Italy: Referendum brings third major defeat for ex-premier Berlusconi

Now workers and ’communist’ parliamentarians must mobilise to prevent attacks from ’centre-left’

A little over a week ago, on June 26, just before Totti scored the penalty that took Italy’s national team through to the quarter finals of the World Cup, the results of a two day national referendum on the country’s constitution were coming through. Italy’s voters had decisively rejected the changes proposed by ex-premier Berlusconi and his right-wing coalition – the ‘House of Liberties’.

The turn-out was on average 53.6% – higher than that for any referendum in the last ten years. (All five of them have fallen well below the quorum of one half of all votes.) The result marks the third defeat in a row for the ex-prime minister, Berlusconi. In April he lost the general election, however narrowly (see previous articles) Then came the victories for the centre-left in important mayoral elections and now a referendum vote giving Berlusconi way below the vote he was expecting.

In only two regions – Veneto and Lombardy in the North – did they get a majority and even there, within the prosperous regional capitals of Venice and Milan, the majority vote was ‘no’. In the poverty-stricken South, which would have lost out heavily from the devolution of public spending proposed in the changes, the vote was overwhelmingly against – in Calabria it was as high as 82.5%.

The South is also the main electoral base of one of the three main right parties – the Allianza Nazionale. This explains why its leader, Gianfranco Fini, did not give whole-hearted support to his coalition’s ‘yes’ campaign in the first place. Now the result puts a question mark over the continued adherence of his party to the ‘House of Liberties’ alliance. Members of another Berlusconi ‘ally’ – the Udc – did not even try to hide their opposition to the project.

They and other right-wingers as well as liberals were fearful of a break-up of Italy and the abandonment of a constitution laboriously thrashed out in 1948 as the country came out of the nightmare of fascism. Ex- Christian Democrat president, Oscar Luigi Scalfaro, himself involved in writing the constitution, headed the ‘no’ campaign as president of the ‘Save our Constitution’ committee.

Other proposals in the referendum would have meant a considerable strengthening of the powers of the prime minister, obviously favoured by Berlusconi for himself. There would have been a diminished role for the second chamber of parliament and a cut in the total number of parliamentarians – at present no fewer than 945. Some changes may be needed but even before the results were announced, Prodi was talking about negotiating with the right-wing parties to draw up some compromise alternatives.

Does the vote mean Berlusconi is politically finished?

Visibly shaken by the rejection of his policies, the richest man in Italy is reported to have talked of taking ‘time-out’ for reflection – possibly up to two months. If he leaves the political scene altogether, this would appear to secure the position of the Prodi government. However, there are other indications, even since the referendum result, that the ‘Cavalier’ is still plotting and scheming to get back into the saddle or at least make things difficult for Romano Prodi. If he did accept defeat, even that could cause problems for the government. As the press pointed out, the threat of a Berlusconi come-back has been a kind of glue holding together the centre-left ‘Unione’ coalition. Could it remain united if this threat is finally removed?

First rebellion

Already eight Senators from the most left parties – the Party of Italian Communists (Pdci), the party of Communist Refoundation (Rc) and the Greens – have said they will not vote with the government over the renewal of the budget for the troops in Afghanistan. The withdrawal of Italian troops from Iraq has been announced, although, in the words of the defence minister, Arturo Parisi, “In the time periods that is compatible with the security concerns for the soldiers and the Iraqi population and to avoid a vacuum of responsibility of power”. Not much different from the commitment made by the previous regime.

The cabinet has agreed unanimously to the proposals but parliament has to give its approval in mid-July. The ‘dissident’ senators have been warned by their parties’ leaders, that voting against the re-financing of the operation in Afghanistan could bring down the very government that is withdrawing the troops from Iraq! The new Rc general secretary, Franco Giordano, was reported to have banged his fist on a table during a session with his party’s parliamentary group to remind them forcefully of their “duties”, of “party discipline”, of the “interests of the country” and how they were “putting at risk” the newly born government”! Conducting individual interviews with each potential defector he was assisted by the Rc leader of the Chamber of Deputies – Fausto Bertinotti.

Economic policies

If this is how the parliamentary representatives are bullied into line on a foreign policy issue, what can we expect when it comes to the deep cuts in public spending this government is bound to make – sooner rather than later? On opening the account books of the country when they took over the reins of power, Prodi and his ministers claim to have been shocked to find an even worse financial situation than had been admitted by Berlusconi and co.

Public investment had fallen by 4% but spending on health had gone over budget. Public debt stands at 108% of GDP, having increased last year by 2.5 points when it was supposed to have gone down by 1.9. The investment rating agency, Standard and Poor, have threatened to give Italy a nil rating if it fails to reduce its debt by the end of the year. The budget deficit is heading for 4.6% this year, far exceeding the European limit of 3% again.

These statistics have been given wide publicity along with the idea of a supplementary budget known as ‘Manovra bis’ to begin to narrow the public deficit by €10bn. The aim of the scare stories is to ‘soften up’ the Italian working class to accept what is coming. Prodi and his cabinet, after a three-day retreat and brain-storming session, announced that the first measures would concentrate on collecting in taxes, supposedly from the rich. But Luca di Montezemolo, head of the Confindustria employers’ organisation told engineering bosses last week that courageous and unpopular choices had to be made. Going after taxes was OK but employers were already paying at very high rates, he claimed. The government must start with cuts in the public sector and put a brake on wages.

Immediate action and trade union leaders

Wild-cat strikes of taxi-drivers and threats of one-day action in July greeted the measures of deregulation announced this week. These open the way for privatisation of local public transport and also represent an attack on small businesses, lawyers, pharmacists and others. A ‘Hot Summer’ is said to be a real possibility.

General strike action to demand the restoration of deteriorating living standards is already in the pipe-line for September. (Electricity bills have gone up 6% and gas bills by over 4%.) But when the government reveals its key budget proposals, including cuts in pension rights and health care provision, there could well be an unexpectedly ‘Hot Autumn’, much like that which greeted the Berlusconi government of 2001.

Union leaders have been involved in round-table talks with the employers and the government, and supported Prodi’s election promise of cutting employers’ costs. But they are having difficulty squaring this with the idea of collecting more taxes from the employers. Although a popular measure, trying to get employers to pay up their taxes will founder. Suffering as they are already from harsh international competition, Italy’s capitalists will not want to part with any of their profits. To avoid paying taxes they can fiddle the books, take their capital out of the country, operate an investment strike or simply stop production altogether.

Guglielmo Epifani, leader of the biggest trade union federation, the Cgil, has said the honeymoon with the new government could be over. Even the leader of one of the more moderate union federations – Luigi Angeletti of the Uil – has begun to express workers’ anger by warning the employers and the government not to take their loyalty for granted.

These leaders, along with those of parties like the Rc, including Fausto Bertinotti, have been trying to maintain their aura of concern for workers by saying no attack must be made on pensions. They declare that the raising of the retirement age to 63, proposed by the previous government, must be defeated, but they conduct no campaign to ensure it is. Nor do they fight for permanent jobs for youth (when half all first jobs are on casual contracts) and an end to privatisation in education and health.

All parliamentary representatives of the two ‘communist’ parties as well as the five or six others in the Union, will be urged to remain ‘loyal’ to the capitalist government of Romano Prodi, when it pushes its major neo-liberal policies forward as well as on foreign policy. The Rc minister for ‘social solidarity’, Paolo Ferrero has already greeted the budget measures as, “Going in the right direction…a good start”. But the first loyalty of these parties’ representatives should be to the workers and young people who voted for them to reverse the policies of the Berlusconi government.

Piero Bernocchi of the rank and file union, Cobas, has complained on a European Social Forum discussion list about the modification of agreed policy on Iraq and on Afghanistan, but also about Bertinotti officiating at the 2nd of June military parade and the visit to Rome of Bush’s main ally, Tony Blair. But preparing to mobilise against the cuts must surely now take precedence.

How far will the rebellious senators go in challenging the government on these policies? One of them, Luigi Malabarba of the ‘Erre’ faction (the one-time Bandiera Rossa group, led by the late Livio Maitain) has said they want to continue their moral stand on Iraq and Afghanistan but agrees that he does not want to see the government brought down. In fact, on the issue of Afghanistan, the Unione has already been assured of the support of the Udc whose votes would save the centre-left government. Will they act the same way over the country’s own budget?


The Christian Democrats are probing the idea of a realignment with the more moderate forces of the Unione. Both major electoral alliances are coming under strain. Berlusconi’s own coalition is losing its glue. Following the referendum debacle, the not-so-happy cavalier invited Umberto Bossi of the Northern League to dinner at Arcore, his home near Milan, with an eye to forming a new devolutionist force with the Northern League. Berlusconi, incidentally, is still boasting that he can bring a million people onto the streets if the government dares to put up taxes.

But trade union and left party leaders should more than match these blusterings with plans for far greater mobilisations of workers and youth against any attacks on their rights and conditions being prepared by the government of Prodi and his Finance Minister – ex-European Central Bank official, Padoa Schioppa.

It would indeed be ironic if, thwarted by the resistance of the working class in the task of balancing the country’s books, the government run by these two ardent pro-European Union politicians led the first 21st century exodus from the Economic and Monetary Union! It would be even more ironic if it were these advocates of capitalist financial and economic rectitude who, because of the consequently higher cost of debt repayments, were the ones to carry through what pundits have already posited as an Argentinian-style default. Other struggling south European economies would be tempted to follow suit and the whole European project would unwind far more rapidly than it has been built up.

(Ironically also, last week the European Commission referred Italy to the European Court of Justice again for arrangements under the privatisations carried through by the last round of centre-left (‘Olive Tree’) governments. These retained ‘golden shares’ for the Italian government which can be used to block foreign investment in Italian companies, contravening the capitalists’ rules of competition.)

The dire state of Italy’s economy and the renowned combativity of the Italian working class mean that a programme of socialist struggle – for nationalisation and democratic planning – is still the only way to fulfil the wishes of those voting for ‘communists’, for the left in general and against the projects and policies of Berlusconi.

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July 2006