Gripped by their worst recession since the 1930s and facing the implosion of the eurozone the Italians went to the polls from 24-25 February to determine who will lead them through this time of crisis. 30% voted for the scandal-tainted Silvio Berlusconi, a 76-year old billionaire tycoon who has already served in the office three times. 30% voted for Pierre Luigi Bersani of the Democratic Party. 25% voted for Beppe Grillo, a comedian turned populist firebrand. A mere 10% voted for the technocrat incumbent, Mario Monti, whose austerity policies have earned him accolades abroad but made him deeply unpopular domestically.

This fragmented result does not bode well for Italy. In the lower house, the centre-left Democratic Party (PD), headed by Bersani, won a narrow victory that guaranteed it outright control. But in the Senate, although the PD took 6 more seats than the right, they were still far short of a majority. Since the houses have equal powers, no party can govern without controlling the Senate. The end result is that the Italian parliament now has no single group capable of governing.
There are now two options that will allow Italy to form a workable government.
The first is a government led by Bersani and backed by Grillo’s Five-Star Movement,. Given recent comments by Grillo however, including branding Bersani as a “dead man talking” and a “political stalker who has been making indecent proposals to the Five Star Movement for days, instead of resigning as anyone else would have done in his position”, this seems implausible.
The second option is Bersani joining hands with Silvio Berlusconi’s People of Freedom (PdL) alliance, which lies on the opposite end of the political spectrum and there is significant opposition among the centre-left to any alliance with Berlusconi, who often dismisses Bersani’s supporters as communists.
Given this impasse, the government looks like it may be a short-term, with the prospect of new elections in as little as six months.
Naturally, all this uncertainty is not bolstering international confidence in the Italian economy. The German Foreign Minister Guido Westerwelle has called on Italy to continue the austerity reforms that have led to improved confidence in financial markets. The Dutch finance minister, Jeroen Dijsselbloem, who was recently made head of the committee running the euro, concurred with Westerwelle, saying that Monti’s austerity regime is “crucial for the entire eurozone.” .
But Berlusconi and Grillo have both criticised Monti’s austerity packages, and even questioned whether Italy should even remain in the eurozone. Grillo has called for a referendum on the matter. Italy is the third-largest economy in the eurozone, but also has the ugly distinction of having the second highest national debt level Whether the eurozone, with the turbulence it is already experiencing, can survive the departure of Italy, is doubtful.
With so much at stake for both Italy and the EU, there will be many nervous people watching Italian politics over the next few months.