Wednesday, 27 February 2013

Italians Possibly Not Irrational

I have a personal theory, which often upsets committed political activists, namely that electorates tend to choose the least bad option presented to them at an election. This is not to claim that voters are individually rational people, because they are not. People vote according to their own whims, a lack of information or a lack of comprehension, raw prejudice, family tradition or indeed any combination of thousands of other motivations. I am saying that in aggregate, if you ask enough people the same multiple choice question, they will generally choose the option which causes the least distress to the greatest number of them.

With this theory in mind, consider the result of the Italian elections. On the face of it, the Italians have chosen a government, or more accurately not chosen a government, which will result in legislative paralysis and economic chaos. One in four of them voted for a comedian (an actual comedian, this is not a metaphor) called Beppe Grillo, whose policies include the abolition of the tax collecting department. They have also granted control of one of the legislative houses to Silvio “Bunga Bunga” Berlusconi, a man who defies all attempts at satire, while the other is dominated by his left wing opponent Pier Luigi Bersani. This is a recipe for gridlock, and almost manages to make the US look like its government is functioning well (but not quite). My theory about the rationality of electorates is starting to look a bit shaky.

Now imagine that you are an Italian voter. The last few years have not been kind to you. The unemployment rate is over 11% and rising. It is over 36% for the under 25s. Savage austerity measures have significantly reduced your standard of living. All this has been deliberately imposed on you by a technocratic government installed by the EU in order to keep the country in the Eurozone. You were told that if you took this harsh medicine, economic growth would return. It hasn’t. If Italy carries on down the present policy course, all you have to look forward to is years of economic depression. Now, your job, your retirement and your children’s future may all be in doubt but, and this is the beauty of democracy, you have one thing left. You have a vote, and you use it to vote against the misery which has been imposed upon you. The Italian electorate voted against candidates backing austerity by a factor of three to two. Notice how Mario Monti, the technocratic leader who has imposed austerity on behalf of the EU, was sent packing at the polls? That was no accident.

There is nothing irrational about the Italians voting in this way, although it could have far reaching consequences. This vote is effectively a rejection of the failed EU wide policy of economic austerity without any concurrent growth plan, which has been the continental response to the Eurozone debt crisis. It cruelly exposes the fatal flaw in that plan-the political elite can impose years of depression on millions of people, but they cannot make those millions of people gladly accept it. Already, analysts are saying that this election heralds the return of the Euro crisis. What has really happened is that the total inadequacy of the previous “solution” has been exposed. Just think, if the Italians won’t put up with it, why would anybody else? The Eurozone looks pretty exposed right now, and deservedly so. Its leaders brought this on themselves.          

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