Chaos in Italy and Spain Challenge the EU

This weekend the ship carrying Italy’s first anti-European government, captained by an amateur skipper and manned by a bizarre alliance of two rival populist parties, sank before it even left the harbor. And although it means more turmoil for the country, that’s a good thing. The League (formerly Northern League), a far-right party, and the Five Star Movement had picked an unknown legal scholar, Giuseppe Conte, as their prime minister and a euroskeptic economist, Paolo Savona, as finance minister. That was too much for Italy’s president, Sergio Mattarella, who rejected the proposed government on Sunday. The choice of Mr. Savona, he said, posed a risk “for Italian families and their savings.” Now, new elections are reality, but Italy is so close to bankruptcy. in every sense. Nothing better is in Spain...So, hot summer in EU with more problems...

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Without the EU these ridiculous populist parties would have had no funding and no platform.  I doubt they would be so generous if the situation were ever reversed.

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I'm afraid that Italy could go right wing and escalate with some "Italy exit" from EU. 

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Yesterday UK and Catalonia, today Italy, tomorrow Hungary....The EU was never weaker.

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Public concerns over the EU’s direction have been growing for years, but the EU have resolutely ignored them and pushed ahead with “more EU” when they should have stopped, listened and reversed direction. And now, looks like EU is falling apart?

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Political turmoil is almost a daily occurrence in Italy. Will have to wait and see how this plays out. 

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Utilitarian arguments are completely unimportant. The only question is if the Italian constitution allows this? Parliamentary constitutions usually do not invest the head of state with the power to override appointments and that's why this could be overreach.

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It will take a while for before returning to political stability in Europe.

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Just now, franco said:

This weekend the ship carrying Italy’s first anti-European government, captained by an amateur skipper and manned by a bizarre alliance of two rival populist parties, sank before it even left the harbor. And although it means more turmoil for the country, that’s a good thing. The League (formerly Northern League), a far-right party, and the Five Star Movement had picked an unknown legal scholar, Giuseppe Conte, as their prime minister and a euroskeptic economist, Paolo Savona, as finance minister. That was too much for Italy’s president, Sergio Mattarella, who rejected the proposed government on Sunday. The choice of Mr. Savona, he said, posed a risk “for Italian families and their savings.” Now, new elections are reality, but Italy is so close to bankruptcy. in every sense. Nothing better is in Spain...So, hot summer in EU with more problems...

Fascinating. Do you have links to more information about this incident?

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2 hours ago, Rodent said:

about the shipwreck specifically? 

 

I got you. This part : "This weekend the ship carrying Italy’s first anti-European government, captained by an amateur skipper and manned by a bizarre alliance of two rival populist parties, sank before it even left the harbor"...  

Is an allegory on political chaos in Italy :) 

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Just now, franco said:

 

I got you. This part : "This weekend the ship carrying Italy’s first anti-European government, captained by an amateur skipper and manned by a bizarre alliance of two rival populist parties, sank before it even left the harbor"...  

Is an allegory on political chaos in Italy :) 

oh that's too funny! I was wondering why I couldn't find any record of any shipwreck. I thought I had missed a huge piece of news somehow!!!  :)

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I can see two aspects to this posting. 

The first problem is the matter of the Euro.  Now the bureaucrats and central planners in Brussels treat the Euro as the Holy Grail. The original idea was to grease the wheels of commerce by making contracts payable in a common currency, removing the uncertainly of changes in the exchange rates. The problem with this is that, by forcing a common currency, that currency and its monetary policies end up being controlled  (some would say dictated) by the dominant economic partner:  Germany.  In the case of Italy, it has historically had a weak currency, and Italy remained competitive in the context of Europe by letting the Lira devalue.  But with a common currency, you cannot devalue because there is no Lira; there is only the Euro. 

So Italy now has to control its fiscal house through taxation (which everybody avoids, as they do in Greece, practically a national sport) and through discipline in spending, which implies a lean civil service.  And in the context of Italy (and Spain), that does not happen, as government jobs are a historical form of patronage.  So now what?  You are locked in to that Euro, you cannot match your currency (through devaluation) with the true value of your outputs, you have difficulties collecting the taxes, and your civil service is un-fireable. Guess what:  your country is headed for trouble. 

And until Italy can devalue and re-value its currency, it will remain in trouble (OK, call it chaos).  Germany and the German bankers have taken away your instrument of balancing.  Italy remains the "poor boy" of the underbelly of Europe. 

The second problem is more that of Spain  (which has the same currency and tax problems of Italy).  But Spain has this large cadre of retirees, mostly from England, who live there by the tens of thousands and spend their retirement pensions there, propping up the Spanish economy and lending stability to the real estate and banking sectors.  If the retirees now start to migrate back to England, the Spain ends up with even more empty houses (collapsing the real estate market) and with even less money on deposit in their banks (and Spain has had a banking crisis, bailed out so far by Brussels and the German central bankers).  How does Spain cope with this?  And it cannot.  Spain needs those expatriate Brits, and if they leave, the Spain ends up same as Italy. 

So the real question is:  can you have a EU without the common currency?  I think that is the way it is going to end up.  If these soft countries have to do what Germany dictates, then I predict failure for the EU experiment.  But they should be able to have a common market and even common parliament but with separate currencies. 

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fascinating discussion going on here, but curiously i havent heard nor read any accusations against Russia over whats going on in Italy and its polemic anti european stance by these parties in power and all the chaos ensuing there. I guess Berlusconi is watching closely how this will play out on his favor,

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(edited)

Successes of populist parties in Italy, France, Germany in recent times  is natural result of massive migration of people from totally diferent than latin civilization to Europe. Its like Huns invasion or  sacco di Roma - maybe smaller scale but also very shocking especially for Germans. 2 milion people if we talk about Germany.

Massive migration is result of destabilization of Middle East and Libya- Libya is simple a gate to Southern Europe for half of african population - just look on map. Gaddafi even warned that result of his overthrow  will be a long war in Libya and massive migration to Europe.

Could anybody tell me who exacly made that destabilization?

Maybe we should talk about the heritage of Arab Spring and  colourful revolutions all over the world for Europe itself?

And thats a heritage of neocons and official plan for new american century.

Its a pitty USA is so far away - we cant dispatch some of these people there.

 

More funtamental problems than recent massive migration:

 wage difference in European Union

Today people in Bulgaria and Romania earn 5-6 times less than for example in Denmark. So 25 % of young male Romanians work abroad. And some people would like to see in European Union in not  a long future  Ukraine where people earn today 15-20 time less than in Denmark. I really dont see  a economic union with such wage difference.

In my opinion even today European Union has a problem with overextension on poor countries. Typical problem when a country was to agressive and annexed  diferent teritories too fast in world's history.

Common currency

Another question is currency union - from the beginnng I was very sceptic that for example Germany and Greece (this country really doesnt have any industry) will have the same currency. Greece Spain Portugal and  Italy (PIGS) during last crisis should depreciate their currency just like Poland did - but they couldnt do this. And in next 10 years we saw a result of this.

Edited by Tomasz
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Two with lucks here.

First: Maybe we will see the demise of the control Nazi Germany has over Europe. Remember WW2?

Second: Those in other disgruntled countries will have someone who is not a moron like the UKs T. May negotiating exit.

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Im shocked also because Italy is more like parlamentarian republic French Third Republic or modern Germany than semi-presidential French V Republic. They have a president but as far as I know its only honorary head of state like german president with no real power. Most of modern italian presidents as far as I know were  person of merit but  rather very old which were outside of recent  big politics for many years.

So for me a president of Italy probably rather has no right to reject a member of new goverment.

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(edited)

6 hours ago, Tomasz said:

Im shocked also because Italy is more like parlamentarian republic French Third Republic or modern Germany than semi-presidential French V Republic. They have a president but as far as I know its only honorary head of state like german president with no real power. Most of modern italian presidents as far as I know were  person of merit but  rather very old which were outside of recent  big politics for many years.

So for me a president of Italy probably rather has no right to reject a member of new goverment.

In Italy the consent of the President is needed for the designation of the ministers proposed by the Prime Minister. In fact it's not the first time a proposed  minister is vetoed by a President.

In 1994 prime minister Berlusconi tried to place his own lawyer Cesare Previti as Justice Minister but president Oscar Luigi Scalfaro didn't agree and Previti ended as Defense minister.

In 2002, Berlusconi tried to place as Justice Minister, Roberto Maroni, but president  Carlo Azeglio Ciampi didn't agree as Maroni was under investigation. Maroni ended in another ministry.

In 2014 Nicola Gratteri picked as Justice minister by prime minister Matteo Renzi didn't get the consent of president Giorgio Napolitano and Andrea Orlando was then proposed by Renzi and got the consent of Napolitano.

 

This time its not the Justice Minister pick that was vetoed by the president but the finance Minister. President Mattarella was opposed to the nomination of the euroskeptic economist Paolo Savona. The problem could have been solved choosing another person for this ministry but the populist coalition 5 Stelle-Lega tried to impose Savona and this ended with the resignation of prime minister Conte.

 

 

 

Edited by Guillaume Albasini
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I am surprised about how many people here accept the Establisment ignoring the will of the Italian people amid subjective qualifications as populist, right wing and the like. Italian people voted them folks just Americans voted for Trump and; frankly speaking, I believe they proved right.

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These are the last throes of the crisis. The positive economic cycle and stability will come back again, provided there is an agreement between China and the US.

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Recent developments in the evolving italian government crisis...

After the resignation of Conte president Matarella has asked Cottarelli (a technocrat formerly working at the IMF) to try to form a government to run the country until a quick return to the polls.. (Cottarelli would probably not get the support of the populist dominated parliament).

But now it seems that Di Maio the leader of "5 Stelle" anti-establishment party is ready to step back on Savona... but has still to convince his wannabe coalition partner Savini, leader of the far-right Lega party, to change his mind. Di Maio said he could be OK with a government including Savona but with someone else as finance minister.

"The leader of Italy’s anti-establishment 5-Star Movement on Wednesday appealed to the far-right League to drop its insistence that euroskeptic economist Paolo Savona should be economy minister in a government of the two parties. "

https://uk.reuters.com/article/uk-italy-politics/italys-cottarelli-opens-door-to-possible-eurosceptic-government-idUKKCN1IU124

 

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On 5/29/2018 at 10:54 PM, ThunderBlade said:

Yesterday UK and Catalonia, today Italy, tomorrow Hungary....The EU was never weaker.

2018-05-29_18-19-02.thumb.jpg.20ee2aefc721e2cfeb142f0d55e83dcf.jpg

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I think I'm most fond of "Quitaly"

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There was a joke going round down here when Romania and Bulgaria joined: the EU was done for the moment they said yes to these two countries. Well, it took a while but...

And political turmoil is chronic in Italy, yes.

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