October 30, 2014


Signs on insurrection in Rome and Madrid

barometer that puts Podemos in first place in voter intent;

The mood in Rome and Madrid is tensing up as austerity and depression are finally taking their political toll.

The mood in Rome was sombre yesterday after an incident in front of the German embassy in Rome. A group of workers, faced with dismissal by a ThyssenKrupp factory, demonstrated peacefully when they were attacked by police. Five demonstrators were hospitalised with head injuries. The police justified the action on the grounds that they received information that the demonstrators were planning to occupy Rome central railway station – which the demonstrators deny. The incident raised all sorts of mostly unsubstantiated speculation in the Italian media this morning about the involvement of the government, and the usual who talked to whom and when. What is important to note, however, is that there are signs of insurrection on the streets of Italian cities, as trade unions are stepping up their national protests against both actual job losses and against the proposed labour reforms. There will also be a general strike in November.

In Brussels, meanwhile, Jyrki Katainen felt the need to emphasise a procedural point – that the interim clearance of the Italian and other budgets does not prejudice the final outcome. This is technically correct, but clearly, the interim stage was the critical step because the old Commission was still in charge, and because we are now moving into the more technical, and less political aspects of the analysis. As La Repubblica reminds us this morning, the final judgement will be influenced by the Commission’s autumn economic forecast, due next month, by the macroeconomic imbalances procedure, and by an analysis of debt sustainability. And while there is still room for haggling, the big political decision seems to have been taken. La Repubblica quotes Pierre Moscovici, speaking in Paris, saying

“Europe is not a penalty machine. Deterrence is there ??to convince. Sanctions are always a defeat. "

Also in La Repubblica, Federico Fubini has a comment in which he compares the favourable market conditions in Spain to those of Italy. He said it is perfectly plausible that relative market perceptions reverse again, as next year’s election season in Spain may produce a similar outcome with Podemos, compared to the rise of the Five Star Movement in Italy at the last election.

In Spain, meanwhile, the commentariat was abuzz about a rumour relating to the latest political barometer of the national sociological institute CIS, to be published next week. According to El Confidencial, which quotes unnamed sources in the PP leadership, the poll will show that Podemos for the first time leads in direct voter intent. This refers to the raw data before they are “cooked” to produce an election vote estimate. The latter puts Podemos in close second place to the PP, and well ahead of the PSOE. According to the senior PP source the major private polling firms have been sitting on unpublished polls but once the CIS’ cat is out of the bag one can expect the release of further private polls confirming the rise of Podemos and the lack of traction of the new PSOE leader.

Our other stories

We also have reports on Spanish productivity, on a proposal to fund Juncker’s €300bn investment programme; on a warning by the Greek parliament’s budgetary office; on a childish proposal by Portugal’s prime minister; on a collapse in German exports to Russia; on a mild improvement in lending conditions; and on a number of euro crisis fallacies.

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