There is a very interesting election taking places in the US today that could have major ramifications for both the next mid term and presidential election cycles.  It’s a by-election for a seat in Congress, specifically Pennsylvania's 18th congressional districts.

I’ll be honest I don’t normally focus this much on the US congressional elections (though I have punted on Democrats reclaiming the Congress in November here). This election though is really intriguing for several reasons.

It’s a district that should be a clear win for the Republican candidate. Donald Trump beat Hilary Clinton here by nineteen percentage points in the presidential election. It also falls into the infamous Rust Belt, that area of the United States that is suffering from continued post-industrial decline.

If that wasn’t enough, Trump visited personally on Saturday to endorse the Republican candidate, Rick Saccone, who himself is a major Trump proponent.
​
Despite these inherent advantages, the Democratic candidate Conor Lamb is slightly favourite after making gains in the polls in the last few weeks.

While only thirty-three, he has a strong pedigree as a former Marine and federal prosecutor in Pittsburgh.
He’s a right leaning Democrat who has already stated he does not support the Democratic Speaker of the House, Nancy Peloisi.

In my view he has identified that Trump has pulled American politics, at least temporarily, into a new paradigm and to regain power in November in the House and then in the next Presidential race the Democrats need to attack the republicans in different ways.

He has stayed quiet on gun control and abortion, two areas that have often been championed by Democrats but that would not necessarily be popular in his district.

He has focused on jobs and combating the drug crisis, which is a major epidemic in many parts of the Rust Belt. The Democrats were seen by many here as out of touch with the working man and part of “the swamp” and he is doing his utmost to portray himself as fighting for the people.

The view among many political analysts has been that a win for Conor Lamb or even a narrow defeat would be a major boost for the Democrats and show that they are on course for major wins in November.

I don’t necessarily disagree with this but I would look at it from a different angle. If Lamb wins, I think it could be the start of a new approach to beating Trump in many political regions of the US.
​
The Democrats may decide that a jobs-focused candidate who is viewed as in touch with the working classes may be a better match up than a socially liberal, progressive candidate in 2020. If this does end up being the case, Trump’s legacy will live on past 2021, regardless of victory or defeat. 

I wrote a preview of the Italian election a while back here that also looked at the overall state of the Italian economy. It didn’t make for pretty reading and I did reflect afterwards if I had been overly negative.

I predicted that Five Star Movement would win the most seats but would fail to get a majority. One interesting aspect of this election was that, unlike the Brexit or Trump votes, the results, though disheartening and alarming to many, didn’t come as a shock to many.

It was clear for at least 6 months that the Euro-skeptical parties were going to make major gains at the expense of the incumbent left-leaning Democratic Party. Furthermore, a hung parliament was also predicted by most polls.

What is less clear now is what follows. Italian politics is typically built on coalitions and in this campaign, there were three main groups; the centre-right coalition, the centre-left coalition and 5 Star Movement. As you can see from the results below, to form a functioning majority, this political landscape will need to be redrawn. 

I won’t spend too long speculating on the internal political machinations now at play as there are plenty of Italian commentators who obviously understand the internal dynamics a lot more than I ever will.

I see three probable outcomes. A Matteo Salvini led centre right minority government, a Luigi di Maio 5 Star Movement in coalition with the League or the Democratic Party.

Of these, the least desirable from my perspective would be a Salvini government. He is strongly anti-immigration and has crossed the line with some language that is close to hate speech and racist on numerous occasion.

It’s important to note that Italy’s challenges and problems haven’t now started because of this election. This election has only brought these issues closer for the forefront of many in Europe, as elections do.

I will hold off further comment for now until we get some further indications of what the next government will be and will then write a more focused article on what this means, in terms of poly and impact.

However, I don’t buy into the simplistic narrative that every election in Europe is now “the centre” v “populism”. There are elements of this in Italy but while immigration has played a role, youth unemployment and disillusionment with the status quo have played a more prominent role.

Unfortunately for Italy, these issues now seem to be part of the status quo. The key policies proposed by the main parties will not help address these issues and I continue to seriously worry for the health of the Italian economy and society as whole , regardless of who next sits in the Palazzo Chigi…
​

In the end the week wasn’t quite as dramatic as I had predicted here. Further details did emerge from all sides but there were no major fallouts or political backlash, aside from a few belligerent comments from the DUP.  

It was a badly kept secret that Jeremy Corbyn would announce last Monday that Labour’s official Brexit policy would now be to seek “a customs union” with the EU. He also stated that the UK would remain in the single market during any transitional period before exiting it.

The speech received a mixed reception with many remain-supporters claiming it didn’t go far enough. Equally, some pro-Brexit Labour MPs were unhappy with Frank Field claiming a customs union would be “ratting” on leave voters.

Now that I’ve had a few days to reflect on the speeches, I’m not sure how impactful Corbyn’s intervention was. It has opened some clear divide on policy between Labour and the Tories but for it to be meaningful, Corbyn needs to cultivate some cross-party support to win any major votes against the government.

Fortunately for Corbyn, Anna Soubry and Chuka Umunna have already tabled Clause 5 in the Trade Bill, that will lead to a vote in parliament. Many analysts quickly jumped on Corbyn’s change in policy as the potential vote that could bring down the government.

May’s speech on Friday was well received by many as containing more detail. Personally, I didn’t see that. I did learn that it’s now highly unlikely that May will request a customs union, along with the responsibilities that come with it.

Her speech does seem to have appeased the Brexiteers. Jacob Rees Mogg, who leads the anti-EU European Research Group that contains enough MPs to force a Conservative leadership contest, gave it his qualified approval, writing in the Telegraph;

“There are inevitably a few small points that will concern Leave campaigners but we must all recognise that everyone will have to give up something to get a deal, so now is not the time to nitpick.”

I think May has done enough to fend off an attack from this faction of her MPs. If she holds firm on her red lines, she may not accomplish much but it is one less flank she must defend against.

The EU has so far shown very little appetite to compromise on its negotiating stance. The protocol it released on Wednesday, was very close to what was concluded in December, much to the consternation of those who thought that “nothing is agreed until everything is agreed”.

The next big challenge for May will come from the remainers. Any meaningful votes in parliament that pushed for a customs union, single market access in exchange for certain Brexit sacrifices could seriously hurt the government.

I do not see Brexit being reversed at this hour but it may end up being quite a light version. This will not be the case if the final agreement is concluded under Theresa May as she has firmly come down on the side of the brexiteers. The strength of the Brexiteer position is that they can maximise the power of their limited numbers by a clarity of purpose.

There is a broad church of pre-EU supporting MPs that would form the majority in the Conservative Party. Unfortunately for them, they have not found a consensus that they can use a rallying cry. In the future political historians would struggle to identify the zeitgeist of the post Brexit referendum vote period.

However, if, for example, the Anna Soubry bill ends up being this rallying cause it could easily win a vote in parliament. Theresa May must now quickly work to convince those within her own party that voting alongside Jeremy Corbyn and Labour for a customs union agreement would seriously undermine the government. I expect to see lots of “red” scaremongering (though done a little more subtly than the Czech spy smear).

Whether this will be enough to convince her own MPs that the UK’s best interests is now outside a customs union but with a bespoke trade deal remains to be seen.

My views on where we are heading have not changed significantly after the last week’s events. I see the UK exiting the EU with a deal that falls short of most expectations on both sides of the EU argument.

Unfortunately, I do not see it causing a general election in the next twelve months, as when push comes to shove the Tories will probably put power over the nation’s interest. I think Theresa May will not last until the summer of 2019 as Prime Minister but my view on whether her exit date is 2018 or 2019 varies almost by the week.

The next few weeks will focus on trade talks and the Irish question, both of which I’ve left aside for today and will come back to shortly. I will be writing quite frequently on Brexit over the next two months, as trade talks are soon going to reach their crescendo..