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May 10, 2017

PSOE primary campaign in full swing

After months of foreshadowing and manoeuvres, the PSOE leadership primary yesterday entered two weeks of official campaigning until the vote on Sunday May 21. The contenders are Susana Díaz, the Andalusian regional premier and favoured by the party apparatus; Pedro Sánchez, the former party secretary general who is hoping for a comeback after being ousted in October and replaced by a managing committee; and Patxi López, who was speaker of the Spanish parliament in the first half of last year and is presenting himself as a compromise candidate between the other two irreconcilable camps. There will be a three-way debate May 15.

The first bout in this contest was the presentation of members' endorsements by the three candidates. Diaz's camp had hoped to show an overwhelming support from the PSOE rank and file, but was instead upstaged by the strong showing by Sánchez. Even though Díaz had the most endorsements - of under 60,000 party members - Sánchez exceeded expectations and presented over 53,000. Considering that Díaz had the explicit support of the party apparatus, this has been interpreted as strenghtening Sánchez. López had under 11,000 endorsements, barely enough to qualify.

Reflecting the conventional wisdom, the two largest US banks, Bank of America and JP Morgan, have sent notes to investors in which they warn of the likelihood of snap elections if Sánchez wins the PSOE leadership contest. Sánchez would oppose Mariano Rajoy's budget, which the PM intends the parliament to pass by the end of June. In the background, there is also Podemos' call for a motion of no confidence agaist Rajoy, which Sánchez could conceivably support while Díaz would not. The two US banks suggest that Díaz as PSOE leader would buttress the political stability of the country. Needless to say, the implicit endorsement of Díaz by two large US banks is not expected to help her with the PSOE members and sympathisers, who are the ones that will be voting in the primary.

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May 10, 2017

Czech government crisis escalates

Last week we reported on Czech PM Bohuslav Sobotka announcing his intention to resign his whole cabinet, as a way to get rid of finance minister Andrej Babis without making him a martyr by singling him out. The reason for this strange course of action is that the Babis-led party ANO ('yes' in Czech, but also 'action for dissatisfied citizens') looks set to win the general election scheduled for October with over 30% of the vote, while Sobotka's CSSD (Social Democrats) have seen their support drop from 20% at the last election to about 12% according to polls. 

But when Sobotka went to meet president Milos Zeman on Thursday, the latter did not wait for Sobotka to formally tender his resignation before telling the press that he would only accept the resignation of the PM, but keep the rest of the cabinet in place. To this, Sobotka reacted by not tendering his resignation, and demanding instead that Zeman dismiss Babis alone. Zaman insisted that the solution to the crisis would be for a different PM to lead the same coalition. He suggested that foreign minister Lubomir Zaoralek or interior minister Milan Chovanec would be suitable interim PMs. Meanwhile, Zeman is using his upcoming state visit to China to delay making a decision. It is no secret that Zeman and Sobotka have a personal feud going back to 2003, when Zeman led the CSSD and Sobotka didn't support his presidential bid, which led to Zeman leaving the party. 

This is escalating into a constitutional crisis, as the PM, the President, and now the Czech senate justify their respective positions with appeals to the country's constitution. Sobotka is appealing to a literal interpretation of the constitution, which says that the president appoints and dismisses ministers at the request of the PM. Zeman is now arguing that Sobotka doesn't have the power to dismiss Babis as long as there is a coalition agreement between CSSD, ANO, and the Czech Christian Democrats KDU-CSL. And this has prompted the Christian Democrats to ask that Zeman cancels his planned trip to China. A group of senators is considering impeaching Zeman if he doesn't dismiss Babis within a week. 

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May 10, 2017

Backroom dealing on electoral reform in Italy

La Repubblica writes that the Five Star Movement has made an offer to the PD to collaborate on electoral reform. They would be flexible on the precise choice of the system, but insists on a couple of parameters that matter to the party. Five Star rejects the majority premium for coalitions - the idea that a pre-election coalition that receives 40% of the vote would be given enough seats to form a majority. This makes sense, since Five Star has rejected forming pre-electoral coalitions and would not benefit from such a rule. And the party also rejects the idea of single-MP constituencies, the essence of many first-past-the-post systems of the kind used in the UK. 

The offer was made by Luigi di Maio, the party’s top parliamentarian and potential PM candidate, and by Davide Casaleggio, the son of one of the party’s two founders who died last years. They said they would reject elections this autumn, given the timetable for passing the budget. 

The PD is currently trying to stitch up an electoral deal with Forza Italia but that, too, is difficult. The coalition premium is important for Berlusconi's party, because this is the only way his group could get back to power (in coalition with the Lega, the Fratelli d’Italia, and maybe Angelino Alfano’s centre-right party). We know that Renzi favours a grand coalition with Berlusconi, and the Five Star's offer is presumably designed as an alternative strategy that some PD parliamentarians might be able to support - thus splitting the PD. 

The parliamentary process is still getting nowhere. Under consideration are still all kinds of systems - a reform of the current electoral law, known as Italicum, and the German electoral system, as favoured by Renzi, with a mixture of proportion and first-past-the-post.

We think there is a problem of attention deficit and hyperactivity disorder in Italian politics. Having spent the previous two years on a subsequently rejected constitutional reform, the entire political system is shifting forwards and backwards on electoral reform - as opposed to simply taking the existing Italicum law, as amended by the Constitutional Court, and extending it to the Senate which could have been done easily in February. All this deflects from the much more important economic and social issues the country is facing. The longer this goes on, the greater the danger of a populist backlash.

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