“Kicking the Can Down the Road” Deferring Fiscal Adjustment as a Premise for Italian Budgetary Populism

The populist aim of rebuilding the state on the true will of the sovereign people cannot succeed without a specific constitutional approach towards public budgeting. The budget, in fact, is a tool enabling governments to meet people’s needs, thus bringing about a different degree of economic and social rights protection. Populist coalitions tend to oppose strict balanced budget rules insofar as they are used to override the putative popular will to found a new social order. In Italy, budget constraints, as enshrined into Articles 81, 97 and 119 of the Constitution under the government of Mario Monti, are perceived as an irrational set of rigid rules imposed by foreign countries and supranational organizations with no democratic legitimacy. The legal resentment against “external constraints”, however, is not just a feature of self-proclaimed populist cabinets such as the first Conte government, but has been shared by several recent cabinets, led by Mr Berlusconi and Mr Renzi. This resentment kept together both right- and left-wing parties, which are keen on pursuing short-sighted economic policies, aimed at steering spending to please single and often contradictory popular interests with no regard for their financial and social effects. This phenomenon triggered a substantive change of the constitutional framework: parliamentary debate has been swept away by the executive branch, the functioning of the fiscal council has been put to an indefinite rest, and derogation from a balanced budget has become the rule rather than the exception. At present, only the Constitutional Court appears to stand up to counter a trend on the basis of which legislative discretion by the ruling majority is raised to the rank of an intangible constitutional rule.