Draining the swamp, Italian style. An interview with Bill Emmott

Italy has only been stable in the sense that there hasn’t been an election in five years, and a broad centrist coalition has endured and survived for most of it. But it has been a very weak stability. The coalition that the PD set up in 2013, initially with Berlusconi’s support, was so broad it in fact represented the weakness of the party. Matteo Renzi should have called an election years ago, on the back of winning 40% in the European elections. Back then he was poster boy for resistance to populism and could have secured a much stronger position from which to actually enact the sort of reforms he has declared himself to be in favour of. Not having done this, it seems the PD has not achieved very much. Unemployment is still above 11% and youth unemployment above 35%. There is therefore a natural desire for alternatives.

One piece of legislation that Renzi did get through was the Jobs Act [a package of policies designed to instill greater flexibility in the Italian labour market] and there were significant public protests against it. Is the impact of this reform being felt yet? Is opposition to it part of the fuel for the turn against the PD?

The Jobs Act has had very little impact in Italy so far. The reason is that while it makes it easier and perhaps smoother to create jobs, you can only create jobs when you are in a cycle of rising demand and of rising business investment. Neither have been rising, at least until the last six months. Compared with the rest of the Eurozone, Italy is under-performing. It’s growing at half the rate of Spain and in fact the only country it is doing better than is Greece. The Jobs Act was never going to be a piece of legislation that would cause economic growth. Its hope was that when economic growth happened it would create more jobs.

You describe Renzi as a one-time European poster boy for blocking populism. In the context of the decline of the PD does this mean the gate is now open for other populist forces? Do the March elections represent a kind of Brexit or Trump moment for Italy?

The situation is the same as in the cases of Brexit and Trump in the sense that there is a populist opposition. But it’s not so clearly a right wing populism. Some elements are populist, as represented by the Lega Nord, and Fratelli d’Italia. Meanwhile Berlusconi is as usual singing their tunes when he thinks it is in his interests to do so, but somewhat trying to play both sides. Then there is the Five Star Movement, which is an anomaly, bridging left and right.

Populism in Italy might not always be nationalistic, but it is certainly far-right and fascistic in tone, and egged on by politicians of all stripes. I’m thinking, most recently, about the remarks made by the mayor of Varese, Attilio Fontana, about the imperative of ‘defending the white race.’ This kind of racist, anti-migrant, strongly Islamophobic politics seems pretty comparable to other European contexts.

Absolutely. It’s the same phenomenon you see in Alternative für Deutschland in Germany, the Freedom Party in Austria, The Danish People’s Party, the Sweden Democrats. And if you compare Italy with Germany and Austria it is at a similar magnitude of around 20% of the vote. What’s different in Italy, perhaps, is the relationship to the EU. Compared with other right wing populist parties movements in Europe, euroscepticism is playing a lower and quieter role. In Italy these movements are mostly focused on immigrants rather than the euro or trade policy. Most portray the EU as something to negotiate toughly with, rather than hold two fingers up to. In Italy the EU is historically seen as something more trustworthy than national institutions, more a safeguard than a threat. This remains more true than untrue.

There has I agree been a move away from what we might call hard euroscepticism in recent months. The Five Star Movement abandoned their mooted referendum on the euro and even the Lega Nord are toning down that aspect to some extent. Why do you think this is?

It has to be a combination of things, the Greek experience, the evolution of the euro, the ECB behaviour during the sovereign debt crisis and now Brexit. All together have, in different ways, made leaving the EU or single currency a less appealing option. Greece in particular showed how withdrawal from the euro, and default on debt, really is a cliff-edge solution. You have to be prepared to jump. Britain is showing how hard those choices are once you’ve chosen this route and how it can dominate policy on everything for years and stop a party being re-elected at the next election. It’s harder and harder to say there is a paradise for Italy somewhere outside the euro or EU.

The Five Star Movement is, as you say, a significant anomaly in Europe’s political panorama. How do you read the evolution of the movement in the past years, since their surprise breakthrough in 2013?

Their continuing popularity is the strongest sign of stability in Italy. The fact that they have remained at above 25% in polls – the same as their 2013 result – shows how disappointing Renzi has been. Most in the centre left Italian mainstream thought they would fade, firstly because Renzi was in government but also because the Five Star mayors would taint their brand by botching up local government. The idea was that when Virginia Raggi and Chiara Appendino were elected in Rome and Turin two years ago, they would finally be done-in, having taken on the poisoned chalice of Rome.

Now nobody could say mayor Raggi has been successful, but it doesn’t seem to have affected them too much. If anything it has only confirmed the problem. To borrow Trump’s language, there is a ‘swamp’ that needs to be drained. And Rome is the worst, smelliest and most mosquito infested swamp that Italy has. The key motive for supporting the Five Star Movement is that you think the system is wrong, that corruption is among the country’s biggest problems, that the establishment need to be kicked out and cleaned up. This has been confirmed by Rome and Turin and Parma and others. The idea that the Five Star Movement is not dangerous, and may perhaps do a reasonable job has probably helped.

Thinking about the dangers though, the movement has been clearly and more explicitly drifting to the right in recent years. I’m thinking, rhetorically, about their frontman Luigi Di Maio’s totally fictitious claim that Italy has ‘imported 40% of Romania’s criminals’ and other similar remarks from local candidates. Not to mention the more tangible right-wing housing policies of Virginia Raggi in Rome. A lot of the movement’s politics seem quite similar to that of the Lega Nord. At the very least, they are fighting hard to capture a right-leaning constituency…

I think that’s right, particularly on the immigration question. But they are still transversal in terms of support. One key question is how well they will do in the south. Are they able to get single member constituencies there, as well as the PR list seats? Those issues are going to be crucial in Sicily and other regions. It’s also important to note that, so far at least, this rightward shift doesn’t seem to have led to much drifting away by left-leaning supporters who were after all the base that built them up.

One of the movement’s most interesting proposals is a kind of ‘citizens wage’, something that is mooted by other smaller parties too and regularly debated by Italian media. Is such a policy desirable? Is it viable? Or just empty rhetoric to outflank the PD?

I think it is perfectly viable in Italy, and desirable to some degree. Alongside the Jobs Act type reform to the labour market, which, incidentally, is similar to what Macron is trying to do in France, there needs to be a rethinking of the welfare system, which directs public resources towards retraining, reeducation, job-seeking assistance and helps ordinary people adjust their lives to globalization, automation and so on. A Scandinavian-esque ‘job adjustment programme’, like that of the Five Star Movement’s programme (rather than a real universal basic income) makes a great deal of sense.

I’m skeptical, however, as to whether they can deliver. To fund this when you have a public debt of 130% of GDP you need to take money away from other things. The key one in Italy is pensions. People can retire in their fifties, and it’s something that has been used by the Italian government as a kind of proxy unemployment scheme. Money needs to be taken away from this, but no one is going to try this as it’s not a vote winner. The Five Star Movement say they would negotiate harder with the commission and partners to get more relaxed fiscal rules. This is how their euroscepticism has been transmuted away from a referendum on the euro. It’s not terribly credible, though, that they’d get enough extra percentage points of borrowing to do all this properly. It’s the right idea, but I’m skeptical.

A lot of international observers are staggered that, despite everything, Silvio Berlusconi can still be a sort of kingmaker. Having been apparently morally and politically discredited, how was Forza Italia able to win in Sicily’s local elections before christmas? And how has he got himself to be a potential power broker for a centre right coalition?

I think the level of Berlusconi’s disgrace is exaggerated in international eyes. Although he has finally had a tax fraud conviction, and he did essentially get booted out of government in 2011 because of the situation with the bond markets and lack of credibility in his government, I don’t think his core voters consider that those two things disgrace him in a way that might be the case if this was UK or Germany. At the same time, though, he has only half the level in opinion polls that he used to, so Forza Italia is not as strong as it used to be. He is a great coalition builder: that’s the skill that got him in power in 94 and which kept him in government for five years after 2001. I think he has simply seen an opportunity to leverage the 16% points he has, in an electoral system that was, it should be noted, drafted by the PD. Plus, of course, he still owns three TV channels and a load of newspapers so he’s in a pretty privileged campaigning position.

A few years ago Mario Monti described Italy evocatively as ‘the detonator of the Eurozone.’ Now commentators are once again forecasting apocalyptic post-election scenarios for the EU as a result of the Italian elections. What do you think the international ramifications will be?  

The only clear time-bomb situation would be if there were a centre right absolute majority, with Lega Nord as largest party. In such a case you would indeed have a eurosceptic Italy. If this result was over 40%, there would be the risk of the government being more like those we see in Hungary and Poland, and less like Spain or France. Matteo Salvini as Prime Minister would be the worst thing for Berlin and Paris. In the case of the Five Star Movement forming confidence and supply alliances with other parties, I don’t think there would be a real crisis. Financial markets would mark down Italian debt, and the bonds would be hit. It would be messy and less stable outcome, but not catastrophic.