John Redwood's Diary: The Italian referendum

Democracy
Friday, December 2, 2016
The Rt Hon. John Redwood MP

 

Read the original article at John Redwood's Diary

The polls say Mr Renzi, the Italian Prime Minister, will lose his referendum.

He has been seeking a way to ensure that his party, whose Democrat party  polled just 25% of the vote in the last election, can form a majority government in  the Chamber of Deputies and not have to worry about the other parties or the Senate, which will be turned into an unelected chamber with little power.

The reason Italian politics is so unstable is the country is very split between a wide range of parties. Proportional representation increases the pressures to form more parties and run more extreme or pure policies through them. In 2013 the Grillo 5 Star party got the largest share of the vote by a very narrow margin over Renzi’s party, but the Democrats managed to form a centre left coalition. Frustrated by the compromises and limitations coalition imposes on trying to reform and govern, Mr Renzi has come up with a wide ranging  plan to change the way future elections are judged.

The biggest underlying cause of discontent with all the parties is probably the poor state of the Italian economy, with slow growth and mass unemployment,which has hit  the young especially hard. Italy’s state debts are far too high for EU rules, and Italy has to curb her deficit to show some willing under the Euro scheme. Italy has some weak banks struggling to handle bad loans and in need of additional capital.

Some argue that if Mr Renzi does lose over the week-end the way is open for Mr Grillo to take over at a subsequent election, which has to be held before May 2018 and may be earlier. Whilst Mr Grillo is critical of the austerity driven Euro policies, he and his supporters are not the same kind of Eurosceptic force as we see in the AFD in Germany or the NF in France. Whether the answer to the referendum is Yes or No, Italian politics is likely to remain volatile with no clear winner. The public will continue to protest against the consequences of Euro membership but that may not make them ready to want to leave it, as we saw with the people of Greece.