Expect the unexpected in Italy's volatile election

Italy's political left has forfeited a strong position to Silvio Berlusconi and the right in the past, and it appears history could be repeating itself – but a groundswell campaign leaves the result wide open.


In 2006 Romano Prodi, the former president of the European Commission, was the leader of Italy’s left-wing coalition. The polls gave him a big lead over his rival, Silvio Berlusconi, then prime minister, going into the general election. In the end, Prodi won by 25,000 votes, or 0.1 per cent of the electorate. He crawled into office with the promise of reforms, but ended up doing very little. Two years later, Prodi lost a vote of confidence in the Italian senate. His government collapsed. Shortly afterwards, Berlusconi returned to power in a landslide.

Could this be happening again – this time to Pier Luigi Bersani, leader of the Democrats, the party formed after the 2008 rout of Prodi to unite the Italian left?

The latest opinion polls suggest a small majority for the Democrats in the election to the chamber of deputies, the lower house of Italy’s parliament. The party has lately been losing support – including to the Five Star Movement, an anti-establishment, anti-euro opposition party led by Beppe Grillo, which has been extremely effective in using the internet to gain support.

If Bersani wins the lower-house election, even by the smallest of margins, he would still end up with a large parliamentary majority due to voting rules that allocate additional seats to the largest party. But to govern, he would also need a majority in the Senate, the upper house, where a vote premium is allocated on a regional basis. The latest polls I have heard of would suggest a tiny majority for the combined forces of the Democrats and the centrist coalition led by Mario Monti, Italy’s prime minister.

If those polls are correct, Italy is headed for a virtual rerun of the Prodi experience. Bersani will lead a coalition that would include the following disparate collection of politicians: the conservative Monti and his Christian Democratic allies, who used to govern with Berlusconi; a hard core of old-style welfare-state socialists within the Democrats; and the Left Ecology Freedom party founded by Nichi Vendola. While Monti and Vendola have both been ruling out a post-election alliance, the ideological gap between Monti and some of the hardcore Socialists within the Democrats is at least as big.

The centre-left coalition would take over in the middle of the worst recession in living memory. In the fourth quarter of 2012, the Italian economy shrunk at an annualised rate of 3.6 per cent, marking the sixth consecutive quarterly decline. The extent of the fall in gross domestic product growth is clearly the result of Monti’s 2012 austerity budget, which he imposed on an economy that was already in recession when he took over. One of the safest predictions one can make about the Italian elections is that Monti’s coalition will come last among the four major contestants.

What about the right wing? Berlusconi is one of the most effective campaigners in modern political history. He closed a massive gap in the opinion polls between his People of Freedom party and Bersani’s Democrats within a very short period of time. I suspect that the right will emerge as the big winner of this election. Either Berlusconi scores an improbable triumph or the right will regroup and emerge as a powerful anti-austerity, anti-euro opposition to a weak and divided government.

Grillo is in some respects an even more effective campaigner. Coming from nowhere – or rather, the blogosphere – in the space of a few months, he has openly advocated a withdrawal from the euro. Media reports always point out that he is a comedian, but to dismiss him this way is to underestimate his political acumen.

So this is the dynamic one week before the elections. The likely outcome is a fractious majority of the centre-left, and an anti-austerity, possibly anti-euro right, likely to unite in opposition. However, what renders any type of forecast particularly hazardous is the unusually large number of people who have not made up their minds. Curiously, that number has gone up during the campaign. A surprise result is possible – in any direction. A further factor of uncertainty is the changed role of the media. Newspapers in particular have lost much of their influence, while internet sites such as linkiesta.it and social networks are becoming more important.

A few months ago, there was a brief chance of a breakthrough in Italian politics, when Matteo Renzi, the young major of Florence, set out to challenge Bersani in the primaries, and when Monti had not yet made his power grab. Italy could today have been on the eve of a victory of a modernised left – which I believe is the only constellation in Italian politics that is capable of delivering the right policy mix: structural reform without austerity.

Bersani, however, had the party apparatus behind him, and defeated Renzi. Bersani seemed to be a safe, reasonable choice. Monti did too.

But remember, so did Prodi in 2006.

Copyright the Financial Times 2013.

Want access to our latest research and new buy ideas?

Start a free 15 day trial and gain access to our research, recommendations and market-beating model portfolios.

Sign up for free

Related Articles