Italy’s populists show how to lose friends

Bloomberg

In their first two weeks in power, Italy’s populist leaders sparked a dispute with France over immigration and threatened to scupper a landmark EU trade pact with Canada.
It’s hardly the way to make friends with European partners in key deciding positions when Italy seeks approval for the big-spending budget plan it will submit to Brussels in four months.
Industry Minister Luigi Di Maio, leader of the Five Star movement, said he would seek a greater allocation of EU aid funds. His coalition partner, Interior Minister Matteo Salvini of the League, is calling on other countries to do more to accept immigrants who cross the Mediterranean and turning back ships headed to Italy.
The demands risk violating an unspoken but fundamental principle of the EU: You give some, you get some. If Italy’s leaders alienate nations that should be their allies, they may find little sympathy when seeking support for their own agenda.
Italy’s feud with France over migration “is not the best way to have friends,” said Lorenzo Codogno, LC Macro Advisors Ltd. founder and former chief economist at the Italian Treasury. “But i think on this issue they don’t care about having friends. They really want to make a point.”
The need for alliances may be on Prime Minister Giuseppe Conte’s mind when he meets German Chancellor Angela Merkel in Berlin, although his timing is less than ideal. And even though Conte and French President Emmanuel Macron pledged to work together when they met on June 15, their war of words over immigration last week won’t be forgotten.
Di Maio and Salvini took power largely thanks to their anti-establishment credentials and not-so-kind words for the EU. The percentage of Italians who trust the union was 38 percent last month, almost half of the 70 percent in 2011, according to an Ipsos poll in Corriere della Sera.
While Italy’s new government has arrived as the euro area is recovering and more mechanisms have been put in place to deal with a crisis, the sheer size of its economy and debt offer cause for worry were it to threaten to leave the bloc.