“It Could Open A Pandora’s Box”: Italy’s 2 Richest Regions Are Voting In Historic Autonomy Referendums
by Tyler Durden
ZeroHedge.com
Oct 22, 2017
Voters in Italy’s two wealthiest northern regions of Lombardy and Veneto are voting on Sunday in referendums for greater autonomy from Rome, in which a positive outcome could fan regional tensions in Europe at a time when neighboring Spain is cracking down to prevent Catalonia from breaking away.
Lombardy, which includes Milan, and Veneto, which houses the tourist powerhouse Venice, are home to around a quarter of Italy’s population and account for 30% of Italy’s economy, the Eurozone’s third largest. Unlike Catalonia, the consultative votes are only the beginning of a process which could over time lead to powers being devolved from Rome. Also unlike Catalonia, which held an independence referendum on Oct. 1 despite it being ruled unconstitutional, the Italian referendums are within the law. Like Catalonia, however, Lombardy and Veneto complain they pay far more in taxes than they receive.
At its core, today’s vote is about whether taxes collected in the two wealthy regions should be used far more for the benefit of the two regions, or diluted among Italy’s other, poorer regions, especially in the south. Lombardy sends €54 billion more in taxes to Rome than it gets back in public spending. Veneto’s net contribution is 15.5 billion. The two regions would like to roughly halve those contributions – a concession the cash-strapped state, labouring under a mountain of debt, can ill afford.
The two regions are both run by the once openly secessionist Lega Nord, or Northern League party, which hopes that the result will give it a mandate to negotiate better financial deals from Rome. The Northern League was established in the 1990s to campaign for an independent state of “Padania”, stretching across Italy’s north, from around Lombardy in the west to Venice in the east. It no longer campaigns for secession but argues that taxes the north sends to Rome are wasted by inefficient national bureaucracy.
While the twin referendums are non-binding, a resounding “yes” vote would give the presidents of the neighboring regions more leverage in negotiations to seek a greater share of tax revenue and to grab responsibility from Rome. The leaders want more powers in areas such as security, immigration, education and the environment.
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