The election most likely to damage the European project is the Italian one — if it happens. Matteo Renzi’s resounding defeat in the recent constitutional reform referendum shows how angry Italians are. By some measures, southern Italy is now poorer than Poland, while manufacturing in northern Italy is struggling to compete because the euro has inflated its costs. Across the country as a whole, economic growth has been flat for 15 years. The IMF predicts that it will take Italy until the mid-2020s to return to its pre-crisis peak — after two lost decades. In these circumstances, one can see why voters there might regard a leap into the unknown as preferable to the status quo.
What makes Italy different from other countries is that there is not just one political party there that opposes the euro. Both main opposition parties are anti-euro, with a third increasingly so. Depending on the electoral system that ends up being used, the leading opposition party, Beppe Grillo’s Five Star Movement, has either more potential anti-EU support in a run-off round, or potential allies in parliament to help it form a government. Grillo says he won’t do deals with other parties to get into power, which limits Five Star’s prospects. But to have an anti-single-currency government come to power in Italy would be an even bigger shock to the EU than Brexit.
Germany’s elections promise to be far less dramatic.
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