Analysis

Shepherding Italian democracy

03.01.13 @ 09:35

  1. By Leigh Phillips

BRUSSELS - There has been a great deal of flurry in recent days over the resignation of Italy's unelected technocrat Prime Minister Mario Monti, the consequent snap elections scheduled for February that have spooked markets, and Italy's “return to a fully democratic government”.

  • Rome: Monti's 'responsible policies' to continue for the sake of the stability of Europe? (Photo: Giampaolo Macorig)

However, it is quite premature to be predicting the restoration of democratic norms in the country - and indeed in much of the eurozone - and it is high time that progressives began to care as much about the extra-democratic shenanigans of EU power-brokers as they do about their disastrous austerity policies.

Monti resigned after the conservative People of Freedom party of ousted leader Silvio Berlusconi withdrew its support for his non-party government. Tied to Monti's unpopular austerity measures and a hated property tax, Berlusconi's party is languishing at 15% in the polls and hopes to make a comeback by denouncing what he now describes as Monti's 'Germano-centric' policies.

Threatening eurozone stability

Berlusconi's berserker move has set European elites into convulsions. The elections are expected to be a pandemonium and any continuity in the imposition of EU-agreed austerity and structural adjustment policies is now unknown, threatening the eurozone's current quite fragile stability.

Elections almost anywhere in Europe at the moment petrify Brussels, Berlin and Frankfurt because there is the possibility that a change in government will introduce a change in economic policies. Leaders – and even EU civil servants - normally reluctant to say anything about foreign elections out of fear of accusations of interference, instead regularly warn voters to be 'sensible' and declare that fiscal policies must remain untouched however people vote.

They publicly denounced the left-social-democratic 'extremists' ahead of votes in Greece and the Netherlands, and after anti-austerity governments failed to materialise, they were gushing in their praise for the pragmatism and reason of voters.

There has been a not-so-quiet sigh of relief that French President Francois Hollande's criticisms of austerity on the campaign trail were largely been abandoned once he arrived in the Council chamber.

Indeed, as a result of this fear of voters upsetting their plans, one of the core projects of EU leaders since the advent of the crisis has been to progressively remove fiscal decision-making powers from elected parliaments and place them in the hands of European bureaucrats and judges, just as monetary policies have been removed from the realm of democracy and placed in the hands of independent central bankers.

So Berlusconi's pulling out his brick from their delicately balanced leaning tower of fiscal Jenga and setting off an unexpected election, is an utter disaster for them given the uncertainty of what the voters might do.

Monti waited a few days after Berlusconi's gambit till he had passed the 2013 budget before resigning, but otherwise, a raft of legislation in the works for months, including, crucially, the balanced budget bill demanded by Germany, but also bills deregulating and slashing the rolls of the civil service, but also covering competition and taxation, will now have to be abandoned. Monti has also taken to introducing a number of measures by decree that will no longer be able to be confirmed. Markets have reacted with the predictable vapours and the bloc's southern economic flank is all a-wobble once again.

European centre-right leaders for their part immediately called in Berlusconi for a dressing down and to encourage him to continue his support for the Monti administration. On 13 December, Wilfried Martins - the head of the European People's Party, the grouping that clubs together most of Europe's conservative parties – stage-managed a summit in Brussels where neither Berlusconi nor Monti knew until the last minute that the other would be appearing.

"It was a clarifying meeting in which we wanted to hear about the political situation and to express our massive support for the policies pursued by Monti, not only for Italy, but for the stability of the eurozone as a whole," is how Martens described the meeting, adding that it would be “a great loss” were Monti to “disappear”. Both the Finnish and Swedish prime ministers said that Monti's “responsible policies” had to continue for the sake of the stability of Europe.

Monti - senatore a vita

The problem for European power-brokers is that no one other than Monti can be allowed to be Italy's prime minister. Or, to be precise, for the sake of the Euro and core European financial interests, no other economic policies can be allowed, and no one other than Monti can be trusted to impose them.

Ahead of an EU summit in December, in an interview with Italian financial daily Il Sole 24 Ore, European Commission President Jose Manuel Barroso warned that the early elections must not hinder forward movement with Monti's policies, lest fresh crisis undermine the last year's increased market confidence: "The next elections must not serve as a pretext for putting in doubt how indispensable these measures are.”

But Monti knows that he would lose badly were he to formally stand for election. Angry at the painful EU-devised policies that have fallen largely on ordinary Italians, some 61 percent of voters do not want him to stand, and analysts have suggested that at most he would win 15 to 20 percent of the vote if he did.

Last Sunday (30 December) in a much awaited end-of-year address, Monti declared that he would not be running for office, but that he would be willing to continue to rule the country, should he be called on to do so: "I would ... be ready to assume one day, if required by circumstances, the responsibilities that would be entrusted to me by the parliament."

Conveniently under the Italian system, as a senatore a vita - or senator for life - Monti does not need to formally announce his candidature for the February polls. So, he will be the face - but not a candidate - of a new centrist coalition bringing together the Christian Democrats, the Future and Freedom party of 'post-fascist'-turned-liberal Gianfranco Fini, and the Alliance for Italy of political chameleon Francesco Rutelli – a sort of liberal green outfit.

The hope is that combined as backing the 'Monti Agenda', these forces will deliver an electoral result that is more than the sum of their parts. One pollster quoted by Agence France Presse reckoned the new alliance could win as much as 24 percent of the vote, which if the prediction is realised, would put them in second place after the pole-position Democratic Party on 30 percent.

Autocratic manoeuvring

Most surveys suggest that the centre-left Democrats under Pier Luigi Bersani will handily win a majority in the lower house, the Chamber of Deputies, but will have to come to an agreement with centrist parties in the Senate. In any case, although Bersani has distinguished his party from Monti by arguing for greater fairness in the implementation of austerity, he has pledged repeatedly that he will maintain the broad outline of the EU-agreed fiscal strategy if he wins.

At the time of writing, Berlusconi's forces meanwhile are split and moulder at 15% in the polls. Even with an alliance with the hard right anti-immigrant Northern League, he could not currently breach 25%. Monti and his European backers will be hoping that the new centrist grouping will be able to wean enough centre-right voters away from the mercurial Berlusconi to block him, while also attracting sufficient centre-left voters to just pip the Democrats, or at least strengthen Monti in any post-election negotiations with Bersani.

If Monti cannot win quite enough of a mandate to win the premiership and have Bersani as his deputy, a Bersani-led coalition between the centre and centre-left with Monti as a “super economy minister”, would still be an acceptable outcome.

Whether as PM or finance minister, Monti could now attempt to claim something of a democratic mandate, even without actually running in the election. And the accusations of autocratic manoeuvring both domestically and at the European level have stung.

When Berlusconi was thrown under the bus last November and President Georgio Napolitano made Monti a senator for life – an accolade traditionally awarded Italians who have achieved "outstanding patriotic merits in the social, scientific, artistic or literary field" - it came just months after similar wangles by EU elites yanking the rug out from under Portugal's Jose Socrates and Greece's George Papandreou when they were deemed unreliable. Even some policy makers convinced that there is no alternative to austerity admit privately to feeling uncomfortable about the extra-democratic meddling.

All the same, the claim of any mandate would be woodenly dishonest. Without doing the honourable thing and resigning from the Senate, Monti still cannot claim anything other than that he was parachuted into Palazzo Chigi by core EU decision makers with the help of local compradors. Nevertheless, even a glistening of a patina of democratic approval would be a tremendous rhetorical help in the presumptive coming battles over labour-market liberalisation and axing of the public sector.

But all of this is a high-stakes gamble involving a motley variety of uncertainties.

Five Star Movement

Monti is not a comfortable campaigner. He has never won elected office. Meanwhile, the ever wily Berlusconi will be hoping that over the course of the campaign period he can reestablish himself through pugnacious anti-tax, anti-German rhetoric; re-organise and galvanise his supporters; and convince voters that he can deliver a less painful path through the crisis. Never underestimate Silvio's capacity to politically defibrillate himself.

Additionally, the centrists are very concerned that Bersani drop his anti-austerity ally, the Left, Ecology, Freedom (SEL) party of Nichi Vendola, currently on five percent, and upon whom the Democrats will likely depend for support. If Vendola ekes out a few more percent, Bersani will be less able to continue with business-as-usual austerity.

And then there is the great unpredictability of what role will be played by the anti-elitist comedian Beppe Grillo, whose pan-ideological Five Star Movement backed by playwright and Nobel laureate Dario Fo and economist Joseph Stiglitz sits in second place on 20% and promises to pull Italy out of the euro.

The only thing that appears sure is that the campaign will be chaotic and bitter. Most worryingly for Monti and his European backers, if he loses badly as the head of the new centrist bloc, it becomes a lot more difficult to subsequently re-impose him as technocrat superintendent.

Nonetheless, keep a close eye on how the 'practical men' of Europe react to a less-than impressive showing from Il Professore at the end of February. From forcing the Irish to vote on the Lisbon Treaty twice to pulling the plug on a trio of elected leaders in the eurozone periphery to the steady removal of fiscal policy from elected chambers, European elites have a great deal of practice now at smoothing the rough edges of democracy.

They always hope the right side wins elections, as it makes things a little easier. But there's always a Plan B in case the voters don't do what they've been told to.

Leigh Phillips, an EU affairs journalist and science writer, was formerly a reporter with EUobserver.

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