Bailing In

Italy's economic distress is matched by its political and institutional debacle.  Starting from the top Italy has a head of state arguably unconstitutional in that second terms of office while not specifically forbidden are excluded by every provision noted within the constitution: by the fixed  length of term of office, 7 years, which implies no repeat -14 years is far too long for a non-hereditary system; by the characteristics sought of candidates,  extensive senior civic and  political experience which of itself implies  relatively advanced age in any candidate; by there existing no precedent for any re-election.

Next Italy has a prime minister wholly unsupported by the electorate's votes.  The election was held with entirely other candidates for office - none of whom was asked to form a government by a then out-going president, who positively precipitated governmental crisis by refusing to invite any Party leader to face Parliament, and then acted extra-constitutionally in appointing a committee to delineate the characteristics of both premier and policies regardless of expressed electoral choices.

The Parliament itself has been elected under  rules that have been rejected as unlawful by the supreme court but its decision, though available on line, has not been officially transmitted to the constitutional court - some half a kilometre away - because various official  practices required for its transmission have not yet been carried out in the last 8 weeks. 

The iffy Parliament is now altering the articles of the Italian constitution that set out the regulation of changes to the Constitution.  The finalisation of the removal of safeguards to the integrity of the Constitution will be during August, while no-one is around and looking. 

The reform of the Constitution will include altering the role and powers of the head of state (retrospective cover there, then) but excludes specifically any alteration to the sections of the  Constitution dealing with the judiciary and its independence -  while the newly and increasingly empowered head of state will remain as head of the judiciary.

The imposed prime minister is ruling ad hoc and  by decree, such decrees to be voted eventually by the Parliament, without normal legislative initiation procedures from parliament, and without any publicly discussed programme, let alone voted-upon manifesto. 

The Democratic party, of whom the Prime Minster is a member, delays electing a leader (having installed a temporary leader who is not the prime minister, in the interim, by appointment not election) and flouts every aspect of its own rule book (for, like the Labour party, when in office the party Leader is prime minister) to prevent any disturbance of the imposed prime minister's tenure.  A Party congress to choose a leader by election is repeatedly deferred and next year (sometime) is now being mooted.   

The minority Coalition partner in government has just seen its leader convicted repeatedly, at various levels for various crimes, and the People of Liberty party is to re-form with most of it in a newly founded Forza Italia party whose self-selected Leader will once more be Berlusconi (what happens to the remnants is not clear).

The third largest grouping within the ruling Coalition, Monti's Civic Choice party, is at last (and at least) demanding a  setting out and agreement of Coalition policies, on the German grand coalition model -  which demand has been refused, dismissed, by the Head of State (not even bothering to have the fig-leaf prime minister make the statement) as not serious, 'not a threat'.  Threat that is to the  novel administration being inflicted on the country.

Meanwhile unemployment is at its highest since 1977 and to say just that there's no money left would be positively reassuring given the state the country's economy is in.   Italy is far too big to bail out using the procedures applied to Greece, Cyprus and Ireland - even Spain, by Troika or the EU currency union alone.  The Cyprus template for financial response to currency union weakness  may not be the only template being trialled by determined europhiliacs. 

Italy is a template, a trying out of a total bail-in: not just in failing banks and financial areas but of the entire country's democratic institutions and procedures, including financial.  Every means of response short of unacceptable gestures in a civil society is being blocked-off and the country delivered hog-tied for whatever-it-takes financial and economic, institutional and political measures that will preserve the Project.