When an anti-austerity, anti-establishment internet-based
political movement with few policies and led by a comedian, gets 25% of the
vote in a general election, you know for sure that the political system is
travelling on a one-way ticket to disintegration.
Beppe Grillo's Five Star Movement (M5S) won 54 seats and
cashed in on Italians’ hatred for a corrupt, incompetent state that has cut
their pensions, living standards and left record numbers of young people out of
work.
Deadlock is what the markets didn’t want. That’s why Mario
Monti was appointed by the European Central Bank to head a caretaker government
15 months ago as Italy ’s
debt mountain threatened to overwhelm the euro. But given half a chance, the
electorate rejected his policies.
The ex-Goldman Sachs banker only got 10% of the vote when he
put his austerity programme to the electorate. And with Silvio Berlusconi also
raging against Brussels
and promising everyone a tax cut, many voters backed a man who has somehow
evaded prison.
As a result there is no immediate prospect of a stable
government to manage Europe ’s third largest
economy. And the markets don’t like the stalemate at all. After initial polls
showed the centre-left alliance winning, the markets rallied.
Then when the electoral deadlock was confirmed, black turned
to red on trading screens around the world. Italian bonds were sold off, trading
in the major banks was suspended, the stock markets plunged and the euro crisis
returned with a vengeance.
“This looks like a recipe for total gridlock,” commented
Nicholas Spiro, a sovereign debt analyst. “On current projections, financial
markets are facing the worst of both worlds in Italy : a full-blown political
crisis in the eurozone’s third largest economy and a severe setback for the liberal
economic agenda championed by Mr Monti.”
Pesky voters!
Enrico Letta, deputy leader of the Democrat party, concluded
that the “absolute majority of Italians have voted against austerity measures,
the euro and Europe ,”. This, he claimed, sent a “a very clear signal
to Brussels and Frankfurt ”.
But is anyone listening at the headquarters respectively of
the European Union and the European Central Bank? No they’re not. The EU and
the ECB is desperately to prop up a weak currency and austerity, austerity and
yet more austerity is the mantra. No matter that it doesn’t work. They have no
alternative.
Spending your way out of the crisis is no good because it’s
a global economic recession that is already dependent on large-scale printing
of money to prevent a full-blown depression. It’s not just the political system
that’s broken.
Grillo’s Five Star Movement is hostile to Brussels and the indecently corrupt Italian
establishment. It wants to reform parliament by halving its size and a new
electoral law based on proportional representation. Other than that, it has
little to say.
Grillo – called everything from “sans-culotte satirist” to “populist,
extremist and very dangerous” – hands it
back with interest. His nickname for Berlusconi is “the psycho-dwarf”,
while he refers to the technocrat Monti as “rigor Montis”.
Grillo told the Financial
Times last year: “We are occupying a void, which in other places like Greece has been
filled by Nazis and extremists. We are a response to government ‘parasitism’,
corruption, a system of political diarrhoea.” Recent scandals include arrests at
the top of state-controlled Finmeccanica to corruption probes into the Eni and Italy ’s
third-largest bank.
Grillo does not appear on television or take part in
debates. His movement – it’s definitely not a party – is driven by the use of
social media. He runs Italy ’s
most-read blog and the M5S organises on two levels – internet and local
grassroots.
He used the social network “meetup”, which was already active in Italy , to set
up local support groups across the country. There are now more than 700 such
meetup groups, with more than 100,000 members.
In Britain
too, the establishment and the state is also mired in a variety of scandals.
The old politics is dying right across Europe
and further afield as the recession coincides with a crisis at the top.
A new politics, a democratic transformation of political
systems, is not only possible – it’s absolutely necessary.
Paul Feldman
Communications
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