Italy’s President Appoints a Technocrat, and Moves From Quiet to Contentiouss

ROME — He’s been called “gray,” “invisible” and “gentle to the point of seeming fragile.” Silvio Berlusconi, the former prime minister, once compared him to “a monk.”

But on Monday, Italy’s quiet, white-haired president, Sergio Mattarella, emerged as the most contentious figure in Italian and European politics. His refusal to confirm a euroskeptic economist as a government minister set off the collapse of a populist coalition hours before it was expected to take control of the European Union’s fourth largest economy.

Mattarella’s defenders hailed him as the courageous protector of Italy’s democracy, institutions and financial health, while fuming populists sought to make the usually revered figure of the Italian head of state the country’s public enemy No. 1. They called for his impeachment, saying he had overstepped his constitutional bounds with delusions of grandeur, blocked the will of the people and destroyed Italian democracy.

In response, Mattarella privately plugged along.

On Monday morning, as markets rose and fell with the whiplashing events in Italy, Mattarella gave a new mandate to form a government to Carlo Cottarelli, a respected economist, former International Monetary Fund official and Italian government appointee, who told reporters that he would form a caretaker government only with the goal of passing a budget and guiding Italy to new elections.

If Parliament votes in support of his caretaker government, elections would take place in early 2019. If it does not, which seems much more likely, he would quit “immediately” and elections would take place sometime after August.

Cottarelli’s main goal in speaking Monday seemed to be to assure nervous investors in Italy and abroad that the country was in good hands. He guaranteed, “in the most absolute way, that a government led by me would assure a cautious management of our national accounts,” and that Italy’s “continuous participation in the eurozone” was essential.

It was Mattarella’s loyalty to the euro that prompted the eleventh-hour collapse of the nascent government of the anti-establishment Five Star Movement and the anti-immigrant League.

He determined that the alliance’s proposed economy minister, Paolo Savona, the co-author of a guide to leaving the eurozone, could lead Italy to abandon the euro without sufficient public debate, being that the parties maintained vague and shifting positions on the issue during the campaign leading up to the March 4 elections.

But in deliberately forcing a new election over the euro, which a majority of Italians say they support, the usually careful and measured Mattarella expressly put an explosive issue with the potential of transforming Europe front and center. And by using his constitutional powers to block the new government in order to protect Italian savings accounts from increasingly wary markets, he also handed the gifted and gleefully hostile populist parties the talking point of a lifetime before the elections.

The coming vote “will be a referendum on Europe, on the euro and on the Italian constitutional model,” Francesco Verderami, a political analyst, wrote in Corriere della Sera on Monday. “Because it is equally clear that the presidency of the republic — which has been threatened with impeachment — during the electoral campaign is sure to be one of the targets of the populist and nationalist forces.”

It did not take long for that to come to pass.

Luigi Di Maio, Five Star’s political leader, called on party members to demonstrate their opposition to Mattarella and “the darkest night of Italian democracy” by hanging Italian flags out their windows, marching in the streets and flooding the social networks where the party developed its support.

In a Facebook post, Di Maio said that Mattarella had prompted problems in the markets by creating uncertainty. “We don’t want to leave the euro,” he insisted, calling the party’s well-documented ambivalence to the common currency “a lie created by the counselors of Mattarella.”

He also said he would work to impeach Mattarella, and to ensure that “after the election there will not be the same president.” His partner in the populist alliance, Matteo Salvini, the leader of the League, added that “the gravest fact is that the president of the republic chose the European markets ahead of the Italian people.”

On Monday, several analysts and politicians accused Salvini, who rebuffed Mattarella’s appeal to substitute the proposed economy minister with a top League official, of purposefully blowing up the government in order to bank increased electoral support in new elections. He wants to be prime minister.

Leading members of the Five Star Movement proclaimed the new technical government dead on arrival and said they would introduce impeachment proceedings against Mattarella in Parliament.

But their efforts to intimidate Mattarella last week, saying he should not get in the way of Italian voters, failed. Some supporters argued that the potential blowback and risk in coming elections was worth keeping the populists, who have shown disregard for Italian institutions, away from power.

Mario Calabrese, editor of the left-leaning daily La Repubblica, wrote in a front-page editorial, “If the president had given in, folding before the ultimatums and threats, and if he went back on his only objection, the state’s checks and balances would have broken into pieces.” Berlusconi, the former prime minister and coalition partner of Salvini, also gave his support to Mattarella, saying the Five Star Movement was “irresponsible as always, talking about impeachment.”

“Forza Italia waits for the determination of the head of state, but when necessary will be ready for the vote,” he added, referring to his party.

That supportive language caused signs of a fracture with Salvini, who said Berlusconi’s defense of Mattarella made him sound like Chancellor Angela Merkel of Germany. Salvini hinted that he was also open to running with the Five Star Movement in the coming election, saying that the policy agenda the two parties had hammered out was not “scrap paper,” and that there was “a good base for working together.”

Both he and the Five Star Movement unveiled campaign language in which they accused Italy of being held hostage by Germany, international markets, bankers and the overreaching president who did their bidding.

Constitutional scholars debated Monday whether Mattarella was within his rights. In Corriere della Sera, Italy’s leading paper, Massimo Luciani, a professor of constitutional law at La Sapienza University in Rome, said Mattarella “exercised his constitutional rights” because he “believed that the choice of a certain minister for a key government position put the interests of our country at risk.”

He added, “This is an institutional evaluation.”

But Paolo Flores D’Arcais wrote in the political magazine MicroMega that while the president can object to the appointment of a minister if “he finds in the candidate’s past behavior something that conflicts with honorability,” Mattarella’s problem with the economy minister was his position on the euro.

“It falls beyond the powers of the president of the republic to judge the candidates’ political opinions in the single ministries,” he wrote.

At first, markets seemed more appreciative of Mattarella’s rejection of the populist government, but they then fell sharply, with stocks and bonds falling as investors digested the increased uncertainty.

“Developments in Italy are likely to keep the financial markets on tenterhooks,” analysts at the German lender Commerzbank said in a note to clients Monday morning. Referring to polls that indicate that Italy’s populist parties are likely to win any snap election called this year, they continued, “The entry into office of an Italian government that is on a confrontational course with the EU and disregards its rules is only postponed.”

Italy’s benchmark stock index, the FTSE MIB, was down more than 2 percent in afternoon trading in Europe, and the country’s bonds took a beating. The yield on the main 10-year Italian government bond, which moves inversely to its price, rose to as much as 2.69 percent, its highest level since August 2014.

The “spread” between Italian government bonds and their German counterparts, in particular, has widened considerably since the start of the year, indicating investors see Italian debt as a riskier investment. That “spread,” a word often uttered with venom by Italian populists, was also the focus of Mattarella’s remarks Sunday night, and Cottarelli’s on Monday morning.

But it is the coming election, and the promised centrality of the euro in it, that makes many in Europe nervous. Mattarella, a 76-year-old Sicilian, has shown he is not easily shaken.

The son of a government minister, he decided to go into politics after his older brother, Piersanti, then the governor of Sicily, was shot and killed by the Mafia. Mattarella pulled his bloodied brother out of the car.

The first time he ran for office was in the 1970s, when he ran for a position in his university. He regretted it right away, his friend Vito Riggio once told La Repubblica, recalling that the quiet Sicilian had found himself surrounded by screaming, rabid student protesters.

“The more they screamed, the more he lowered his voice,” Riggio was quoted as saying. “At a certain point, he said to the most enraged one, ‘Excuse me, but why are you screaming? We are here to discuss. No?'”