Italy's Machiavellis Play a Reckless Game

(Bloomberg Opinion) -- The Italian president has been cast as an enemy of democracy after his refusal to accept a euroskeptic finance minister. By contrast, the anti-establishment League and Five Star parties — who chose to blow up their attempt to form a government instead of proposing an alternative name — have been hailed as defenders of the popular will.

But the longer the wrangling goes on, the clearer it becomes that the populists’ actions aren’t being driven by some kind of noble principle. They are playing politics. The League and Five Star are simply jostling for advantage ahead of possible fresh elections. In doing so, they have plunged the country into a constitutional crisis for the sake of winning a few more votes.

Luigi Di Maio, the Five Star leader, has been the most irresponsible by far. On Sunday night, mere hours after president Sergio Mattarella refused to appoint Paolo Savona as finance minister because of his position on the euro, Di Maio called for his impeachment. “We need to try the president,” he said. “We need to bring this crisis to parliament also to prevent a reaction from the people.”

That was truly extraordinary. A president can be impeached only for high treason or betraying the constitution. The formal procedure has been initiated very few times in Italy’s history (including once by Five Star) and has never succeeded. Matteo Salvini, the League’s leader, didn’t back Di Maio’s call, saying his priority was a new election. 

Even worse, after making such a reckless intervention, Di Maio changed his tune a few days later. On Tuesday, he backed off from his calls for impeachment, trying to deflect the blame onto Salvini. He said Five Star was willing now to collaborate with the president to solve Italy’s crisis. Mattarella went from being a traitor to a partner in a matter of hours.

Di Maio’s volte-face is pure political calculation. Initially, Five Star tried to exploit the president’s veto to bolster its appeal among euroskeptics. However, its enthusiasm waned as it became clear that the clash with Mattarella would lead inevitably to a new election, and that wouldn’t be to Di Maio’s advantage.

Polls show that Five Star has lost some support since the last election in March, as left-wing supporters have become dismayed by Di Maio’s attempt to form a government with the right-wing League. While Five Star would almost certainly remain the largest party in Italy, a fresh election could see the League make substantial gains. That in turn would improve the prospects of a majority for a center-right alliance, excluding Five Star.

Di Maio now wants to stitch together a new alliance with the League. But an emboldened Salvini isn’t playing ball.

The League leader has at least given the appearance of being more principled — even though his motives are murky too. He criticized the president over Savona’s rejection, but he steered clear of provoking a full-blown institutional clash. Voters have responded well. The League won 17 percent of the national vote in the last election, and polls show it could jump to 25 percent in a new contest.

Still, Salvini is no innocent. He has refused to give Mattarella an alternative name for finance minister, even though this would unblock a Five Star-League coalition government. With his popularity rising, he can afford to ride out the chaos a little while longer. The League is demanding new elections, but it is remaining deliberately vague about whether it would prefer a new center-right alliance or to try again to team up with Five Star in an anti-establishment “dream team.”

The populists are meant to be a break from the established way of doing politics, but their maneuvers show they are anything but. And they are taking a real toll on the country.

Italy's Machiavellis Play a Reckless Game

Italy’s borrowing costs are rising sharply. At an auction on Wednesday, the government placed 10-year bonds at an average yield of 3 percent, up from 1.7 percent last time. Italy’s stock market lost more than 10 percent in just two weeks, before rebounding somewhat on Wednesday.

Of course, the formation of a viable government is worth a few days — or even weeks — of market volatility. But the political parties have been going in circles for three months, with no end in sight. Italy needs resolution now.

©2018 Bloomberg L.P.