Can Europe Make It?

If Europe is forged in crisis, Italy has something to say

As the Italian case suggests, addressing the democratic deficit of European institutions is critical if we are to prevent this crisis from forging the end of the European Union. Español

Jan Mazza Azucena Moran
18 May 2020, 11.05am
Italian PM Giuseppe Conte and French President Macron pose at a Franco - Italian summit, February 27, 2020.
Manuel Dorati/PA. All rights reserved.

“… People will say ‘What is this great journey that you [the EU] are offering? These people won’t protect you in a crisis, nor in its aftermath, they have no solidarity with you… When immigrants arrive in your country, they tell you to keep them. When you have an epidemic, they tell you to deal with it. Oh, they’re really nice. They’re in favour of Europe when it means exporting to you the goods they produce. They’re for Europe when it means having your labour come over and produce the car parts we no longer make at home. But they’re not for Europe when it means sharing the burden.’”

Not many would have imagined these words would be uttered by the man deemed the potential saviour of the troubled European project. Not anti-EU propaganda by Matteo Salvini or Viktor Orban – too busy taking full power at home to engage in intellectual discussions about the future of Europe – but a statement given by the French President, Emmanuel Macron. His words, a warning of the sentiment upon which euro-scepticism will flourish if countries fail to give a common European response to COVID-19, signal the current point of inflection posed by the coronavirus pandemic.

The outbreak’s ripple effects intensify wherever the social order heavily depends on the unequal accumulation of capital. As the crisis puts into question exploitative economic dependencies that subsist with little to no democratic basis within the Eurozone and beyond, it calls governments across the globe to politicize and transform our social, economic, and democratic horizons. However, the same planetary challenge prompting governments and citizens to consider deep societal changes has also accentuated the weak transformative capacity of the EU architecture, international organizations, and decision-making processes.

Characterized by outdated national(istic) response mechanisms to major threats, the current global crisis has catapulted world leaders across the political spectrum into a border-obsessed, technocratic and elite-driven management of the outbreak. Some countries like Germany have been praised for how they have handled the pandemic within their borders, favouring social rights and data-driven decision-making over economic ends and populist claims. Be that as it may, Germany has yet to prove whether it can work beyond nation-driven ends and a naive denial of hegemonic power at the regional and global level.

If Europe fails to respond collaboratively and globally to the pandemic, it will not only mean failing to give the immediate economic relief needed to countries in the South of Europe and the Global South. It will also mean failing to react to the long-term socio-economic effects of the pandemic and other internationally-connected challenges such as climate change. In an already-interconnected world, the lack of joint political decisions and global leadership could constitute a socio-economic threat as dangerous as the current pandemic.

What can Italy tell us?

In the EU, the increasingly shaky foundations of an international order based on multilateralism, the centrifugal dynamics stemming from its exiting member, and the entropy due to the mounting rise of anti-system political forces, have significantly complicated the landscape. Our ability to understand the block’s tumultuous path towards a collective (not just economic) response to the virus and its consequences is limited. Yet, like Minerva’s owl who rises only at dusk, Italy’s case can be particularly illuminating – as one of the countries most harshly hit by the virus and a major European sufferer of its social and economic fallout.

Pilot project

Amongst the six founding members of the ECSC in 1957, Italy’s population was one of the most enthusiastic believers in the European project – although its citizens’ support could never match the elite’s. Italy’s economic and political ruling class saw European rules, in particular those concerning exchange rates, competition and state aid, as a welcome “external constraint” on the economic policies that Italy would be de facto allowed to follow. After decades of impressive economic growth (even if volatile and increasingly fueled with a rise in public debt), the beginning of the 1990s saw the start of a new phase that would characterize the economic and political evolution of Italy for the next thirty years. On the one hand, there was a massive slowdown in economic growth, basically stagnant ever since. On the other, an unadvertised fiscal frugality - Italy has had the highest average primary balance in the whole world over the period 1995-2019, indicated a very sizable and prolonged constraint in its public sector spending, compared to its revenues. This exceptionally high degree of fiscal discipline responded to two driving motives: first, compliance with the requirements to enter the virtuous club of euro members and, second, the austerity measures taken in the aftermath of the financial and debt crises of 2008-9.

As in the case of fascism almost one century ago, recent Italian history can retrospectively be seen as a pilot project for the type of politics, institutions, and novel reactions we now see worldwide. Silvio Berlusconi, an allegedly ‘self-made’ business man, became Prime Minister in 1994, after running a surprisingly successful campaign against old-style politicians by promising to run the country as efficiently as his own economic empire. After dominating the Italian political scene for almost two decades, Berlusconi was finally ousted in 2011 in the wake of rising financial stress and heightened political pressure for a “change of regime” from other European capitals.

His role as Prime Minister was taken by Mario Monti, a professor at the renowned Bocconi University of Milan and former EU commissioner. Monti, with his large bipartisan majority, pursued the agenda recommended by European institutions to other peripheral countries on the verge of financial collapse: raising taxes and cutting public expenditures, in particular through a historic pension reform. Despite his initial denial, he decided to run for the next elections in 2013, where he gathered a meagre 10 percent. Parties supporting his government obtained fewer seats than expected, and the moral winner of the democratic game was the Five Star Movement, which had never been in Parliament before and had run on a strongly anti-system platform.

The ‘Tsipras moment’

Once elected, politicians running campaigns on anti-system platforms blaming “Brussels” for its economic performances would experience what Monti defined as the “Tsipras moment”. That is, a political impasse in which politicians either implement an agenda upholding EU/Eurozone institutions - if necessary, in opposition to their democratic mandates -, or are willing to bear the inevitable political consequences. These consequences range from a (more or less) induced removal from office or being forced out of the euro. The founding “Tsipras moment” occurred when the Greeks, through a dramatic referendum, rejected the 2015 Memorandum of Understanding with the Troika, only to see their Prime Minister sign a harder version of it a few days later. It exemplifies one of the crucial issues weighing on the EU’s precarious democratic foundations: the impossibility of bringing about democratic changes in national economic policies, unless consistent with the eurozone economic and political framework.

Open secret

Thanks to Germany’s bluntness, this is an open secret. In 2011, Angela Merkel herself declared that “parliamentary codetermination” on the European Financial Stability Fund (the ancestor of today’s hotly debated European Stability Mechanism) had to be “market conforming.” In 2015 her Finance Minister Wolfgang Schauble warned his Greek counterpart, Yanis Varoufakis, that “elections cannot be allowed to change economic policy.” On April 11 2020, perhaps as a glimpse of the EU’s capacity to transform, the German Foreign Minister Heiko Maas called European countries to help the most affected by the consequences of the virus without the “torture tools” that accompanied previous rescue programmes in the eurozone.

It is clear how populist politics and technocratic solutions have represented the great ‘political’ opposition of our times, played on the grounds of sovereignty and necropolitics –the sociopolitical power of deciding who lives and who dies, in the words of Mbembe. The Italian case illustrates, in a longer time span, the perverse effects of decoupling democratic accountability and the policy-making process, and how we are failing to trust in citizens' capacity to shape policies at the national and regional level. If the solutions to current fiscal and monetary challenges firmly lie in Brussels and Frankfurt, the display of citizens’ solutions and popular discontent remains a business only to be dealt with in Rome.

The distance between national actors and the supranational managers of the political game has strengthened elites’ lack of accountability and politicians’ irresponsibility. This has fueled citizens’ frustration, ultimately threatening their evermore wavering support to democratic institutions altogether. By the same token, one can explain seemingly paradoxical outcomes such as the six different voting behaviours by the six Italian parties at the European Parliament on the resolutions about the European economic reactions to COVID-19. Undermining the government’s position in defence of a “supposed national interest” before historical negotiations is a small price to pay, when national politics have become merely about voicing concerns, while others are endowed with the tools to address them. The longer it is before the roots of this dysfunctional arrangement are eradicated, the deeper the divergence or outright hostility of European peoples. Today in Italy, once the most Europhile country, there are as many people willing to leave as to stay in the block, whereas another survey indicates that Germany and France are considered Italy’s main international foes, with China being its “closest friend”, followed by Russia.

The longer it is before the roots of this dysfunctional arrangement are eradicated, the deeper the divergence or outright hostility of European peoples.

As a final piece of evidence of the irony of history, at the peak of the corona crisis, many started suggesting that current PM Giuseppe Conte was unfit to lead the country in such distressed times. One name has emerged as the most prominent solution for national unity: Mario Draghi, former head of the Bank of Italy and the European Central Bank. Nearly thirty years after Berlusconi stepped into Palazzo Chigi for the first time (replacing Carlo Azeglio Ciampi, a former governor of Bank of Italy and first technocrat to take office in the history of the Republic), no financial meltdown or once-in-a-century pandemic has yet managed to break the techno-populist loop.

What can the EU do?

The EU risks repeating the same mistakes and failing to issue a common rescue plan that goes beyond incomplete technocratic and unambitious solutions. In responding to COVID-19, the EU should enhance accountability and legitimacy by involving European citizens, politicizing a vicious cycle of technocratic solutions, and deepening democratic capacities within the block. Whether it manages to do so will depend strongly on the leadership of the current hegemonic powers and their ability to reverse the dynamics of economic, political and cultural divergence that have dominated the European landscape in the new millennium.

The power currently held by Germany and the EU comes with great regional responsibility. Other global powers like the United States are failing to uphold substantial democratic qualities within their own borders and are withdrawing their support from international institutions. Meanwhile, the effects of the pandemic are disproportionately and arbitrarily impacting on some of the poorest corners of the Global South. The EU’s transformative capacity and decisions will set a precedent for global challenges that lie ahead. Not only will it determine the fate of its member states, but also the medium-term prospects of liberal democracies concerned with individual rights and collective deliberation in this increasingly Hobbesian-looking world.

Positive examples of European integration exist. Competences at the community level, such as competition and trade, have produced reasonably good outcomes, even if uneven for citizens across the union. GDPR is a highly praised piece of legislation that sets an ambitious reference for the many domains where supranational actions are needed. The ECB has reacted to the coronavirus shock much more swiftly than during the financial crisis, and way more effectively than other inter-governmental bodies such as the Eurogroup or the European Council.

As Jean Monnet famously said, “Europe will be forged in crises, and will be the sum of the solutions adopted for those crises.” His compatriot Emmanuel Macron concluded his warning about the potential avenues soon available for populists with a dramatic claim: “We are at a moment of truth, which is to decide whether the European Union is a political project or just a market project. I think it’s a political project . . . We need financial transfers and solidarity, if only so that Europe holds on.”

This might sound more abstract, and even less realistic than achieving financial transfers, but as the Italian case suggests, addressing the democratic deficit of European institutions is critical if we are to prevent this crisis from forging the end of the European Union.

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