After 11 weeks of negotiations, the populist parties that triumphed in March’s Italian elections have agreed on who should be Italy’s new prime minister. Before they could settle on Giuseppe Conte, a 53-year-old law professor with no previous political experience and little political conviction, they had to agree that Silvio Berlusconi, an 81-year-old swinger with plenty of political experience and convictions for tax fraud and wiretapping, should not be prime minister.
Only when Berlusconi withdrew did a deal become possible. This, as much as Conte’s inexperience and the ideological differences between his patrons, the old-right Lega and the alt-left Five Star Movement, suggests that Conte is not going to be a real prime minister at all, but a messenger who happens to sit in a big chair.
The terms of the message are still being worked out but, whatever it is, it won’t please the European Union. March’s election result confirmed that the Italians, once the most Europhile of EU publics, are deeply disenchanted with the union. The reasons for the electoral rebellion are a stagnant post-2008 economy, high youth unemployment, mass immigration from the Middle East and Africa, and the utter failure of Italy’s political class to do anything other than feather its nests and fill its pockets.
In 2008, Italy’s GDP was equivalent to $2.39 trillion. In 2016, Italy’s GDP was $1.85 trillion, which is where it was in 2005. Italy’s public debt is equivalent to 132 percent of its GDP; the third-largest debt of any developed economy. As of January 2018, youth unemployment was at 31.5 percent. This is not as bad as Spain (36 percent) or Greece (43.7 percent), but it is twice as high as the EU average (16 percent), and roughly five times’ higher than in Germany (6.6 percent).
A lost decade, and frustration at the way in which Berlusconi, having promised to get rid of Italy’s corrupt postwar political class, replaced it with another corrupt political class, produced the electoral upset of March 2018. The Five Star Movement, a populist anti-party of left-wing provenance founded by the comedian Beppe Grillo, won the most votes (32.7 percent), but a center-right coalition of four parties carried a plurality (37.35 percent). The dominant parties in that coalition were the Lega (League), a populist party of hard-right and regionalist provenance (17.35 percent) and Berlusconi’s Forza Italia (14 percent). Berlusconi’s withdrawal allows the Legal and Five Star to form a working coalition, with Conte as their puppet.
Italy’s president, Sergio Mattarella, now has to approve Conte’s nomination. He has no grounds to refuse. No one knows what Conte’s first ventriloquized statements will be, but their drift is clear. Five Star and the League have surged to power on the back of massive popular dissatisfaction with the EU’s post-2008 economic and immigration policies, and with a domestic political class that, when it lifts its nose from the trough, is complicit with Brussels.
For the first time, populists have taken over a western European state. Or rather, two populist parties who hate each other have made an alliance of convenience against their common enemies. The League, based in the northern industrial city of Turin, is one of Europe’s more established New Right parties, and a political party in the traditional sense. Under its current leader, Matteo Salvini, the League has managed to shed its recurrent taint of racism and nostalgia for Mussolini.
The Five Star Movement is not a party: Beppe Grillo, like Mussolini, founded an anti-party. The capital “V” in MoVimento Cinque Stelle stands, Grillo says, for Vaffanculo!: “Fuck off!” Five Star is as much a political cult as a people’s movement. It may now be led by Luigi de Maio, but its office remains Grillo’s website. Five Star could be called “alt-left,” in that it emerged from the collapse of the institutional parties of the left, and from Grillo’s failure to secure a leading position in one of them. Again, the parallels to Mussolini’s fascism are striking.
The Five Star-League alliance is ideologically tense and perhaps untenable in the long term. But it looks like they will divide their turf domestically. The League wants to free the Italian economy from its bureaucratic and legal paralysis. Five Star has promised a universal basic income for the unemployed, the restoration of the social safety net, and free internet as a human right. Both parties want to get the trains running on time, and both have promised to fill them with unwanted migrants.
Neither party has experience of government at the national level. The League does have experience in running northern cities and regions. But Five Star is full of neophytes. The failure of Five Star’s Virginia Raggi, mayor of Rome since 2016, suggests that while Five Star has more seats in the parliament, the League has a better understanding of how government works. Conte, for what he is worth, is a Five Star-ish post-leftist with technocratic leanings.
In the past, both Five Star and the League have been explicitly Euroskeptic. The League, which is still registered under its full name, the Northern League for the Independence of Padania, has proposed that Italy’s industrial north should secede from Italy as the state of Padania, and held pro-autonomy referenda in the northern regions of Veneto and Lombardy. In the run-up to March’s elections, both the League and Five Star moderated their positions. The likelihood is that they will send Conte to Brussels to ask for debt relief. The League and Five Star have agreed a spending program that would cost 100 billion euros year. To find it, they need the European Central Bank to forget that, during post-2008 quantitive easing, it spent 250 billion euros on Italian sovereign bonds.
This sets Italy on a collision course with the EU. Manfred Weber, who leads the European People’s Party grouping in the Brussels parliament, has warned that Five Star and the League are “playing with fire, because Italy is already heavily indebted.” On Sunday, Bruno Le Maire, France’s finance minister, said that Italians “must understand that the future of Italy is in Europe and nowhere else,” and that Italy should “respect” the rules. But a future in Europe is not the same as a future in the Eurozone. Last week, a leaked document showed that Five Star and the League want the EU to create a mechanism for countries to leave the Eurozone. Reviving a weak national currency would be another way to dissolve Italy’s Euro-denominated debts.
Italy is not Greece. In 2016, Greece’s GDP was $194 billion, about the same as Kentucky’s ($197 billion). Italy’s GDP ($1.85 trillion) is between that of Texas ($1.6 trillion) and California ($2.62 trillion), or Britain, which has California’s GDP but not its climate. Greece has no economic leverage against the EU, but Italy and Britain do. Thus the EU is able to ignore Greece’s pleas for debt relief, but is obliged to negotiate with Britain. The question is, will the EU feel obliged to negotiate with Italy, when a majority of Italians still want to remain in the EU, and when neither party in Italy’s unlikely coalition has a solid position on its EU policy?
It’s possible that Italy will become a laboratory for the new European politics—against the immigrants, for the natives, accommodating toward Russia, skeptical toward Brussels. It’s quite likely that the populists will bungle their chance at government, and create an opportunity for Berlusconi, with whom the EU would prefer to deal. It’s very likely that the EU will refuse to negotiate a custom deal for Italy. If it did, the EU would encourage Spain, Portugal and Greece to ask for debt relief, and a refusal often offends, leading to further anti-EU sentiment in Europe’s southern tier. Whatever happens, just when the Eurozone seems to be tipping into recession, the EU is about to face a crisis in relations with a core member.
