Italy Blames Europe, Sparking Populist Rise

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The shockwave from Europe's refugee crisis continues to reverberate two years after its peak. 

Italy became the latest country to enter political gridlock yesterday as voters abandoned the mainstream in favor of anti-establishment parties. 

At first glance there's little in common between the two main election winners, the upstart Five Star Movement of Luigi di Maio and Matteo Salvini's right-wing League. But both tapped into widespread resentment at Europe and the government's inability to shelter Italy from the front line of Mediterranean migration. It's now up to Italy's president to map a way forward.

As Rome faces uncertainty, Berlin saw the clouds lift on a five-month deadlock after an election that catapulted the far right into the Bundestag for the first time since the 1950s. Angela Merkel now has her grand coalition, but it will be harried by the Alternative for Germany, which brands the chancellor a traitor for her open borders stance.

Immigration concerns arguably swayed the U.K.'s Brexit referendum, fed anti-EU sentiment in eastern Europe and prompted Austria's turn to the nationalist right. France fought back; but Emmanuel Macron's pro-European response looks increasingly like an anomaly.

Global Headlines

Trump's not for turning | U.S. President Donald Trump doesn't intend to bow to pressure from allies seeking exemptions to stiff tariffs on imported steel and aluminum, Andrew Mayeda reports. Investors are now coming to terms with the fact that the president — who campaigned on a pledge to put “America First” — may mean what he said and could be just getting started. 

A balancing act | France's foreign minister is in Tehran as part of a European drive to salvage the nuclear deal that Trump is threatening to scuttle and Iran has said it may be forced to abandon. Jean-Yves Le Drian's trip is a test of  Macron's foreign policy: Le Drian will have to reassure Iran of Europe's commitment to deliver economic benefits promised in the 2015 pact in return for curbing its nuclear program, while acknowledging Trump's concerns.

New D.C. power player | A stranger has emerged as a leader in the ruthless world of Washington lobbying, thanks in part to his ties to Trump. When Trump won Florida, local fundraiser Brian Ballard's cellphone lit up with clients looking for a guide into the new administration. It's been a lucrative stint for Ballard and his firm, Bill Allison reports.

Bibi at the White House | Israeli Prime Minister Benjamin Netanyahu's Oval Office visit with Trump today will give him a chance to divert attention from a widening corruption probe and trumpet successes such as winning U.S. recognition of Jerusalem as Israel's capital. But as Jonathan Ferziger reports, behind the scenes he'll be struggling to muster support on a much more pressing issue: keeping Iran and its proxies in check across the northern border with Syria. 

Pyongyang peace party | A high-level South Korean delegation crossed the border today in a bid to persuade North Korean leader Kim Jong Un to start talks with the U.S. and stave off a potential conflict over his nuclear program. South Korean President Moon Jae-in is seeking to turn an Olympic detente with Kim into full-blown negotiations before the Paralympics end March 18 and the threat of war rises again. 

And finally ... Last night's Academy Awards weren't the only high-profile formal event this weekend. Trump took his first turn headlining the annual Gridiron dinner, which he skipped last year in a break with presidential tradition. He cracked jokes about members of his administration — including son-in-law Jared Kushner — kidding that he was late to the event “because Jared could not get through security.”

--With assistance from Kathleen Hunter

To contact the author of this story: Alan Crawford in Berlin at acrawford6@bloomberg.net.

To contact the editor responsible for this story: Karl Maier at kmaier2@bloomberg.net, Caroline Alexander

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