GP Insights # 133, 24 August 2019
On 20 August, Italy's Prime Minister, Giuseppe Conte, submitted his resignation to the President Sergio Mattarella. He blamed the Interior Minister Matteo Salvini for disloyalty as the reason for his resignation. In 2018, this Government came to power with the coalition of hard-right and anti-migrant party League party of populist Salvini and Conte's Five Star Movement Party which is anti-establishment.
The Government has not been dissolved, and Conte continues to play his role in a caretaker capacity until there is a solution, under the order of the President. Salvini, who still retains his ministerial position, has said he is prepared for an election. However, that is unlikely, as President Mattarella is consulting the party leaders to form a new majority and have stated if there is no majority government, then he will call for an early election.
What is the background?
Political crisis and unstable Government are not new for Italy. History is repeating itself; this was the same scenario before the 2018 election, when there was a caretaker government since 2016, because of a failed constitutional referendum. The 2018 coalition government came to power to resolve the problems of political corruption, fragile financial condition, lack of jobs, discontent and irregular immigrant flow. Even after 14 months in power, this Government has failed to live up to their expectation due to in-fighting.
The problem started with a tiff between two parties in coalition and Salvini's push for an early election. Salvini is basking in his rising popularity due to his anti-migrant stand, and growing proximity to the Russian President Vladimir Putin started campaigning. The Five Star Movement Party had to draw a line when he extended his campaigning in Italy beachside which is its stronghold.
What does it mean?
Italy may soon face a new election. Based on this anticipation, several coalitions are being formed. One of them is the coalition between the centre-left Democratic Party and the Five Star Movement Party. These parties and their leaders, De Maio and Matteo Renzi are known to be arch-rivals. They claim to forget the enmity for the larger cause and come together. However, in case they come to power next term, there is no guarantee that it can provide a stable government. They might end up meeting the same fate as this current coalition of League party and Five Star Movement Party.
Second, the politically unstable and financially crippled Italy has turned into the European Union's Achilles heel. The 2018 government has been vocal about their anti-EU stand. Their growing proximity with Russia has also been a worrying concern for the EU. Hence it seems that the current political crisis will also impact the EU.
Thirdly, Salvini seems too confident about his popularity and a new election. However, even in the 2018 election, they were not able to form a government alone. Plus, Salvini's campaign focuses on migrants and EU, and there is no focus on the revival of the economy and generation of jobs, which are a more significant concern for the Italians. The voters are losing their faith in the institution, which may not be helpful for even populist like Salvini. Hence, Italy could be taken as an example for a populist who is confident of forming a government but unable to sustain it.