Austria"s Anti-Immigrant Freedom Party Enters Government; Wins Key Ministry Posts

Two months ago, in Europe"s latest shocking, anti-establishment outcome, Austria"s 31-year-old Sebastian Kurz became the world"s youngest leader after his conservative People"s Party won the Austrian National Council elections, making him Austria"s youngest Chancellor in history, while the establishment Social Democrat party suffered its "worst result since Hitler rule."

Sebastian Kurz and his girlfriend Susanne Thier

And now, two months later, in a double whammy for Europe"s outraged liberal establishment, the anti-immigrant Freedom Party of Austria (FPO) - which finished third in October"s elections with 26% of the vote, less than a percent behind the Social Democrats, has joined a coalition government with Sebastian Kurz and his People’s Party (OVP). The agreement between the People’s Party and the Freedom Party, which is returning to government after more than a decade"s absence, was struck on Friday, the two parties’ leaders, Sebastian Kurz and Heinz-Christian Strache announced in a joint news conference.

Austria"s president approved the new coalition on Saturday, two months after inconclusive elections. According to BBC, the coalition government makes Austria the only country in Western Europe to have a far-right party in power.

Sebastian Kurz and Freedom Party chair Heinz-Christian Strache

Introducing the new government, and the 180-page document setting out its agenda, Mr Kurz said the two parties had agreed "on a clear pro-European outlook". Meanwhile, Strache, who in January advocated a law similar to the ban on Nazi practices to be introduced against “fascist Islam,” spoke about “mutual appreciation” with Kurz, adding that they share “the responsibility for our homeland Austria and for the people in this country.”

While the two parties have yet to unveil the details of the coalition agreement, some of the key points that will shape the next government have already been discussed: among them is a further crackdown on migration

“We want to reduce the burden on taxpayers ... and above all we want to ensure greater security in our country, including through the fight against illegal immigration,” Kurz said.

And while the FPO will be the junior coalition partner, it has already secured several critical posts in the new cabinet. Party leader Heinz-Christian Strache will be vice-chancellor, while his party colleagues will run the ministries of the interior, defense and health and social security. Specifically, Herbert Kickl, will be the new iterior minister: the party"s general secretary and campaign director, 49, was a speechwriter for the late party leader Jorg Haider and is a close confidant of the current leader, Hans-Christian Strache.

For one, the sweep assures that any and all benefits for migrants will be eliminated. To be sure, the opposition has expressed concern that the police and the security apparatus are now all firmly in the hands of the Freedom Party.

Separately, the new foreign minister will be Middle East expert and writer Karin Kneissl, who is not a Freedom Party member but was nominated by the party, which to some suggests that the Freedom Party now effectively runs Austria.  At the request of Austria"s president, the posts of justice minister and interior minister would not be held by the same party, Mr Kurz said.

Today"s crowning success of the far-right Freedom Party, which gained 7 percentage points on the previous elections, come amid a backlash to the immigrant wave that swept Europe in 2015 in the aftermath of Angela Merkel"s now defunct "open door" policy. The party"s hardline anti-immigrant stance emerged after Austria was overwhelmed by a wave of refugees fleeing the US-stoked proxy war in Syria.

Since 2015, the Alpine country took in some 150,000 asylum seekers, which accounts for over 1 percent of its population, one of the largest shares per capita alongside Sweden. The signs of the growing popularity of the far-right was evident in December last year, when Freedom Party candidate Norbert Hofer’s bid to become modern Austria"s first far-right president was only narrowly defeated in a neck-and-neck contest with centrist Van der Bellen.

And so, with Austria set to form a right-wing government, institutionalized opposition to Europe"s liberal “open door” policies on migrants is no longer restricted to the EU"s eastern territories. Poland, Hungary, the Czech Republic and Slovakia, with their own conservative governments, remain staunchly opposed to the EU relocation scheme and refuse to take in a single refugee. Now, with Austria joining the "resistance", the anti-migrant wave have officially broken into central Europe.

And now, we await Europe"s response: when the Freedom Party last entered a coalition in Austria in 2000, the country"s fellow EU member states froze bilateral diplomatic relations in response. While they were lifted months later, such measures are unlikely to happen again, as resurgent populist groups have been promoting anti-immigration and eurosceptic agendas across much of the EU, and the last thing any other establishment party wants is to experience a similar revolution in the top political echelons.

In Historic Result, 31-Year-Old Wins Austrian Elections, Worst Result For Establishment Party Since Hitler Rule

In another stunning defeat for Europe"s establishment, as previewed earlier this morning Austria"s 31-year-old Sebastian Kurz is assured victory in the Austrian National Council elections, becoming Chancellor with his center-right People"s Party set to take roughly 30.2% of the vote - the best result in almost two decades - according  to exit polls by Austrian broadcaster ORF, while just as shocking is that the anti-immigrant, nationalist Freedom Party appears set to top the Social Democrats in 2nd place with 26.8% of the vote: the two parties are expected to form a coalition government. If confirmed out by final results, that would be its strongest performance for the Freedom Party since the 26.9% it won in 1999 when the party was led by the charismatic Jorg Haider. Meanwhile, Chancellor Christian Kern"s Social Democrats are looking at another devastating - for Europe"s establishment - loss, sliding to 3rd spot with just 26.3% of the vote.

The full breakdown from the initial exit polls vs the last election results in 2013:

• People’s Party (Foreign Minister Sebastian Kurz) 30.5% vs 24%
  


• Freedom Party (Heinz-Christian Strache) 26.8% vs 20.5%


• Social Democrats (Chancellor Christian Kern) 26.2% vs 26.8% in 2013


• Neos (Matthias Strolz) 5.3% vs 5%


• Greens (Ulrike Lunacek) 4.7% vs 12.4%


• Liste Pilz (Peter Pilz) 4.3% (didn’t run in 2013)

Austria: Seat prediction (SORA exit poll): PILZ enters parliament for the first time.#nrw17 #Wahl17 #orfwahl17 pic.twitter.com/zVun1n6AAu

— Europe Elects (@EuropeElects) October 15, 2017

The preliminary geographic breakdown of Sunday"s election shows that most constituencies voted for the People"s Party:

It remains to be seen if and how Kurz will form a coalition with the anti-immigrant Freedom Party - a historic outcome for the nationalist party which could enter government for the first time in history - however one thing is clear: just like in Germany, where Merkel"s CDU/CSU suffered its worst result since 1949, so in Austria the "establishment" SPÖ, or Social Democrat party just suffered what Europe Elects described as the "worst result since Hitler rule."

Austria: Centre-left SPÖ (S&D) with worst result since Hitler rule: 26.3% (SORA exit poll). #nrw17 #wahl17 #beifunk pic.twitter.com/pWFRQI2u5T

— Europe Elects (@EuropeElects) October 15, 2017

We now await the market"s reaction to the news that Europe"s populist anti-establishment, anti-immigrant revolt, considered to have been dead and buried following the French elections, was not only revived after last month"s German election, but is once again thriving.

Three Of Italy's Top Four Political Parties Seek A New Parallel Currency

Authored by Mike Shedlock via MishTalk.com,

In a bid to appeal to the growing anti-euro sentiment in Italy, three of Italy’s biggest political parties seek a dual currency.

Italy’s leading opposition parties are calling for the introduction of a parallel currency to the euro, which they say will boost growth and jobs.

Three of the country’s four largest parties – the Five Star Movement, the Northern League and former prime minister Silvio Berlusconi’s Forza Italia – have proposed introducing a new currency following an election scheduled for next year.

The proposals for a parallel currency have replaced the opposition parties’ previous calls to leave the euro completely.

By settling on a dual currency, analysts say the parties hope to appeal to anti-euro sentiment in the country while avoiding, for now, the upheaval of an outright exit.

A poll by the Winpoll agency in March showed that only around half of Italians back the euro.

As the election nears, and with opinion polls currently pointing to a hung parliament, only the ruling Democratic Party is not proposing changes to the current euro set-up.

Next General Election

The next Italian General Election is due to be held no later than May 20, 2018.

Key Players

• M5S – Five Star Movement – Beppe Grillo, a comedian. The M5S is variously considered populist, anti-establishment, environmentalist, anti-globalist, and Eurosceptic. The “five stars” are a reference to five key issues for the party: public water, sustainable transport, sustainable development, right to Internet access, and environmentalism. In foreign policy, the M5S has disapproved military interventions of the West in the Greater Middle East (Afghanistan, Iraq, Libya) as well as any notion of American intervention in Syria.


• PD – Democratic Party – Matteo Renzi, former prime minister. The PD’s main ideological trends are thus social democracy and the Italian Christian leftist tradition.


• Northern League – Lega Nord – Matteo Salvini. Under Salvini, the party has emphasized Euroscepticism, opposition to immigration, and other “populist” policies, while forming an alliance with nationalist and right-wing populist parties such as France’s National Front, the Netherlands’ Party for Freedom and the Freedom Party of Austria at the European level.


• Forza Italia – Forward Italy – Silvio Berlusconi, a four-time Prime Minister. Under Berlusconi, FI’s long-time coalition partner was Lega Nord.

Silvio Berlusconi is prone to flip-flops and would likely do anything if it brought him back in power. However, PD + FI will likely not come close to 50%.

Early Elections?

On May 30, Bloomberg reported Italy Moves Toward Early Vote as Election Law Deal Nears

Italy’s biggest parties are considering a proportional system similar to the German model with a 5 percent cut-off for smaller parties, and lawmakers are due to discuss a first draft of the new law early next month. An agreement would remove any hindrance to snap elections, eliminating the need to wait for scheduled elections in early 2018.

Ultimately, it’s up to Italian President Sergio Mattarella to make the call on when to dissolve parliament. According to Italian newspapers including Corriere della Sera, Mattarella would prefer to let the government of Prime Minister Paolo Gentiloni, 62, a soft-spoken diplomat and Democratic-Party ally of Renzi’s, stay in power until next year.

While an early vote would put an end to a legislature that already saw three governments in power amid palace coups and constitutional-referendum defeats, a proportional system runs the risk of producing a hung parliament. An election this year would come at a delicate time for Italy, with its banking woes unresolved and the budget law for 2018 still to be approved.

The proposed new law “would likely not facilitate an outright victory by one of the three major political groups” resulting in a hung parliament, said LC Macro Advisers Ltd. founder Lorenzo Codogno who sees the likelihood of early elections at 60 percent.

That deal fell and I can find no other recent references regarding early elections.

Left Crumbles

On June 26, the Guardian reported Italy’s Centre-Right Wins Big in Mayoral Elections as Left Crumbles

An alliance of Silvio Berlusconi’s Forza Italia party and the anti-immigrant Northern League won 55% of the votes in Genoa, the northern port city that was a leftwing stronghold but which the right will now govern for the first time in more than 50 years.

PD leader Matteo Renzi, 42, who has been seeking to make a comeback since stepping down as prime minister in December, was the clear loser in Sunday’s vote.

The centre-left has governed Italy for four years, during which time the economy grew by only half the eurozone average. Three different PD premiers have struggled to shore up a banking system strangled by bad loans, and to manage half a million migrants who came by boat from north Africa.

Sunday’s vote – the second round for cities where no one candidate won more than 50% two weeks ago – is one of the last before a general election due by the end of May 2018, but it may not be a reliable indicator of what will happen then. The first-past-the-post voting system used at the municipal level, which favours coalitions, may not be replicated at a national level, where a proportional system is now in place.

Genoa is the latest of a string of defeats in the PD’s traditional strongholds. Last year it lost Turin, Italy’s fourth-largest city, and the capital Rome, both to the Five Star Movement (M5S), which was founded only eight years ago.

M5S, which opinion polls say is slightly more popular than the PD nationwide, performed very badly in the first round of voting on 11 June and made the run-off in only one of the 25 largest cities. It added eight mayors to its modest tally.

“We now have 45 mayors, up from 37 before, which is an increase of 20%,” M5S founder Beppe Grillo said on his blog. “Every damned election we are growing and that is what counts.”

Two Things

M5S, NL, and FI appear likely top a combined 50%, perhaps easily. That does not necessarily mean a coalition will form.

The two things and possibly the only two things that unite the Five Star Movement, the Northern League, and Forza Italia are a desire to crush Matteo Renzi and a desire to get Italy off the Euro.

And when it comes to Berlusconi’s views on the euro, one has to question his sincerity. He has changed his position many times.