Italy government

Why Matteo Renzi is sinking the Italian government even as the pandemic rages on

Without the pandemic, the government of Giuseppe Conte might not have lasted so long. Last February, neoliberal centrist Matteo Renzi threatened to split the ruling center-left coalition, only to fall back into line. But even as COVID-19 rages in Italy again, Renzi is today withdrawing ministers from his Italia Viva party – and pushing the government towards collapse.

Prime Minister Conte has faced several major crises during his short career. In June 2018, the law professor became the figurehead of a coalition bringing together the eclectic Five Star Movement (M5S) and Matteo Salvini’s far-right Lega. When Salvini resigned in the summer of 2019 in a failed attempt to force an election, M5S struck an opposing deal with centre-left parties and Conte remained prime minister.

Conte is not a party member and was an obscure figure when first appointed. But his ability to form a new coalition two summers ago and his initial response to the pandemic have elevated his position. Although he has no parliamentary base of his own, Conte has become an icon for many on the soft left, and even identified as a future leader of M5S.

But Conte’s undeniable skill in the face of the opportunistic cut of Italy’s fragmented parliament might not be enough to save his job. Renzi, an acolyte of Tony Blair and Emmanuel Macron always seeking the spotlight, is today using his influence to try to force Conte’s resignation – and, he hopes, force the creation of a new coalition more slavishly faithful to the dogmas of austerity.

The crisis has a definite element of personal animosity – former Prime Minister Massimo D’Alema, an old enemy of the Italia Viva leader, has mocked Renzi’s attempt to oust Conte as “the most most unpopular in Italy demanding the head of the most popular”. But it also has deeper political underpinnings, both in electoral calculations and the pressures the government is likely to face in the post-pandemic period.

The ideological divisions at work here should not be exaggerated. Conte’s second government proved only moderately social democratic, even in the face of the need for urgent pandemic response measures. Where it has intervened in failing businesses (in 2020, the partial renationalisation of motorway operator Autostrade per l’Italia and the bailout of the airline Alitalia), such measures have only made small inroads into more than three decades of disposals of public companies.

This lack of radicality is not surprising. The largest party in the coalition, the M5S, started life with an “anti-establishment” message more directed against the privileges of politicians than austerity per se. The other main force, the democrats (PD), is the direct product of the conversion of the left of the years 1990-2000 to liberal-Europeanist ideas. Small partners Liberi e Uguali (LeU) and Italia Viva are both recent splits from the PD; more left-leaning advisers like Mariana Mazzucato don’t really direct government strategy.

Yet while Conte’s administration has never fundamentally challenged neoliberal assumptions or European spending limits, even slight concessions to labor and social protection are too much for Italia Viva fundamentalists. It echoes the hysterical denunciations of the centrist media and economists of the Bocconi school accusing Conte of creating a “new Venezuela” and of imposing a “North Korean style“Prohibition of dismissals in response to COVID-19.

The government has in truth proved too weak to confront the corporate pressure groups. Even last spring’s lockdown left a large minority of businesses operating, and the “red zones” declared this winter did even less to keep workers at home. In the face of an increasingly confused response, public admiration for Conte’s initial response to the pandemic is waning, along with optimism that “everything will be fine.” Now Renzi is trying to use this problem to completely sink Conte’s government.

Italia Viva’s attacks on Conte in recent weeks have focused particularly on the response to the pandemic. He criticizes the Prime Minister for a lack of clarity on the intended use of money from the European Recovery Fund and for not using the European Stability Mechanism (ESM) to finance investments in healthcare – saying that this failure is due to an ambient euroscepticism. They accuse his administration of accumulating debts that will be passed on to younger generations, without doing anything to invest in their future.

Italia Viva figures like economist Luigi Marattin have in fact vigorously defended post-2008 privatizations and spending cuts, including in health care; Renzi’s tenure as prime minister in 2014-2016 saw reduced labor protections, again in the name of opening up opportunities for young people. But the focus on the MES is particularly useful in attacking the M5S, which has long seen it as an EU tool to impose “conditionalities” on Italian public spending. In reality, such constraints owe little to the ESM in particular; the politically superficial M5S, however, prefers to tackle this problem rather than confront larger issues such as limits on deficit spending and the need to cancel debt.

Polling a dismal 3%, it seems unlikely that Renzi and his fading band of followers really want a snap election, which would lead to their own exit from parliament. Instead, faced with the current backpack of small centrist forces (like +Europa, the Azione of its former finance minister Carlo Calenda, and even elements of Silvio Berlusconi’s Forza Italia), Renzi, always auto -promote, hopes to be able to rise to the head of a new centrist-Europeanist force, whether in a new government or by gaining access to the benches of the opposition.

Everything indicates that an early election would give the absolute majority of seats to the so-called “center-right” alliance, led by Salvini’s Lega (polls in the 20%) and Giorgia Meloni’s post-fascist Fratelli d’Italia (high teens). The third part of this alliance, Berlusconi’s Forza Italia, is currently rising in the polls at the expense of the Lega, at around 10%. Despite his dissociation from his “right-wing type” of fanatics who have rioted on Capitol Hill, Berlusconi seems unlikely to break with his allies in the hard right, a bloc that dominates regional governments across Italy.

It is unlikely that an early election will be held under pandemic conditions, but it should also take place at least six months before the departure of the President of the Republic, that is to say before August 2021. However, c It’s also a good reason not to expect a vote in 2021 at all. Since the president is elected by MPs and senators, most sitting lawmakers will want the February 2022 vote on replacing incumbent Sergio Mattarella (PD) to take place with the current parliament still in place. Although the president is not the head of government, he can intervene in the formation of the cabinet and the coalition.

Given those calculations — as well as the current strains of the pandemic — the outcome that would sit well with most sitting lawmakers is not a return to the polls, but some sort of political reshuffle or broadening of the current coalition, possibly still led by Conte. This can only work if the current parties in government find new allies in the Senate. Conte has spent the start of this week trying to lure centrist forces, whether recruiting various expellees from the M5S and smaller parties together known as the “Mixed Group”, or picking individual senators from Italia. Viva and Berlusconi’s Forza Italia.

Yet if there is any logic in Renzi’s moves – that is, beyond mere megalomania – it is to form a new government with the current parliamentary base but with a more assertive neoliberal leadership . Conte (like M5S) has announced that it will no longer ally itself with Italia Viva. But the possibility remains that Renzi will manage to convince his former allies to support a new administration – one in which the M5S has even less clout and a technocratic figure will take over as prime minister, on behalf of the union of various political forces.

A name often put forward in this regard is that of Mario Draghi, former head of the European Central Bank and hero of the neoliberal hawks. In 2011, he played a key role in the overthrow of the last government of Silvio Berlusconi, considered unreliable by European leaders despite its promised obedience to austerity measures. That operation replaced Berlusconi with Goldman Sachs adviser Mario Monti in a technocratic government that implemented biting austerity measures backed by both the center-left and center-right in parliament.

This is comparable to Renzi’s current campaign against the remnant “eurosceptic” M5S – a force that has not so much embraced the Europeanist center as capitulated to it. While the base of the M5S has fractured after associating first with the hard-right Lega and then with the soft-left PD, its parliamentary rump will likely seize any means to avoid new elections. This has already happened in the summer of 2019, when the M5S first accepted its current pact with the PD. Grillo and Foreign Minister Luigi di Maio are today calling for a government of national unity.

The next few days will see if Conte can save his coalition, if a palliative is found, or if the right is brought to power almost by accident. Any administration that forms will face a dire post-pandemic scenario, with soaring public debt, a heavily understretched public health care system and mass layoffs likely this spring. Horse-trading in parliament and calls for urgency can allow a coalition to be cobbled together, perhaps led by unelected technocrats. But above all, should we expect a government strong enough to withstand the social fallout of the pandemic.