RACHEL MARTIN, HOST:
Italy's president has allowed two populist parties to form a government there. It's a development that raises major questions about the country's role in the European community going forward. Here to help us understand all the significance of this is Sylvia Poggioli. She is NPR's senior European correspondent. You usually hear her voice from her base in Rome. But she's in Washington right now and joins us in our studios. Hi, Sylvia.
SYLVIA POGGIOLI, BYLINE: Hi, Rachel.
MARTIN: Nice to see you. So help us understand how we got to this point. Earlier this week, the Italian president actually rejected a populist government proposal, right?
POGGIOLI: That's right. He has an institutional role in forming governments. He rejected the proposed candidate for the key economy ministry because the man is a vocal critic of Italy's membership in the eurozone who had even written a detailed game plan for leaving the euro. The leaders of the two populist parties refused to propose another candidate. That precipitated the crisis. And it triggered huge turmoil in global markets because investors feared another round of elections could lead to even bigger populist gains. With all that chaos, the leaders of the two parties got the message, agreed to another less controversial candidate for economy minister. So the president gave them the green light for the first fully populist government in Western Europe.
MARTIN: Wow. So this coalition is made up of these two parties. They are called the League and the Five Star Movement. What do we know about each of them?
POGGIOLI: Well, Five Star is an anti-establishment party. It was founded by a comedian less than 10 years ago. It calls for big spending increases and a guaranteed income for poor people. The League is a hard-right party that calls for much lower taxes. It's strongly anti-immigrant and wants to expel hundreds of thousands of illegal migrants from Italy. Both parties are very euroskeptic and in the past had called for a referendum on membership in the eurozone. But during the election campaign, they both claimed that that was no longer on their agenda. Now, both parties are also pro-Putin and want the lifting of sanctions on Russia. And they've chosen a virtual unknown and untested law professor, Giuseppe Conte, as prime minister. But the party leaders, Luigi Di Maio - Five Star - and Matteo Salvini of the League, will hold key ministerial posts and will be the real center of power in the government.
MARTIN: So this whole alliance has some folks on edge about what it can mean for Europe as a whole?
POGGIOLI: Absolutely. It comes right after Brexit and puts Italy closer to the camp of euroskeptic countries of Eastern Europe - Hungary and Poland - where we see growing authoritarianism. Now, European officials have a lot of blame for this development. Italy was one of the most pro-European countries. But, you know, in recent years, it was forced to implement various tough austerity measures by Brussels, and it was left alone to handle the whole migrant crisis on its own. That caused a lot of resentment and anger among Italian voters. And that led to the creation of this populist government.
MARTIN: All right. NPR's Sylvia Poggioli for us this morning. Thanks so much, Sylvia.
POGGIOLI: Thank you, Rachel. Transcript provided by NPR, Copyright NPR.