Italian Elections and Politics 2018: Yellow Tide

[jaichind]

LA7 television cites increasing consensus among Italian lawmakers from different parties on early elections as soon as July 29 or Aug. 5.

[Tender Branson]

I think both sides are to blame for this mess:

M5S + Lega for being stubborn and presenting no alternative name to President Matarella for Finance Minister and insisting on their extreme candidate.

And Matarella for ignoring democracy (to some extent) and the will of the people by acting as the prolonged arm of Macron and Merkel and pushing the extreme pro-EU/Eurozone agenda.

Italian voters will become only more annoyed and aggressive over the next months and Lega will likely finish at the top this time, or very closely to M5S - both getting around 30% of the vote.

The PD will likely get crushed, as will Berlusconi's party. Then, I also think Italians should be able to vote on EU/Eurozone membership to settle this issue.

PS: Can any of the Italian posters still answer my question what the requirements are for the impeachment of the Italian president ? Is a 2/3 majority in both chambers needed ? Or a referendum vote ? Or both ?

[BigSkyBob]

Is there a chance that the right gets an absolute majority and instead of M5S-Lega, Italy gets Lega-Forza Italia-FdI? Honestly, I'd say that would be a marginally better government, at least Berlusconi will put the brakes on the radical proposals (I still can't believe Berlusconi is Italy's best hope)

To be clear: Mattarella said no to Savona but would have accepted one of Lega's main politicians as Finance Minister.
The point is that Lega and M5S wanted to break up from the euro while not having said it publicly one single time.

If a country aspired to create an export-oriented economy with large trade surpluses it would, in general, face the severe headwind of rising currencies that made its exports more expensive abroad while lowering the costs of imported goods. That assumes currencies float. If they didn't, the headwind would be less severe.

The Euro is a glorified fixed-exchange regime amongst the European states.

In the real world, that aspiring state is Germany,  and that export policy is succeeding spectacularly as the folks in Greece can attest.

Devaluation is the answer, and, leaving the Euro is the only path to devaluation. Otherwise, teaching German, English, and Dutch in primary school is the best hope Italian children have for a better life.

Ah yes, because that worked flawlessly for Zimbabwe and Venezuela

Devaluation, aka, free floating currencies, is market forces in action. Quantitative easing is not. Advocating floating currencies is simply not advocating quantitative easing no matter how hard you try to conflate the two. The Deutchmark isn't rising relative to the Lira simply because there was a political decision to call the German currency the "Euro" and the Italian currency the "Euro" and then declare the two currencies of equal value in perpetuity. Fixed exchange rates are anti-market, as is quantitative easing.

[BigSkyBob]

I think both sides are to blame for this mess:

M5S + Lega for being stubborn and presenting no alternative name to President Matarella for Finance Minister and insisting on their extreme candidate.

Refusing to throw away your victory, aka the right to set public policy, for the right to organize the collection of trash simply isn't an example of being "stubborn.'

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[jaichind]

I think both sides are to blame for this mess:

M5S + Lega for being stubborn and presenting no alternative name to President Matarella for Finance Minister and insisting on their extreme candidate.

One can make the argument that for Lega, Matarella's move is a feature and not a bug and that Salvini's goal was always new elections to strength his position.

Salvini could have looked at the experience of Austrian FPÖ in the 1999-2006 period and Finland's Finns Party since 2015 and conclude a Right anti-European populist party loses support quickly if it goes into government as a junior ruling party.  If so Salvini could conclude that new elections is the real way out.  But Lega cannot be seen as the party that provoked a crisis ergo one had to be engineered with Matarella taking the fall by trapping him into a no-win situation.

[jaichind]

Devaluation, aka, free floating currencies, is market forces in action. Quantitative easing is not. Advocating floating currencies is simply not advocating quantitative easing no matter how hard you try to conflate the two. The Deutchmark isn't rising relative to the Lira simply because there was a political decision to call the German currency the "Euro" and the Italian currency the "Euro" and then declare the two currencies of equal value in perpetuity. Fixed exchange rates are anti-market, as is quantitative easing.

Totally agreed.  I think the issue here is not an issue of floating currencies but what is the relationship between Germany and Italy.  If the population and elites of both states sees a common fate like what we have in USA between different states, then a common currency would make sense.  If the view of each other is of a foreign entity then issues like "the EUR rates benefits Germany at the expense of Italy" will crop up.  Note in USA there is usually not talk of "the current monetary policy is for the benefit of TX and hurts NY" because people do not think of cost-benefit in those lines.  If Italians and Germans do think along those lines then perhaps a separate currency is best. I guess the main problem here is German and Italian elites think in common fate terms but not a significant section of the general population. 

[🦀🎂🦀🎂]

I think both sides are to blame for this mess:

M5S + Lega for being stubborn and presenting no alternative name to President Matarella for Finance Minister and insisting on their extreme candidate.

And Matarella for ignoring democracy (to some extent) and the will of the people by acting as the prolonged arm of Macron and Merkel and pushing the extreme pro-EU/Eurozone agenda.

Italian voters will become only more annoyed and aggressive over the next months and Lega will likely finish at the top this time, or very closely to M5S - both getting around 30% of the vote.

The PD will likely get crushed, as will Berlusconi's party. Then, I also think Italians should be able to vote on EU/Eurozone membership to settle this issue.

PS: Can any of the Italian posters still answer my question what the requirements are for the impeachment of the Italian president ? Is a 2/3 majority in both chambers needed ? Or a referendum vote ? Or both ?

Apparently it's just a simple majority of a joint sitting of parliament, according to the Italian constitution (article 90).

[EPG]

It's a very basic question whether Italians want their government to stay in the euro or not.

One outcome
1. Most vote for the white nationalists and basic income allies
2. "hey, why is the bank closed"
3. "pay your EU membership fee in euro"
4. "hey, where did the EU flags go"

[swl]

You guys need to chill. My bet:
-Lega finishes first
-Markets panic, businesses panic (all located in the north btw), Italians who have something to lose (also most of them also in the north) start to panic.
-Salvini one hour later: "we have no intention to leave the euro"

[EPG]

You don't insist on Prof. "Plan B" Savona if your secret mission is to stay in the euro.

[palandio]

What if Salvini's secret mission isn't to stay in the Euro or not to stay in the Euro, but to win the next elections? The League is already polling in the 20-30% range. When Salvini saw that Mattarella would reject any government including Savona because "the financial markets...", he saw the opportunity for electoral gain. I don't of course deny that it's a gamble; and by that I mean a gamble at the cost of his would-be coalition partners and in the first place a gamble at the cost of the Italians and Europeans.

[jaichind]

What if Salvini's secret mission isn't to stay in the Euro or not to stay in the Euro, but to win the next elections? The League is already polling in the 20-30% range. When Salvini saw that Mattarella would reject any government including Savona because "the financial markets...", he saw the opportunity for electoral gain. I don't of course deny that it's a gamble; and by that I mean a gamble at the cost of his would-be coalition partners and in the first place a gamble at the cost of the Italians and Europeans.

That is what I suspect is his real goal.

[○∙◄☻¥tπ[╪AV┼cVê└]

You don't insist on Prof. "Plan B" Savona if your secret mission is to stay in the euro.

You do if you think it'll help you get a bigger majority in some elections very soon.

[SPQR]

To be clear: Mattarella said no to Savona but would have accepted one of Lega's main politicians as Finance Minister.
The point is that Lega and M5S wanted to break up from the euro while not having said it publicly one single time.

If a country aspired to create an export-oriented economy with large trade surpluses it would, in general, face the severe headwind of rising currencies that made its exports more expensive abroad while lowering the costs of imported goods. That assumes currencies float. If they didn't, the headwind would be less severe.

The Euro is a glorified fixed-exchange regime amongst the European states.

In the real world, that aspiring state is Germany,  and that export policy is succeeding spectacularly as the folks in Greece can attest.

Devaluation is the answer, and, leaving the Euro is the only path to devaluation. Otherwise, teaching German, English, and Dutch in primary school is the best hope Italian children have for a better life.

As a PhD in Economics, I am not impressed by words like "devaluation" and "floating currency" flying around for no reason, and I also strongly disagree with your view.
Also, Italy has had a floating currency for decades, and the continuous devaluations only helped the political class to accumulate deficit and deficit, building up the 130% debt/GDP that we currently have.

But that is beside the point, and the topic. Lega and M5S never mentioned the issue during the electoral campaign. And there is no way Italy can be brought outside of the EU after decades through backdoor maneuvering, and without a clear electoral mandate.

Now those clowns are back together and will possibly get to government without the controversial anti-euro minister.

[jaichind]

It seems M5S is willing to try again with Lega to form a government.  Lega does not seem to be interested and seems determined to push for early elections.  One way out is for M5S-PD to form a government.  But that just means Lega will win a even larger vote share next election. 

[EPG]

We all thought there would be an election within 18 months regardless of what happens, and that Lega would take FI-FdI voters. That has merely been accelerated. In my experience, most politicians want to be in government, but also, want to be in government to enact policies (though I don't know anyone at Salvini's level). There are very few benefits to being in government and not enacting your stated policies. It makes you look weak. That is why when Salvini proposes a minister with a secret plan to quit the euro, you should assume that Salvini's plan is not to stay in the euro, nor is it merely to be top man in a government when he was already, basically, writing the policies.

[Sestak]

I hope Di Maio realizes that a deal with PD is M5S' last chance of being in a dominant position in government. And that PD realizes that such a deal is the only way they aren't destroyed in a second election.

[jaichind]

League, Five Star Reach Agreement on Savona Role: La Stampa
(Bloomberg) -- Italy’s populist parties -- League and Five Star -- reach deal which would see Paolo Savona serve as minister of European affairs, La Stampa reports, citing anonymous sources.

[Tender Branson]

League, Five Star Reach Agreement on Savona Role: La Stampa
(Bloomberg) -- Italy’s populist parties -- League and Five Star -- reach deal which would see Paolo Savona serve as minister of European affairs, La Stampa reports, citing anonymous sources.

Economics professor Giovanni Tria to become Finance Minister, if President Matarella agrees (which he should).

His blockade of this government has become annoying ...

[Andrea]

Prime Minister – Giuseppe Conte
Deputy PM and Minister for Work, Economic Development and Social Policies   – Luigi Di Maio (M5S)
Deputy PM and Home Affairs – Matteo Salvini (Lega)
Relationship with Parliament and Direct Democracy  – Riccardo Fraccaro (M5S)
Public Administration– Giulia Bongiorno (Lega)
Regional Affairs and Local Autonomies – Erika Stefani (Lega)
South: –Barbara Lezzi (M5S)
Family and Disabilities– Lorenzo Fontana (Lega)
Foreign Affairs – Enzo Moavero Milanesi
Justice – Alfonso Bonafede (M5S)
Defense – Elisabetta Trenta (M5S)
Economy– Giovanni Tria
Agricolture – Gianmarco Centinaio (Lega)
Environment - Sergio Costa (M5S)
Infrastructure and Transport– Danilo Tonineli (M5S)
Education– Marco Bussetti (Lega)
Culture and Turism– Alberto Bonisoli (M5S)
Health – Giulia Grillo (M5S)
European Affairs– Paolo Savona

Under Secretary to the PM - Giancarlo Giorgetti (Lega)

Swearing in ceremony tomorrow at 16:00

[Tender Branson]

M5S + Lega has been sworn in.

Let the fun begin.

[Tender Branson]

[rob in cal]

  One thing about the new government is that most of its top goals are actually pretty achievable, such as lowering the pension age, a crackdown on illegal immigration (outgoing interior minister Minniti has been working on slowing the departure rate from the Libyan route of migrants), the new welfare reform idea etc.  Of course the budget deficit side of things will probably get really ugly, especially if the flatter tax/tax cuts go through.  Also, apparently Savona wasn't acceptable as finance minister due to his anti euro feelings, but is ok as Europe minister?

[Andrea]

After being sworn in

[SPQR]

  One thing about the new government is that most of its top goals are actually pretty achievable, such as lowering the pension age, a crackdown on illegal immigration (outgoing interior minister Minniti has been working on slowing the departure rate from the Libyan route of migrants), the new welfare reform idea etc.  Of course the budget deficit side of things will probably get really ugly, especially if the flatter tax/tax cuts go through.  Also, apparently Savona wasn't acceptable as finance minister due to his anti euro feelings, but is ok as Europe minister?

Now Savona can bash the EU all he wants, but he doesn't have the power to hiddenly manage an Italexit that he would have had as Finance Minister.

Anyway, "lowering the pension age" is far from achievable: the Fornero reform may not be perfect, but given the Italian demographic crisis and its past pension system, there is no way out of it. Going back to the previous system would cost tens of billions, and without solving any of Italy's structural problems.