ACTIVE TO PASSIVE
ROME —
After 88 days of impasses and negotiations, two Italian populist parties with a
history of antagonism toward the European Union received approval Thursday
night to create a government that has already unsettled the Continent’s
political order.
Only days
ago, President Sergio Mattarella of Italy rejected
a populist government over concerns about a proposed finance
minister who had helped write a guide for withdrawing
Italy from the euro[1], Europe’s single currency. The political
chaos and sudden uncertainty about the euro helped send global financial
markets reeling.
On
Thursday, the populists reshuffled, keeping the same prime minister, Giuseppe
Conte, and other top players, but moving the objectionable finance minister to
a less critical post.
That was apparently enough
to satisfy the president, who preferred an elected government to a caretaker
alternative he had in reserve. The populist parties constituting the new
government won the most votes in a March 4 election, promising a sweeping
crackdown on the illegal immigration that helped fuel their ascent.
But the
president’s assent was not enough to allay concerns about the actual agenda of
the populists once they enter power, even though they now claim a sudden
conversion to full faith in the euro.
“The
populist and right-wing government has a program that’s dangerous for the
country and the events of recent days confirm our longstanding concerns,” said
Maurizio Martina, a leader of the Democratic Party, which will now leave
government for the opposition. “Their acts so far have been a mix of
extremism, anti-Europism and iniquity.”[2]
The new
government still needs to win a confidence vote in Parliament, but that was a
formality. The government will be sworn in Friday.
The
remarkable rise of the populists now leaves Italy’s traditional political
establishment, left and right, in tatters. It also shocked a European Union
that thought it had successfully beaten back an anti-establishment and
hard-right insurgency last year.[3]
The populist victory in
Italy now could not come at a worse time for the European Union. A corruption
scandal in Spain threatens the demise on Friday of a government that had been a
model for the central authorities in Brussels. Britain is leaving. Chancellor
Angela Merkel of Germany is weakened. President Emmanuel Macron of France is
a pro-Europe leader in search of partners.[4] Poland and Hungary are
rolling back democracy. The United States president is waging a trade war on
European allies, while more and more Europeans look to Russia’s strongman,
Vladimir V. Putin, as a model.[5]
But
amid all the geopolitical and economic threats to the European Union, Italy
represented perhaps the gravest. And as is often the case with Italy, it was
overlooked.
The
birthplace of fascism and for years the home of Western Europe’s largest
communist party, Italy again proved an incubator for political experiment. The
populist parties it produced — the Five Star Movement, a party developed on the
internet, and the League, a formerly northern secessionist movement — to
varying degrees both blame the euro for depriving Italy of sovereignty.[6]
Like
the other countries that have adopted the euro, Italy has lost its power to
control interest rates, which are set by the European Union’s central bank. The
so-called eurozone countries also must adhere to strict fiscal rules, which are
especially difficult for Italy because of its heavy debts.
Economists
say that if Italy, the fourth-biggest economy in the European Union, were to
exit the euro it would do enormous financial damage to the country and hurt the
Continent’s economic stability.[7]
The
political uncertainty in Italy — as well the remote possibility of leaving the
euro — spooked the markets when the formation of a government by the two
parties appeared likely. The combination created some of the scariest
economic days for the country since the 2011 financial crisis that planted the
seeds for this week’s populist flowering.[8]
After a
leaked draft of the alliance’s government platform incl
uded proposals about
leaving the eurozone and a proposed finance minister turned out to have helped
write a guide to leaving the euro, the global markets dipped precipitously.
Since then, however,
seemingly every Five Star and League leader has disavowed their antagonism to
the euro, or rather denied ever harboring any hostility to it whatsoever.
On
Wednesday night, League officials literally whitewashed their anti-euro
history by painting over the blue “Basta Euro,” or no more euro, sign on its
headquarters in Milan.[9]
“The euro was never in
discussion,” Mr. Conte, who will be sworn in Friday as prime minister with
the rest of his cabinet[10], said in Florence on Thursday morning before
traveling to Rome and then the Quirinal Palace in a plain taxi cab, the
preferred transportation for the anti-establishment Five Star.