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Italy's populist coalition failure leaves future unclear

Megan Williams
May 29, 2018

The rise of anti-establishment parties in Italy has profoundly transformed Italian politics in just a decade. Now, with a second attempt at forming a government, the future is unclear. Megan Williams reports from Rome.

Ex-IMF official Carlo Cottarelli
Image: Reuters/T. Gentile

When the Five Star anti-establishment movement began organizing in piazzas across Italy with the goal of purging the country of mainstream politicians, few could have predicted that nine years later their main target would be Italy's president.

Yet the mounting tensions between President Sergio Mattarella and Italy's latest would-be government, comprised of the populist Five Stars (M5S) and the far-right League party,  has led to a clash of institutions not seen since Italy established its republic in 1946. Political scientists say the situation is unprecedented, and for the first time there is a real possibility of Italy moving towards exiting the euro.

Read more: Italian president asks economist Cottarelli to form interim government

Carlo Cottarelli mandate

Ministerial musical chairs?

Sunday night, Mattarella refused to accept the two-party coalition's nomination for Finance Minister, the anti-euro economist Paolo Savona. Mattarella said Savona's appointment would "alarm” both Italian and foreign investors, risk further increasing Italy's already mammoth debt and take Italy down the path toward exiting the eurozone.

As a result, Giuseppe Conte, the little-known law professor accused of padding his resume whom the populist coalition nominated as prime minister-designate just days before, resigned Sunday night. By midday Monday, Mattarella had named former IMF official Carlo Cottarelli prime minister-designate and tasked him with forming a cabinet within the next two days.

But not before Luigi Di Maio, the 31-year-old head of the M5S, called for Mattarella's impeachment for refusing Savona as finance minister, a decision the president has the right to make. Instead, he called for Italians to protest nation-wide against Mattarella on June 2, the national holiday, and to drape the Italian flag outside their windows.

A 'very serious crisis'

Experts say that the current situation is not to be ignored. "This is a very serious crisis, maybe one of the most serious we have experienced in 20 years," says Cristina Fasone, professor in comparative public law at the Political Science Department at Rome's LUISS University.

Fasone says impeachment of the president – which requires an absolute majority in parliament, approval by the constitutional court and strong public backing – is unlikely to happen. But the political stalemate involving a coalition that was supposed to deliver the people's will is the real crisis.

"We have been for weeks, months without a government. In terms of expectations of the people, it's just more proof of the inability of Italian politics to provide concrete responses to what Italians want. Not even the M5S can resolve this issue.”

Italy shares tumble on failed coalition negotiations

Deep rift reflects EU neighbors' woes

Italian elections on March 4 produced a hung parliament with the M5S receiving 32 percent of the vote and the anti-migrant League party 17 percent. While the two parties clash on important issues such as taxation and social spending, they both have expressed anti-EU sentiment, which is deeply worrisome to both pro-EU Italians and the EU itself, already threatened by growing nationalism across the continent.

Yet many of the more than 50 percent of people who voted for either the M5S or the League see the interference of President Mattarella as usurping Italians of their right to decide their own future in a country where many blame Italy's migrant influx and EU austerity measures for its high unemployment and sluggish economy.

Costanza Giardina, 38, a physiotherapist in Rome, says she disagrees with President Mattarella's decision to veto anti-euro economist Paolo Savona.

"Mattarella made his decision based on what Europe wants, not what the elected coalition's choice for ministers was,” says Giardina. "Italy is always responding to what outsiders think we should do and it needs to go its own course, even if that means returning to the lira.”

Giorgio Rossi, 60, a retiree, however, says Mattarella had every right under the Italian constitution to veto the populists' choice of finance minister.

"One of the stupidest things Italy could do is to leave the euro,” says Rossi. "Before we entered the euro, when we had the lira, it was laughing stock of Europe. God forbid we return to those times. He did the right and legal thing."

Read also: Italy's rising populism leaves refugee aid workers concerned

Staying the course in the short term

With Mattarella's selection of the pro-euro economist Cottarelli as prime minister-designate, Italy, at least in the months ahead, will remain committed to the euro.

In the next days, Cottarelli will try to put together a technocratic and politically "neutral" government that will try to pass a new budget before elections can be held by early 2019.

If he fails to win parliamentary support as prime minister, he will temporarily remain the head of a technical government until Italians return to the polls in the fall.

Despite the calls from the M5S to impeach the president and cries of outrage from the League, Cristina Fasone says the two parties are likely to benefit the most from new elections. 

 "I think [letting their coalition fail] was a strategic move on the part of the League to obtain a new election to strengthen their position in the centre-right,” she says. "Although given how divided Italy is between the 5SM and the League and the current election law that makes it hard to get a majority, I'm not sure it will be enough for anyone to get elected."