Italian elections resulted in the success of a populist party Five-star movement lead by a comedian Beppe Grillo. The Five-star movement isn’t a standard political party, with Anti-immigration policies as well as anti-European views in their program.
With the outcome of recent parliamentary elections in with gained support even a former prime minister Silvio Berlusconi; Italy joined other European countries with rising populism. We have asked Italian/Icelandic professor Giorgio Baruchello where does this trend have its roots in an interview.
Why do people vote for Five-star movement instead of politicians or a standard political party?
It’s not a standard political party and they don’t want to be: it is a self-styled “movement”. It’s not such a young movement anymore either. They have already been taking part in local elections and at least one round of national elections. They have accumulated experience and they have representatives that are very visible on local scenes as majors of big cities such as Rome and Turin, for instance. Their political ideologue is a comedian, Beppe Grillo, who has been active for many years as a chastiser of public mores. Working as a comedian, the content of his shows was always pretty much political. He was a critical observer of economic malpractice long before the collapse of 2008. As to why they have obtained so much success, that has to do with a combination of factors. Some are national, some are international.
Can you define the ones at the national level?
Nationally there is a widespread sense of disillusion and fatigue vis-à-vis the traditional parties, as well as a sense of distrust and annoyance with the traditional parties, because they haven’t been able to eradicate forms of malpractice and corruption that many Italians would like to see destroyed, in order to make Italy a “normal” country like Germany, Austria or Switzerland, very close neighbors in fact. Then we have to consider again, on the national level, Italy’s minimal growth for a period now of almost twenty years. That has translated into difficulties for the population, especially its youth, to find good jobs and avoid underemployment or unemployment, which is high in Italy. Then there is the loss of qualified young people that emigrate and see or build a future abroad. I think only Romania, in the EU, has lost as many citizens holding university degrees as Italy, in proportion to the overall population.
What about demographic consequences?
Because of this prolonged economic stagnation, the trend towards very low birth rates, which started in the late seventies, has worsened further, and so the country is becoming older and older, which also creates kind of a negative mood. Young societies remain fairly optimistic about the vitality of youth on their side. Whereas in countries that age, like Japan or Italy, people tend to be far less optimistic and projective towards the future. Also, the political system is then led to reflect the interests of the older population. That wants to retain what they have, rather than presenting the younger population with opportunities for the future, for example by implementing changes that are needed to boost the economy but don’t get implemented nonetheless.
Can you clarify the international factors of these changes?
Internationally, first of all, the greater Middle East has been destabilized by NATO and the U.S. since the first Gulf War. Then we had a second Gulf War, and then we had Libya and now Syria. And that is part of the explanation for the considerable immigration coming from those areas into Italy, which is the country in Europe with the longest coastline and that is not an island. Italy is a fairly easy access point for desperate individuals leaving the Middle East and North Africa. Which, since the collapse of Libya, has become an even more pressing phenomenon. It has certainly played a role in this round of elections, but again this is not a new problem. It’s something that started to gain momentum because of the destabilization of the Middle East, which has a longer history than just the past few years.
What about the collapse of 2008?
The collapse of 2008 was an international financial crisis, which led to an economic crisis affecting every country on Earth, though all in slightly different ways because each country has its own structural weaknesses. Concerning Italy, there was this huge public debt, which has become even more burdensome. As a result, the Italian State has been paying more and more money to its creditors. That has limited the resources available to provide welfare, education, healthcare, strategic investments and so on. You know, if more of your money goes to your creditors, then you have less to do all these nice things. This, to some extent, means also fulfilling the citizens’ rights. The relevance of the post-2008 international crisis shouldn’t be underplayed. The effects are still lingering on to a significant extent and high unemployment is among them.
Have immigration and Euroscepticism played a role in these elections, considering the anti-European direction of the five-star movement?
Yes, and the implications are perplexing, to say the least. As regards immigration, for instance, you can see how, for a short period after 2008, there was widespread criticism of the banking sector and the financial elites in Europe and worldwide. Very quickly, however, the media closed that window of opportunity for criticism and started focusing on other issues. Countries like Italy or Portugal that had accumulated new bigger debts to support the banking sector and let it survive, thus securing the investments of creditors from France in Germany, became the target of criticism, as part of the so-called “PIGS”; That is a splendid case of victimization of the victim. Even if the collapse came from the private sector in New York and London, these debtor countries started being blamed incessantly, as if they were responsible for the whole downturn. Somehow, the crisis that had started in the private sector became a crisis of the public sector, which started suffering from bad press and budget cuts. The criticism of the financial elites responsible for the initial collapse was forgotten and, after the weakening of public institutions, the new roaring media phenomenon started being the waves of desperate immigrants coming to Italy. It has all been very reminiscent of 1929 and the ensuing Great Depression, with its xenophobic results.
Didn’t the number play a role in terms of immigrants?
If you look at the numbers, immigrants have been coming into the country for a long period of time and it’s only after the collapse of Libya that you see a kind of spike. But again, that has been going for some years, but now it is as though they were the biggest threat to Italian stability. Not the loss of resources because of the relationship between Italy and its creditors. Seeing all this from abroad, because I have been living abroad for many years, it looks like a kind of scapegoating. Or, if you like, a manipulative redirection of public anger from those responsible for the major international financial collapse onto desperate people, who for that matter are the victims of even older financial collapses—just think of the third world’s debt spiral that has been sucking away resources from many nations since at least the 1980s.
Why the Euroscepticism though?
That was launched long before the collapse 2008, which after all came primarily from the American side of the Atlantic. And it was the hope, at least according to the declarations of the Italian political leaders of the late nineties, that the euro would lead to a better form of entrepreneurship in Italy. Not based on cheap labour, but on innovation and high added-value production. However, that has not been the case, at least not across the board, and many entrepreneurs have actually either sold their activities or moved them abroad to use cheap labour there. That’s one significant part of the Italian manufacturing sector, which has based its success on cheap labour. In the 1960s, the Italians used to be called “the Chinese of Europe” because we had a highly productive industrial sector paying very low wages. And so the euro hasn’t brought this change to the kind of entrepreneurship prevalent in the country. On top of that, because of lack of monitoring and lack of countermeasures, prices nearly doubled when the euro was introduced. So, over time, that sucked away a lot of resources and depressed domestic demand.
What was the result of that?
Since trade unions, at the same time, had been losing power for about one generation, workers in many sectors didn’t manage to get better salaries. They stagnated. So the purchasing power of the population at large was diminished. With it demand, which is a fundamental driver for any healthy economy, that lead to further difficulties in terms of overall production. These difficulties affected in turn the job opportunities and the purchasing power of the population, hence hitting on a vicious circularity. That’s why many people still associate this long period of stagnation with the introduction of the euro. And I’m not saying that it is an entirely mistaken judgment, given what actually happened.
What were the pros and cons of introducing euro?
The collapse of 2008 has shown, vis-à-vis Italy, that much of the industrial manufacturing and to significant extent agriculture, were based on low costs of production. Meaning, low wages in the first place. Not having your own currency, which you could devaluate in order to make your production competitive, came to prominence after 2008 because people came to realize that if we still had our currency, we could have devaluated, increasing our exports and retaining or increasing the jobs available. So went one of the gambles of the greater EU integration, which was giving up national currencies to have one strong currency that would withstand financial speculations. Let’s not forget, to go back to the 1990s, that people had been shocked by the ability of financial speculation to attack currencies of major countries. So, back then, having one big European currency was considered like a wall against these novel speculations. And well, that gamble didn’t pay off. At least as far as Italy is concerned. Meanwhile, the root of all evils, namely deregulated international finance, keeps marching on.
Do you think people actually have this insight into the issues and that’s why they are choosing populists, or do they do it out of protest and being desperate for not being able to choose anything else?
There are millions of voters. There are so many different intentions. If we assume that people can be easily manipulated, then it might just be an expression of resentment, despair, hopelessness and lack of trust in the traditional political class. If we assume that people are not that stupid, then some, in his or her own way, must have been able to grasp that the euro didn’t work out quite as well as it was hoped. Or that the policies pursued in the name of globalization and the war on terror in the Middle East didn’t pay off and actually caused dramatic consequences.
Can you elaborate on the concept of populism, please?
I think that populism is a complex phenomenon. On the one hand, it’s true that there are demagogues. There are politicians who are very good at exploiting people’s frustration and lack of trust in the political class. But on the other hand, it’s also true that there is nothing more important in the democratic polity than the people that inhabit that polity. So, doing something for the people, which is what “populism” means in a neutral sense, is not a bad thing. What we have to determine here is if we are having a new group and a new family of political players that are just preying upon the frustration of millions of Italians, or there is a large number of citizens that have decided to regain control of their political institutions. A political formation such as the Five-star movement, for example, is trying to kick out parties that have proven not sufficiently capable or competent, or that have even been blatantly corrupt.
It makes one wonder if Italy doesn’t just fit into a pattern of raising international populism all over the world, also in the “normal” countries, let alone countries in eastern Europe and such.
Without a doubt, there is an international trend. You see it with Brexit in the UK, with Trump in the US, with the rise of neo-nazi parties in Germany, and the near-success of right-wing nationalists in France. A common key element there is a prolonged sense of economic insecurity of the populations. Aggregate numbers may tell you that, after all, there hasn’t been such a widespread immiserisation of the European populations. But statistics and numbers tell you only a part of what goes on. Because even if there may be still enough jobs going around, even if there may not have been a substantial increase in absolute poverty, still the relative poverty caused by the increasing polarization and skewed distribution of wealth, an overall sense of insecurity across the population is certainly there. Which applies to kids finishing their studies, not knowing whether they will find a decent job. A job that allows them to lead a dignified existence, have children, make plans and enjoy the kind of well-being and affluence that his parents had. Then you go up to people in the middle of their career fearing that they might be downsized. And, once they are fired, they realise that they no longer have strong trade unions behind them and that the job security that used to be the norm in Europe has vanished. And then they fear that they can never find a decent job again in their fifties.
Who is at fault?
The financial sector, above all, and their political minions. After 2008, so many governments were implementing cuts on pensions and public spending, in order to keep banks at the float. Austerity was forced on largely innocent populations to rescue culpable banking wizards and their wealthy clients. There could have been different remedies implemented to prevent some of the downsides, but they were not implemented, and many European citizens have been left out in the cold. You can see that most clearly in Greece. It’s just horrifying to look at the suicide rates and the preventable deaths and emigration that have occurred there, or the lower access to medical services. It’s THE true horror story of the situation after 2008. Where there have been responses closer to a social-democratic or Christian-democratic Keynesian spirit, the policies have focused more on preserving jobs than preserving the value of financial assets. Then a traditional party can still gain a lot of support because the population have felt defended and perceived a given level of economic security. I say “perceived” because that is what aggregate numbers are very often unable to measure. It’s the sense of crisis, the sense of danger, the sense of weakness and fear that one has to consider when looking at societies in the attempt to understand their political shifts.
As you mentioned that frustration is causing people to shift to extreme-right movements in Europe. How does a rise of fascism in Italy affect its position as an actor in the international economic arena?
So far it hasn’t had any effect. Even when the Northern League was in power in Berlusconi’s cabinets, it meant a number of restrictive policies vis-à-vis immigration, but it didn’t really affect Italy’s standing internationally. Neither did it affect its participation in European institutions or international institutions such as the United Nations, the World Bank or NATO. One conspicuous change occurred with this round of elections, however, is the level of outright racial discrimination. The language has become much more uncivil than before. But again, I think it’s just an intensification of elements that were present before 2008 and became much more pronounced afterwards. A certain rhetoric of racism was considered just too ill-mannered to be a part of the mainstream political discourse. Some extremist might cultivate it, but now you have leaders of self-proclaimed center or center-right parties adopting the same rhetoric because it brings votes. They might have always wanted to utter these horrible things but they thought they weren’t allowed; now, however, they can come open with these prejudices.
Is it possible to reflect on this situation with emphasis on the crisis of 2008?
I tend to go back the collapse of 2008 and then the auterity policies that followed because that reminds me very much of what happened in 1929 and then in the 1930s. I think that if we want to find a relatively simple explanation to current affairs, then we have to look at that specific precedent. And say, first of all, that we have had a collapse in international finance due to the greed and incapacity of the private sector that was allowed to do what they wanted by the public sector. Then we had policies aimed at defending the value of the financial assets as far as possible and the interests of the creditors’ class rather than the jobs of the population at large. Insecurity is then widespread and more intense and since the financial elite is up there and very remote and difficult to reach, all these insecurities and fear get vented at easier targets. It was the Jews in the 1930s, it is the immigrants today.
Is it dangerous to get the public to the new normal of discrimination against minorities, which after WWII became a taboo, and now we live in a time when even social democratic parties are in a position to state angry opinions against immigration?
Hardcore left wingers in my youth said that by allowing the freedom of movement across borders, potential employers in a country could attract cheap labor across the border and keep the wages down. I remember in my youth, for one, that Italy’s communist party wasn’t racist but wasn’t in favour of free movement of labor across countries either, because it was argued that it kept the wages down and disempowered the working class. The bourgeoisie, it was argued, wanted to have a reserve army of unemployed that they could use to lower the cost of labor whenever the workers were getting what they asked for, i.e. better wages, primarily. And I mention this without a sense of racism because I think that there exists only one race and that is the human race. Still, I can think of sensible arguments against the free circulation of labor, without adequate standards and regulations. Although I am willing to help as much as possible, any nation on earth and any person on earth, unchecked migration across countries might not be what is needed. What might be needed is a serious development plan for countries that saw so many of their inhabitants leaving to other countries or trying to leave.
What is the solution?
I think we should seek inspiration from the Marshall plan and the post-war reconstruction of Europe. This, among other things, allowed for movement across borders, but in a controlled fashion. Both of labor and of capital, incidentally. State control over financial capital, currency and investment is the big unspoken tool that, in my view, would create more jobs, more security, and defuse the frustration and fear that are now fueling the extremist parties. And that includes the abolition of the free circulation of capital across borders, as seen in Iceland after 2008, when the free capital trade was suspended. We have just revoked the controls last year. In the interim period, it was possible for the government to know what monetary mass was present in the country and how to use it in order to lower unemployment and then keep it at a very low level. It also helped with directing investments in such ways as to improve the overall wellbeing of the population. We went back to the Bretton Woods system out of necessity and that move paid off.
Why does it represent a problem?
I think it is something that should be reconsidered by governments worldwide. Because the most pernicious kind of migration that I have witnessed in my life is the migration of capital. It’s a migration of large amounts of money that can enter the country overnight and leave it overnight. This leads to boom-bust cycles that had been eliminated by the Bretton Woods system between the end of Second World war and the late 1970s. And I know these phenomena very well, not just because I studied them, but also because my father worked in a bank for forty-three years and was involved for decades in the foreign exchange department of the bank, of which he became eventually a director. Since my youth, I have discussed these issues with him and his colleagues, and I have a vivid sense of how it was back in the days before the liberalization of the financial sector, before international capital trade became again the norm, for it had been the norm in the late 19th century and up to the First World War. Of course, there are always strings attached, there are always costs that you have to pay. But considering the overall effects of free capital trade worldwide, I think that it would be time now to reconsider the value of limited transnational capital trade, as well as of much heavier financial regulations.
Giorgio Baruchello (*1974) was born in Genoa, Italy. He is an Icelandic citizen and works qua Professor of Philosophy at the Faculty of Humanities and Social Sciences of the University of Akureyri, Iceland. He studied philosophy in Genoa and Reykjavík, Iceland, and holds a PhD in philosophy from the University of Guelph, Canada. His publications encompass several different areas, especially social philosophy, the theory of value, and intellectual history. Since 2005 he edits Nordicum-Mediterraneum: Icelandic E-journal of Nordic and Mediterranean Studies. He is married with two children.