WHILE WINNING THE FRENCH PRESIDENCY WAS AN EXTRAORDINARY ACHIEVEMENT FOR EMMANUEL MACRON, FULFILLING HIS MISSION OVER THE NEXT FIVE YEARS WILL REQUIRE FORMIDABLE FOCUS AND CONTINUAL CITIZEN ENGAGEMENT
Emmanual Macron and Federica Mogherini at the World Economic Forum in Davos, January 2016. Photo credit: WORLD ECONOMIC FORUM/swiss-image.ch/Photo Michele Limina: https://www.flickr.com/photos/worldeconomicforum/24428299722
Put simply, President Macron will need to make France an easier, more dynamic place in which to create and expand businesses, so as to increase employment and wages, while at the same time providing an increased sense of security and equal participation to citizens of all ages. Fortunately, he considers Europe as France’s friend, not its enemy, so he will be better able to obtain support and collaboration from his European partners, most notably Germany.
If he is to succeed, he will need to engage citizens all over the country, persuading them that change is in their interests and can be achieved without creating losers. Here are eight points that should be at the top of his agenda, to help him to Wake Up France, as well as Europe:
1. Constant nationwide campaigning
Rather than something directed from comfy salons in Paris and the Elysee Palace. Macron needs to turn his one-year-old movement, En Marche, into a permanent means of citizen engagement and activism.
2. Concrete results on jobs and living standards
So as to convince people that any apparent sacrifices are worth it. When his Italian equivalent, Matteo Renzi, also swept into office in 2014 as a 39-year-old reformer, he made the mistake of prioritising political reforms that had no relevance for ordinary people, and a labour reform that caused more worry than hope.
3. Focus spending on a few areas that have a big, visible impact
For example infrastructure investment; this will reap more rewards than handing pennies round to lots of different causes (another of Renzi’s mistakes). Macron really needs to be able to say, after 12 months, 'This is how France is changing'.
4. Get Germany to be ambitious on Europe:
Macron should exploit his great political capital to convince Angela Merkel (or her successor) to be ambitious about European collaboration. Two great areas of European construction are just waiting to be pushed forward: a real, profound development of European Defence and Security Cooperation; and a coordinated programme of public investment in infrastructure, especially in sustainable energy and a smart grid. On Defence and Security, a blueprint has already been produced by Federica Mogherini, the EU’s High Representative (pictured above).
5. Fix Europe’s stance on migration and banking:
Alongside those areas of European construction stand two areas in desperate need of attention: European policy towards migrants and asylum-seekers, and the Banking Union which is needed to make the euro single currency more stable. Both of these would become much easier to obtain agreement on - and full political backing - if they are associated with a pro-growth public investment plan and a European Defence and Security initiative which adds to Europeans’ sense of security rather than their fears.
6. Stay strong on Trump:
Fear of the policies of Donald Trump’s United States can be helpful, even if a confrontational approach would be unwise. Europe needs to stand on its own feet, able to serve its own security needs and to defend the open trade on which it depends. France, rather than Brexit Britain, now has the chance to be the true advocate of a strong, open, global Europe.
7. Match openness with equality:
Openness, as Macron stressed in his debates with Marine Le Pen, is vital for France’s future; but it must be matched with equality, with convincing measures to rebuild social trust and to create unity. In this, Macron’s emphasis in his campaign on learning from Sweden, Denmark and other Nordic countries is welcome. France shares Sweden’s egalitarian culture; now it needs to follow Sweden’s example in enabling new creative industries, the French versions of Spotify, to flourish while maintaining welfare systems.
8. Galvanise older supporters:
The biggest welfare challenge is going to be pensions and the retirement age. As our 2050 Index shows, France spends 14% of GDP on public pensions, chiefly because French citizens can retire so early. Cutting pensions will just cause anger: a better approach will be to help people in their 50s and 60s to get or keep jobs, often part-time ones, so that they remain fit and productive as well as continuing to contribute the taxes that finance the country’s excellent public services. Older voters supported Macron often because they feared Le Pen’s anti-euro stance would threaten their savings. Now, he needs to galvanise older people to help create a new vibrant France.
NOW HE MUST WAKE FRANCE UP TO THE NECESSITY OF CHANGE, IF HE IS TO ADDRESS CITIZENS' HOPES AND FEARS
It counts as a huge relief to anyone who believes in liberty, the open society and European collaboration. But the election of Emmanuel Macron as France’s president, welcome as it is, does not mean that the moment of “peak populism” has passed in either Europe or America. The despair and disillusion that persuaded fully 35% (on early projections) of French voters to support the far-right candidate, Marine Le Pen, need now to be addressed. Otherwise she, or someone like her, will be back in 2022.
Populist-nationalists such as Marine Le Pen, Donald Trump in America, Geert Wilders in the Netherlands or Nigel Farage in Britain have not invented the grievances that they exploit. They fan the flames of fear through lies, by demonising foreigners and by making empty promises. But the anger of their supporters is real.
France has had 10% or more of its workforce unemployed throughout the five-year presidency of the outgoing Socialist, François Hollande. Across the border in Italy, unemployment is even higher, and has been so for longer. Household incomes have been flat or falling for years in both countries.
Meanwhile the European Union, which in the past was seen as a source of hope, a source of solutions, has become in recent years associated with burdens, with dysfunction, with division. Membership of the euro has brought rules and constraints. If there are any benefits from it, ordinary French and Italian citizens cannot work out what they are.
Older French voters may well have rejected Marine Le Pen for fear that her desire for France to leave the euro would wipe out their savings. They will not have done so, by and large, out of much love for the currency or belief in European solutions.
Emmanuel Macron’s achievement in winning election is extraordinary. This 39-year-old is France’s youngest president ever. He has never before held elected office. He formed his party, En Marche, only a year ago, when he quit from the post as economy minister he had held under President Hollande.
Now he and his party have to win a working majority in the parliamentary elections that France will hold next month, on June 11th and 18th. They stand a good chance of doing that, such is the disarray of the mainstream Socialist Party and Republican Party. But then they actually have to address the grievances of French voters, and in doing so wake all French citizens up to the need for change. That, for sure, will be harder.
If Mr Macron wants to understand how hard it will be, he could do worse than talk to Matteo Renzi, who in 2014 became Italy’s youngest ever prime minister, at the same age of 39. He did so without having been elected to national office, having just been Mayor of Florence, but had the apparent advantage of having taken over a well established party organisation, the Democratic Party.
In his nearly three years in office, he achieved a handful of significant reforms. But the living standards and hopes of Italian citizens barely improved. Meanwhile, Renzi’s reputation as a fresh, innovative outsider swiftly declined as he surrounded himself with cronies from Florence and seemed to play the same sort of political games as had his predecessors.
In December last year he crashed and burned, resigning as prime minister following a resounding defeat over constitutional reforms
Now, Renzi is trying to make a comeback, ahead of general elections that will be held in Italy either in the Autumn of 2017 or likelier in February or March 2018. But it is an uphill struggle, with Italy’s most popular party now not his Democratic Party (which has split) but the populist Five Star Movement led by the comedian-cum-activist Beppe Grillo. Though not of the far right like Le Pen’s Front National, Five Star shares some of Le Pen’s policy stances, notably a referendum on euro membership and withdrawal from NATO.
This battle is going to run and run.
Next Sunday evening the world will learn which of Emmanuel Macron or Marine Le Pen will be France’s new president.
No election has been more important for the future of Europe, and perhaps the world, than this one, as our Director Bill Emmott explains.
We have selected five of the best infographics that make sense of the first-round election results, current polling and their implications. We’d love to hear what you think
1. Deutsche Gesellschaft für Auswärtige Politik have summarised the two candidates’ stances on key international issues. Le Pen and Macron differ dramatically on their attitudes to foreign policy and trade, with vast implications for Europe, NATO and the world:
2. Huge variations in the voting patterns of different age groups continue to characterise Western elections. This IPSOS France table tells the story of how generational divisions played out in the first round, including the fact that Le Pen did better than Macron with voters under the age of 50:
Notice the inverse relationship between Fillon and Mélenchon’s results. Fillon was the candidate who most represented France’s political old status quo and attracted by far the most support from older generations. By contrast Mélenchon, a maverick left-wing candidate, was wildly popular among France’s youngest voters.
How Mélenchon’s young supporters vote next will be a critical factor in determining the final result (see next graphic). But so too will the choices of older voters who are likely to be worried about the impact on their savings of a Le Pen victory.
3. This Guardian graphic uses Ifop polling data predicting how votes for the first round losers will be redistributed, including those crucial Mélenchon youth votes:
4. The first round was a victory for French pollsters as much as anyone else, particularly after less-then-impressive recent performances by counterparts in the UK and US (David Cameron's 2015 election victory, Trump’s 2016 defeat of Clinton and the 2016 Brexit result all caught pollsters by surprise).
These Telegraph charts demonstrate how close France’s first round election results were to polling averages:
5. The Wake Up Foundation’s 2050 Index explores the underlying factors driving political developments in France and elsewhere. Despite being Europe’s second largest economy (bigger than the UK thanks to sterling’s post-Brexit devaluation), France ranks twentieth out of thirty-five due to significant weaknesses in demography and resilience:
Find out more: http://wakeup2050index.eu/country/france/
Do you feel nervous about May 7th in France or hopeful? The result of the first round on April 23rd was a welcome boost for everyone who favours openness and the preservation of Europe’s core values. But it would be premature to assume that a victory for Emmanuel Macron in the second round is a foregone conclusion.
Huge efforts can be expected to try to discredit the 39-year-old leader and founder of En Marche (“Forward”), the movement that during the past year has surprised the nation through its vigour, popular appeal and rapid growth. Social media, in the use of which the Front National has proved adept, will be buzzing with stories, with rumours, with accusations.
Macron’s opponent, Marine Le Pen, is trying to recast herself as a statesmanlike figure by leaving the leadership of her Front National, trying to channel General Charles de Gaulle as a politician above petty party politics. But this will cut little ice, since the Front National’s campaign will continue to try to divide France and not unite it, to demonise and destroy Europe rather than to build it.
Macron now needs both to stay cool and to stay a unifying force, a force of hope and constructive reform. His strong belief in Europe will be a vital weapon too, not as a belief in Europe for its own sake but rather as a belief that European collaboration is essential in France’s own interest.
No election has been more important for the future of the whole continent than this one. Europeans everywhere, even in Brexit-obsessed Britain, are waiting anxiously for a positive result on May 7th.
It is a cliché to describe elections and other events as being “a turning point” but in this case it could really be true. This is far more important than Britain’s referendum last June. That decision to leave the EU was dramatic, but need not damage the EU fundamentally. If France were to choose Marine Le Pen as president it would cause catastrophic damage to the whole European Union and to NATO too.
In The Great European Disaster Movie, we envisaged the possibility of a President Le Pen. Make no mistake: we hope this prediction will not come true.
Even if, as we hope, France elects President Macron instead, the dangers facing Europe will not be over. He will need to deliver results, of better lives for all French citizens, of new hope and opportunity, if the 2022 election is not again to present the possibility of President Le Pen.
The need, in France as in Italy, Germany, Spain and all its neighbours, will be for a programme of inclusive reform that releases the great energies of creativity that currently lie trapped, while preserving and extending the sense of equality, security and social trust that have been such an important achievement in past decades.
By Bill Emmott
We have grown used to political earthquakes, as once inconceivable electoral outcomes turn into reality. Yet this year’s greatest political shock could turn out to be a positive one. It is time to think seriously about the possibility that Angela Merkel may be defeated in September and be replaced as Germany’s chancellor by Martin Schulz.
Since Martin Schulz, former president of the European Parliament, became leader of Merkel’s coalition partner, the centre-left Social Democratic Party, a little more than two weeks ago, the SDP has surged in the opinion polls, even in some polls overtaking Merkel’s centre-right Christian Democrats/Christian Social Union group.
Novelty is a powerful force in politics. So is being seen as an outsider. Of course, this momentum for Schulz may not be sustained over the seven months between now and the federal elections. But the possibility should be taken seriously because it fits in with major doubts and criticisms of Mrs Merkel being voiced privately not just by her opponents but her own supporters.
Since the election of Donald Trump, many commentators have described Angela Merkel as the last great hope for liberal, western values. Yet is she really such a figure? By the time of the German elections she will have been in office for nearly 12 years. That makes her hugely experienced and respected. But it also makes her stale. And it inevitably means she has made some big mistakes.
Her own supporters are beginning to think, and even to say, that she has stayed Chancellor for too long. From their point of view, she is unavoidably associated with two historic mistakes: her decision to allow Greece to remain a member of the euro; and her decision to open Germany’s doors to more than one million migrants, a decision that weakened European solidarity at a time when it desperately needed to be strengthened.
To others, she is associated with a third historic mistake: the decision to insist upon the 2012 fiscal austerity treaty for Eurozone members. That decision remains popular with her own supporters and many German voters, but it has damaged Germany’s relations with other Eurozone countries. Most critically for the election, it also opens up a space for a serious competitor such as Martin Schulz.
No one can accuse Schulz of being in any sense anti-European or even soft on EU issues. So he can run as being a strong defender of Europe while also offering alternative economic policies, and new thinking about the migrant crisis.
It is far too soon to make predictions. Even if they beat Merkel’s party, Schulz and the SDP might face difficulties forming a coalition government with the Green Party and the Left party. There are many uncertainties about the coming seven months, to say the least.
But let us think of the potential, in any case. A few months ago, the brightest outlook from a pro-Europe point of view this year was the idea of France being led by a President Francois Fillon and a Germany led by a re-elected Angela Merkel succeeding in reviving the Franco-German “engine” of the EU. Yet this prospect, bright as it may have seemed, came with some doubts, over Merkel’s continued energy after 12 years in office and over differences between Merkel and Fillon over Russia.
Now, the brightest outlook is a much sunnier, more invigorating one: of France electing the centrist independent Emmanuel Macron and of Germany changing chancellor to Martin Schulz. Such a combination would be fiercely pro-European. It would combine a liberalizing, reforming zeal with a progressive, centre-left instinct, one likely to be more favourable to economic growth. And it would be fresh and well able to stand tall to represent Europe in any confrontations with either Donald Trump or Vladimir Putin.
Yes, a President Le Pen would change everything. But let us think more positively. Politics in all European countries is in turmoil. The times, as the Nobel-prize-winning Bob Dylan told us many years ago, are a-changing. Yet that change need not only be negative. The possibility of positive change is also rising.
By Bill Emmott
This article first appeared in La Stampa Feb 9 2017
Well, at least the uncertainty is over. Some commentators had labeled the British government’s six months of dithering about its plans for Brexit as “constructive ambiguity”, a phrase used by Henry Kissinger 40 years ago. Muddle was the better term, but now there is clarity: Britain, Prime Minister Theresa May has announced that the UK will be leaving the EU single market and the EU customs union.
It is a gamble, but a logical one. Even last summer, Mrs May had indicated that her priorities were to put limits on EU freedom of movement into Britain and to end all jurisdiction of the European Court of Justice in the UK. That requires Britain to leave the single market, since European laws govern that market and free movement is a core principle. So it is logical to stick to that plan.
One can easily dispute whether these are the right priorities, even on political grounds, let alone economic ones. Mrs May clearly thinks that it would be too politically risky for her to agree to retain freedom of movement. She is thus saying that she is willing to risk economic damage to Britain by leaving the world’s largest single market in order to avoid that political risk to her Conservative Party.
During the six months of muddle and ambiguity over Britain’s Brexit plans, the prime minister allowed her ministers and her party to engage in an open public debate about whether this was the right choice. Her own position on the issue has been consistent. But by letting the debate happen, and waiting to see what other EU governments’ attitude would be, she allowed uncertainty to prevail.
The end now to that uncertainty is good for the other 27 EU members. They no longer have to worry that Britain is going to try to persuade them to give up the core principles of the European Union. Britain would not have succeeded in that effort, though some British politicians and intellectuals clearly believed that some other countries might be eager to limit immigration and that keeping Britain, the world’s fifth largest economy, inside the single market could be so valuable that a deal could be done.
A lot of time could have been wasted proving that this was a delusion. The process of doing so would also have risked creating even greater divisions between EU countries and a even more bitter relationship with Britain.
So achieving clarity on that issue is of benefit to Europe. The celebration of the 60th anniversary of the signing of the Treaty of Rome, in March, need not be overshadowed by this issue. The EU can get on with trying to develop its own policies on the much more important issues of refugees, economic policy and relations with Russia.
For Britain, however, even Prime Minister May’s speech does not bring full clarity about the country’s future. The UK knows it will in future negotiate a free-trade agreement with the EU, just as it will also seek to do so with the United States and other countries. What it doesn’t yet know is how far the British government is willing to go in fulfilling Prime Minister May’s vague promises of creating a “Global Britain” that will be a leading advocate of open trade.
We know, for sure, that Britain is not going to follow Donald Trump down a route of isolation and protectionism. The Brexit vote was more a vote of nationalist arrogance than on the sort of anger about globalization that Trump tapped into. But what this means for the British economy we still do not know.
Mrs May says her objective is free trade with the EU. Does she include agriculture in that ambition? Is she going to abolish all subsidies and other trade protection for British farmers when we leave the EU and give tariff and quota-free access for EU farm produce?
Or, to take another example, we know that by leaving the EU it will be possible for the UK to lower its tariffs on imports of cars to zero if it wishes to do so. The EU’s current tariff is 10%. That is what Mrs May implies when she argues that by being “free” of the EU we will be able to become bigger advocates of free trade. But do the Japanese, Indian and American carmakers producing in the UK agree with this excellent idea?
All this is still unknown. So the net result of the British prime minister’s clarifying speech has been to produce much greater clarity for the other 27 EU members but not much more clarity for Britain itself.
By Bill Emmott | 17/01/17
This article first appeared in La Stampa Jan 17 2017
General Charles de Gaulle would be proud. For the future of Europe will be shaped in this new year not in Germany, not in Italy, not in troublesome Russia, not in Brexiting Britain, but in France. Others will play a role, could even produce shocks. But France will have the most decisive influence.
De Gaulle wasn’t really a collaborative believer in European solidarity. After all, he notoriously held the young European Community to ransom in the mid-1960s by boycotting meetings in order to foster his own vision of an intergovernmental, rather than supranational, Europe. He was what Donald Trump might call a “France Firster”. But still, he wanted Europe to make France more powerful in the world, which is about to happen, again.
One reason is well known: the possibility, shocking even that it can be called a possibility, that the Front National’s Marine Le Pen could be elected president in May. Who hasn’t heard the gloomy, speculative logic? That after Brexit and Trump, the next blow to rational predictions and conventional wisdom, the next victory of populism, must be President Le Pen?
If that were to happen, the European Union would be for the scrapheap. Unlike Trump, Le Pen has been in politics for 20 years already and her policy positions have a consistency that means they have to be taken seriously: she would want France to rebuild trade barriers, leave the euro and restrict immigration tightly, none of it compatible with the EU as we know it. And she really means it.
The result is that there is no point in any EU country – Britain negotiating Brexit, Italy contemplating a general election – taking serious action until after the second round of France’s presidential poll has taken place on May 7th. The result is simply too important for all of us. But it is important also for another reason, beyond fear of a President Le Pen.
This other reason why France will be influential is a much more positive one. It is that in its 60 years of existence, the European Union has never made progress, never been able to act credibly and decisively, except when the governments of France and Germany have thought together, planned together and worked together. During the five-year term of President Francois Hollande, this Franco-German motor has ground to a halt. Neither side trusts the other, and the Germans think President Hollande is weak and incapable.
Without that Franco-German motor, management of Europe’s multiple crises has been disastrously slow, ineffective and divisive. Yet the interests of France and Germany are shared: the Berlin killings on December 19th, just over a year since the Bataclan massacre and five months on from an identical truck attack in Nice, showed that the two countries face the same terrorist threat; having conceived the euro together when Presidents Kohl and Mitterrand were in full co-operation, they share a deep interest in making the currency system work; and with America potentially turning hostile to Europe under President Trump, they need each other more than ever in geopolitics.
If the much likelier outcome of France’s presidential election in May occurs, namely a victory for the centre-right candidate Francois Fillon, the stage would be set for a new era of Franco-German collaboration. Fillon, who is an economic liberaliser but a social conservative, is far more compatible with Chancellor Angela Merkel and especially with her Christian Democrat and Christian Social Union party supporters, than has been President Hollande. He would even stand a chance of convincing Merkel and the German parliament to relax the tight fiscal constraints that have been holding euro-zone economies back.
But will the likely outcome actually transpire, after a 2016 during which the supposedly likely outcomes in Britain and America have both failed to occur? The key dangers, in France as in the Netherlands, which has a general election in March, and in Italy, whenever its election takes place, arise from the combination of high unemployment, stagnant household incomes and fear of immigration.
Hillary Clinton’s problem was that she represented too closely the American establishment that had brought the 2008 financial crash and then had failed to oversee an equitable recovery from it. Brexit is a very different case, given Britain’s long history of semi-detachment from Europe, but it still can be explained by alienation from the powers-that-be, which crucially included a Europe that, thanks to the loss of the Franco-German motor, now looked like a problem rather than any sort of a solution.
To win the argument during 2017, political parties and intellectuals that favour open, liberal societies and European collaboration will have to show that they offer more hope for the future of citizens of all ages than do the advocates of closure and of rejecting Europe, such as Le Pen and the Netherlands’ Geert Wilders.
That means that they will need to convince voters that they can make Europe work again, make it part of the solution for national ailments rather than a problem in itself. Above all, however, they will need to convince voters that they can restore national economic dynamism, removing obstacles to growth and to the creation of jobs.
Francois Fillon is a good person to lead this argument, since he is capable of appealing both to young voters who want jobs and opportunities and to older voters worried about traditional French values. Both the other two mainstream candidates, Manuel Valls of the left and Emmanuel Macron as an independent, also have the chance to inspire the young, though as former members of President Hollande’s administration they are also tainted by recent failure.
The stakes, for Europe and for the world, could not be higher.
By Bill Emmott
This article was originally published in Italian by La Stampa on January 9th 2017
The long, slow fuse on Italy’s time-bomb has been lit. The crushing defeat of Prime Minister Matteo Renzi’s constitutional reform proposals in the national referendum on 4th December has left the whole country—indeed the whole of Europe—wondering whether the anti-euro Five Star Movement might soon come to national power.
Five Star, the internet-based political party led from outside parliament by the comedian Beppe Grillo, is frequently described as populist, but it is cut from quite different cloth from France’s Front National, Britain’s Ukip or even US President-Elect Donald Trump. While those have got their core support from older, non-college-educated, often working-class voters, Five Star’s base is young, university educated and professional.
That is exactly the group that Renzi sought to appeal to when he landed suddenly on the national stage in 2013, when he decided to hurry from his base as mayor of Florence and compete first for his Democratic Party’s leadership and then prime ministership following the inconclusive general election of February that year.
He won his prize in February 2014 through a coup in his centre-left party through which he ousted his colleague, the incumbent prime minister, Enrico Letta. He did so largely on the twin arguments that he could credibly offer the country radical reform, under his self-anointed nickname of il Rottamatore, the demolition man; and that, at 38, as the country’s youngest prime minister since unification in 1861 he could symbolise change and appeal to young, university-educated professionals like him.
So he presented himself as Italy’s insurgent change-maker. Trouble is, he largely failed to bring change, at least the sort of change that Italians could feel in their lives and their incomes. The economy has barely grown during his nearly three years in office. Unemployment is stuck at 11.7 per cent of the workforce. Ambitious young people are still emigrating to find opportunities. The justice system remains a national disgrace.
The reforms he did bring—for schools, for labour contracts, some minor tax changes—will only produce detectable results after a delay. Meanwhile, he made two huge mistakes: he shied away from calling a general election when he was popular in 2014, and so had to govern through a coalition with small centrist parties; and he used most of his political capital to push through constitutional reforms with the aim of making a future government more effective—a government he had intended to lead.
It is that second bet that failed so resoundingly on 4th December. His plans involved ending the duplicative bicameralism of Italy’s parliament—by cutting the Senate’s powers and replacing elections to the upper house with appointment by regional assemblies—abolishing provincial governments, and centralising powers over big infrastructure projects. All this will now die.
The most pressing task is to reform the electoral law that Renzi brought in back in 2015 for the lower house, the Chamber of Deputies. It is still on the books, but it won’t stand politically, since it was part of a package with the overhaul of the now-reprieved Senate. It flowed from the same “let the government govern” impulse which the voters have just rejected, and would—if enforced—see a single set of elections yield very different results in the two chambers. But elections must still take place before May 2018 at the latest, and none of the mainstream parties want them to be held until electoral reform is agreed.
Why? To hobble the Five Star Movement. That 2015 electoral law was designed to enable British-style single-party government by handing bonus seats to the party that leads after two rounds of voting, to guarantee it an absolute majority.
Previous electoral laws have essentially encouraged or necessitated the formation of coalitions, either before the election or afterwards. The Democratic Party, its current centrist allies, and Silvio Berlusconi’s centre-right Forza Italia now want to return to that sort of system. Their reasoning is simple: Five Star will find it much more difficult than them to form coalitions.
In fact, Five Star has shunned coalitions in the past, on principle, and for the time being it has no natural partners. That is a natural consequence of running on a stance of a plague on all existing political houses—or, in Grillo’s fruitier slogan Vaffanculo!, which basically means “fuck off, the lot of you!”
So a new electoral law is likely to be negotiated, by a caretaker government, a process which could take up much of next year. Meanwhile, Italy’s economy will remain stagnant and unreformed, and its banking system will remain tottery, loaded down as it is with unperforming loans which get bigger the longer that the economy fails to grow. Any hope of substantial reform will have to wait until new elections.
Neither politics nor popular anger will stand still while this happens, however. The Five Star Movement will gain new energy and new adherents as a result of the referendum defeat. Doubts over its coherence and effectiveness, which grew following the chaotic start in June by Five Star’s mayor of Rome, former lawyer Virginia Raggi, could now be replaced by a growing feeling that it is really the only game in town for anyone wanting change.
The implication is that this is a timebomb that has to be taken seriously. Even with a new electoral law, Five Star has the potential to gain a very large share of the votes and so in theory could even form the next government alone. There is nothing certain about that—13 months is a very long time in politics—but the party is undoubtedly going to be a force to be reckoned with.
That is by no means entirely a bad thing. Five Star stands for a lot of sensible things, alongside some more explosive ones. It is building up a good record in municipal administration, with the young mayor of Turin, Chiara Appendino, drawing particular praise.
Rather than condemning it as a bunch of reckless populists, it would be more sensible for business, the media and academia to engage with it seriously. Such a process could even end up defusing the time-bomb, and turning Five Star into the change-maker that Italy does need—what Matteo Renzi should have been, but wasn’t.
Article first appeared in Prospect 12/12/16
Pro-Europeans may have been sad to lose Matteo Renzi, after the Italian prime minister’s crushing defeat in his constitutional referendum, but were relieved that Austrians rejected the far-right candidate in their re-run presidential election.
Neither reaction is sound, at least not for the longer term. The battle to save Europe is on. Winning it requires sobriety and determination, not sentimentality.
Matteo Renzi had failed. That is why he lost his referendum, with the “no” camp made up both of pro-Europeans and of the sort of young, university-educated professionals that Renzi once considered his core supporters.
Virtually zero growth, unemployment stuck at 11.7% and a poor record on reforms of the sort that had a chance of making a difference in the short term: that is Renzi’s failure. He put too much of his political capital and energy into constitutional reform and too little into bringing dynamism back into the Italian economy.
Given a stronger position in the Chamber of Deputies after a general election, and with the blocking powers of the Senate removed, he could have moved on to more significant reforms had he won the referendum. But he failed to convince voters to trust him to do that.
So the new task is now clear: to convince the millions who voted against him that saving and reforming Europe should be part of their agenda too.
Many of the Five Star Movement’s supporters are natural Europeans: the sort of young people who see Europe as their own cultural and economic space. The movement is dangerous just because of one policy position: its call for a referendum on membership of the euro, which may well be unconstitutional, but in any event would be enormously destabilizing to financial markets and Italy’s creaky banking system, regardless of the likely result.
All of us who care about Europe and the future of its nations need to work hard to persuade Five Star to drop its referendum proposal and to press for reform of the Eurozone instead.
That could be doable. Austria however is a less comforting prospect than it looks.
Before celebrating Alexander van der Bellen’s victory too cheerily, we need to remember that the far-right Freedom Party still won 46.7% of the votes.
This bodes very badly for the much more important parliamentary elections that Austria is due to hold by September 2018 but are widely expected to occur sooner.
Current opinion polling indicates that if the election were held now, the Freedom Party would stand a good chance of being the largest party and so even of choosing Austria’s new Chancellor, a far more powerful figure than the largely ceremonial president.
This is not to diminish the pleasure at Mr van der Bellen’s victory. But the argument still needs to be won. The tide of populism and xenophobia has not turned simply because Brexit and Trump were not followed by Austria.
The battle remains on.
The Wake Up Foundation
Dec 5 2016
A time-bomb is ticking away in the heart of Europe, carrying a label marked ‘Made in Italy’. It could yet be defused. But if it goes off, it would make Brexit look like a lot of fuss about nothing.
The time-bomb has been laid by Italy’s young, reformist prime minister, Matteo Renzi. The potential trigger is the referendum he has called for December 4th on reforms to the country’s constitution. The explosive content is that his fiercest and strongest opposition, the Five Star Movement, is also young, reformist, and wants a referendum held on Italy’s membership of the euro. And it is running neck and neck with Mr Renzi’s party in national polls.
Five Star is campaigning for a “no” vote, even though it is a big potential beneficiary of a related reform that is not on the Dec 4 ballot, namely a new electoral law that would make it possible for the party led by former comedian Beppe Grillo to win an absolute majority in a general election – and so hold its euro referendum.
Wake Up Europe believes a “yes” is the right vote next Sunday. But it should be a “yes” with a strong call, from all political forces and citizens groups, to have the electoral law changed by Parliament as soon as possible.
The stakes couldn’t be higher. Populism and Euroscepticism are all the rage, throughout Europe. But that matters most when a party pursuing such anti-establishment goals has a serious chance of entering government. That is where Italy comes in: if a general election were held tomorrow, the Five Star Movement would have a serious chance of winning. If it were to do so, the mere hint of a referendum on the euro would send financial markets haywire.
A general election does not have to be held tomorrow: the next one is not due until 2018. However, that is not far away, and an early election could become conceivable if Mr Renzi were to lose his referendum on December 4th.
On the arguments, he doesn’t deserve to do so. The December referendum – which is required under Italy’s constitution – concerns a set of changes to the country’s political institutions that are designed to make it more governable, and to open the way to liberalizing, pro-growth reforms that are long overdue.
Quite reasonably, Mr Renzi proposes to abolish the elected upper house, the Senate, and replace it with a house with reduced powers made up of nominees from regional assemblies. Until now, the Senate has held identical powers to Italy’s lower house, but generally with a differing political complexion, so it has blocked many major items of reform.
Mr Renzi also proposes, quite reasonably, to abolish one of the country’s four layers of government, the provinces, which lie between cities and regions and simply reinforce the country’s susceptibility to corruption. Moreover he wants to shift decisions over major items of infrastructure up from lower levels of government to national level, to make them less prone to blockage by local interest groups.
Italy is a country which passes an abundance of laws, but fairly few of which make a real difference to policy or society. Mr Renzi wants to change that. The trouble is, that in order to do so he wants to make his own office, the prime ministership, more powerful. He has done that in part through the new electoral law for the lower house, the Chamber of Deputies, passed in 2015 and designed to ensure the country has strong governments by handing out a bonus of extra seats to whichever party comes top in an election.
It makes sense in theory. But in practice this, in combination with the Senate’s abolition, will greatly reduce the checks and balances in place. This raises fear of a new Mussolini coming to power. Perhaps, ill-wishers think, that could be Mr Renzi himself. Or it could be the Five Star Movement.
The referendum is complicated and raises plenty of causes for concern. But the background to it is worse. Italy has been the worst-performing euro-area economy since the 2008 crash, barring Greece. Nothing Mr Renzi has done has changed that. The economy is still bumping along the bottom, with unemployment above 11% of the workforce and incomes flat or falling.
No wonder he is not popular, especially in his own party, and no wonder that current polls imply he will lose the December 4th referendum. Before the summer, he recklessly promised he would leave politics if he loses in December, a promise he has since tried to wriggle away from.
Whatever his view, the choice may not be his. When he entered office in February 2014, it was by a party coup, in which he unseated his predecessor, Enrico Letta, without a general election. The same could happen to him, after December 4th. The first aim would be to replace him with a safe, technocratic prime minister, or someone else from his own Democratic Party. But a general election could soon become unavoidable.
The risks to Europe and to the world are huge. The Five Star Movement is not a party of far-right devils along the lines of France’s Front National, nor of Donald Trump. It is peopled by young professionals desperate to drive out corruption and renew their country. It deserves sympathy and support. But it is a party without coherent policies or organization, led by a comedian, Beppe Grillo, and driven by naïve dreams of internet-based participatory democracy.
Those dreams have already been exposed as mere chaos by the Five Star mayor of Rome, Veronica Raggi, elected in May and who has struggled even to form a full council, let alone to carry out any reforms.
This has not yet had a noticeable impact on Five Star’s national polling. That is because it is a pure protest movement, against the establishment of which even the young Mr Renzi forms a part. Five Star remains strong because Italy has, so far, proved immune to radical change.
There is still time for Mr Renzi to defuse this time-bomb. To do so, he would need to convince his country that he is the one who can bring radical, prosperity-enhancing change, not Five Star. Most of all, though, he needs to reform his own constitutional reforms, altering the electoral law to make it less prone to bring to power a new Mussolini. We can all remember how he ended up.
Chairman The Wake Up Foundation
This is an adapted version of an article that appeared in the December edition of Prospect