Even after Mattarella’s re-election, the Italian political system remains unstable

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It is an unspoken rule of Italian politics that the best solutions come only after approaching the abyss. In a political system characterized only by instability, the re-election of Sergio Mattarella as President of the republic on January 29 provides an institutional anchor which should hold until 2029. chaotic infighting, a decision that ultimately strengthens Draghi. Meanwhile, another highly reputable official, former Prime Minister Giuliano Amato, has been appointed President of Italy’s Constitutional Court. It is hard to imagine any other European country with three more competent and internationally respected administrators at the top of its institutions.

But the electoral process, conducted as a kind of real-time televised mole game with no less than 12 candidates crushed in less than a week, was a spectacle that once again exposed the fragility and confusion of the political system. Italian. The improvised strategies were thrown into the array one after another in a flurry of tweets and leaks; political leaders were discredited as their coalitions fell apart, failing to agree on presidential candidates. At the height of the confusion, the mother of all political ghosts emerged: a renewal of the radical populist alliance of 2018-19 between the League and the Five Star Movement (M5S), flanked by the far-right Brotherhood of Italy. This anti-establishment and potentially anti-European and anti-Atlantic alliance could control a parliamentary majority and could have elected its presidential candidate. It was probably this possibility that led a reluctant Mattarella, pressured by Draghi, to accept a second term before it was too late.

The ineffective Italian political system

The Italian President does not exercise executive powers. Nonetheless, their function as guarantors of stability has become increasingly important over the past 20 years as new political forces have grown stronger to challenge the traditional pro-European economic policies and Atlanticist foreign policies of the EU. Italy. In recent years, the Brothers of Italy, the League and the M5S have also questioned the need for Italy to remain in the euro zone, blaming European integration for the poor performance of the Italian economy in the over the past 30 years. It is easy to imagine that these issues will be important when campaigning for next year’s general election. In the coming months, Italy will benefit from EU economic stimulus funds but will suffer from the tightening of monetary conditions in the Eurozone. Blaming Europe and the euro will allow populist politicians to overlook the fact that most of Italy’s problems are internal.

In fact, the euro has institutionalized — but also made more transparent — the external constraints Italy was already grappling with in the early stages of globalization. In a context of strong global interaction, a democratic state must rely on its ability to govern on the basis of a balanced distribution of constitutional powers. It must be able to guarantee fundamental freedoms, but also the effectiveness of political decisions. Despite some quality administrations, the Italian political system has failed in terms of efficiency and coherence over the past three decades.

Italian society and economy lacked far-sighted impulses from policymakers who were primarily concerned with securing short-term consensus while fighting financial instability. Even the highest levels of the Italian institutional establishment were prone to demagogy, but without the financial means to achieve it, which led to the volatility of popular consensus. Since 1994, in every election, voters have punished the parties in power. The response of the party system has always been to demand new electoral laws as if the problem were the “demand for politics” by the citizens rather than the “supply” provided by the political forces. These are expressed, with a permanent sense of urgency, through the alternation between populist choices and antidotes adopted by technical governments like that of Draghi.

The implementation of new electoral laws was far from being a sufficient remedy. The idea that political stabilization does not require reflection on the merits of policies has been misleading. In fact, by Italian standards, the last 30 years have been marked by more stable Governments. Three of the four longest-serving governments of the Italian republic came after 2001. It was speculated that the short lifespan of governments caused financial instability and increased debt, but perhaps the reverse happened over the past few decades: the longer governments have lasted, the more distant they have become. of a path of economic stability and convergence towards European partners. The 2001-05 and 2008-11 governments of Silvio Berlusconi and that of Matteo Renzi (2014-16) lasted three times longer than the average Italian government and during this period they changed Rome’s path towards fiscal stabilisation.

Between 2001 and 2005, Italy’s primary budget surplus fell from 5% of GDP to zero. Between 2008 and 2011, at the height of the euro crisis, Italy nearly defaulted on its public debt. Between 2014 and 2016, Renzi broke away from the traditional pro-EU alignment of Italy’s centre-left and made extensive use of the EU communication on flexibility under the rules of the Stability and Growth Pact to expand his government’s fiscal space. Apparently, the longer the Italian government remains in power, the greater its deviations from budgetary discipline. Therefore, the problem seems to be more related to the populist culture of Italian politics than to electoral mechanisms.

From the outset, the system of rules governing the single currency was intended to contain the populist temptations of EU member governments. Even then, Italy’s public debt was a major concern. The whole system of EU economic governance can be interpreted as an attempt to anchor policy on long-term stability and growth. Making political promises without worrying about the consequences is more difficult in the EU framework. Unsurprisingly, populists promising miracles do not tolerate the European straightjacket.

A forthcoming reform of European budgetary rules?

In this sense, it is a happy coincidence that this latest demonstration of the inefficiency of the Italian political system comes as Europe debates the reform of its rules of economic governance. If Italy’s problem is the political culture of its establishment, the country would benefit more from the reforms leading to European political union (in which sovereignty is shared among the 27 countries) than from the coveted fiscal union (in which the debt is pooled). Unfortunately, most Italian proposals to reform EU rules appear aimed at expanding the government’s fiscal space or canceling some of Italy’s public debt.

There are many good reasons to change European fiscal rules to prevent them from worsening recessions and do them work better with the common monetary policy. However, the resistance that Italy’s proposals will encounter among European partners will not be primarily economic in nature, but rather political-economic in nature. Who will guarantee that once the budgetary constraints are relaxed or the debt partially cancelled, Italian politics will not find it easier than before to indulge in populist practices? After all, such constraints compel governments to devote resources to what is really needed, rather than wasting them. Shouldn’t we at least wait and see if the Recovery Fund (NextGenerationEU), the vast aid program launched by the EU following the recession caused by the COVID-19 pandemic, being used wisely? If this is the case, and if Italy’s capacity for growth increases, the current constraints will also be less severe and new European “recovery funds” could be launched with the agreement of Italy’s partners. The broader use of pooled funds and mutual debt could become acceptable, making the Recovery Fund a permanent institution. If this were to happen, a permanent common government of the European economy might become necessary. The ensuing process of political interaction could lead to the necessary improvements in the political systems in the Member States, and in Italy in particular.

As the re-election of President Mattarella shows once again, Italy manages to regain stability at the last moment. Draghi is now expected to remain at the helm until the end of the legislature. In the months to come, it will be able to consolidate the intense Recovery and resilience plan which commits Italy to dozens of EU-funded structural reforms and investments. Whichever coalition may emerge from the next Italian elections, it will also have to respect these commitments until 2026, if it wants tens of billions of euros to be disbursed by the EU. Even in the worst-case scenario, if Italy needed a rescue package from EU partners, the dreaded “programme” that would ensue (reminiscent of those inflicted on Greece, Ireland, Portugal, Spain and Cyprus during the euro crisis) could only replicate the reforms agreed in the context of the Recovery Fund.

In this complicated context, three initiatives would represent a test of maturity for the Italian political forces. First, to combat the short-termism of the Italian political system, the leaders of the ruling parties should explicitly subscribe to the long-term objectives that have been agreed with the European institutions through the Recovery Fund. Second, Rome should focus its energies on carrying out the reforms and investments agreed with the EU. Third, based on the eventual success of the Recovery Fund, he should call for a reform of European economic governance that brings political integration closer.


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