Giorgia Meloni’s Balancing Act

The new Italian prime minister is seeking to reassure allies—and bond markets—without losing her far-right base.

By , an Italian journalist based in Paris.
Italian Prime Minister Giorgia Meloni arrives at Chigi Palace in Rome.
Italian Prime Minister Giorgia Meloni arrives at Chigi Palace in Rome.
Italian Prime Minister Giorgia Meloni arrives at Chigi Palace in Rome before the swearing-in ceremony and first Council of Ministers meeting of the new Italian government on Oct. 23. Antonio Masiello/Getty Images

In many ways, the hard part is yet to come for Giorgia Meloni, the newly appointed Italian prime minister. As the war in Ukraine rages on, Italy remains in the grip of a dramatic energy crisis and soaring inflation; the country has one of the lowest employment rates in the eurozone, its public debt stands at an eye-watering 150 percent of GDP, and the International Monetary Fund projects its economy is in for a recession next year.

Yet, as Italy’s most right-wing government since World War II was sworn in at the presidential palace over the weekend, the main feeling showing on Meloni’s face was relief. Despite the right’s overwhelming victory in a snap election last month, coalition talks over the new cabinet’s lineup were anything but a cakewalk.

Meloni is a nationalist firebrand whose Brothers of Italy party has its roots in the Italian post-fascist tradition. She’s spent a large part of her political career lashing out at the European Union and praising authoritarian Hungarian Prime Minister Viktor Orban. Now, she finds herself needing to reassure the financial markets as well Italy’s wary allies in Europe and Washington without appearing to sell out in the eyes of hard-liners at home.

In many ways, the hard part is yet to come for Giorgia Meloni, the newly appointed Italian prime minister. As the war in Ukraine rages on, Italy remains in the grip of a dramatic energy crisis and soaring inflation; the country has one of the lowest employment rates in the eurozone, its public debt stands at an eye-watering 150 percent of GDP, and the International Monetary Fund projects its economy is in for a recession next year.

Yet, as Italy’s most right-wing government since World War II was sworn in at the presidential palace over the weekend, the main feeling showing on Meloni’s face was relief. Despite the right’s overwhelming victory in a snap election last month, coalition talks over the new cabinet’s lineup were anything but a cakewalk.

Meloni is a nationalist firebrand whose Brothers of Italy party has its roots in the Italian post-fascist tradition. She’s spent a large part of her political career lashing out at the European Union and praising authoritarian Hungarian Prime Minister Viktor Orban. Now, she finds herself needing to reassure the financial markets as well Italy’s wary allies in Europe and Washington without appearing to sell out in the eyes of hard-liners at home.

Hunger for ministerial posts and the pro-Russia stance of her two junior partners—Matteo Salvini, head of the far-right League party, and Silvio Berlusconi, leader of conservative Forza Italia party, didn’t make the job any easier. In audio recordings leaked to the press last week, Berlusconi could be heard saying he had just exchanged “very sweet” letters as well as bottles of vodka and lambrusco wine with Russian President Vladimir Putin.

During the decadelong stint in opposition that preceded her election win, Meloni hardly had to negotiate with anyone. Over the past weeks, however, she played a difficult political game with considerable ability.

“Meloni has come across as a real stateswoman in this phase” compared to her two allies, said Arturo Varvelli, head of the Rome office for the European Council on Foreign Relations, a think tank.

Her strategy: Throw a bone to the ultra-conservatives in her ranks by handing them prestigious roles that come with little actual power and distribute the most crucial ministries to well-respected moderates in a bid to reassure observers abroad.

“Her cabinet is a mixed bag,” said Roberto D’Alimonte, a professor of politics at LUISS, a university in Rome. “Part of it represents the new Meloni, who stands by NATO, Ukraine, Europe, and fiscal responsibility. Then there’s the ‘identity’ part of the bag, the old Meloni.”

The role of president of the Senate, technically Italy’s second-highest post, went to Ignazio Benito Maria La Russa, a Brothers of Italy co-founder who proudly showcases a variety of Benito Mussolini effigies at his home and who is, incidentally, a fan of Native American resistance, naming his sons Geronimo; Cochis, spelled differently from Cochise; and Apache.

As La Russa’s counterpart in the lower house of Parliament, the new majority elected Lorenzo Fontana, an ultra-Catholic League member who once referred to the idea of children having same-sex parents as “filth.” The new minister for family, Eugenia Roccella, also holds fiercely conservative views on LGBTQ and abortion rights.

Despite these divisive appointments, on many crucial policy areas, Meloni was also careful to signal continuity with her predecessor: the pro-EU, market-friendly Mario Draghi, who could count on the unconditional trust of Brussels, Paris, and Washington. Meloni must handle with care the Brothers of Italy’s transition from a small, hard-line party to one that won just over one-quarter of the vote in the last general election, with many voters deciding to give her a chance without necessarily sharing her most radical stances of years past, D’Alimonte said. “She’s a transitional figure,” he added.

For the role of foreign minister, Meloni picked Antonio Tajani, a Brussels insider who served as European commissioner and president of the European Parliament and immediately reaffirmed Italy’s unwavering support for Ukraine. The choice for defense minister—Guido Crosetto, considered a moderate within Meloni’s relatively pro-NATO party—is another reassuring sign for Kyiv. Shortly after the swearing-in ceremony, Ukrainian President Volodymyr Zelensky struck an upbeat tone, congratulating Meloni and adding that he “[looked] forward to continued fruitful cooperation.”

The level of international scrutiny was even higher on Meloni’s pick for finance minister. Although Meloni and Salvini have toned down their euroscepticism in recent years, they both called for Italy to abandon the eurozone in the past. Despite the country’s sky-high public debt, the right-wing coalition campaigned on a long wishlist of costly measures, including cutting taxes, raising pensions, and beefing up benefits, with almost no indication on how to pay for all that. Britain, and the fruit fly lifespan of former British Prime Minister Liz Truss, showed the folly of such a course. Italy’s last right-wing government, led by Berlusconi, was also forced to quit in 2011 after its careless spending policies spooked financial markets, sending Italian government bond yields through the roof.

Against this backdrop and to steer the country through these challenging times, Meloni has chosen Giancarlo Giorgetti as finance minister. While a senior member of Salvini’s League, Giorgetti’s quiet demeanor and belief in balanced budgets make him much more similar to Draghi than to his party’s boss.

“The markets know Giorgetti. Brussels bureaucrats know Giorgetti, and they trust him,” D’Alimonte said. “The problem with Giorgetti is that he is not a political heavyweight, so we will have to see if he is able to stand up to Salvini when hard choices will have to be made.”

Investors appear to be cutting Meloni some slack, at least for now. On Monday, at the end of the first day of trading since she was sworn in, the spread between Italian and German bond yields had dropped while the Italian stock exchanges FTSE MIB index had risen by almost 2 percent.

EU authorities are also taking note of Meloni’s efforts to boost her credentials, but they remain wary, said Gregory Claeys, a senior fellow at the think tank Bruegel. “The details of the right’s economic platform look worrying, but when it comes to the choices that were made in terms of ministers, you can tell that Meloni has tried to go against those fears,” Claeys said. EU leaders are in a “wait and see mode,” he added.

Lingering awkwardness between Meloni and other Western European leaders was clear in a hastily arranged meeting on Sunday with French President Emmanuel Macron, in town for a long-planned visit with Italian President Sergio Mattarella and the pope. No media were invited to the talks, and no press conference took place afterward. Sources from Macron’s camp spoke of a “frank and demanding exchange” and said Meloni would be judged “on her actions.”

With Italy’s economic stability largely dependent on the EU’s massive COVID-19 recovery program as well as joint European efforts to tackle the energy crisis, Meloni appears eager to shed her maverick image and find a seat at the grown-ups’ table. Although her government may well leave an enduring mark on the country regarding domestic matters such as abortion rights, “she fully understood the constrictions and limitations of Italian foreign policy,” Varvelli said.

But Meloni’s got to figure out how to balance a coalition that hates Europe and courts it, that aids Ukraine and coddles Putin, and that despises a balanced budget almost as much as soaring bond spreads.

“We don’t know yet who she really is,” D’Alimonte said. “It’s what she’ll do in the next few months that will tell us.”

Michele Barbero is an Italian journalist based in Paris, where he covers French and international news for various news organizations in Italy and abroad.

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