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What to expect from Italy’s new government

Image result for gentiloni
Far from a rupture, Italy will get more of the same under its new prime minister Paolo Gentiloni. (AFP / Getty)

Consider Italy’s new government renzismo without Renzi.

A week after Matteo Renzi failed, in spectacular measure, in his efforts to win Italian voter approval of his ill-fated referendum on political reform, Italy has a new prime minister after consultations between Renzi, other political leaders and Italian president Sergio Mattarella.

With no more than 15 months (and likely far less) until the next general election, Italy’s new premier Paolo Gentiloni will lead a government that looks much like the one Renzi led until last week — one dominated by the centrist and reformist wing of Italy’s center-left Partito Democratico (PD, Democratic Party).

Given that the Democrats and their centrist allies retain a majority in the lower house of the Italian parliament, the Camera dei deputati (Chamber of Deputies), it was almost certain that Mattarella would appoint someone from the Italian left. It was not certain that Mattarella would turn to a Renzi ally, however, given the longstanding tradition of non-partisan ‘technocratic’ governments in Italian politics. Still, Gentiloni was a colorless Roman aristocrat with an undistinguished political career until his sudden ascent to foreign minister two years ago. He replaced Federica Mogherini, who departed Renzi’s government in 2014 to serve as the EU high representative for foreign affairs and security policy. Today, Mogherini remains a rising star who may yet eclipse even Renzi from her perch as Europe’s top diplomat.

Gentiloni, who hails from Roman nobility, began his career in journalism, switching to politics in the 1990s as an ally of Francesco Rutelli, a former centrist mayor of Rome from 1993 to 2001. Both of them served in the short-lived government of Romano Prodi from 2006 to 2008; Rutelli as deputy prime minister and culture minister, Gentiloni as communications minister. In the center-left primary to determine the party’s candidate in the 2013 Roman mayoral election, Gentiloni finished in third place with just 14% of the vote.

Despite strong marks for his time as foreign minister, no one expects Gentiloni to remain prime minister longer than the next election, no matter who wins.

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RELATED: Renzi’s referendum loss isn’t the end of the world
for Italy or the EU

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Gentiloni, instead, looks more like a caretaker who will lead the government through rough months ahead while Renzi licks his wounds back home in Florence and prepares for the next election.

Perhaps most consequentially for Europe (and global markets), Gentiloni’s cabinet retains Renzi’s finance minister Pier Carlo Padoan, himself seen as a potential successor to Renzi. Other key ministers retained include defence minister Roberta Pinotti and justice minister Andrea Orlando, while Angelino Alfano, previously interior minister, will assume Gentiloni’s new role as foreign minister.

Italian banks on the brink

With his confidante running the government, Matteo Renzi is now free to start crafting his own political comeback from the sidelines. (Facebook)

Gentiloni and Padoan will turn most immediately to efforts to calm markets about Italy’s tottering banks and, in particular, the Banca Monte dei Paschi di Siena (MPS).  Increasingly, it seems likely that the bank, the world’s oldest (dating back to 1492, will require a bailout from the government, potentially angering taxpayers. Potentially, the government might also require a ‘bail-in’ of the bank’s investors, potentially angering Italy’s capital class. Other Italian banks in need of capitalization may come in for the same treatment. Essentially, Italian banks today find themselves in much the same position as American banks in 2009 — undercapitalized and sitting on far too many non-performing loans. While the U.S. bailout in 2008 and 2009 was far from popular, in today’s climate, in a country like Italy, where joblessness and listless (or negative) growth have become endemic, a bailout could be far more toxic.

Renzi may believe that, by leaving such unpopular steps to Gentiloni and Padoan, he can emerge later in 2017 or 2018 for a comeback — not unlike Silvio Berlusconi, himself forced from office twice, despite dominating Italian politics for nearly two decades.

That may be too clever by half. Continue reading What to expect from Italy’s new government

Renzi’s referendum loss isn’t the end of the world — for Italy or the EU

Prime ministry Matteo Renzi is resigning after losing a key referendum on reforming Italy's political institutions.
Prime minister Matteo Renzi is resigning after losing a key referendum on reforming Italy’s political institutions.


The xenophobic leader of Italy’s anti-immigrant Lega Nord (Northern League), Matteo Salvini, jubilantly Tweeted out a message last night as it looked increasingly like the government’s referendum on reforming Italian political institution would fail: Italy Flag Icon

‘Long live Trump. Love live Putin, long live Le Pen and long live the League.’

So much for dog whistles.

Salvini, and the increasingly illiberal and populist Movimento 5 Stelle (M5S, the Five Star Movement) of comedian Beppe Grillo, founded in 2009 as an anti-austerity platform, want to use the referendum’s failure as proof that their vision.

Don’t let them.

Beware anyone, in fact, who claims that there’s a single, clear message from Matteo Renzi’s spectacular failure Sunday night. It’s a lot more nuanced than the message Salvini and Grillo are projecting, that some rising populism of the right has now beat back the elites. Far from it. Remember, even The Economist opposed  a ‘Yes’ vote on the referendum. The opposition also included the center-right Forza Italia, now weaker but still headed by Silvio Berlusconi; former technocratic prime minister Mario Monti, a former European commissioner; Pier Luigi Bersani, the informal leader of the old-guard Italian left that had always been wary of Renzi; and democratic socialists like Nichi Vendola, the former regional president of Puglia.

The measure failed by a margin of 59.11% to 40.89%. Only three regions — Emilia-Romagna, Tuscany and Trentino-South Tyrol — voted yes.  Continue reading Renzi’s referendum loss isn’t the end of the world — for Italy or the EU

Mixed results for Renzi in Italian regional elections


Despite headlines proclaiming a setback for Italian prime minister Matteo Renzi and his center-left Partito Democratico (PD, Democratic Party), Renzi’s Democrats emerge from the May 31 regional elections as the strongest national party in Italy today.Italy Flag Icon

It’s true that the PD’s narrow loss in Liguria, a bellwether region straddling the Mediterranean and home to the ancient city-state of Genoa, is a disappointment for Renzi. His candidate, Raffaella Paita, narrowly lost the race to Giovanni Toti, the candidate of former prime minister Silvio Berlusconi’s center-right Forza Italia. Nevertheless, Renzi will be delighted to have retaken control of Campania, retained power in leftist strongholds like Marche and Tuscany and also in south-central regions like Umbria and Puglia, where the PD will govern with a much more Renzi-friendly candidate than outgoing regional president Nichi Vendola, an avowed communist.

It’s not that it was such a great election for the Democrats or for Renzi, who emerged Monday morning on a surprise visit to Italian troops in Afghanistan. There are many good reasons why voters are losing patience and enthusiasm for the youthful premier. Liberal voters worry that he has not been successful in effecting deep reforms in the face of vested interests. Leftist voters worry has is abandoning the core values of the Italian left. Voters of all stripes are despondent about the poor performance of Italy’s economy, which has only marginally improved in the past year.

Nevertheless, the alternatives to the Democratic Party are still so divided or extreme that the PD is still by far the clearest party of government. If Renzi can achieve more reforms and if the Italian economy improves over the next three years, there’s no reason to believe that Renzi won’t consolidate the PD’s gains at the next national elections, potentially transforming the Democrats into the kind of dominant party of government that the now-defunct Christian Democrats were from the 1950s to the 1990s or that Berlusconi’s center-right was in the 2000s.

Italians voted in seven of the country’s 20 regions, four of which rank among the country’s ten most populous regions. Each region holds two simultaneous elections — the first for a regional president (typically backed by a broad coalition of national and local parties) and the second for parties to the regional assembly.

Liguria, witliguriah just 1.6 million residents, assumed overstated strategic importance as a bellwether region. The left’s loss in Liguria, after a decade in power there, had less to do with the resurgent power of Berlusconi and the centrodestra (center-right) and more to do with three confluent trends throughout the Italian regional elections, all three of which were present in Liguria.  Continue reading Mixed results for Renzi in Italian regional elections

Calabria, Emilia Romagna elections boost Renzi government


In the wake of regional elections last month, Italian and international commentators have been quick to anoint Matteo Salvini, the right-wing leader of Italy’s Lega Nord (Northern League) the new star of Italy’s right.  calabriaItaly Flag Iconemilia-romagna

The most important takeaway, however, from both the Emilia-Romagna and Calabria elections on, is that Italian prime minister Matteo Renzi remains, by far, the most potent political force in the country. Renzi’s center-left Partito Democratico (PD, Democratic Party) won by double-digit margins in both elections. Though worrisome trends for Renzi certainly lurk behind the headline numbers, the overwhelming narrative in Italy is that the Democrats, under Renzi, are quickly becoming Italy’s hegemonic political force, much like the Christian Democrats from the 1950s to the 1990s and the various iterations of the Silvio Berlusconi-led centrodestra (center-right) since 1994.

In both elections, voters were replacing scandal-tainted regional presidents who resigned earlier in the year.

Calabria, in Italy’s south (the ‘toe’ that nearly touches the island region of Sicily), with just 1.98 million residents, is among the poorest regions in Europe, let alone Italy, plagued by the ‛Ndrangheta, the local organized crime operation, and fewer economic opportunities than the more storied (and well touristed) northern regions. The Democrats easily won the regional presidency, however, under the candidacy of Mario Oliverio, the decade-long president of Consenza province, who won 61.4% to just 23.6% for Wanda Ferro, the candidate of Berlusconi’s Forza Italia.  The victory means that southern Italy, generally a conservative region, has almost exclusively center-left regional presidents (with the exception of Campania), two of whom — Puglia’s Nichi Vendola and Sicily’s Rosario Crocetti — are openly gay leftists.

Emilia-Romagna, a region of nearly 4.5 million people in central Italy just north of Tuscany, is the beating heart of the Italian left and during the postwar period, its regional governments were reliably under the control of the old Italian Communist Party. So it’s no surprise that the Democratic Party, a few iterations removed from its Communist Party roots, would dominate the race. True to form, the PD’s candidate, Stefano Bonaccini (pictured above, right, with Renzi) easily won the regional elections by a margin of 49.05% to 29.85% for his nearest competitor, Alan Fabbri of the Northern League.

Despite the wide victories for Renzi and his Democratic Party candidates, it was something of a shock that the Northern League won so much support in Emilia-Romagna, both because of the region’s historical left-wing tilt and because the Northern League has focused its efforts north of the region, chiefly in the Veneto, Piedmont and Lombardy.


That the Northern League is breaking out of northern Italy and into central Italy, with plans to attract national support, is due to the vision of its young new leader, Matteo Salvini (pictured above). Continue reading Calabria, Emilia Romagna elections boost Renzi government

Despite Senate vote, Renzi’s reform push stalling in Italy


If Rome wasn’t built in a day, it’s certainly proving that it won’t be reformed in a day, either. Italy Flag Icon

Nearing a half-year in office, the most ‘impressive’ accomplishment of Italy’s new prime minister Matteo Renzi is engineering the relatively anti-democratic putsch of his own party’s prime minister, Enrico Letta in February.

Renzi, the 39-year-old former mayor of Florence, gave Letta just 10 months to enact urgent reforms before he executed his takeover of the Italian government. Six months into his own premiership, Renzi has greater support than Letta ever had to shake up Italy’s ossified government. But Renzi nonetheless has surprisingly little to show for half a year in office, even as the country slipped this summer into, incredibly, a triple-dip recession. 

When he ushered himself into power, Renzi came to the office with a wish list of reforms, all of which he promised would be delivered before the summer: a new election law, labor market reforms, tax reform and changes to Italy’s sclerotic public administration. 

Renzi isn’t much closer to achieving any of those today than he was in the spring. He’s lucky to have won a key vote last week in the upper house of the Italian parliament, the Senato (Senate), to reduce that chamber’s powers, making it essentially an advisory body, giving Italy a unicameral parliamentary system in all but name. Renzi must still win a vote in the lower house, the Camera dei Deputati (Chamber of Deputies), where Renzi’s Partido Democratico (PD, Democratic Party) controls an absolute majority, as well as another final vote in the Senate before the reforms are put before voters in a referendum next year. Continue reading Despite Senate vote, Renzi’s reform push stalling in Italy