Brussels bureaucrats have been worrying about the effects of Brexit; but Brexit Smexit, there is a whole larger whirlwind now raising itself across the Mediterranean in Italy.

Just like in Britain in 2016, there appears to be another battle underway between the Establishment and the People.

The markets took a hit yesterday after the prospect of yet another Italian General Election loomed; frightened investors began to sell Government bonds as confidence fell.

Politically and economically, the stakes are much higher than, say, in the Greek crisis. Italy is, after all, one of the six founding members of the EU and is the eurozone’s third largest economy.

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What is happening in Italy echoes to some degree the debate that we had in Britain two years ago: who has control.

The anti-Establishment populists, the Five Star Movement[M5S] and the League, who won the election, want to ease the EU economic straitjacket. They chose as their Finance Minister Professor Paolo Savona, an 81-year-old economist, whose Plan B, if reforms could not be secured, was to pull Italy out of the euro altogether.

President Sergio Mattarella vetoed the appointment as he believed it threatened his country’s economy, underpinned by its eurozone and EU membership. M5S and the League smelt a rat and believed Berlin was behind the rejection of Prof Savona.

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The new Prime Minister-designate is Carlo Cottarelli, an IMF veteran with close ties to the Eurocrats in Brussels and who is solidly pro-euro and pro-austerity; indeed, he is known as "Mr Scissors" because of his penchant for cuts.

While the M5S and League want to reform the economics of the eurozone, the big question is, if in the wake of their likely re-election this autumn, Brussels, or more pertinently Germany, simply says No to change, what then?

If Italy decides, on a wave of disgruntlement, to go back to the lira, this would send an economic earthquake across Europe and beyond.

Italy’s current £2bn debt lies in many pockets across Europe and beyond. If the markets took fright, as is highly likely, then Italy’s old/new currency would collapse; contagion would begin to spread like wildfire.

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Just as in 2008, the financial system would seize up as panic set in, leading inevitably to another raft of recessions with all the dire consequences, economic, political and social, that would bring.

George Soros, the pro-EU billionaire, yesterday said the EU had an “existential crisis” and needed to “reinvent itself” to make it more attractive for countries to stay in. Time is of the essence.