So Italy becomes the second troubled economy in a week to change government, with former EU commissioner Mario Monti commissioned to put together a ministry that will “unite the diverse political forces in an extraordinary effort”.
But although the similarities with Greece are evident, there is a critical difference. In Greece there is no doubt that the change will lead to an early election; in Italy that is much less obvious. The difference results from the different attitude taken by the opposition in each case.
Greece’s opposition New Democracy has throughout the crisis held to the objective of forcing an election, refusing to give any support to former prime minister George Papandreou except on that basis. Opposition pressure forced Papandreou out, and while the new government of Lucas Papademos has gained itself some breathing space it is clear that the election cannot be delayed for long.
The fall of Italy’s Silvio Berlusconi, however, has seen the opposition play a more limited role; it was defections from his own coalition that finally forced his resignation. The opposition has seemed like more of a spectator, treating Berlusconi as a problem that the government had to sort out for itself and conspicuously not demanding an election. At times last week the opposition sounded very much as if it was afraid that Berlusconi would resort to the polls.
Why the difference? Greece had a centre-left government and centre-right opposition; Italy was the other way around. In Europe, the right still sees the electoral tide as running in its favor: it is confident, while the left is insecure.
That’s been the case for some time now. Voters have put the centre-right parties into power across most of the continent — perhaps because they believe their prescriptions for how to overcome the crisis, or perhaps because they figure that austerity measures are going to be necessary anyway and they think the right will be more competent in carrying them out.
Despite all the talk of a crisis in capitalism, there has been no real sign so far of the electorate rejecting the orthodox economic consensus that attributes the crisis to unsustainable levels of government debt and warns that recovery is going to be painful.
That’s not to say that the left is without hope. It succeeded in taking power in Denmark in September (although mostly due to liberal gains), and last month the centre-left opposition in Slovakia felt confident enough to force an early election, to be held on March 10. Opinion polls also show the left in a strong position in France in advance of next April’s presidential election.
But those hopeful signs look like being outweighed by elections next Sunday in Spain, the last major EU country with a centre-left government. The latest polls predict a crushing victory for the centre-right opposition of Mariano Rajoy, with a lead of 15% or more over the incumbent Socialists.
Across the EU the centre-left is in a bind: having embraced economic orthodoxy and done, by its lights, the responsible thing during the crisis, it is now being punished for it. Being told by both sides that austerity is the answer, it’s natural for voters to shift to the centre-right, who can be assumed to be more serious about it — and who, unlike their American and Australian counterparts, have mostly kept themselves tethered to reality on other subjects.
The left’s day, no doubt, will come again. Either reform measures will work, prosperity will return and voters will feel it’s safe to go back to the left; or else they won’t, the crisis will deepen and the new centre-right governments will face punishment in their turn.
For now however, despite the dark economic times, the right is enjoying its moment in the sun.
Am I the only one thinking that the headline is at best oblique, if not diametrically opposed to the thrust of the actual article?
Both the left and the right parties in most European countries have persued social economic policies for decades now. This idea that governments can manage the economy through their
direct intervention can only be taken so far. At some point the economy has to pay for it all.
I agree with Keynsian interventions such as that undertaken by the Rudd government in 2009 in Australia but the ALP has gone to great pains to assure us all that it is temporary.
In Europe however, deficit spending has become ingrained by both sides of politics as normal and it is only now that the end game has become clearer as the productive, private sector on the economy becomes unable to support the redistributive, unproductive state sector.
I’m all for sharing the benefits of economic growth around for everyone but someone has to create the wealth in the first place. Left parties are capable of such reforms, as demonstrated by the Hawke government in Australia and the Lange government in New Zealand.
Europe is just waking up to this. Rudely.
David Hand – “In Europe however, deficit spending has become ingrained by both sides of politics as normal and it is only now that the end game has become clearer as the productive, private sector on the economy becomes unable to support the redistributive, unproductive state sector.”
And exactly the same has happened in the US under the Republicans, but instead of social spending it’s been on half-ar*sed military adventures.
I’m bored witless reading this sort of stuff, locked into long dead paradigms which unfortunately keep moving, probably due to the worms eating their guts.
May I suggest Crikey contacts Fintan O’Toole of the Irish Times, the clearest, most succinct and perceptive of commentators on the collapse/implosion of Europa?
You’re dead right, Malcolm. The USA’s massive deficit spending will doom their economy. I believe they spend more on their military than the rest of the world put together.
Republicans tend to go harder than Democrats though it is in my view a bipartisan shared belief about national security that is deeply embedded in the Americal psyche.
The economic reality is that deficits either must be paid off or eaten away by economic growth. Europe looks incapable of either.