Italian populists assume power as Euroskeptics cheer and EU worries

Italy swore in a populist, Euroskeptic government on Friday, triggering alarm bells at the European Union as it already faces splinter challenges with Britain’s decision to leave the bloc.

The new government in Rome, formed by the Five Star party and the anti-immigrant League, has promised to sweep away EU-ordered austerity measures with massive tax cuts for the employed as well as $900 monthly unemployment checks for the jobless that economists fear will together breach EU spending rules.

The swearing-in of Prime Minister Giuseppe Conte on Friday prompted an appeal from European Council President Donald Tusk not to abandon the EU.

“Your appointment comes at a crucial time for Italy and the entire European Union,” Tusk said in an open letter to Conte.

“To overcome our common challenges, we need unity and solidarity more than ever.”

Italian voters, however, have fallen out of love with the European Union after watching the German economy surge while Italy’s remains in the doldrums. They are also resentful over a perceived lack of European assistance as more than 600,000 migrants have entered Europe through Italy in the last four years. Officials estimate there are at least 500,000 undocumented migrants in the country.

League leader Matteo Salvini, who will become interior minister, has promised mass expulsions of illegal immigrants and, as he left the ceremony at the presidential palace, said he would divert cash currently spent on migrant reception centers.

“Five billion euros to put up migrants who eat breakfast, lunch and dinner is too much. We’ll cut that,” he said.

Five Star’s rise to power comes just nine years after the party was founded by comedian Beppe Grillo to fight the sleaze of Italy’s traditional parties and build a new form of democracy based on online voting.

Five Star leader Luigi Di Maio, who will take over the labor and industry ministries, promised Friday on Facebook to push on with Five Star’s $20-billion plan for a wage for the jobless, which combined with plans to lower the pension age and cut taxes, could push Italy beyond the EU’s 3% annual deficit rule.

The swearing-in ended 88 days of political chaos in Italy following inconclusive elections in March, which climaxed when President Sergio Mattarella last weekend rejected the Five Star and League choice for finance minister, Paolo Savona, because he supports exiting the euro currency system.

Global markets trembled over fears of fresh elections and further radicalization of the populists.

But after angry protests, the Italian leadership agreed to make Savona minister for European affairs, meaning he would not control the nation’s finances but will bring his controversial views to EU summits and will be Italy’s point man in talks on “Brexit,” Britain’s departure from the alliance.

Mattarella accepted the parties’ next candidate for the finance job, economist Giovanni Tria, who has not advocated a euro pullout. But in comments that may unsettle the markets, the League’s Salvini said Tria and Savona think alike.

“We haven’t taken a step back, but two steps forward,” he said Friday. “We have Savona at European Affairs and a minister who agrees with him at finance.”

Neither Salvini nor Di Maio wanted the other to be prime minister, so they settled on Conte, 53, an unknown law professor from the University of Florence who had worked with Five Star on plans to cut back state bureaucracy.

Officials at the EU also will have some sleepless nights over the populists’ shared support for Russian President Vladimir Putin.

Lorenzo Fontana, the League’s newly appointed minister for families and the disabled, has said he admires Russia for its defense of the family.

An opponent of abortion and gay marriage, Fontana also has said migration is canceling out Italy’s traditions, echoing similar claims made in Hungary by leader Viktor Orban, the right-wing prime minister who hasrefused EU requests to take a share of Europe’s migrants.

A surprise appointment as foreign minister was Enzo Moavero Milanesi, formerly a judge at the EU Court of Justice in Luxembourg, a mainstream, nonpolitical Cabinet pick who may stand up to moves by the League to bring Italy closer to Putin.

Kington is a special correspondent.

UPDATES:

12:15 p.m.: This article was updated throughout with Times staff reporting.

8:40 a.m.: This article was updated following the swearing-in ceremony.

This article was originally published at 5:20 a.m.