At a closed-door meeting on Aug. 6, Matteo Salvini's advisers told the populist Italian politician he was trapped in an unproductive coalition government and should bring it down. The next day, Salvini told Prime Minister Giuseppe Conte he was pulling his League party out of its ruling alliance with the 5-Star Movement (M5S), hoping to trigger an election that would return him to power as the unquestioned leader of a new government.

The League's euroskeptic leader, riding high in the opinion polls thanks to his hard line on immigration, had just made a major miscalculation. Salvini's gambit backfired badly, ushering in a new alliance that is expected to soften his confrontational stance on EU budget rules, which he blamed for Italy's weak economy, and his crackdown on migrants arriving by boat from Africa. Italy's once-dominant politician, known as "The Captain" by his followers, is now on the verge of opposition wilderness, a mere spectator as the M5S and the center-left Democratic Party (PD) form a government without him. Right after receiving approval from President Sergio Mattarella for his new cabinet, Conte will have to win confidence votes in both houses of parliament before the government can officially start work.

The M5S and PD on Tuesday unveiled a shared, 26-point policy program for their proposed coalition, putting an expansionary 2020 budget at the top of their agenda but pleasing markets with a pledge draft a budget that would not endanger public finances. The coalition cleared its final hurdle on Tuesday night when members of the M5S approved the union in an online vote.