Populism in Europe: A Government & Opposition Collection

The political landscape of Europe is changing rapidly and in ways that are hard to interpret. The recent Italian referendum is a good illustration. Matteo Renzi inherited an agenda to reform the Italian constitution when he became prime minister. He negotiated an agreement with the centre-right on the precise details of the package. He shepherded the agreement through two majority votes in each of Italy’s two chambers of parliament. He then brought the agreement to a popular vote as per constitutional requirement and with an electorate broadly disenchanted with politics and therefore favourable to reform.  Nevertheless, virtually every party outside the government opposed the reform package and Renzi lost the referendum vote by a spread of twenty percentage points.  Now Renzi is out of office. Italy is without a viable electoral system because of changes made in anticipation of the (failed) constitutional reforms. And it is unclear whether the new government headed by Paolo Gentiloni has sufficient support in the Senate to pass a new electoral law. Most Italians did not want Renzi’s constitutional reforms and yet they are not happy with the status quo either. Disillusionment with politics has grown as a result.

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The Future of Central Bank Independence

Central bank independence is under attack. This is true particularly in the United States. When the dust began to settle on the presidential primaries in spring 2016, three of the four leading candidates – one Democrat and two Republicans – supported legislation to audit the Federal Reserve (or Fed) and to compel it to follow a rigid and transparent rule for changing policy in response to changes in a limited range of macroeconomic variables. The reason has a lot to do with the same populist resentment that swirls around global trade. And while the Fed has not received the attention given to the trans-Atlantic Trade and Investment Partnership, for example, it is arguably just as important.

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Italy’s Referendum Risks

The U.S. Ambassador to Italy, John Phillips, caused a minor uproar by telling the Italians that international investors were going to be disappointed with a ‘no’ vote in the upcoming referendum on constitutional reforms.  At about the same time, Finch announced that a popular rejection of the reforms would put downward pressure on the country’s ratings.  The Italians responded that the ambassador should mind his own business and that the ratings agencies should find some new analysts.  Italy will be fine whatever the referendum outcome, they insisted.  If anything, this unwelcome foreign intervention is going to encourage the Italians to vote against the reforms just to prove a point.  The echoes with Brexit were obvious – and widely noted.  So is Italy headed for disaster or is this just another storm in a teacup?

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The UK Referendum is a Bad Idea; Voting to Leave Would Make It Worse

The British referendum is based on (at least) two bad ideas. The first is that the popular legitimacy of a referendum can restore the sovereignty of the British parliament. The Leave campaign believes they can take power from Brussels and give it back to Westminster. That is a fantasy. The British parliament will be more constrained and less effective if the UK leaves. The second bad idea is that referendums are more democratic than acts of parliament (which is the kind of decision that brought Great Britain this far in its relationship with Europe). By giving the people the chance to speak their mind on a yes-or-no (in-or-out, remain-or-leave) question, we can discover what they really want. That is not how people work. Real people prefer trial and error. Real people also like to delegate responsibility for making complicated decisions. This matters because the two bad ideas combine to make the worst of all possible worlds. Britons who vote to Leave will discover that they have made a terrible mistake only to learn that there is no easy way to fix it.

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The Decline of the West?

Some countries fall from greatness. For them, decline is absolute. Others face increasing competition from rising powers. Their decline is relative. However there is a third kind of decline that has more to do with degeneration than with failure, and less to do with competition than diminishing potential. This is a kind of morbid decline. It echoes the ‘decadence’ of the late 19th Century but without the implied culture of excess. The countries of the West might be accused of falling prey to this morbidity, so Benjamin Rowland and his contributors argue. Hence it is worth asking why that should be happening and what is to be done about it.

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The United States Needs Europe

‘In an interconnected world, there are no global problems that can be solved without the United States, and few that can be solved by the United States alone.’ United States National Security Strategy, 2015, p. 3.

‘A strong Europe is our indispensable partner, including for tacking global security challenges, promoting prosperity, and upholding international norms.’ United States National Security Strategy, 2015, p. 25.


The United States needs strong allies in Europe. The United States also needs European unity. This is has been a recurrent theme in Barack Obama’s foreign policy since the start of his campaign for the presidency in 2007. It is a theme he borrowed from the second administration of George W. Bush. It is also one of Obama’s greatest disappointments in shaping U.S. relations with the outside world. From the outset, both Obama and his predecessors have been explicit that the United States needs Europe’s strength to promote world order and uphold democratic values. U.S. foreign policy is most effective when it works in concert with Europe. It is least effective when coordination across the Atlantic falters or when Europe is divided or distracted. Future U.S. Presidents will struggle to adapt if European division and distraction becomes the norm. In fact, that may be happening already. Despite the strong language of his 2015 National Security Strategy, President Obama seems to be moving in a direction that relies less on trans-Atlantic cooperation.

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U.S. Presidential Elections – Known and Unknown

The U.S. Presidential elections represent a stark choice between a competent if unexciting continuation of the status quo and an emotional – perhaps even terrifying – break with the past. Moreover, the results of the contest will be felt far beyond the borders of the United States. On 17 and 18 March, I was invited by the United States consulate in Milan to participate in a series of events to explain the ongoing elections. The audiences were mostly Italian but there were some others mixed into the groups as well. My goal was give some sense of how the U.S. elections are going to have an impact on the outside world. That impact will be both direct and indirect. The direct effects will come through the change in U.S. foreign policy. The indirect effects will come through the change in economic policy. I outlined the two issues in turn. Then I offered some thoughts on the future of U.S. global leadership. The bottom line in all three cases is very similar: Americans must choose between the familiar and the unknown – and the world must accept the consequences.

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Democracy without Solidarity

There will never be a good a solid constitution unless the law reigns over the hearts of the citizens; as long as the power of legislation is insufficient to accomplish this, laws will always be evaded.’ Jean-Jacques Rousseau (1772)


You can have the best political institutions in the world but if the people who live within them do not want to use them properly, then those institutions will not work. The challenge is to make people want to use common institutions properly and to agree on what constitutes proper use. This is the challenge that Jean-Jacques Rousseau tackled in his ‘considerations on the government of Poland and on its proposed reformation.’ It is the same challenge advanced industrial democracies face today – at all levels of government. Moreover, better institutions or ‘structural reforms’ were not the answer for Rousseau and they are not the answer now: ‘Although it is easy, if you wish, to make better laws, it is impossible to make them such that the passions of men will not abuse them as they abused the laws that preceded them.’

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Partnership and Solidarity: Obama’s Last State of the Union

Leadership through partnership works; democracy without solidarity does not. These are two of the central arguments Barack Obama makes in his eighth and final ‘State of the Union’ address as President of the United States. The first argument builds on the premise that the United States cannot lead by trying to do everything itself; it has to make sure ‘other countries pull their own weight’. The second rests on the idea that ‘democracy does require the basic bonds of trust between its citizens.’ Isolated like this, these claims seem self-evident. In the context of a U.S. presidential election, they are controversial. Indeed, American presidential candidates have been fighting over these issues at least since Barack Obama rose to prominence. This explains in large measure why the United States is so conflicted over the conduct of its foreign policy and so polarized in its domestic political discourse.

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