MILAN — Italian voters dealt Premier Matteo Renzi a resounding rebuke by rejecting his proposed constitutional reforms, plunging Europe’s fourth-largest economy into political and economic uncertainty Monday.

Renzi announced he would quit following Sunday’s referendum vote, in which 60% of voters rejected his proposals and signalled they wanted a change in political direction. Renzi, who had boldly staked his political future on winning the referendum, was expected to hand in his resignation to President Sergio Mattarella later Monday.

The unexpectedly large margin of defeat with a robust voter turnout of 68.5% appeared to rule out any chance that Renzi would be offered another shot at forming a government. Analysts did, however, expect Mattarella to ask Renzi to stay on long enough to pass the new budget, with a target date of Dec. 23.

The vote energized the anti-establishment 5-Star Movement and the anti-immigrant Northern League, whose leader has allied himself with far-right figures in Europe including France’s Marine Pen.

While Italy’s opposition parties were united in antipathy for Renzi’s policies and reform course, they have little else in common and have already begun vying to position themselves for a new election, although the timing of any vote remained unclear. Analysts expect that Mattarella will appoint a transition government to draft a new election law, with speculation centring on either Renzi’s finance minister, Pier Carlo Padoan, or the president of the Senate, Pietro Grasso, to lead the effort.

But that course is already facing opposition.

Northern League leader Matteo Salvini called for an immediate election this winter “because real change happens only through electoral victory.”

The current election law, which Renzi wanted to reform, would hand a huge bonus of seats to the lower house while maintaining a proportional system for the upper house, raising the potential for parliamentary gridlock.

With much wrangling ahead, the risk facing Italy is “a prolonged muddle-through period, the emergence of an ineffective, patched-up coalition government in the postelection phase and continuously poor economic performance,” said Wolfango Piccoli, a political analyst at the Teneo Intelligence consultancy.

European partners sought to downplay the risk for the common euro currency and European unity.

“This is a crisis of government, not a crisis of state, and it’s not the end of the West. But it’s certainly not a positive contribution against the backdrop of the crisis in Europe,” German Foreign Minister Frank-Walter Steinmeier said in Athens.

The EU finance commissioner, Pierre Moscovici, told reporters in Brussels that “I’m very confident in the capacity of the eurozone to resist all kind of shocks.”

The main stock index in Milan was volatile. It opened down 2%, with many bank shares suspended due to excessive volatility, but recovered to trade down only 0.9%.

Investors had been anticipating Renzi’s defeat for several days, and had sold off Italian stocks and bonds. Monday’s sanguine market reaction can also be attributed to the fact that Italy’s markets indirectly enjoy a big backstop from the European Central Bank.

The central bank for the 19-country eurozone is buying 80 billion euros ($85 billion) every month in bonds, including government debt, across the currency bloc. It is expected on Thursday to decide to extend that program beyond its current end date of March. The bond purchases aim to boost growth and inflation but also effectively help keep low government borrowing rates. That is crucial for Italy, which has a massive public debt load of 130% of GDP.

Italy’s 10-year bond yield was stable at 2.03% on Monday. That’s up from 1.65% last month but is still very low for a highly indebted country like Italy. It’s also far short of the 7% rate that in 2012 had created fears that Italy might default and fall out of the euro.

Still, the result cast doubts on the ability of Italy’s third-largest lender and the worst performer in last summer’s EU stress test, Monte Paschi di Siena, to execute a rescue plan that includes a 5 billion euro market recapitalization. Advisers are meeting to discuss the vote’s impact, according to Italian media. Italy’s biggest bank, UniCredit, also is to present to analysts its new business plan next week in London.

Renzi swept into power 2 1/2 years ago on a pledge to dismantle the system, claiming the moniker of demolisher. His brash ways divided his own party, however, and his confidence was widely perceived as arrogance, even in other European capitals and especially in Brussels, where he had grown increasingly bold in pressing for flexibility on the budget.

“I lost and the post that gets eliminated is mine,” Renzi said early Monday after the polls closed. “The government’s experience is over.”

Frances D’Emilio in Rome, Carlo Piovano in London and Frank Jordans in Berlin contributed to this report.</s>MILAN – Italians vote Sunday in a referendum on constitutional reforms that is being closely watched abroad to see if Italy becomes the next country to reject the political status quo.

Premier Matteo Renzi has said he will resign if the reforms are rejected, and opposition politicians have vowed to press for a new government if voters reject the proposed constitutional changes.

The premier made no comment as he voted in Pontassieve, a Tuscan town east of Florence, along with his wife, Agnese Landini. He is expected to return to Rome later this afternoon to watch the outcome of the vote.

The risk of political instability in Italy, Europe's fourth largest economy, has triggered market reaction before the vote, with bank stocks sinking and the borrowing costs on sovereign debt rising.

European partners were closely monitoring the vote, which comes on the same day as a runoff in Austria that could put a right-wing populist in power for the first time since World War II.

A headline in the Frankfurter Allgemeine Zeitung said Renzi's "arrogance is his shortcoming," noting that "Europe is at stake" in the vote. The Guardian noted that the referendum was among a series of votes in Europe that could "conceivably herald the end of the European project in its current form."

The referendum aims to streamline Italy's cumbersome lawmaking process by reducing the powers of the Senate, while also removing some key decision-making powers from regions.

Renzi has argued that the reforms dismantle bureaucracy and will make Italy more attractive to investors and help his drive to transform the country. But his decision to tie the outcome to this political future transformed the vote into a plebiscite on his leadership.

Political opponents are hoping to tap populist sentiment that has been gaining ground with the U.K. vote in June to leave the European Union and the U.S. presidential victory by billionaire political outsider Donald Trump.

A "yes" vote would strengthen Renzi's 2 ½-year-old government, giving it impetus to complete its five-year term and time to prepare for elections in 2018, while a "no" vote would favor early elections sometime next year.

Three former premiers – Silvio Berlusconi, Massimo D'Alema and Mario Monti – have come out against the reform, albeit for different reasons. Berlusconi has argued that it concentrates too much power in the premier, while Monti says the reforms don't go far enough and downplayed the risk of political instability.

How the vote plays out politically is likely to depend on the turnout and the margin of the decision.

"For example, if only 30 percent of eligible voters turn out, the result will hardly be influential," the founder of La Repubblica, Eugenio Scalfari, wrote in a column on Sunday.

If voters reject the referendum, Renzi is expected to announce his resignation right away. But analysts say President Sergio Mattarella, whose job it would be to designate someone to form a new government, is unlikely to move until parliament passes a new budget law.

More than 46 million Italians were eligible to cast votes from 7 a.m. until 11 p.m. (0600 GMT until 2200 GMT) while another 4 million were registered to vote abroad. The overseas votes were being tallied under guard at a warehouse outside of Rome.</s>Italy was plunged into political and economic uncertainty following voters' resounding rebuke of Premier Matteo Renzi's proposed constitutional reforms.

Renzi announced he would quit following Sunday's referendum vote, in which 60 percent of voters rejected his reforms and signaled they wanted a change in political direction. Renzi is expected to hand in his resignation to President Sergio Mattarella later Monday.

The Milan Stock Exchange opened down 2 percent, but many bank shares were suspended due to excessive volatility meaning the hit could be even deeper.

The results hit Italy's sovereign debt, increasing the spread on Italy's 10-year bonds to 2 percent, from 1.7 percent on Dec. 1 and a record low of just over 1 percent last March and April.</s>First Britain voted for Brexit. Then America voted for Trump. And now Italians have overwhelmingly voted to reject constitutional reform, leading Matteo Renzi to state he will resign as prime minister later today. It’s tempting to draw parallels between the three votes. But Italy’s referendum does not mark a political earthquake. Its causes are different, and its effects on domestic and international politics are likely to be contained.

Italy’s no vote does not fit quite so neatly into the narrative of a populist revolt against globalisation and elites. Themes such as globalisation and immigration did not feature as strongly in the debate. Instead, after Renzi stated that he would resign if the constitutional reforms were rejected, the debate was focused on his own record as prime minister. And while of course populists voted no, many of the other no voters did so against the substance of the reforms, arguing that they were anti-democratic and would have altered constitutional checks and balances. Unlike Britain and the US, where elites were homogeneously in favour of remaining in the EU and opposed to Trump, in the Italian case, the political establishment and the experts were split in two.

Opposition to the proposed constitutional changes did not just come from the populist Five Star Movement and the nationalist Northern League, but also from mainstream political figures. These included factions of Renzi’s own Democratic party, former prime ministers such as Massimo D’Alema and Mario Monti, prominent academics and former constitutional court judges. This was not a vote that neatly pitted globalists against nativists or “the populists” against “the establishment”.

Italy’s vote is also different because the consequences of the vote are likely to be much more limited. Of course, in the coming days and weeks, we can expect some financial market volatility: it is likely that yields on Italian government debt will rise and that shares in Italy’s most troubled banks will fall.

But the situation is different from the peak of the crisis in 2011, and the European Central Bank has already stated it will step in to ensure yields on Italian bonds do not rise too far. And while banks may find it harder to tempt international investors to raise the capital they require, once markets realise that Italy’s underlying political stability is not at stake, the consequences for the banking sector are also likely to be contained.

The vote is unlikely to lead to political instability or the rise of the populist Five Star Movement, as many commentators fear. Renzi’s resignation is unlikely to lead to early elections. Instead, president Sergio Mattarella will first explore options for a new government. He could give the mandate to form a government to a respected political figure such as economics minister Pier Carlo Padoan, who has just cancelled a planned trip to Brussels.

The formation of a new government is highly likely: mainstream parties have little appetite for early elections because of the prospect of a strong showing by the emboldened Five Star Movement. Moreover, the current electoral law needs to be amended, as it was designed under the assumption that the referendum’s constitutional changes would be approved. The law is also under consideration by the constitutional court, and it would be inappropriate to use it to vote before its verdict.

A new government would likely be made up of the same political majority currently supporting Renzi, with the possible addition of Berlusconi’s Forza Italia party. It would face the same challenges and would continue to act in much the same way, steering the country towards new elections in late 2017 or 2018 and pursuing the stony path of incremental economic reform. Indeed, while Renzi sought to portray the reforms as a make or break moment for Italy, the economic reforms of the past five years are not about to be undone.

A takeover by the populist Five Star Movement is unlikely either now or in the next election. The movement may run out of steam, as it increasingly becomes embroiled in political mishaps arising from its administration of Rome and Turin. Crucially, planned electoral reforms are likely to lead to a form of proportional representation that will make it difficult for any single party to form a government. The continuation of coalition governments will exclude the Five Star Movement, which refuses to take part in them.

And any new Italian government is likely to behave in the same way as Renzi’s government did towards its European allies, seeking to bend fiscal rules in its favour and to press for a more expansive fiscal policy. It will also continue to demand solidarity from the EU with its efforts to deal with migrants and to rebuild the areas affected by recent earthquakes. Italy is unlikely to be the domino that leads to more instability in Europe.</s>Italy's Prime Minister Matteo Renzi gives a press conference at the Palazzo Chigi on December 4, 2016 in Rome (AFP Photo/Andreas SOLARO)

Rome (AFP) - Italian Prime Minister Matteo Renzi announced his resignation on Monday, hours after it was confirmed he had suffered a crushing defeat in a referendum on constitutional reform.

"My experience of government finishes here," Renzi told a press conference, acknowledging that the No campaign had won an "extraordinarily clear" victory in a vote on which he had staked his future.

Interior Ministry projections suggested the No camp, led by the populist Five Star Movement, had carried the vote by a margin of almost 60-40 with a near 70 percent turnout underlining the high stakes and the intensity of the debate.

Markets seemed to take Renzi's departure in their stride. Stocks and the euro fell in early trading in Asia but there were no signs of panic with the possibility of his resignation having already been largely factored in.

Renzi said he would be visiting President Sergio Mattarella on Monday to hand in his resignation following a final meeting of his cabinet.

Mattarella will then be charged with brokering the appointment of a new government or, if he can't do that, ordering early elections.

Five Star founder and leader Beppe Grillo called for an election to be called "within a week" on the basis of a recently adopted electoral law which is designed to ensure the leading party has a parliamentary majority - a position Five Star could well find themselves in at the next election.

"Democracy was the winner," Grillo wrote in a post-vote blog that marked a significant change in the party's position on the electoral law. Prior to the referendum, Five Star had been arguing for it to be revised.

Most analysts see early elections as unlikely with the most probable scenario involving Renzi's administration being replaced by a caretaker one dominated by his Democratic Party which will carry on until an election due to take place by the spring of 2018.

Finance Minister Pier Carlo Padoan is the favourite to succeed Renzi as prime minister and the outgoing leader may stay on as head of his party - which would leave him well-placed for a potential comeback to frontline politics at the next election, whenever it is.

On the day Austria's voters rejected a far-right candidate for president, the scale of the No victory in Italy was even bigger than opinion polls had been indicating up until November 18, after which the media were banned from publishing survey results.

Renzi had gone into the final weekend of the campaign insisting he could still win voters around but he acknowledged he had failed. "The Italian people spoke today in unequivocal fashion," he said.

Opposition parties had denounced the proposed amendments to the 68-year-old constitution as dangerous for democracy because they would have removed important checks and balances on executive power.

Spearheaded by Five Star, the biggest rival to Renzi's Democratic party, the "No" campaign also capitalised on Renzi's declining popularity, a sluggish economy and the problems caused by tens of thousands of migrants arriving in Italy from Africa.

Renzi's backers believed they were voting for overdue change.

Outside a polling station in Rome, business owner Raffaele Pasquini, 37, told AFP he had voted "Yes" in the interest of his two-year-old son.

"We are voting to try and change a country that has been stalled for far too long," he said.

After the Brexit vote and Donald Trump's victory in the US presidential election, the No vote is likely to be interpreted as another victory for populist forces and a potential stepping stone to government for Grillo's Five Star.

But the campaign was not just about popular discontent with the state of Italy. Many Italians of a similar political bent to Renzi had deep reservations about the proposed changes to the constitution.

Under the proposals, the second-chamber Senate, currently a body of 315 directly-elected and five lifetime lawmakers, would have been reduced to only 100 members, mostly nominated by the regions.

The chamber would also have been stripped of most of its powers to block and revise legislation, and to unseat governments.</s>The Latest on the Italian referendum (all times local):

Germany's finance minister is calling for a calm response to the outcome of Italy's constitutional referendum and says that there's no basis to talk of it triggering a "euro crisis."

Wolfgang Schaeuble said as he arrived for a meeting with his eurozone counterparts in Brussels that Italy needs a government that's capable of acting and he hopes it will continue pursuing reforms despite the referendum result.

Schaeuble added: "I think we should take note of this with a degree of calm. The Italians have decided; we have to respect that. They will make the best of it."

The minister said: "There is no reason to talk of a euro crisis and there is certainly no reason to conjure one up."

The head of the group of 19 countries that use the euro currency says there is no need for "emergency steps" after Italian voters rejected constitutional reforms.

Jeroen Dijsselbloem, who is also Dutch finance minister, tried to calm concerns that uncertainty after the Italian vote and prime minister's resignation could weaken the euro.

He told reporters in Brussels that "it doesn't really change the situation economically in Italy or in the Italian banks. It doesn't seem to require any emergency steps."

He also insisted that the Italian vote against a reform by pro-EU Prime Minister Matteo Renzi doesn't mean that anti-EU forces will win in upcoming votes in France or the Netherlands.

Ratings agency Standard & Poor's says the rejection of Italy's proposed constitutional reforms in a referendum will not affect its credit rating for the country.

S&P, which rates Italy at BBB-, said the proposed reform would have had potentially positive benefits. But its rejection "does not have an immediate impact on Italy's creditworthiness."

It added Monday that the vote outcome "does not have immediate implications for Italy's economic or budgetary policies beyond likely near-term changes in Italian politics."

Italian markets opened lower on Monday, but soon recovered to trade higher.

Germany's foreign minister has expressed concern about the result of Italy's referendum, while lauding the loss of a right-wing populist in presidential elections in Austria.

Speaking during a visit to Greece, Frank-Walter Steinmeier said that while the result of the Italian referendum on constitutional reform, which has led Italian Premier Matteo Renzi to resign, was "not the end of the world," it was also "not a positive development in the case of the general crisis in Europe."

Steinmeier said that Germany was watching the developments "with concern."

The foreign minister said Renzi's government had been moving in the right direction, and he said Germany hoped the new Italian government would continue along the same path.

The European Union's finance commissioner has played down the impact of Italy's referendum on the euro and European unity.

Pierre Moscovici told reporters in Brussels that he has "full confidence in Italian authorities to manage this situation" after Italian voters rejected constitutional reforms and pro-EU Prime Minister Matteo Renzi announced his resignation.

With the euro trading lower on world markets, Moscovici said, "I'm very confident in the capacity of the eurozone to resist all kind of shocks."

French Finance Minister Michel Sapin insisted that the Italian referendum "is a question of internal politics. The referendum wasn't about Europe."

Sapin and Moscovici hailed the victory of a left-leaning, pro-EU Austrian president and defeat of his far right challenger. Moscovici said: "Populism is not inevitable. The extreme right is not irresistible."

A senior European Parliament lawmaker from Germany says Italy's reform referendum heralds a period of instability and is a setback for those who want to see reform in Europe.

Italian Premier Matteo Renzi announced his resignation after losing Sunday's referendum on constitutional reforms. Asked what that means for Europe, Manfred Weber, the leader of the main conservative group in the European Parliament, told ZDF television: "Initially, a phase of instability now lies ahead of us — how will one of the biggest countries in the European Union now stabilize itself?"

He added that "it is also a setback for those who want readiness for reform, those who want European countries to change. That is the only way we can deal with globalization."

Luxembourg's foreign minister, Jean Asselborn, said the vote was an Italian domestic issue and he doesn't see a defeat for Europe. He told German news agency dpa: "Italy voted on a reform. It would be wrong to extrapolate that now to the European level. It was a domestic political argument."

He added, however, that "it would be bad for the euro if the government crisis dragged on for a long time."

Italy was plunged into political and economic uncertainty following voters' resounding rebuke of Premier Matteo Renzi's proposed constitutional reforms.

Renzi announced he would quit following Sunday's referendum vote, in which 60 percent of voters rejected his reforms and signaled they wanted a change in political direction. Renzi is expected to hand in his resignation to President Sergio Mattarella later Monday.

The Milan Stock Exchange opened down 2 percent, but many bank shares were suspended due to excessive volatility meaning the hit could be even deeper.

The results hit Italy's sovereign debt, increasing the spread on Italy's 10-year bonds to 2 percent, from 1.7 percent on Dec. 1 and a record low of just over 1 percent last March and April.</s>Italian Prime Minister Matteo Renzi has resigned after voters heavily rejected a national referendum to make changes to the country’s constitution. Swiss newspapers aren’t convinced by Beppo Grillo, head of the Five Star protest movement, who “talks a lot but says little”.

“Such a considerable defeat was unimaginable,” declared the Corriere del Ticino. “The No camp triumphed by a colossal margin.”

The newspaper in Italian-speaking Switzerland said Italians had rejected a constitutional reform which, had it been approved, would have questioned certain fundamental principles of democracy and the Italian republic. In the end, almost 60% of voters came out against the reforms.

What’s more, voters had given a firm thumbs-down to Renzi, “who less than three years ago was still seen as some sort of extraordinary innovator and considered by many Italy’s only real hope”.

Although the vote focused on making the central government stronger and the Senate weaker, some also said it would have given the prime minister too much power. The poll was widely seen as a chance for Italians to show their discontent at the ballot box and to register how unhappy they were with the political establishment. Those campaigning against him were led by a mixture of populist parties who have capitalised on Italy’s economic problems and public concern over immigration.

Renzi took a “foolish” gamble, wrote the Tages-Anzeiger in Zurich. However much he tried to separate his own personal destiny from the issues at stake, he couldn’t – everyone who wanted to punish him for not bringing the economy back up to scratch or for his “self-important” governance style took the opportunity.

However, even more important than the personal aspect is the danger that the No vote will end a period of renewal that had been winning Italy a lot of respect abroad, the paper added. Renzi had a new “dynamic” that the country urgently needed.

“No prime minister before him had carried out more reforms – and faster than he had – although they were far from perfect,” it said.

The Tages-Anzeiger noted that one winner on Sunday was Beppe Grillo, the founder and leader of the Five Star protest party, who motivated people to “vote with their gut feeling, rather than with their heads”.

“It’s difficult to define the Five Star movement,” the paper wrote. “It’s not really comparable with other European populist parties, taking ideas from the left and the right to win as much support as possible.”

The paper concludes that although the party is “not yet standing at the door to power”, if hate is their only argument for Italy’s future, then “Buonanotte!”

Le Temps in Geneva said that while the Five Star Movement could already see itself in power, Matteo Salvini, leader of the Lega Nord party, which wants more autonomy for northern regions, was delighted by the “victory of the people over the powerful”.

However, it said Renzi’s defeat could not be explained only by anti-establishment populism. It pointed out that the No camp comprised “in addition to the anti-system brigade, representatives of the political caste which they ceaselessly attack, namely former Prime Ministers Mario Monti, Massimo D’Alema and Silvio Berlusconi”.

Yet another popular vote has gone differently to how the government planned or wanted, wrote the Neue Zürcher Zeitung (NZZ).

Renzi, who pitched himself as the “scrap merchant of the old political order”, now finds himself “on the scrap heap”.

The reforms were difficult to communicate and to understand, it said. Italians didn’t trust him and his “lust for power”. Perhaps Italians have had enough of “solo entertainers” and egoists, it mused.

Either way, the new scrap merchant has arrived: Grillo, the “noisy brat of the nation”, who talks a lot but says little – little that’s binding anyway, the paper continued, adding that what he does say is played out on numerous stages and on television, as he rages against politicians, the system and the euro.

The NZZ said the weaknesses of the political system were more visible than ever, and the concerns in the eurozone are strongly felt right now. Italy with its high debt level and a crisis in government is enough to make the single currency quake – especially after the general insecurity caused by the Brexit decision.

The current mood is focusing more on the stability of the euro than on Italy, it concluded.</s>(CNN) Matteo Renzi will offer his resignation as Italian Prime Minister in Rome Monday after suffering a crushing referendum defeat which could transform the country's political and economic landscape.

The 41-year-old, who was appointed to office in 2014, will meet with President Sergio Mattarella, hours after close to 60% of voters rejected his plans for constitutional reform.

As the result reverberated around the country and the continent, the euro fell to a 20 month low against the dollar and dragged Italy towards more financial pain.

The prospect of instability in the eurozone's third biggest economy saw the currency drop some 1% against the dollar to around $1.05 in Asia trade, its lowest level in 20 months. It trimmed those losses later in the day.

The decisive outcome, with a 70% turnout, is considered a notable victory for eurosceptic populist and nationalist parties which campaigned heavily against Renzi and his promise to stimulate Italy's sluggish economy.

Italy's path will become clearer as the week progresses but Renzi's promise to resign brings with it yet more uncertainty.

He may yet be asked to stay on in office by the President until parliament passes a budget bill which is due later this month.

There is also the possibility that a caretaker administration could be appointed to keep the country running until the 2018 elections.

That could see the likes of finance minister Pier Carlo Padoan take over as Prime Minister or even Pietro Grasso, the Senate leader.

And while unlikely, there is also a scenario in which parliament is dissolved and a snap election is called.

As Europe awoke to the result, leading figures began to react to the latest installment of political change.

A statement from the Elysee Palace said that Hollande shared Renzi's will to "steer Europe to growth and employment."

In Brussels, European Commissioner for economic and financial affairs Pierre Moscovici said he remained convinced the Italian authorities would deal with the situation.

"Italy is a strong country, a reliable country," he said before adding he did not expect there to be an economic crisis.

He also insisted the the result was not an anti-Europe or an anti-EU vote.

German Finance Minister Wolfgang Schäuble added that he expected Italy to "make the best of it" while president of the Eurogroup Jeroen Dijsselbloem rejected accusations that the result would radically affect the economic situation within the country.

What was it all about?

At its core, this vote was a referendum on whether or not Italy should amend its 1948 constitution.

Renzi wanted to reduce the power of the Senato, the upper chamber of the Italian Parliament, by slashing its numbers from 315 to 100 -- making it more of a consultative assembly.

Proponents of the referendum said that the goal was to make the job of governing Italy less complicated and reforms would help revive the nation's lethargic economy.

However, critics claimed the reforms would impact the constitution's checks and balances and give the Prime minister too much power.

"It was shifting power from the regions to the center in a really unbalanced way," she said. "It was a dangerous reform for the roots of our democratic system."

This, according to Schlein, was Renzi's "completely unnecessary" mistake. She said that personalizing and dramatizing the vote meant that many of the people who voted "No" -- particularly the younger voters -- did so for political reasons beyond the text of the reform and its consequences.

"The vote was transformed into a vote on himself and his government," she said.

In Rome, there were a range of emotions ranging from elation to huge disappointment.

"I believe this was a lost opportunity for our country," Lino Settola, director of a private company, told CNN.

"What interested me was speeding up the process of passing laws and not continuing the ping pong between the House of Representatives and Senate, waiting years before things happen.

"This referendum would have helped speed this process up."

Giuseppe Cazuolo, a photographer from Rome, was equally concerned by the result.

"What will happen is that the people who have governed Italy will return but nothing will happen," he said.

"It's too soon to say who will take power. but everything is in the hands of the President of the Republic now.

"I have faith in him, he is a person that Italians love because you can see he is a professional person.

Another voter, Alex, said that Renzi's mistake was making the referendum too political.

He also cited a frustration with Brussels and being governed by EU law as another area which caused political angst.

"I voted no, but I think people want a real change," Alex told CNN.

"They don't want just a political change, but a change where things really happen.

"I think the referendum was too political and Renzi made an error."</s>Italy’s referendum might well have been one of the biggest smoke screens in modern Italian politics. Many Eurosceptics have wrongly portrayed the vote as a plebiscite on Europe. What was presented as a noble institutional reform became a vote of confidence in the Italian government and the prime minister Matteo Renzi himself. In fact, it was nothing more than an all-too-familiar rejection of the Italian political establishment.

Renzi’s defeat was written in the stars; a sitting government linking its fate to a referendum almost always ends in tears. The historical examples are abundant. The Dutch and French referendums of 2005 on the European constitution were successfully hijacked by opposition parties, who turned them into a plebiscite on the government of the day. However, the example that best explains Renzi’s defeat is the 1969 referendum in France called by Charles de Gaulle.

The similarities are striking. Both votes proposed a drastic diminishing of the senate’s role and both of them wanted to change the relationship between regional and central government. Just like Renzi, De Gaulle personalised the referendum by announcing he would step down if the French voted “no”. More than 52% did so. The hero of the second world war had failed to understand that the France of the “deadlocked 1950s” had been replaced by the one of May ’68.

Matteo Renzi was equally blind in not recognising that Italians are fed up with the country being run – or rather: mismanaged – by the two old socialist and conservative groupings. In 2013, Renzi entered national politics as a young lion promising change, but he proved to be nothing more than a younger version of the old crocodile Silvio Berlusconi. He tried, but failed, to hide the fact that the main goal of the referendum was to give electoral bonuses to the two big parties and to punish political initiatives outside the old party structures.

The young crocodile struck a deal with the old one by trying to prevent new political movements from flourishing, despite the fact this is exactly what Italian voters crave: fresh blood in their out-of-date political system. The way politics in Italy is organised has a real and devastating effect on people’s lives. Youth unemployment in Italy is sky-high, yet the kids of well-connected families get well-paid jobs. Pension reform is on hold, while government officials give themselves very generous schemes. The list goes on.

It is because of these core issues that Italians voted “no”. It was not a vote against the European ideal, as some populists have tried to spin it. Italian voters are fed up with the static division of power between the two big groupings, who have mismanaged both Italy and Europe for decades.

The result of the presidential election in Austria, meanwhile, was a victory against the hard-right populism engulfing the west. It is telling that Arron Banks, a close confidant of Nigel Farage and bankroller-in-chief of Ukip, yesterday tweeted after the result that “I suppose they [the Austrian people] haven’t suffered enough rape and murder yet.” In one tweet, the mask slipped and the ugly xenophobic, racist face of the populist right was exposed for all to see.

It’s telling that many in Norbert Hofer’s party actually blamed Farage’s intervention for its defeat – after he went on US television to suggest that Hofer would propose a referendum on EU membership if he won. Austrians remain in favour of EU membership, with the latest polls suggesting 34% wish to leave the EU, down from 49% prior to the UK referendum. As a result of the Brexit referendum, support for EU membership has increased significantly across Europe. Did Europe’s Brexit backlash help defeat Hofer? Quite possibly.

Of course, this increase in support for EU membership must not be taken for granted. Arguably, the EU remains one or two elections away from disintegration. But the Austrian result shows that so-called “alt-right” populist coup attempts can be defeated, even in the current climate. If we dare to radically reform the EU, then the tide can be turned. The upcoming Brexit negotiations offer the possibility to start this process.

If the EU is to survive, people want to see that it is capable of producing results. They want a convincing European stimulus package to end the economic crisis and tackle the obscene youth unemployment plaguing so many European countries. They want a sizable border and coast guard that can actively manage the refugee crisis. Moreover, they want an EU that will intervene to manage globalisation so that it offers opportunities for everyone, not just the few. So long as mainstream politicians continue to play party-political games with referendums, instead of putting genuine radical reforms on the ballot paper, people will continue to vote “no”.</s>“Today saying No is the most beautiful and glorious form of politics….Whoever doesn’t understand that can go screw themselves.” It could have been Donald Trump before the US election two weeks ago, or Boris Johnson during the Brext campaign in Britain last June, but it was actually Beppe Grillo, founder and leader of Italy’s populist Five Star Movement.

Grillo unhesitatingly compares his movement to “Trumpismo” in the United States, and the Five Star Movement is currently running neck-and-neck with Prime Minister Matteo Renzi’s Democratic Party in the opinion polls. Moreover, if Renzi loses the referendum on changing the Italian constitution that takes place this Sunday, there may be an election in Italy quite soon.

Matteo Renzi wanted to replace the elected Senate with a smaller appointed body and make other changes to streamline the process of passing laws in Italy. He got his proposal through both houses of parliament last April – but with such a slim majority that the results had to be confirmed by a referendum. At the time Renzi was confident that he would win it easily.

But that was before the Brexit vote in the United Kingdom and the irresistible rise of Donald Trump in the United States put wind in the sails of the Five Star Movement. Now the Five Star Movement’s “Io Dico No” (I Say No) campaign is drawing huge crowds as it tours Italian cities, and the final opinion polls before the vote on 4 December gave the “No” a five-point lead in the referendum.

As the polls began to turn against his constitutional reforms, Renzi warned that he would resign if the vote went against them. But all that did was to turn it into a referendum on his own popularity, which is turning out to be considerably less than he imagined. And if the Five Star Movement comes to power, it is pledged to hold another referendum – this time on pulling Italy out of the euro “single currency”.

At the moment a large majority of Italians still want to keep the euro, but that could change. Italian cities don’t look as devastated as the US Rust Belt, but the same processes that brought Donald Trump to the presidency have been at work in Italy. Average family income is still less that it was before the 2008 crash, and unemployment among the young is close to 40 percent.

An estimated quarter of Italian industry has closed down in the past decade, and the country is staggering under the burden of a public debt that amounts to 132 percent of GDP. If uncertainty about the euro crashes Italy’s economy (the third-largest economy in the Eurozone), then all 19 countries that use the euro, some 340 million people, are in deep trouble.

In theory, it’s a long road from a “No” in Sunday’s constitutional referendum to an M5S government and a referendum on the euro. If Renzi resigns, and if no other combination of parties in parliament can form a government (probably not), there would be an election. But then M5S would have to win a majority, which is a long way from its current 30 percent support.

In practice, it might be quite a short road. A lot of Italians are so angry that they just want to punish “the elites”. If both the Five Star Movement and the right-wing Lega Nord (which also wants to quit the euro) did well in the election, they might be able to form a coalition government, and then the fat would be in the fire.

Technically, only the single currency would be at risk, but in the current febrile atmosphere in Western politics, with support for populist parties surging everywhere, things can change very rapidly.

It is no longer inconceivable that the National Front, which wants to leave not just the euro but the European Union, could win the French presidential election in April. With Britain on its way out, a French government that wants to follow suit, and an Italian government that at least wants to leave the euro, the entire 60-year-old project of European unity could crumble by the end of next year.

That’s a lot of ifs, and the likelihood of such a calamity is still very small. But we do live in interesting times.

Gwynne Dyer is an independent journalist whose articles are published in 45 countries.
Italians go to the polls to for a referendum on whether to approve a constitutional law that amends the Constitution of Italy to reform the powers of the Italian Parliament. Prime Minister Matteo Renzi, who introduced the referendum bill, resigns after exit polls show that the no case is likely to be successful.