The Rise of European Economic Nationalism

by John Engle

May 6, 2014

The siren song of independence and national self-determination has sounded once again across Europe. It is a song that holds echoes of a century ago, when the internal force of nationalism convulsed the European empires into world war. Yet, while the song remains the same, the tune has changed.
One hundred years ago, many of the great countries of Europe were patchworks of cultures, ethnicities, and national identities. The most vulnerable of these states was the Austro-Hungarian Empire. It was so vulnerable because of its gross economic mismanagement and its denial of any political say from nationalist movements, a policy that left many groups resentful. It is thus no surprise that the spark that ignited World War I was lit by Serbian nationalists in Austro-Hungary.
The war tore Austro-Hungary apart. When the conflict ended, the country was divided into many smaller states, most of which were formed along ethno-nationalist lines. While the political divisions created by the war were soon convulsed anew in the Second World War, the idea that nations should be allowed to self-determine was firmly established in the European, particularly Western European, mindset.
That right of self-determination is now being tested across Europe. In Spain and Italy, regions are moving toward political separation from their central governments. However, the reasons are somewhat different than they were in the last century. While the impetus then was a desire for political freedom, today’s nationalists are more concerned about economics.
Economics is certainly the main driver of the independence movements in Spain and Italy.

Catalan Nationalism

Catalonia has long had a strong cultural identity unique from the rest of Spain. Separatist parties have frequently had great influence in the regional parliament, and cultural elements, such as teaching in the Catalan language, are strongly supported. Yet the separatists have also found it hard to build sufficient support to declare full independence from Spain.
Since the global financial crisis and recession, however, things have begun to change in Catalonia. As one of the richest regions in all of Spain, Catalans have come to feel as if they are subsidizing the profligacy and irresponsibility of less prosperous regions. This resentment might have been containable during the decades of economic growth after the fall of the Franco regime in the 1970s, but in the wake of a massive debt and housing crisis, it has bubbled to the surface.
Today, 55% of Catalans support full independence, and a far larger majority supports holding a referendum on the place of Catalonia in Spain. In 2013, the Catalan parliament set a date to hold a referendum on independence for November 2014.
The Spanish government has not responded well to the threat of secession. The national parliament and courts have rejected the referendum as unconstitutional.
Despite the opposition of the central government, the separatist government of Catalonia has declared its decisions will not be made by the Spanish authorities. Now most Spain-watchers think the regional parliament will call an election to act as a proxy for an independence vote. If the separatist parties are returned to power, the march to independence may become unstoppable.

Venetian Nationalism

Venice has always been independent-minded. An independent republic for over a thousand years, Venice is a relatively recent addition to the also relatively young unified Italy. Rolled into Italy by conquest, the current state of things does not sit well with many Venetians.
The level of discontent only became clear in March 2014 when an unofficial referendum on Venetian independence was held by separatist activists. Independent sentiments were always high, as much as 65% in favor according to some polls, but no one anticipated the result of the referendum. Fully 89% voted in favor of secession from Italy.
The shocking degree of pro-independence sentiment has sparked a full-fledged movement to gain political independence. Activists are buoyant about their prospects and look forward to leaving the sclerotic Italian central government behind.
Like Catalonia, Venice is much wealthier than the majority of the mother country. Venetian taxpayers pay billions of dollars in net transfers to the central government. They have finally become sick of it and are ready for a change.

The Ties that Bind

The lesson the separatists of Catalonia and Venice offer collectively is that the ties that bind nations are not unbreakable, especially when they are confronted with economic strains. Whether these regions gain their independence, greater autonomy, or return to the status quo, the very fact that the question is being tested at all shows that government profligacy and economic distribution can only go on for so long. Eventually those who face the economic drain will revolt against the injustice.
Under such circumstances, maybe a peaceful secession is the best solution one can hope for.