Political upheavals

Euro-scepticism didn’t win out: Italy, Hungary and Poland collectively amount to 25%, but the governments of the major EU countries are all under pressure

The European elections at the end of May brought to light how Italy’s is no longer aligned with its traditional partners. In no other major European country Euro-scepticism held sway like did in the Italian peninsula. Forty percent of the Italian electorate opted for a nationalist party, Matteo Salvini’s League or Giorgia Meloni’s Fratelli d’Italia. North of the Alps, the Euro-sceptic wave fell flat. In Germany, Chancellor Angela Merkel and her Christian Democrats had their most disappointing showing since 1949, but this mainly benefitted the Greens and not the radical right. Alternative für Deutschland only rustled up 10% of the votes. In Spain, the Neo-Franchist movement Vox obtained just 6%, without anything like the success they’d recorded in Andalusia last December. The only ambivalent country among Europe’s greats is France. The Rassemblement National obtained 23.5% of the vote, topping French President Emmanuel Macron’s la République en Marche. The result is significant, but it’s more of a confirmation that a novelty. For years now the country has had to come to terms with a party steeped in a broad and retro nationalism that picks up votes among the victims of globalisation and decolonisation. It’s not the euro they’re against, it’s the proud and nostalgic memory of a France of the past they’re trying to revive.

The Italian isolation compared to its neighbours is probably more cultural than political. Unlike the other eurozone countries, even twenty years since the introduction of the single currency, Italy is still having trouble adapting to the rules of the monetary union. It has failed to achieve much of the modernization imposed by participation in the eurozone. The country is undoubtedly among the world’s greatest exporters, but it has stubbornly refused to reduce its public debt, liberalise its economy and abandon the ingrained corporate structure of its society. More than elsewhere Euro-scepticism in Italy is reactionary. The Italians view the rules of the single currency and the requirements of the Stability Pact as a threat to its social structure that over the decades has allowed wealth to be redistributed mainly through accruing public debt. And it matters little if today it’s this same public debt that is weighing down the economy and increasing the tax burden, if cronyism undermines free enterprise, and family allegiances are expensive and inefficient: a broad section of Italian society continues to refuse to accept the need to modernise the country. We’d be lying to ourselves if we blamed the emigration of thousands of young people on growing concerns about the political situation. It may be that some decide to leave the country fearing authoritarian tendencies or a debt crisis: but most of them leave the country because the entrenched tribal and fiercely trade unionist system, placed under stress by the economic crisis, the EU regulations and global competition can no longer satisy the national crony networks, and this means that the young and the enterprising find now place within the job market. The responsibility lies with all the political parties, not just the League and the Five Star Movement, currently in power.

Conversely, Italy’s main neighbours have adapted to the euro. Germany did so at the beginning of the 2000’s with its Agenda 2010 promoted by Gerhard Schröder’s chancellorship; France was forced, willy nilly, to fall in line; Spain is enjoying a new Renaissance after a banking crisis which it tackled by accepting a loan from Europe that has enabled it to clear its credit balances and bolster its economy. Italy’s Euro-scepticism is not only stronger than elsewhere, it’s also more genuine, in that it doesn’t harp back to past forms of nationalism, it is a knee-jerk reaction to victimisation and frustration spawned by a refusal of the single currency and its rules. A few institutions will be affected by the electoral result more than others.

As far as the European Commission is concerned, the choice of portfolios of the individual commissioners does not depend on the Twenty Eight and the European Council, which only appoint the president of the EU executive. It’s the latter that then assigns the posts to the candidates put up for election by the member states. In the past the more controversial and euro-sceptical candidates have been isolated and been assigned minor portfolios. A case in point is the Hungarian Tibor Navracsic in the current Juncker Commission, who is responsible for sport and culture. Even the European parliament plays a decisive role in the selection of the commissioners. In the past, the parliamentary assembly has rejected candidates who were not acceptable, such as Rocco Buttiglione in 2004 who had claimed homosexuality was “a sin”. The college of commissioners reaches decisions by consent. The experience of the last ten years shows that as time passes political differences fade, the kinks are ironed out and the esprit de corps gets the better of partisan politics.

On the parliamentary front, though it is true that the major people’s party and socialist coalition will need help from the Liberals and the Greens to govern, the majority of its members is still strongly pro-Europe. The euro-sceptic parties secured 25% of the votes, in other words 171 members of parliament (154 in 2014, equal to 20% of ballots cast). The challenge for them will be creating a single parliamentary group (today these movements are dispersed over three different groups) so that they can have a say in the legislative debates and the political negotiations. The early negotiations have shown how these nationalist parties have different sensibilities, contrasting objectives and diverging cultures. And that’s not all: will these movements, particularly if in power, wish to enter a close relationship with a governing majority that in Italy is suggesting the country could leave the euro? The unavoidable contagion could affect countries close to Rome, even if they are outside the euro. Hungary has not forgotten how when the financial crisis reached its peak, in 2008, it was forced to ask for the help of the International Monetary Fund, and was granted a loan of 11.6 billion dollars. Ever since then they’ve balanced their books. If Italy decided to betray the rules governing the euro it might find itself even more isolated that it is right now.

The weakest of the institutions is probably the Council. The co-legislating organism alongside the parliament that represents the Union’s 28 countries usually reaches decisions based on a qualified majority. Unanimity is only required in matters concerning tax policy and foreign affairs. The three countries that are forthrightly euro-sceptic or nationalist – meaning Poland, Hungary and Italy – all together don’t add up to a blocking minority (which would require 35% of the weighted votes). They could match this figure by joining forces with the Czech Republic and the United Kingdom, for example. In Brussels or Strasbourg, alliances come together or break apart over the various dossiers. There are no pre-established or predictable rules. The wagers are calculated and short term. International interests have a whole range of nuance. The risks of filibustering are easily spotted in the Council which even in recent years has trod water when having to deal with the flagging rule of law in Hungary or Poland.

None of the governments of the Union’s major countries can rest easy. Of the three leaders of Germany, France and Spain, the one who at present seems to be in the best position, after the May elections, is the Spanish premier Pedro Sanchez. However, more in general, Italy’s neighbours have all adapted to the euro, despite pockets of euro-scepticism here and there. They have no intention of challenging the single currency anytime soon. In fact, the euro is part of their future. They are probably ready to accept Italy’s grumbles, as it tries to defend its supposed nationalist interests with greater energy than in the past; but Italy won’t get much backing if it threatens the stability of the monetary union or heads on an authoritarian path. In this case, the country will be left to its own devices. Berlin, Paris and Madrid would follow the investor’s instincts, who when faced with too many risks is primarily concerned with cutting his losses.

@BedaRomano

This article is also published in the July/August issue of eastwest.

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