Italy’s inconclusive election

Five Star Movement leader and comedian Beppe Grillo. Photo: Reuters

Five Star Movement leader and comedian Beppe Grillo. Photo: Reuters

Italy’s election has produced the worst possible result both for the country and the eurozone, leading to fears of political instability in the single currency’s third largest economy. While the centre-left got a parliamentary majority in the Lower House, no political bloc acquired a majority in the Senate, where the centre-left Democratic Party and the centrist Civic Choice together don’t even have the numbers to form a parliamentary majority.

There is no doubt that Beppe Grillo’s anti-establishment message struck a chord with the electorate

Significantly, it was the comedian Beppe Grillo who stole the show. In an extraordinary rebuke of the established political parties, his Five Star Movement won a quarter of the national vote, which translates into the largest share of any single party (not bloc).

There is no doubt that Grillo’s anti-establishment message struck a chord with the electorate. An example of this is the fact that for years Italian MPs refused to cut their salaries, which are among the highest in Europe, or reform the country’s electoral laws, despite voter anger over this.

The results of the election are as follows: The centre-left Democratic Party led by Pier Luigi Bersani got 29.54 per cent of the vote, and a majority of 340 seats in the Lower House – due to bonus seats being awarded in this Chamber to the party receiving the most votes; Silvio Berlusconi’s centre-right People of Liberty party got 29.18 per cent and 124 seats; Grillo’s Five Star Movement got 25.55 per cent and 108 seats; and Mario Monti’s centrist Civic Choice got 10.56 per cent and 45 seats.

However, in Italy a government needs to have a majority in both the Lower House and the Senate in order to govern and legislate. And the final results for the Senate show that no bloc acquired a majority there; neither are the combined seats of the centre-left and Monti’s centrists enough to form such a majority.

Unlike the Lower House, bonus seats in the Senate are awarded on a region by region basis, and in this case there was no overall winner.

The centre-right got 116 seats, the centre-left 113, Grillo 54 and Monti 18. Grillo has ruled out governing with the Democratic Party by supporting it in the Senate, and so the only possibility for a stable government is an alliance between the centre-right and centre-left, which although Berlusconi hinted at being a possibility, I doubt is remotely possible.

The centre-left blames Berlusconi for ruining Italy, while the billionaire tycoon never loses an opportunity to label his opponents on the left as communists. The two blocs are incompatible, especially with Berlusconi leading one of them; even if by some miracle they do decide to govern together, the result will be gridlock and no real reforms will be carried out.

This is exactly what the markets hate and we can expect Italy’s borrowing costs to increase until a stable reform-minded government is in place.

The biggest disappointment in this election is without doubt the performance of outgoing Prime Minister Mario Monti, whose centrist Civic Choice got only 10.56 per cent of the popular vote. Monti never had an established base among voters and he teamed up in this election with small centrist parties.

The technocrat Prime Minister did a good job at stabilising the Italian economy and deserves credit for restoring the country’s credibility, both internationally and with the markets, but there is no doubt that his austerity measures (such as the hated property tax) were painful and unpopular with the electorate.

The centre-left Democrats did not have a particularly good campaign and Bersani, who seems to lack both leadership skills and charisma, managed to throw away a comfortable lead in the opinion polls, which until a few weeks ago seemed certain of guaranteeing him victory. James Walston, a professor at the American University of Rome, said soon after the election: “The centre-left was not able to put forward a clear picture; they lack leadership.”

Berlusconi, on the other hand, has proved to be the great survivor of Italian politics. He not only managed to catch up in the polls in the last few weeks of the campaign but also only polled 0.36 per cent less votes than Bersani, which means he came very close to winning a majority of seats in the Lower House.

One reason for Berlusconi’s ‘comeback’ is that he promised not only to scrap the despised property tax but to actually reimburse voters for the tax already paid. However, it is important to note that the centre-right People of Liberty party lost six million votes compared to its performance in 2008, which is hardly a good result.

It is possible that President Giorgio Napolitano will ask Bersani to form a government in the hope that he will be able to form some sort of alliance in the Senate from across the political spectrum.

Grillo’s Five Star Movement now has to live up to its responsibilities and cannot be ‘anti-establishment’ forever. Whether it likes it or not, it is now part of the establishment.

While any new government in such a scenario is unlikely to pass wide-ranging reforms, it should at least respond to voter concerns over matters such as politicians’ pay or the electoral law.

The most likely outcome, perhaps not immediately but probably this year, will be a new election. It is perfectly acceptable to have another election after an inconclusive one, in the interest of stability. This is what happened in Greece, and there is no reason why it shouldn’t happen in Italy.


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