The rise of anti-establishment and far-right forces in Italy: Neoliberalisation in a new guise?

Abstract

Over the last decade, the succession of financial crisis, neoliberal reform processes, and emergence of anti-establishment and far-right political forces has become a familiar pattern across Europe. But in few countries has it been as striking as in Italy. After the 2018 national elections, the anti-establishment Five-Star Movement (M5S) and the far-right League joined forces to form a government characterised by its rejection of past neoliberalising reforms and by its defiant stance towards European Union fiscal rules. The League’s victory in the latest European elections confirmed its ascendance and its centrality in the Italian political landscape. This article examines these developments in light of the recent trajectory of the Italian political economy and investigates whether the rise of these parties, and particularly the League, marked a break with the post-2011 neoliberalisation process. Analysis of the M5S-League government’s action indicates that these forces can further neoliberalisation processes together with a mix of anti-migration and welfare chauvinist measures. Moreover, an investigation of the political-economic project of the League shows that far-right parties can advance ‘nation-based’ neoliberalisation processes.

Introduction

The ascendance of anti-establishment and far-right parties over the last decade has often been accompanied by the rejection of ruling liberal elites and globalisation, appearing on the surface as a challenge to neoliberalism (e.g. Fraser, 2016). In Europe, these parties made substantial gains in recent elections by standing in overt opposition to the supranational governance of the European Union (EU) and tapping into popular resentment against political and technocratic elites who promoted neoliberal restructuring during the Eurozone crisis. Against this backdrop, the issue of the compatibility between these political forces and neoliberalism was put into stark relief by the rise of the anti-establishment Five-Star Movement (Movimento 5 Stelle, M5S) and the far-right League (Lega) in Italy. Following the 2018 parliamentary elections, these two parties went on to form a government, promising to dismantle past neoliberalising policies and to defy the EU budgetary rules. Although the League eventually withdrew from the coalition government in the summer of 2019, the strength of the Italian far-right camp had been attested by the League’s stunning performance in the latest European Parliament (EP) elections, making it the largest party in Italy and one of the largest in Europe.

In light of these events, the present article investigates (1) whether the rise to power of these parties fundamentally challenged the neoliberal logic underpinning previous policies, and (2) whether the political-economic project advanced by the far-right League represents a threat to Italy’s neoliberalisation process. These issues will be addressed in two steps. First, an analysis of the content of the flagship policies adopted by the M5S-League government will be carried out to assess whether they fundamentally broke with the neoliberalising reforms promoted by previous governments, especially after the 2011 sovereign debt crisis. In this respect, although the article primarily aims at examining the relationship between the far right and neoliberalism in the Italian context, the action of a governing coalition formed by a far-right party (the League) and an anti-establishment, yet ideologically ambiguous, political force (the M5S) will feature as a central element. Indeed, the investigation of this government’s action can provide valuable empirical insights into far-right politics and its relationship with neoliberalism not only because this executive constitutes the League’s first experience in power after its nativist/nationalist turn (Albertazzi et al., 2018) but also due to a rightward shift characterising the M5S in the run-up to the 2018 elections, especially in migration policy (Caiani and Padoan, 2021). As a second step, the article will explore the agenda of the League through an examination of the content of its 2018 electoral manifesto and public statements by League’s leader Matteo Salvini at the beginning of the Covid-19 crisis.

The broader relevance of the Italian case lies in the fact that developments in Italy are both paradigmatic of the European (and global) rise of far-right and anti-establishment forces, and, at the same time, clearly distinctive. In this respect, Italy is one of the few European countries where these parties formed a government without being in coalition with more ‘mainstream’ parties. Moreover, even in the wake of the Covid-19 pandemic, far-right forces continue to hold a prominent position in the political landscape, which illustrates that Italy remains one of the main laboratories for far-right politics on the continent. For this reason, an analysis centred on the Italian case will allow to observe from a vantage point both present and future trends in the relationship between the far right and neoliberalism.

The main argument of this article is that the anti-establishment and far-right forces in power in 2018-2019 not only avoided fundamentally questioning the neoliberal logic underlying past reforms, but appeared to further a neoliberal dynamic together with a mix of anti-migration policies and welfare chauvinism. In addition, the close examination of the ideas and positions of the League reveals how protective measures targeting popular and working classes sit in a subordinate position in relation to a core of neoliberalising policies. Through this empirical discussion, the paper aims also to make a two-fold theoretical contribution to the literature on neoliberalism. First, relying on critical political economy (CPE) and critical geography perspectives, the article shows that, by considering the geo-historically variegated nature of neoliberalism, it becomes possible to recognise and better grasp neoliberalising tendencies arising outside the Anglo-American capitalist space dominating the literature. Second, the empirical insights drawn from the Italian case calls into question the conflation between neoliberalism and internationalism by indicating that class alliances organised around far-right forces can potentially advance more ‘nation-based’ neoliberal projects.

The article is structured in three sections. The first section delineates the understanding of neoliberalisation the analysis relies upon and reviews the literature on the relationship between neoliberalism and the far right. The second section provides an overview of the neoliberalisation of the Italian political economy, focussing especially on post-2011 trends. The third section examines the measures adopted by the M5S-League government and explores the ideas and positions of the League until the outbreak of the Covid-19 pandemic. The last section concludes with some final reflections on more recent political developments against the backdrop of the Covid-19 crisis.

Neoliberalisation processes and the far right

‘Neoliberalism’ as a concept and neoliberalisation processes

Addressing the issue of the relationship between far-right political forces and neoliberalism first requires clarifying the understanding of ‘neoliberalism’ this article relies upon. Indeed, this term has been employed in multiple ways in the burgeoning literature on the subject, even prompting a growing number of scholars to question its usage due to its ambiguity (e.g. Dunn, 2017; Venugopal, 2015). However, calls for precise categorisation downplay the inherently undetermined nature of the explanandum itself (Peck, 2010: 31), which makes any attempt to produce clear-cut definitions a fool’s errand, always bound to reflect the specific forms neoliberalism assumes in particular spatial and historical contexts (Bruff and Tansel, 2019). Having in mind the difficulty of defining neoliberalism in all-encompassing terms, outlining an adequate and sufficiently flexible conceptualisation is still possible starting from two sources of its inherent definitional ambiguity.

The first relates to the unbridgeable distance between, on the one hand, neoliberal narratives positing the existence of free markets and limited states and, on the other hand, the ‘actually existing neoliberalism’ in which the state’s role is central (Peck et al., 2018). In this context, state and market should not be seen as independently-constituted entities, but as grounded on the same, unequal social relations under capitalism (Bruff, 2011). Thus, neoliberalism does not entail ‘freeing the markets’ from the supposedly external intervention of the state. Rather, the market-based restructuring of society always requires an active role of state institutions, which should be regarded as a ‘permanent and necessary part of neoliberal ideology, institutionalisation, and practice’ (Bruff and Wöhl, 2016: 95, emphasis in the original).

The second source of definitional ambiguity lies in the mutating nature of neoliberalism across space and time. A strand in the critical geography literature highlights the spatially uneven nature of neoliberalism, which can be better grasped by relying on a ‘processual understanding of neoliberalisation’ (Peck and Theodore, 2019). Processes of neoliberalisation, while all being characterised by a broad tendency to mobilise state power to re-regulate and commodify a growing number of aspects of social life, are seen as always non-linear, contradictory, and subject to setbacks and reversals (Brenner et al., 2010). They also occur and necessarily co-exist with regulatory regimes, institutions, and practices that are other than neoliberal (Peck, 2013), giving rise to hybrid and geographically variegated formations (Brenner et al., 2010). Moreover, neoliberalisation processes assume different contours over time depending on the phase of capitalist development and the geo-historical conditions within which they emerge (see Brenner et al., 2010; Peck and Theodore, 2019). Part of the reason for the ‘malleability’ of neoliberalising dynamics is that they can be fostered by different constellations of political and social forces. In this respect, neoliberalisation processes are not agentless, but should be viewed as representing declinations of projects of societal transformation advanced by particular class alliances, which themselves are contingent upon specific geographical and historical contexts (see Overbeek and Van Apeldoorn, 2012).

The hybridity characterising neoliberalisation processes entails that, although they tend to be associated with a particular set of policies, they are not identified by the diffusion of a policy blueprint across space and do not necessarily require the establishment of new institutions (Brenner et al., 2010). Rather, neoliberalisation can also unfold through the re-purposing of existing policies and institutions to attain different goals (Bruff, 2014; Wacquant, 2012), as in the case of conditional unemployment benefits aimed at fostering the ‘employability’ of the workforce to meet employers’ needs (Peck and Theodore, 2000). As illustrated below, this has important implications for the empirical analysis of the post-2018 Italian context, as it implies the need to go beyond the mere indication of policy reversal and to carefully analyse the social content not only of the particular policies adopted, but also of the broader project of societal transformation advanced by political and social forces. Accordingly, neoliberalisation processes cannot be considered as effectively reversed or challenged if the underlying rationale for policy change remains in line with a commodifying and market-based logic, or if neoliberalisation is scaled back in some domains and simultaneously rolled out in others.

This conceptualisation is also particularly apt to take into account the specificities of neoliberalising trends arising outside the ‘Anglo-American centre of gravity’ prevailing in the literature on neoliberalism (Bruff and Tansel, 2019: 235). This is the case of Italy, whose political-economic features are seldom portrayed as fitting the Anglo-American neoliberal canon and where neoliberalising tendencies, even when acknowledged, are considered at best as expressions of a ‘statist liberalism’ that ‘violates’ proper neoliberal tenets (Gualmini and Schmidt, 2013: 370). Conventional understandings of neoliberalism as a static and monolithic paradigm would thus be unable to account for the peculiar neoliberalising dynamics arising in contexts such as the Italian one, where, for instance, neoliberalisation was often driven by state technocracies (Gallo, 2021) and occurred in a ‘selective’ manner in order to circumvent and weaken trade union resistance (Ferragina and Arrigoni, 2021). Hence, an understanding of neoliberalism emphasising its geo-historically variegated nature as well as its processual character allows us to capture the distinctness and the non-linearity of the neoliberalisation of the Italian political economy in the recent decade.

The far right against neoliberalisation?

The relationship between the far right and neoliberalism has generally received little attention in political science literatures, even though exceptions exist. A first wave of scholarship tackling this issue initially acknowledged the presence of neoliberal elements characterising the platform of (a number of) Western European far-right parties in the 1980s and early 1990s (Betz, 1993; Kitschelt and McGann, 1995). Nonetheless, as these forces began to embrace more ‘welfarist’ views, it was argued that most far-right parties ‘muted’ their adherence to neoliberalism in favour of nationalism and protectionism (Betz, 1994; McGann and Kitschelt, 2005). In an influential contribution, Mudde (2007: 136–137) concludes that European radical-right parties ‘hold a fairly centrist position on the dominant state–market axis’ and that their socio-economic programme is subordinated to (and is a reflection of) their primary commitment to a nativist, authoritarian, and populist ideology, resulting in a platform ‘based upon economic nationalism and welfare chauvinism’. While seldom referring to the term ‘neoliberalism’, more recent scholarship has tended to align with Mudde’s thesis (e.g. Ennser-Jedenastik, 2016; Ivaldi and Mazzoleni, 2020), frequently separating far-right parties’ ‘cultural’ features from their positions on ‘purely economic’ matters, the latter often measured in terms of the advocated degree of ‘state interventionism’ (Otjes et al., 2018). While in government, these parties are also found to oppose welfare retrenchment and to restrain their ‘market-liberal’ coalition partners’ desire to engage in deregulation (Röth et al., 2018).

This literature outlines some of the distinguishing features of the political economy of the far right. However, whenever the issue is addressed, two main limitations hamper a more holistic understanding of the relationship between the far right and neoliberalism. The first is the reliance on a rather simplistic conceptualisation of neoliberalism as ‘less state/more market’, whereby the degree of ‘state intervention’ promoted by far-right parties is inversely proportional to the degree of neoliberalism espoused by their programmes ¹ . However, in light of the above discussion on the state-market dichotomy, demands for ‘more state’ cannot be considered alone as proving the point that a political programme is not in line with neoliberal logic. In addition, neoliberalisation processes are not necessarily in antithesis with public intervention in the form of welfare provisions, and are in fact often accompanied by (disciplinary) social policies (Wacquant, 2012). The second limitation derives from the assumption of incompatibility between neoliberalism and nationalism or welfare chauvinism. This rests on the conflation between neoliberalism and internationalism, which overlooks not only that nationalist policies might be consistent with neoliberal tenets (Harmes, 2012), but also that nationalist narratives can be deployed to entrench neoliberal values, as illustrated, for instance, by the significance of nationalist and nativist discourses for the rise of Thatcherism in the UK (Hall, 1979). Similarly, it can be argued that the distinction between ‘good natives’ and ‘bad immigrants’ typical of welfare chauvinism represents an intensification of neoliberal discourse and practices distinguishing between ‘deserving’ and ‘undeserving poor’ (Kiely, 2020; Putzel, 2020).

The CPE literature, by analysing far-right politics within the wider historical conditions of capitalist development, highlights instead how the projects advanced by far-right movements can be fully compatible with a neoliberal logic (see Saull, 2015; Worth, 2014). These contributions frame the rise of far-right parties in the context of capitalist crisis and the legitimation crisis of neoliberalism (Davidson and Saull, 2017; Worth, 2019). In Europe, the emergence of an ‘authoritarian’ turn following the Eurozone crisis can be understood as the main reaction to this crisis of legitimation. The re-shaping of the institutional architecture of the EU economic governance became functional to foster austerity and neoliberal restructuring through (quasi-)constitutional mechanisms and the ‘construction of a permanent, continent-wide conditionality regime’ sheltering neoliberal policies from popular contestation (Bruff, 2017: 161; see also Bruff and Wöhl, 2016; McBride and Mitrea, 2017; Sandbeck and Schneider, 2014). This was also accompanied by the ‘self-disempowerment of nominally democratic institutions, governments and parliaments’ (Bruff, 2014: 116), as well as by the concomitant empowerment of both national and supranational technocracies as an attempt to de-politicise neoliberal policy choices in the name of ‘economic necessity’ (see Gallo, 2021). Nonetheless, the ‘authoritarian fix’ ended up simultaneously strengthening and weakening neoliberal institutions (Bruff, 2014), exposing them to challenges coming from both the left and the right (Bruff, 2017).

In this contradictory phase of continuing dominance of, yet weakening consensus for, neoliberalism, the European far right aims to present itself as the only force capable of reacting to the de-democratisation of policy-making and crisis management, re-politicising key socio-economic domains and European integration in the process (see Kiely, 2020). Far-right parties all over Europe began to question the increasing role of unelected technocracies both within their countries and in EU institutions, appearing to pose a threat to the dominant neoliberal mode of governance (see Davidson and Saull, 2017). Nonetheless, as observed by Worth (2014, 2019: ch. 3), while a number of parties seemingly reject neoliberal ideologies and practices, several others operate within the limits of the existing order, thus unveiling the potential for neoliberalisation processes to be advanced by far-right forces.

Relying on CPE contributions, it can be argued that, while assuming a confrontational stance towards the EU, these parties merely oppose the ‘spatial and institutional dimensions of neoliberalism’ as embodied by the supranational governance, rather than the neoliberal principles underpinning European economic integration (Davidson and Saull, 2017: 717). Central to the agenda of the European far right is also the attack on the ‘socially-liberal’ content of neoliberal social policies and the re-purposing of the welfare state in order to promote a familist, racialised and gendered vision of society, without embracing a universalist view of the welfare state or questioning the shift towards workfarism (see Fischer, 2020; Kiely, 2020). Nevertheless, these general traits and commonalities aside, the issue of what aspects of neoliberalism (if any) are embraced by the far right remains an empirical question. Factors such as the different insertion of national political economies into the wider international and European political economy, and local social struggles and configurations of class alliances give rise to a certain variegation of the modalities through which neoliberalisation can be fostered by the far right. Examples of this are the diverging positions assumed by the radical right in ‘core’ and ‘peripheral’ Eurozone countries in relation to fiscal discipline and monetary policy (Cooper, 2020; Kiely, 2020), and the various extent to which ‘unorthodox’ economic measures, welfare retrenchment, and workfarist social policies have been implemented in Eastern European countries (Stubbs and Lendvai-Bainton, 2020; Toplišek, 2020).

This variegation can be seen as one of the reasons why a clear transnational political-economic project coming from the far right has thus far failed to emerge. Until the outbreak of the Covid-19 pandemic, the only visible effect in this domain of the rise of the far right had been a further erosion of the hegemonic character of the EU transnational neoliberal project (see concluding chapter in Worth, 2019). Nevertheless, the far right has been unable to mount a counter-hegemonic assault to the post-crisis EU economic governance (as epitomised by the partial setback in the 2019 EP elections and the botched attempt to build a pan-European alliance), with these forces being seemingly content to roll out neoliberalisation processes appealing to their core social base (i.e. domestic capital fractions and petty bourgeoisie) on the national scale (see below).

In sum, the CPE literature, by contextualising the rise of the far right within the current stage of capitalist development, leaves theoretical space open to the possibility of radical-right forces advancing neoliberalisation processes while opposing specific elements of the existing order, such as the supranational institutional framework of the EU. However, the modalities through which neoliberalisation can be fostered by the far right remain highly context-specific and might give rise to ambiguities and contradictions. In the following sections, the analysis of the Italian case will further shed light on what kind of neoliberal trajectories, if any, can be observed when far-right forces manage to prevail in a specific national context.

The neoliberalisation of the Italian political economy: post-crisis acceleration and emerging mutations

In the early 1990s, the process of neoliberalisation of the Italian political economy, whose inception phase could already be traced between the end of the 1970s and the beginning of the 1980s, entered a ‘consolidation’ stage (Cozzolino, 2019). European monetary integration was crucial in fostering this dynamic, as Europe’s ‘external constraint’ was framed by the Italian political, economic and technocratic elites as necessary to ensure the path towards ‘modernisation’ (Cozzolino, 2021: 85–87; Talani, 2017: 172–182). The neoliberalisation process in the 1990s and early 2000s involved radical pension system reforms and labour market flexibilisation (Ferragina and Arrigoni, 2021), the latter creating a large number of ‘atypical’ contractual forms and leading to growing labour precarization (Caterina, 2019: 88–94; Ferragina et al., 2020). Importantly, successive governments also undertook unprecedented fiscal consolidation efforts, which later effectively turned into ‘perpetual austerity’ as Italy ran primary budgetary surpluses every year until 2019 (with the exception of 2009) (Storm, 2019).

This reform process and the membership of the Economic and Monetary Union (EMU) ultimately failed to bring about the promised modernisation and economic growth, and were followed instead by a long phase of economic decline characterised by stagnation in real wages, labour productivity, and private and public investments (Storm, 2019). Absent significant productive investments and the ability to devalue the currency, the strategy based on ‘rigorous control of labour costs and equally rigorous control of public finances’ (Caterina and Huke, 2021: 273) seemed to have driven Italian capitalism into an impasse even before the Eurozone crisis. The main features of this structural crisis can be summarised as follows: (1) presence of a ‘chronic shortage’ of internal demand (Storm, 2019); (2) increasing exposure of Italian industry to competition from lower-wage Eastern Asian and Eastern European countries (Celi et al., 2017: 174–179; Storm, 2019); (3) diminished ability of the Italian state to induce changes in the capital accumulation strategy, following long-term austerity, loss of monetary policy autonomy, and privatisations (Caterina and Huke, 2021), a problem compounded by the deflationary bias of the EU/EMU regulatory regime ² ; (4) perpetuation of the North-South divide and growing difficulty, under the EU fiscal rules, to maintain societal consensus (e.g. through fiscal transfers and social benefits) behind the spatially uneven development of Italian capitalism (see Celi et al., 2017: 228).

Despite these fundamental problems, the 2011 sovereign debt crisis was still framed as due to fiscal indiscipline and a lack of ‘structural reforms’ (see Cozzolino, 2021: 91–92). In this context, a further acceleration of the neoliberalisation process took place amid intense (formal and informal) supranational pressures and the aforementioned reconfiguration of the European economic governance increasing the disciplinary and surveillance power of the EU institutions (see McBride and Mitrea, 2017; Sandbeck and Schneider, 2014). The most prominent example of this enhanced pressure is represented by a (then confidential) letter addressed to the centre-right Berlusconi government in August 2011 and signed by the European Central Bank (ECB) President Jean-Claude Trichet and the Bank of Italy Governor (and soon-to-become ECB President) Mario Draghi. The letter implicitly linked the adoption of austerity measures and ‘structural reforms’ to the purchase of Italian bonds on the secondary market (Sacchi, 2015). These demands contributed to putting the centre-right parliamentary majority under strain, further deepening the existing divisions within its social base (see Amable and Palombarini, 2014). In a critical juncture characterised by heightened financial tensions and the inability of the centre-right coalition to carry out the ‘necessary’ reforms, in November 2011, the Berlusconi government was compelled to resign in favour of a cabinet led by former EU Commissioner Mario Monti and supported by a large coalition of centre-right and centre-left forces (with the far-right Northern League notably in opposition).

The post-2011 neoliberalisation process was thus initiated under a fully technocratic executive sworn in by twisting constitutional procedures and amidst strong supranational pressures, leaving the widespread impression that democratic rules had been bypassed to hasten the adoption of certain measures with the aim of restoring the country’s ‘credibility’ on financial markets (Cozzolino, 2021: 137). The political fallout of these events started to become clear in the 2013 parliamentary elections, with the rise of the M5S as the largest party and the dismal performance of Monti’s own party. However, more significant political and electoral consequences would materialise only later, as the neoliberalisation process continued to unfold under successive centre-left governments, particularly the one headed by the then-leader of the Democratic Party (Partito Democratico, PD) Matteo Renzi.

This neoliberalising dynamic invested once again the three areas of fiscal, pension, and labour market policies. Under the Monti government (2011–2013), draconian tax increases and spending cuts were implemented at the peak of the crisis (Caterina, 2019: 136–137). A large part of the savings came from yet another pension system reform, the Monti-Fornero law, which considerably raised the retirement age, curtailed access to seniority pensions, and completed the shift towards a contribution-based system (Pavolini et al., 2015). In addition, only a few months later, the Parliament voted to enshrine the balanced budget principle in the Italian Constitution (Cozzolino, 2019). Thereafter, although the Renzi government (2014–2016) assumed a more critical stance towards austerity and EU budgetary rules (see below), the commitment to fiscal discipline was not fundamentally questioned (Di Pace, 2016).

As regards the labour market, successive interventions aimed to bring the Italian system closer to the ‘flexicurity’ model. Following the first step in this direction undertaken by the Monti government in 2012, the Renzi government’s ‘Jobs Act’ (2014–2015) dismantled the protection granted by Article 18 of the 1970 Workers’ Rights Statute, which provided for the reinstatement of workers found to be unjustly laid off in firms with more than 15 employees. Under the newly-introduced standard open-ended contract, job reinstatement was replaced by monetary compensation for all instances of economic dismissal (Picot and Tassinari, 2015). Moreover, the Jobs Act removed some restrictions on the use of temporary contracts and liberalised the rules for the so-called ‘vouchers’, hourly compensation tickets initially designed for ‘accessory jobs’ (Cirillo et al., 2017). Finally, while a reform of unemployment benefits (UBs) increased their duration and amounts, as well as relaxing eligibility criteria compared to previous schemes, UBs were made conditional upon active attempts to seek employment and their amount was to be progressively reduced every month in line with a workfarist logic (Perulli, 2015).

The post-2011 reform process underwent a sudden stop at the end of 2016, when a constitutional revision promoted by the Renzi government was rejected in a referendum, leading to Renzi’s resignation and the formation of a new executive headed by Paolo Gentiloni. The referendum defeat represented the last act in the attempt to foster neoliberalisation in an ‘authoritarian’ manner. This is illustrated, for instance, by the increasing use of the question of confidence (Cozzolino, 2019), as well as by the demise of social pacting and the marginalisation of trade unions (Baccaro and Howell, 2017: 138–139). This mode of policy-making signals the non-consensual character of the post-2011 neoliberalisation process, which was underpinned by a restricted ‘bourgeois bloc’ including large and medium firms, upper classes, and skilled workers, while excluding popular classes and organised labour (Amable and Palombarini, 2014; see also Bulfone and Tassinari, 2021). The ‘narrowness’ of this social bloc signals the increasing difficulties of building large class alliances around neoliberal projects and continuing EMU membership in the current Italian context.

Against this backdrop, post-crisis developments were further characterised by the emergence of two interrelated patterns. First, in contrast to past governments, the Renzi government assumed a more critical position towards EU budgetary rules, even obtaining some fiscal leeway after the adoption of its labour market reform (Badell et al., 2019). This defiant stance also came to incorporate issues linked to the growing number of migrant arrivals, as Italy’s (costly) humanitarian effort in the Mediterranean was used by the Italian executive as an argument in its confrontation over fiscal rules with the European Commission (EC) (Campani, 2019). However, and this represents the second emerging pattern, following failed attempts to win a more substantial budgetary flexibility and to push for a European solution to the so-called ‘migration crisis’, the Italian migration policy began to change. Starting from 2017, the centre-left Gentiloni government undertook a series of controversial steps to curb the number of arrivals, facilitate deportations, and tighten procedures to obtain international protection (see Campani, 2019; Gargiulo, 2018).

These two emerging patterns should be jointly understood within the broader Italian political-economic context. With little (fiscal) room for manoeuvre to make concessions to subordinate groups, the goal of expanding the social alliance behind neoliberalisation has become more and more difficult to realise (see Amable and Palombarini, 2014). In short, it appears increasingly evident how austerity politics has become an obstacle not only for the advancement of a progressive project of societal transformation, but also for the furthering of neoliberal projects. Thus, the shift in migration policy towards a more ‘exclusionary’ stance can be viewed as a surrogate for fiscal transfers and social protection, and as an instrument to enlarge the social base underpinning neoliberal projects. These developments somewhat prepared the terrain for the rise to power of the M5S and the League, and anticipated some of the trends emerging in the post-2018 context.

The rise of the M5S and the League: neoliberalisation in a new guise

The 2018 elections and the M5S-League government

The results of the 2018 parliamentary elections laid bare the ‘narrowness’ of the social alliance supporting the post-2011 governments. While the M5S and the League obtained greater-than-average vote shares among the working class and the unemployed, the PD gathered high levels of support among upper classes (see Afonso and Bulfone, 2019; Bulfone and Tassinari, 2021). The dismal performance of the PD (the worst in the party’s history) exposed the deep crisis of legitimation of the ‘neoliberal-progressive Europeanism’ associated in Italy with centre-left political forces (Cozzolino, 2021: 140–141). At the same time, the success of the M5S and the League vindicated their strategies aimed at re-politicising certain key socio-economic issues, opposing national and supranational technocracies, and denouncing the de-democratisation of European integration (see Baldini and Giglioli, 2021; Caiani, 2019). Moreover, the rise of the League clearly showed its ability to capitalise upon the ‘migration crisis’ (often linking immigration with the issues of unemployment and low wages) (Caiani and Padoan, 2021) and to keep it at the centre of the political agenda, despite a continuous decline in the number of migrant arrivals (Strazzari and Grandi, 2019). The results also highlighted the existence of a fracture between the North, where entire regions were dominated by the League, and the Centre-South, where the M5S obtained a landslide victory.

Before joining forces to form a government, the M5S and the League were ideologically different in many respects, but shared several common traits. The M5S exhibited a hybrid identity difficult to locate along a right-left axis, and was mainly characterised by its rejection of the Italian political and economic establishment and by its anti-austerity discourse (Caiani, 2019; Pirro, 2018). Conversely, the League (formerly Northern League) retained a clear far-right identity. Originally a Northern regionalist party that took part in all centre-right governments in recent history, it managed to repackage itself as a nationalist, anti-establishment force under the leadership of Matteo Salvini (Albertazzi et al., 2018). On immigration, the positions of the two parties converged in the run-up to the 2018 elections, with the M5S bringing its (initially only sporadic) nativist appeals more to the fore and adopting a more ‘exclusionary’ attitude, thus moving closer to the League’s aggressive anti-migration stance (see Caiani and Padoan, 2021; Pirro, 2018). Finally, both parties held strongly Eurosceptic positions, even though they never genuinely questioned EMU membership while in government (Giugliano, 2020). Against this backdrop, once formed, the M5S-League cabinet led by Prime Minister Giuseppe Conte promised to reverse the direction undertaken by previous governments in economic and social policy, and to adopt a firmer stance to tackle the ‘migration crisis’. The executive, with League’s leader Salvini as interior minister, became soon associated with port closures to NGO rescue vessels and legislation targeting undocumented migrants and asylum seekers (Strazzari and Grandi, 2019). In parallel, the ‘yellow-green’ government started to focus on those three domains in which the neoliberalisation process had been furthered the most starting from the 1990s: fiscal, pension, and labour market policies.

The draft budget plan presented in 2018 foresaw an increase in the public deficit by proposing the introduction of, among others, a ‘flat tax’ for self-employed and small businesses, a tax amnesty for lower incomes, a pension reform allowing early retirement, and a ‘citizenship income’ (‘Reddito di Cittadinanza’, RdC) (Ministero Economia e Finanze, 2018). In contrast to the EU recommendation to produce a budgetary adjustment in structural terms (Council of the EU, 2018), the plan included nominal deficit/GDP targets of 2.4% in 2019, 2.1% in 2020, and 1.8% in 2021, which would have led to a deterioration of the structural balance (Ministero Economia e Finanze, 2018). This prompted the EC to threaten the opening of an excessive deficit procedure, before the government eventually backtracked, lowering the targets to 2.04% for 2019, 1.8% for 2020, and 1.5% for 2021 ³ . While the failure to reverse course in fiscal policy reflected contingent financial market pressures (Di Quirico, 2021) and more structural impediments to the ‘steering and fiscal capacity’ of the Italian state (Caterina and Huke, 2021) rather than a simple lack of political will, the chosen path to reduce the initially-planned deficit reveals elements consistent with a neoliberal logic. Indeed, on the one hand, some of the largest savings came from the scaling down of the originally-foreseen public investments and of the RdC, and, on the other hand, the revenue increases were to accrue almost entirely from ‘safeguard clauses’ in the form of future hikes in the rate of VAT (a notoriously socially-regressive tax) (Ufficio Parlamentare Bilancio, 2018: 12).

In the area of pensions, the change initially advocated by the League would have allowed workers to retire upon attaining a sum of age and contribution years equal to 100 (‘Quota 100’) ‘without penalisations’ in monetary terms (Lega, 2018: 5). However, the final version (law 26/2019, art. 14) set a minimum threshold of 62 years of age and 38 years of contributions (i.e. giving up the possibility of choosing different combinations of age and contribution years) and, most importantly, was designed only as an ‘experimental’ measure lasting until 2021. In addition, while no explicit penalisations were introduced, the method of calculating the benefit was left unchanged, de facto penalising workers who decide to retire earlier (see simulations in Ufficio Parlamentare Bilancio, 2019). In sum, despite the rhetoric accompanying its introduction, Quota 100 only temporarily cushioned the effects of the 2011 Monti-Fornero reform, while avoiding fundamentally altering the system (Branco et al., 2019).

More contradictory developments occurred in the field of the labour market. One of the first acts of the Conte government was the adoption of the so-called ‘Decreto dignità’ (‘Dignity decree’) (law 96/2018), which revised some of the provisions of the Jobs Act by marginally restricting the use of temporary contracts and by increasing the thresholds for compensation for unfairly dismissed employees. Nevertheless, the decree by no means affected ‘the core of the Jobs Act – namely, the reduction of employment protection for open-ended workers’ (Branco et al., 2019: 221).

Another key policy implemented in this domain was represented by the RdC, a flagship measure of the M5S. Although its name suggests a form of guaranteed basic income, the RdC could be more adequately described as a means-tested UB for low-income households and as an active labour market policy (ALMP) (Stamati, 2020). Stringent economic criteria are set for accessing the benefit, a monthly transfer of a variable amount (up to 780 euros) depending on the household’s wealth, income, and composition (law 26/2019, art. 2–3). Importantly, obtention of the RdC depends upon the fulfilment of a residency criterion, which makes the benefit available only to Italian citizens and to foreigners who resided in the country for at least 10 years (the last two consecutively) (art. 2.1), thereby severely restricting access for migrants.

Furthermore, as an ALMP, the RdC is expressly aimed at favouring the reinsertion of the beneficiaries in the labour market and is linked to tight conditionalities (art. 4). The recipients are required to confirm their immediate availability to work and to sign a ‘Pact for work’, which includes an obligation to accept job offers that becomes increasingly strict over time. Indeed, the UB is lost following three rejected job offers whose minimum salary is set to only 858 euros per month (10% more than the maximum benefit amount), with the third and last offered position potentially located anywhere in the national territory. Hence, the workfarist logic underpinning the RdC makes it ‘[fall] in line with the unemployment insurance reforms of recent decades’ (Stamati, 2020: 260), even exacerbating their most disciplining and commodifying features. The ensemble of these conditionalities has been termed by the government itself as ‘norme anti-divano’ (‘anti-sofa rules’), as their rationale is to ensure that ‘nobody can stay on the couch’ while receiving the benefit (Governo Italiano, 2019). The social content of these rules reflects a narrative typical of neoliberal workfarist policies, which tend to stigmatise the poor and the unemployed as individually responsible for their condition and fundamentally non-motivated to work, while also framing the problem of unemployment exclusively in terms of ‘employability’ of the workforce (see MacLeavy, 2016; Peck and Theodore, 2000).

The peculiar experiment of anti-establishment and far-right forces in power is best understood against the backdrop of the post-2011 developments, which laid bare the limitations of austerity-based strategies in building sufficiently large and lasting class alliances. Thus, while essentially maintaining the core (neoliberalising) labour market policies of the past, a little additional fiscal room was deployed for measures intended for social groups that had been marginalised during the crisis, namely self-employed and small and medium enterprises (SMEs) mainly located in the North (flat tax and tax amnesty) ⁴ , precarious classes in the South (RdC) ⁵ , and older (male) workers (Quota 100) ⁶ . Moreover, the anti-migration and welfare chauvinist posturing should be viewed as serving the purpose of attracting support from sections of the working class and the petty bourgeoisie by pitting them against the ‘Other’, while hiding an unwillingness to challenge structural socio-economic inequalities. At the same time, welfare chauvinism continued to foster a workfarist logic premised upon the distinction between people ‘deserving’ and ‘undeserving’ of the (supposedly scarce) resources available for social protection, albeit in its nativist variant prioritising Italians as the ‘deserving poor’ ⁷ .

Overall, the experience of the M5S-League government illustrates that, despite their rhetoric, anti-establishment and far-right forces can advance an agenda that is fully compatible with neoliberalism, and even intensify some neoliberal traits in certain areas (in this case, ALMPs). Moreover, it also highlights that Euroscepticism and rejection of the EU fiscal rules are not necessarily conducive to a wholesale repudiation of the neoliberal tenets underpinning the policies promoted by the EU economic governance. In this context, the (limited and provisional) loosening of budgetary discipline, as well as nativist and anti-migration discourses and practices, can be effectively re-tooled by these parties to further advance neoliberal projects while, at the same time, enlarging the social base in their support.

The far-right League against neoliberalisation?

After merely one year in government, and thanks to its leader’s tenure as interior minister, the League had been able to hegemonise the executive’s action and public discourse around themes linked to migration and national sovereignty (Pucciarelli, 2019). In particular, despite the ‘yellow-green’ government’s acquiescence to the EU budgetary rules, Salvini’s assertiveness in pursuing a harsh anti-migration strategy (including frequent skirmishes with EU institutions and other European governments over the management of migrant arrivals) (see Strazzari and Grandi, 2019) considerably boosted the League’s credentials as the main challenger of the European ‘status quo’, leading to its landslide victory in the May 2019 EP elections (Chiaramonte et al., 2020). In the meantime, Salvini’s ascendance cemented the League’s ambitions to forge a pan-European far-right front in order to change the EU ‘from within’ (Financial Times, 2019), an attempt that would eventually fall flat due to internal divisions and the failure to win a majority in the EP. Nonetheless, the League still tried to exploit its electoral success nationally by pulling the plug on the (increasingly unstable) governing coalition in the hope of gaining a majority in snap elections, before being unexpectedly outmanoeuvred by the M5S and the PD, which went on to form a new government. Despite this episode, the League’s enduring prominence in Italian (and European) politics (as also demonstrated by its more recent participation in a 'national unity' government) makes it all the more relevant to investigate whether its political project represents a break with the neoliberalising tendencies of the past.

The League’s regionalist precursor, the Northern League, was portrayed as epitomising a ‘far-right neoliberalism’ (Worth, 2019, ch. 3), since it strongly advocated tax reduction for self-employed persons, shopkeepers, and businesses (especially SMEs and artisans in the North), as well as less state bureaucracy and the end of ‘assistenzialismo’ (welfare dependency) in the South (see Betz, 1993). The current version of the party retains most of these traits, even though the regionalist attitude has been dismissed in favour of a more markedly nationalist and nativist agenda. This brings to the fore a critical (if not openly hostile) stance towards the EU and the euro, multinational corporations, globalisation, and ‘cultural homogenisation’ (see Albertazzi et al., 2018; Perri, 2019). The near-complete absence of a politically-relevant left-wing force (as well as the shift to the centre of the Italian Communist Party’s heir, the PD) allowed Salvini’s League to have free reign in attracting workers’ support in the Centre-North by calling for more protectionism in the face of delocalisation and deindustrialisation (Pucciarelli, 2019). In addition, in 2019, the League managed to expand its support base in the South, where popular classes voted en masse for the M5S just one year earlier ⁸ . The fragmentation and the variety of social groups that this party aspires to represent translate into an apparent inconsistency of the League’s project of societal transformation. Nonetheless, neoliberalising policies can be seen as forming the core of the League’s project, while other measures seem to be in a subordinate position. Analysing the party manifesto for the 2018 elections, a few examples illustrate this point.

First, the lynchpin of the League’s economic programme is the ‘flat tax’, an income tax system applying a unique rate (15%) to all taxpayers regardless of their income (Lega, 2018: 3). The ‘flat tax’ is promoted alongside forms of tax amnesty (some of them already realised while in government), which clearly signals the negative connotation assumed by taxation in the League’s discourse and practice (Perri, 2019). Second, a suggestion to set a nationwide minimum wage can be found alongside proposals to reduce the tax wedge in favour of employers, increase wages ‘on a meritocratic basis’, decentralise collective bargaining, and reintroduce ‘vouchers’ following their suppression under the Gentiloni government (Lega, 2018: 11–13). Thus, in line with the interests of the Northern firms, which remain the core of the League’s social base (Perri, 2019), the continuation of the labour market policies which resulted in workforce precarisation and weakening of organised labour appears as pivotal in the far-right project. Apart from the measures included in the manifesto, the League’s actions during its experience in power are particularly indicative of this aspect. For instance, all attempts to reverse the Jobs Act and reinstate Article 18 of the Workers’ Rights Statute found the League as their staunchest opponent, since this ‘would [have gone] against the interests of business owners and shopkeepers’ (Afonso and Bulfone, 2019: 250). Furthermore, in the summer of 2019, the League rejected a proposal by the M5S to introduce a statutory minimum wage, on the grounds that priority was to be given to the ‘flat tax’ (ANSA, 2019). This clearly illustrates that, within the alliance the far right seeks to build, the interests of workers are effectively subordinated to the interests of capital.

Finally, observations regarding the League’s Euroscepticism seem to confirm the fundamentally neoliberal logic of its agenda. To begin with, although the 2018 programme calls for a renegotiation of all EU treaties and the end of the common currency, the EU is mostly criticised from a neoliberal standpoint as a ‘tentacular bureaucratic structure’ hampering ‘the real potential of the EU Internal Market’ (Lega, 2018: 9–10; see also Worth, 2019, ch. 3). Moreover, a paragraph emphasising the need to sustain internal demand and promising public investments in the South is curiously included in the same section advocating reforms of the European governance (Lega, 2018: 9). This is a further indication that workers and popular classes (particularly in the Mezzogiorno) remain in a subaltern position in the class alliance, since every concession made to them is ultimately subject to the outcome of negotiations with EU partners somewhere in the future.

More recent interventions by the League’s leader Salvini in the wake of the Covid-19 crisis also confirm the pre-eminence of the interests of Northern firms. Salvini advocated a ‘liberal revolution’ centred on the ‘flat tax’ and tax amnesties, alongside less public controls on the construction sector (Sole24Ore, 2020, emphasis added). In addition, his criticism of ‘the internationalisation of production’ was effectively re-tooled in order to plead for the creation of an ‘attractive environment’ to relocate manufacturing at home through lower taxes and less stringent tax avoidance rules for businesses (Salvini, 2020) ⁹ . Furthermore, as reiterated in public declarations until recently (Adnkronos, 2020), exit from the Eurozone still remains off the table and this stance has not been altered by the onset of the Covid-19 crisis. This position is again fully in line with the interests of those Northern firms that continue to be integrated with the Central European manufacturing value chain and that regard ‘Italexit’ as a risky gamble (Palombarini, 2020).

Overall, the rise of the League seems to be premised on the attempt to build a reactionary social alliance that brings together sections of capital representing (both export-oriented and less internationalised) small and medium-sized businesses, and, in a subordinate position, petty bourgeois strata and part of the working and popular classes. The project of societal transformation advanced by the League can thus be labelled as ‘nation-based neoliberalisation’. This maintains a core of neoliberalising policies, while simultaneously rejecting international elements of the neoliberal order (e.g. the EU regulatory regime) and promising protection against ‘external threats’, mainly epitomised by the EU bureaucracy, foreign governments, multinational corporations, and migrants. However, it is important to note that the international dimension of neoliberalism is rejected only selectively ¹⁰ . The example of the defence of the EU Single Market suggests that the League does not seem to question the economic integrationist logic outright, but only those specific elements that are perceived as hindering Italian firms’ potential to compete internationally.

While a detailed comparison with other European far-right parties is beyond the scope of this article, this analysis highlights the peculiarity of the League’s project. Indeed, this appears to give considerably more emphasis to neoliberal deepening in certain areas (e.g. taxation and labour market) and less to social protection compared to the one promoted by far-right parties in Eastern Europe, particularly in Poland (see Stubbs and Lendvai-Bainton, 2020; Toplišek, 2020). In this respect, the League’s strategy seems to be more akin to the one espoused by Fides in Hungary (Fabry, 2019) and by Northern European radical-right parties, as, for instance, Alternative für Deutschland (AfD) in Germany (Havertz, 2019), with the significant difference that the Italian far right rejects the budgetary discipline advocated by these forces, given also the limits of austerity politics in the current Italian context.

Conclusion

The aim of this paper was to contribute to the debate on the relationship between neoliberalism and far-right and anti-establishment forces by investigating recent political developments in Italy. The examination of the experience of the M5S and the League in power illustrates how a mildly expansionary fiscal policy, a particularly aggressive anti-migration policy, and elements of welfare chauvinism were effectively combined with a substantial continuation of the neoliberal logic of past reforms. Moreover, analysis of the League’s manifesto and recent public interventions indicates that neoliberalising policies occupy a central role in the far-right party’s political project, while social protection, public investments and support for internal demand are offered only as promises to fulfil in a (distant) future, ostensibly once national sovereignty is regained. The League’s ‘nation-based’ neoliberal project results from the attempt to build a class alliance having at its core less internationalised fractions of capital and Northern export-oriented firms, with petty bourgeoisie and sections of the working and popular classes sitting in a subaltern position. Of course, a future rapprochement between transnationalising capital and the core of the League’s social base cannot be excluded, since, ultimately, significant overlap exists among the interests of the various capital fractions.

Through this empirical discussion, the paper attempted also to further an understanding of neoliberalisation as a geo-historically variegated process. In particular, insights from Italy’s post-2011 trajectory allow us to see more vividly (1) how these processes can unfold by re-purposing policies that do not necessarily belong to the traditional ‘neoliberal toolkit’; (2) how continuing neoliberalising tendencies in certain areas can occur in conjunction with (partial) reversals in others; and (3) how marketisation and commodification can be accompanied by radically different discourses and practices. The Italian case also reveals how constellations of social forces organised around far-right parties can rally behind ‘nation-based’ neoliberal projects, thereby showing that neoliberalisation processes may assume different traits depending on the composition of the class alliances supporting them.

Amid the Covid-19 crisis, although the temporary relaxing of fiscal rules and the adoption of the Recovery and Resilience Facility (RRF) may appear on the surface as a shift away from austerity, the EU economic governance has thus far remained substantially unchanged, which suggests that neoliberalism in Europe is unlikely to wane any time soon. In turn, the failure to formulate and advance a project alternative to the European ‘status quo’ implies that far-right forces will have to continue to operate within the existing EU regulatory regime in the foreseeable future. While this further weakens the prospects of a far-right counter-hegemonic challenge, the continuing strength of these forces in several national contexts will presumably result in a period of transition and adjustment, during which tensions will emerge between co-optation attempts by neoliberal-progressive Europeanist forces and concomitant radicalisation trends in the far-right camp.

This is once again illustrated by recent developments in Italy, where a ‘national unity’ government led by Mario Draghi and featuring technocrats in key ministerial roles was formed in February 2021. On the one hand, the inclusion of the League in the governing coalition can be viewed as an attempt by state technocrats and Europeanist forces to finally ‘normalise’ the Italian far right. On the other hand, the League’s decision to join the cabinet was most likely taken with the main aim of influencing the allocation of the RRF funds in favour of its core base of Northern businesses (Pianta, 2021). In this context, the post-fascist Brothers of Italy (Fratelli d’Italia, FdI) remained almost alone in opposing the Draghi government. This allowed FdI to boost its credentials as the only alternative to yet another technocratic executive and to rapidly surge in local elections and national polls, suggesting future shifts towards a further radicalisation of the conservative bloc (see Albertazzi et al., 2021). While the final outcomes of these tensions and mutual adjustments remain to be seen, these are likely to shape present and future trends in the relationship between neoliberalism and the far right in Italy and beyond.