vote or to send “messages” to national politicians. </p>
<p>Aware of this tendency, politicians focus their campaigning (and journalists their reporting) on national issues, with the result that European election campaigns are not primarily about the parliament or what its members do there but about the distribution of support between politicians, policy positions and parties in the national arena.</p>
<p>Against this background, the main focus is on the implications of the outcome for the recently installed prime minister, Matteo Renzi and his government. There is also much interest in the <a href="http://www.thelocal.it/20140516/why-has-italy-turned-eurosceptic-overnight">growing Euroscepticism</a> as expressed by a number of parties led by Beppe Grillo’s Five-star Movement (M5S). Observers are also keeping an eye out for signs of a <a href="http://www.opendemocracy.net/can-europe-make-it/michele-barbero/can-alexis-tsipras-save-italian-left">resurgence of the radical left under Greek opposition leader Alexis Tsipras</a> and on the domestic reform implications of a poor result for Forza Italia (FI) under its ageing leader Silvio Berlusconi. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/49261/original/gyjx5x9j-1400755061.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/49261/original/gyjx5x9j-1400755061.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/49261/original/gyjx5x9j-1400755061.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=323&fit=crop&dpr=1 600w, https://images.theconversation.com/files/49261/original/gyjx5x9j-1400755061.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=323&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/49261/original/gyjx5x9j-1400755061.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=323&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/49261/original/gyjx5x9j-1400755061.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=406&fit=crop&dpr=1 754w, https://images.theconversation.com/files/49261/original/gyjx5x9j-1400755061.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=406&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/49261/original/gyjx5x9j-1400755061.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=406&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="attribution"><a class="source" href="http://europa.eu/about-eu/countries/member-countries/italy/index_en.htm">Europa.eu</a></span>
</figcaption>
</figure>
<p>As the post-election standing of every one of these causes and parties will have very significant implications for the future direction of Italian politics, it is not surprising that commentators, if not the general public, are awaiting polling day with an unusual degree of eager anticipation.</p>
<h2>Renzi’s first test</h2>
<p>May 25 will be the first electoral test for Renzi, the charismatic 39-year-old who <a href="https://theconversation.com/springtime-for-matteo-renzi-italys-untested-political-tyro-23323">secured the premiership</a> in a “palace coup” in February. His audaciousness seemed to confirm popular assumptions of his ability to shake up the existing power structures against the odds.</p>
<p>Renzi is a politician with little ideological baggage; one who promises a Blair-style policy revolution capable of extending his party’s appeal across the political spectrum. If the Democratic Party (PD) does well it will strengthen Renzi’s hold over his party and therefore his ability to pursue <a href="http://online.wsj.com/news/articles/SB10001424052702304626304579509721468661850">labour-market and institutional reform</a>, currently provoking significant internal divisions. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/49265/original/6zc4ybnx-1400757089.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/49265/original/6zc4ybnx-1400757089.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/49265/original/6zc4ybnx-1400757089.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=455&fit=crop&dpr=1 600w, https://images.theconversation.com/files/49265/original/6zc4ybnx-1400757089.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=455&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/49265/original/6zc4ybnx-1400757089.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=455&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/49265/original/6zc4ybnx-1400757089.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=572&fit=crop&dpr=1 754w, https://images.theconversation.com/files/49265/original/6zc4ybnx-1400757089.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=572&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/49265/original/6zc4ybnx-1400757089.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=572&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Poll taken by Euromedia for Porta a Porta. Published May 9.</span>
<span class="attribution"><a class="source" href="http://metapolls.net/category/europe/euroelections-2014/italy-euroelections-2014/#.U33RkPldXsY">Graphic courtesy of Metapoll.net</a></span>
</figcaption>
</figure>
<p>His strategy of attacking entrenched privilege is designed to cut the ground from under the feet of the Five-Star Movement (M5S) whose explosive growth at the 2013 general election was due to a wave of popular protest against established party interests and to widespread demands for political renewal. Its <a href="http://openeuropeblog.blogspot.co.uk/2013/03/anti-euro-party-grillos-advisor-says.html">call to consider withdrawing from the euro</a> reflects its success in linking its critique of representative democracy with opposition to austerity. </p>
<p>By exploiting widespread popular discontent with EU-imposed austerity, then, the M5S both expresses and feeds a Euroscepticism once extremely rare in a country which saw in European integration the road to liberation from the perceived shortcomings of its own public institutions.</p>
<p>The radical left, meanwhile, has come together under the label: “The other Europe with Tsipras” – in reference to the Greek opposition leader’s anti-austerity vision. The Other Europe, founded in March by a group of far-left intellectuals, But the left’s is diametrically opposed to the anti-European, xenophobic assumptions driving the anti-austerity of the right. </p>
<p>Finally, Berlusconi’s Forza Italia (FI) has adopted an ambiguous position reflected in the slogan: “More Italy in Europe, less Europe in Italy!” – a slogan that accurately reflects the rather schizophrenic attitude of a party which has always tended to combine the pro-European credentials deriving from its membership of the European People’s Party with periodic anti-European outbursts on specific issues.</p>
<p>The best performing party is the PD with more than 30%, followed by the M5S with around 23-25%, FI at around 18% and the remaining parties are hovering at or around the exclusion threshold of 4%.</p>
<h2>Vote with extra meaning</h2>
<p>Berlusconi’s political decline poses a significant threat to Renzi and to long-awaited <a href="http://www.ft.com/cms/s/0/e3cdc5e6-b8fe-11e3-98c5-00144feabdc0.html#axzz32RTgJXFU">reform of the political system</a> which depends to a certain extent on the continuing strength of FI to check the growing popularity of the M5S. If FI does badly at the EU elections, then Berlusconi’s followers’ perceptions that his political career is over could turn into a self-fulfilling prophecy. The elections will therefore not only be a referendum on Europe and the performance of the Renzi government but they are also likely to determine the future shape of the Italian political system as a whole.</p><img src="https://counter.theconversation.com/content/25781/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>James Newell does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>In Italy, as elsewhere, elections for the European parliament have always tended to be “second order”. This means that voters see them as less important than the “first-order” elections for the national…James Newell, Professor of Politics, University of SalfordLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/233232014-02-17T10:30:54Z2014-02-17T10:30:54ZSpringtime for Matteo Renzi, Italy’s untested political tyro<figure><img src="https://images.theconversation.com/files/41687/original/6myhdssm-1392630724.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Consummate political performer: Matteo Renzi</span> <span class="attribution"><span class="source">Mario Carlini / Iguana Press</span>, <a class="license" href="http://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span></figcaption></figure><figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/41687/original/6myhdssm-1392630724.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/41687/original/6myhdssm-1392630724.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/41687/original/6myhdssm-1392630724.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=399&fit=crop&dpr=1 600w, https://images.theconversation.com/files/41687/original/6myhdssm-1392630724.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=399&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/41687/original/6myhdssm-1392630724.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=399&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/41687/original/6myhdssm-1392630724.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=502&fit=crop&dpr=1 754w, https://images.theconversation.com/files/41687/original/6myhdssm-1392630724.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=502&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/41687/original/6myhdssm-1392630724.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=502&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Consummate political performer: Matteo Renzi.</span>
<span class="attribution"><span class="source">Mario Carlini / Iguana Press</span>, <a class="license" href="http://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span>
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<p>Three weeks can be an awfully long time in politics. Last Thursday, Matteo Renzi, the new leader of Italy’s Democratic Party (PD) – the largest member of the country’s ruling coalition – <a href="http://www.youtube.com/watch?v=SWISeYcqe5Q">announced</a> that there needed to be a change at the head of the government, led since last April by Renzi’s PD colleague, Enrico Letta. It was time for Letta to go and time for Renzi to become prime minister. The members of the PD assembly agreed, backing him by 136 votes to 16.</p>
<p>This of course was the same Renzi who had spent much of the previous two months since his election as party leader in December insisting that he had no desire whatsoever to replace Letta. On January 17, for example, Renzi had stated on a popular television chat show: “<a href="http://www.youtube.com/watch?v=1Ftub-DZsfQ">Enrico, relax. Nobody wants to take your place. Continue. Do what you have to do</a>” (listen out at 18:35 for Renzi saying “Enrico stai sereno” in a reassuring tone). He later re-iterated in the same interview: “I am not trying to take his place”. This week, Renzi will almost certainly take his place.</p>
<p>“Ambitious politician waits until the right moment to reveal desire to become prime minister” is hardly an earth-shattering newsflash for anyone used to political life. Prime ministers know that some of those in their party’s elite or around the cabinet table believe the top job should be theirs. They also know that pretenders to the throne may not be willing to wait for it to be passed on to them, but will try to seize power by orchestrating a takeover. </p>
<p>Challengers may create the conditions for this by providing damaging leaks to friendly journalists and subtly canvassing support among party colleagues while all the time repeating in public that the PM has their full support. Then they make their move, casting it as essential for the party’s future prospects. It might sound underhand. But it’s all in the game.</p>
<p>Nonetheless, many Italian <a href="http://www.corriere.it/editoriali/14_febbraio_13/giochi-pericolosi-editoriale-409db7a6-9477-11e3-af50-9dc536a34228.shtml">commentators</a> both in print and social media have claimed in the last few days that what Renzi has done is not “normal” elsewhere and that in other parliamentary democracies prime ministers come into power only after having won elections. This is obviously nonsense. Two of the last four prime ministers in both Britain and Ireland took office without going to the public first to get a mandate (John Major and Gordon Brown, John Bruton and Brian Cowen, in case you were wondering). While Julia Gillard and Kevin Rudd in Australia both became prime minister at the expense of the other (in 2010 and 2013) thanks to the votes of the Labor caucus, not the people. </p>
<p>Indeed, Renzi’s protestations that he was not interested in displacing Letta recall those of Rudd last year. Take <a href="http://www.theaustralian.com.au/news/kevin-rudds-leadership-push-its-on-ice-until-after-the-election-at-least/story-e6frg6n6-1226578589368">this interview</a> in February 2013 when Rudd said those suggesting he was after Gillard’s job needed to take ice baths. Four months later, he took her job.</p>
<p>Changing the prime minister without an election is risky, but there is nothing illegitimate or overly exceptional about it. In fact, not having the leader of the largest party in a ruling coalition as prime minister is probably far more anomalous. What is unusual, however, is Renzi’s lack of experience. He has never served a day in parliament and his most significant institutional role to date has been as mayor of Florence since 2009. </p>
<p>With all due respect to my Florentine neighbours, running a city of less than 400,000 inhabitants is not necessarily the best preparation for leading one of the world’s top ten economies (especially as it struggles to emerge from a long financial and political crisis).</p>
<h2>Smooth operator</h2>
<p>Nonetheless, I am cautiously optimistic about Renzi’s prospects. He is the best natural political communicator in the country. He is full of enthusiasm and drive. And, unlike his many predecessors on the centre-left, he does not seem to suffer either from a political inferiority or overbearing moral superiority complex towards the man who has dominated Italian politics for two decades: Silvio Berlusconi. In fact, Renzi has rightly waved aside howls of indignation from those on the Left and met Berlusconi in order to try and reach an agreement on the institutional and electoral system reforms which Italy so badly needs.</p>
<p>And Renzi is young. At just 39 he will be the youngest ever prime minister in a country which may finally be starting to lose its status as “a country for old men”. Italy’s political, business, civil service, academic and media elites remain gerontocracies – and will probably continue to do so for many years – but Renzi’s emergence and rise to the top is a very positive development in this sense.</p>
<p>Being young however does not mean he has time on his side. The next six months will be crucial for him – can he manage to pass reforms in one of the most reform-adverse political systems in Europe? Can he overcome his lack of experience and not just talk the talk (which he does so well), but walk the walk? All the while, he will be well aware that there are many within his own party who, although they are backing him now, would delight in seeing what they consider an overly centrist egocentric fall flat on his face. And they would be very quick to begin the exact same kind of back-biting and manoeuvres that led to Renzi displacing Letta.</p>
<p>So far, Renzi has barely put a foot wrong in his career. Everything he has done has appeared perfectly calculated and timed. Even the fact that he seems set to become prime minister just as the first days of Spring are arriving in Italy seems almost too coincidental for one so concerned with image and presentation. As does the proximity of his taking office to the announcement last week that the country’s economy was growing again for the first time since 2011. Renzi’s time in power will begin amidst positive omens. If he can build on them, few will care about how he got there.</p><img src="https://counter.theconversation.com/content/23323/count.gif" alt="The Conversation" width="1" height="1" />
Three weeks can be an awfully long time in politics. Last Thursday, Matteo Renzi, the new leader of Italy’s Democratic Party (PD) – the largest member of the country’s ruling coalition – announced that…Duncan McDonnell, Marie Curie Fellow, European University InstituteLicensed as Creative Commons – attribution, no derivatives.