Analysis. Italian Prime Minister Carlo Cottarelli is working to assemble a technocratic government, but parliament is determined to replace it as quickly as possible with new elections this summer. The institution of the presidency, meanwhile, is in crisis.

Mattarella tried to prevent an economic backlash, the result was far worse

The newly appointed prime minister and former spending review commissioner, Carlo Cottarelli, promised “I will present a list of ministers in a very short time” as he came out of the meeting with Italian President Sergio Mattarella late Monday morning, immediately after receiving his appointment. It will be difficult for him to keep this promise.

More realistically, he has proposed to the presidents of both chambers of Parliament that a vote of confidence should be scheduled for next week. The problem is that it is not easy to find people willing to be part of a government for only a few months, without parliamentary support, while in the crosshairs of the two largest parties, eager to throw every criticism they can at them.

If the government does not win the vote of confidence, new elections will be organized “after August,” Cottarelli announced. Otherwise, this government would last until January—but that is only a theoretical possibility. Cottarelli will likely get 60 votes against him in the Senate and will at least not need to go through that humiliating experience again in the Chamber of Deputies. His government will be in office exclusively for the usual “ordinary administration” and to manage the upcoming elections, with the commitment, made by the prime minister and all the ministers, not to run in the elections in order to ensure neutrality. This means they will not be able to pursue any actual policy, including cancelling the scheduled VAT increase.

Matteo Salvini and Luigi Di Maio asked Monday that the parliamentary committees be set up; however, this request is more of a propaganda move than anything. This Parliament will not end up doing any work at all, and the elections are likely to be held as soon as possible, on Sept. 9 or 16.

No more is expected on Quirinal Hill for the Cottarelli option, and the fact that the president has resigned himself to the humiliation of seeing a government he will put together reduced to the barest minimum in terms of parliamentary support says everything about how dramatic this situation is.

The reaction to this radical move by Mattarella has been explosive, even more so than expected. The 5 Star Movement has called for a demonstration on June 2, and they are insisting, although in a less shrill tone, on their surreal proposal to impeach the president. Di Maio has asked for new elections “as soon as possible, even in August.” The traditional June 1 reception at the Quirinal might be snubbed by the parties who are now denouncing Mattarella.

The Democratic Party on Tuesday said it would not support the president’s government and called for new elections as soon as possible, even in July. We are very close to an institutional delegitimization of the presidency, with Mattarella held up as the standard-bearer by one part of the country and considered the enemy by another part—the very opposite of what the president should be, and of what he intended.

Different reconstructions are being offered for the events of this disastrous Sunday. The leader of the M5S revealed that he had made an alternative proposal to Paolo Savona for finance minister: the pair Armando Siri-Alberto Bagnai. The Quirinal denies it, but Di Maio insists this was the case. In any event, this would itself have been a surreal proposal, as Bagnai is even more hostile to the euro than Savona.

There has been no denial, however, regarding the leaked last-minute proposal by Mattarella, who asked Conte as a last resort to take up the portfolio of the Ministry of the Economy himself. An equally surreal proposal, which would have had the finance ministry headed by a prime minister who was not only inexperienced but lacking an education in economics. It goes to show just how dramatic the situation had become on Sunday, and how dramatic it is set to remain. Fortunately, Conte had the sense to decline. The person at the heart of the controversy, Savona, had harsh words to say: “I have suffered a grave injustice at the hands of the highest institution of the country, as I have been put on trial for my intentions.”

Mattarella’s main concern, however, remains that of speculative attacks on the country’s economy, to which Italy is now more vulnerable than at almost any other time in the past. That is why he has chosen Cottarelli, a man with IMF connections, and why the newly appointed prime minister, in his first speech, spoke mainly about the markets and the EU: “A government led by me would ensure the prudent management of public finances. Our role in the EU remains essential, as does our continued participation in the euro.”

Mattarella hoped this would be enough to calm the situation, knowing that if an electoral alliance between the Lega and the M5S were to be confirmed, Cottarelli as a stopgap would be absolutely insufficient. The president is keeping a close eye on what is happening at the Lega’s headquarters in via Bellerio in Milan. If the Lega remains in the center-right alliance, Berlusconi’s presence, even if in a subordinate position, should be enough to reassure the markets and to prevent the upcoming election from becoming a referendum on the euro. But if M5S and the Lega run together, the vote will inevitably become not only an up-or-down vote on the euro, but also on the presidency itself.

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