Italy: Populism and Business in a Stagnant Economy

This chapter provides an overview of how populism has evolved in Italy since the 1990s, focusing in particular on the political changes occurred after the crisis of 2008. It shows that the collapse of mainstream parties has been accompanied by the rise of the League and the 5 Star Movement (M5S), two populist parties which have challenged EU control over budgets and austerity policies. The League provides an interesting case of populist party characterised by high levels of ideological ‘adaptability’ – confirming the ‘chameleonic’ nature of populist parties– and oscillating between support for neo-liberal economic policies and pro-welfare positions (filtered through the lens of its nativist ideology). This is then linked to a discussion of how business associations have responded to the new wave of populist politics started during the Great Recession. It is argued that the ambiguous position of Italian populists on economic issues is mirrored by ambiguous responses from business elites, which also reflect the divide existing between small/medium sized enterprises and large industrial and financial companies. Overall, a ‘soft voice’ business response to populism seems to have prevailed – it became louder only when confronted with clearly redistributive policies proposed by the M5S. The last part of the chapter also considers more recent developments following the start of the COVID-19 pandemic, which marks a new critical juncture in Italian (and world) politics and economy.