"It Could Open A Pandora's Box": Italy's 2 Richest Regions Are Voting In Historic Autonomy Referendums

from ZeroHedge:

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.

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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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Enthusiasm for today's vote will be critical as the level of turnout will have a direct significance of the results: in Veneto, it has to pass 50% for the result to be considered valid. There is no threshold in Lombardy but low voter participation would weaken the region's hand in any subsequent negotiations with the central government.

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Even though secessionist sentiment in the two wealthy regions is restricted to what has been dubbed "fringe groups" with little following, nonetheless with both regions expected to vote in favour of the principle of greater autonomy, analysts see the referendums as reflecting the pressures that resulted in Scotland's narrowly-defeated independence vote, Britain's decision to leave the EU and the Catalan crisis according to AFP.

With dynamic economies and lower unemployment and welfare costs than the Italian average, both regions are large net contributors to a central state widely regarded as inefficient at best.

Public opinions covered both extremes of the spectrum:  

“Lombardy and Veneto have two efficient administrations and public services work well, much better than in other Italian regions ... this is why I think it is worth asking for greater autonomy,” said Massimo Piscetta, 49, who voted “Yes” in a small town outside Milan.

"Our taxes should be spent here, not in Sicily," echoed says Giuseppe Colonna, an 84-year-old Venetian, speaking to AFP.

“I am not going to vote because I think this referendum is useless, expensive, ambiguous and unfair,” countered Giovanni Casolo, 54, speaking to Reuters and expressing concern that the text of the Lombardy referendum did not spell the areas where the region wanted to increase its autonomy.

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