Poor but Proud

The next meeting of the European Council, set to take place on June 28, 2018, promises a certain level of intrigue. One reason for this is the expectation that the new Italian government, formed on the basis of the March 4 elections after 80 days of coalition talks and conflict between the president and parliament, will present an ultimatum to Brussels.

The ultimatum is expected to include the following points:

1) The cancellation of Italy’s €250-billion debt to the European Central Bank (ECB);

2) The abolition of the financial and budgetary restrictions established by the 1992 Treaty of Maastricht, which Italy and several other EU countries have been ignoring for years. These restrictions include setting the maximum allowable budget deficit, national debt, public bond rates, etc. Even France, which today lays claim to being the main driver of European integration, has gone beyond the allowable level of national debt by 60 per cent;

3) A revision of the Dublin Regulation, which obliges first-port-of-call countries to deal with the registration of refugees and the arrangement of the necessary infrastructure for them, which entails significant financial expenditure;

4) The lifting of sanctions against Russia, which have caused serious damage to European export industries.

The new Italian government also does not support the sanctions against Russia. Giuseppe Conte has repeatedly confirmed the desire to take more active steps towards normalizing relations with Moscow. However, Italy did not officially oppose the sanctions imposed against Crimea, which were extended just last week. This gives cause to believe that it will not oppose the rest of the sanctions package and will likely use it as a bargaining chip for other items on its agenda – items that have far greater significance for Italy than increasing trade with Russia.

At the end of the day, work according the “done with Russia” paradigm is reasonably well established and has made it possible to restore half of the trade that was lost following 2013. But the threat of default, and the risk of being left alone to cope with ships coming in from Africa, are very real.

A sovereign yet unemployed and starving Italy is unlikely to think first and foremost about sanctions against Russia.

The next meeting of the European Council, set to take place on June 28, 2018, promises a certain level of intrigue. One reason for this is the expectation that the new Italian government, formed on the basis of the March 4 elections after 80 days of coalition talks and conflict between the president and parliament, will present an ultimatum to Brussels.

The ultimatum is expected to include the following points:

1) The cancellation of Italy’s €250-billion debt to the European Central Bank (ECB);

2) The abolition of the financial and budgetary restrictions established by the 1992 Treaty of Maastricht, which Italy and several other EU countries have been ignoring for years. These restrictions include setting the maximum allowable budget deficit, national debt, public bond rates, etc. Even France, which today lays claim to being the main driver of European integration, has gone beyond the allowable level of national debt by 60 per cent;

3) A revision of the Dublin Regulation, which obliges first-port-of-call countries to deal with the registration of refugees and the arrangement of the necessary infrastructure for them, which entails significant financial expenditure;

4) The lifting of sanctions against Russia, which have caused serious damage to European export industries.

A Country of “Limited Sovereignty”

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It would make no sense for Brussels to ignore this ultimatum or to attempt to isolate the new Italian government as a group of radical populists, politicians who do not want to repay their debts and who are under the thumb of their own voters for the sole purpose of strengthening their positions. Italy is not a new EU member state, one that does not yet quite understand the “rules of civilized conduct” within the European family and can thus act like an impetuous teenager. On the contrary, it is one of the original members of the European Union, having laid the foundations for European integration along with Germany and France. Furthermore, the results of the general election held on March 4 clearly demonstrated the legitimacy of the people who have come to power and the level of public support for the ideas they have offered. This is why there is every reason to discuss the issues that have “accumulated” over time, and a serious discussion is now unavoidable. Essentially, the discussion should revolve around the most deep-seated problem of European integration – namely, the problem of sovereignty – because financial and economic policy, the right to carry out independent foreign economic activity, and border security are issues that directly affect the problem of balancing the national and the supranational.

The revival of national sovereignty, understood as the right of a country to pursue its own national interests, has become the main leitmotif of the Italian populists. The most outspoken critic of the policies that have led to the loss of Italy’s sovereignty has been the Federal Secretary of Lega Nord (the “Northern League”) Matteo Salvini. When the country’s president refused to approve the cabinet proposed by Giuseppe Conte, for example, Salvini commented, “I am convinced that we are not a free country and that we have limited sovereignty… We have a principle, which for us is absolutely key, and that is that Italians should decide their own destiny, not the people of Germany, Portugal or Luxembourg. First and foremost, we are talking about the right of the Italian people to employment, security, and happiness. For several weeks we toiled, day and night, to set up a government that is capable of protecting the interests of the Italian people. But someone (under pressure from someone else, perhaps) is telling us ‘no.’

“We will no longer exist in servitude. Italy is not a colony… You must give us our voice back!”

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The ideology of this “revival of sovereignty” is underpinned by a relatively solid set of public fears and expectations – fears and expectations that are reflected in the results of opinion polls and which, if ignored by the authorities, would be tantamount to political suicide. According to research, the share of Italians who see the key national interest as ensuring the security of the country’s borders and establishing control over migrant flows grew from 30 per cent in 2013 to 66 per cent in 2017. The majority of Italians do not approve of the immigration policy pursued by the previous government. They see a direct link between illegal migration and terrorism and demand more decisive action on the part of the authorities to stem the flow of migrants.

There is a lack of understanding in Brussels of the fact that, against the background of Italy’s record national debt and youth unemployment levels that are higher than anywhere else in the European Union, the endless stream of refugees flowing into the country is actually a matter of existential significance.

A meeting of the EU Heads of State was scheduled for June 24 at the European Commission, where the issue of migration will surely be at the top of the agenda. The meeting will be attended by the heads of France and Germany (as the two countries most involved in “putting out the fires” related to European integration), Austria and Bulgaria (the co-Presidents of the European Commission for 2018), the four Mediterranean countries that took the “first blow” of the migrant wave (Italy, Spain, Greece and Malta), and the two most popular “secondary destination” countries (countries where migrants eventually head after arriving in the European Union) – Belgium and the Netherlands. The purpose of the meeting is clearly to snuff out the flame before it turns into a fire in the run-up the summit, which is to be held on June 28–29. This will consist of convincing the Mediterranean states to adopt a new plan to reduce the flow of refugees in return for them dropping the idea of repealing the Dublin Regulation. According to the Italian media, the plan involves stepping up control over the external contour of the European Union and “refining” the procedures for arranging the necessary infrastructure in territories outside the European Union (such as Libya, among other countries). The Italian side will have to guarantee greater control over the movement of refugees outside the country – that is, prevent them from moving into other EU countries. We do not know the details of the plan right now, but we can assume that the Italian side is sceptical of the capacity of the European Union to control the external contour and establish order in Libya. The Prime Minister of Italy is determined to present his own plan in Brussels.

The Italian people feel that decisions are being made for them, without their direct participation. According to polls, 82 per cent of Italians believe that the country has no influence on international relations or European policy. This is despite the fact that in the late 1990s, Minister of Foreign Affairs Gianni De Michelis declared that Italy had to become a “global protagonist” and conduct a more independent foreign policy. The growing partnership of France and Germany is calling for deeper European integration and for countries to welcome refugees (although France is in no hurry to accept the refugees it promised to take from Italy). This, along with growing uncertainty in U.S. foreign policy and Washington’s ostentatious disregard for the views of European states in resolving global problems that have appeared during the Trump administration, pours water on the idea of “limited sovereignty” that is firmly entrenched in the minds of the Italian people.

The number of people who believe that Italy and the European Union member states need to develop more independent foreign and security policies while remaining within NATO has grown from 35 per cent in 2012 to 62 per cent in 2017. Italy is becoming increasingly irked by the desire of the Germany–France partnership to speak on behalf of the entire European Union, whether it be on issues of migration, financial discipline within the association, or U.S.–Russia relations.

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The new Italian government also does not support the sanctions against Russia. Giuseppe Conte has repeatedly confirmed the desire to take more active steps towards normalizing relations with Moscow. However, Italy did not officially oppose the sanctions imposed against Crimea, which were extended just last week. This gives cause to believe that it will not oppose the rest of the sanctions package and will likely use it as a bargaining chip for other items on its agenda – items that have far greater significance for Italy than increasing trade with Russia.

At the end of the day, work according the “done with Russia” paradigm is reasonably well established and has made it possible to restore half of the trade that was lost following 2013. But the threat of default, and the risk of being left alone to cope with ships coming in from Africa, are very real.

A sovereign yet unemployed and starving Italy is unlikely to think first and foremost about sanctions against Russia.

What Does This Mean for Russia?

For Russia, this means that there is no need to shout about the conflict that is brewing between Italy and the European Union any louder than the Italians are themselves. The temptation to support a friendly country in its rush to fight for its sovereign national interests is more than understandable, especially if we take into account the role of the concept of sovereignty in Russian political discourse. The desire to tell the whole world that one of the founding members of the European Union is actively promoting the idea of lifting the sanctions against Russia is similarly understandable. However, if Russia’s goal is still to patch up relations with the European Union, particularly with Germany and France, then it is worth taking into account just how important European solidarity is for Paris and Berlin and stop counting on a split forming within the Union. It is worth remembering, too, that Italy has something to offer in return for its vote against the Russian sanctions, while Paris and Berlin, in an effort to save European solidarity, could attempt to make Rome an offer it cannot refuse.