It is not the watershed moment many are making it out to beby Luigi Scazzieri / November 25, 2016 / Leave a comment
After the victory of “Leave” in the EU referendum and Donald Trump’s election as US President, Italy’s seems to be lined up as the next domino to fall to populism, with a referendum on constitutional changes scheduled for 4th December.
Prime Minister Matteo Renzi has repeatedly said he will resign if voters say “No” to his reforms. If this happens, some observers inside and outside the country fear a new, and potentially more dangerous, phase of political instability in Italy. Renzi’s resignation could lead to new elections, and pave the way for a government led by the populist 5 Star Movement—a party highly critical of the EU, in favour of a referendum on Italy’s membership of the eurozone, and opposed to sanctions on Russia. Solving the still unaddressed banking crisis could become a lot harder, and the slow reform process and economic recovery might be choked off entirely. These fears are understandable but overblown.
The constitutional changes aim to streamline the legislative process and give more powers to the government and the lower house of parliament, turning the Senate from a directly elected upper house into a largely consultative body representing Italian cities and regions. The reform would also increase the powers of central government vis-à-vis regional and local authorities.
Supporters of the constitutional changes argue they will lead to a stronger executive based on more stable majorities in parliament, and that this will facilitate the economic reforms needed to boost growth, employment and eventually to reduce Ita…