Italian Election result confusion marks grim prospects for economy and a ‘Fail’ for voters

So, it’s a few days after 2018’s election and the dust has yet to settle over a bitter result for Italy. It may be over, but it appears it is not yet over.

Here we are, more than 90 years after one of the country’s biggest ever electoral mistakes — a 1924 landslide result for the Fascist Party’s Benito Mussolini and his alliance partners, bought with threats and intimidation — and just how far have we come?

Two years before that fateful election Mussolini addressed an audience of some 60,000 at the Fascist Congress in Naples to make one stark declaration: “Our programme is simple: we want to rule Italy.”

Mussolini was subversive and manipulative. Many business and financial leaders felt Mussolini himself could be manipulated thanks to the content of some of his earliest speeches. He had been vocal about policies that underlined the benefits of a free market and laissez faire economics.

The optimism contained within those speeches waned as total state power over business as well as individuals via governing bodies or ‘corporations’ controlled by the Fascist party prevailed, leaving businesses holding onto all the responsibilities with very few of the promised freedoms.

At the end of 1924, after turmoil, resentment, clashes and even murder, Mussolini was forced to dispense with his public face aspirations and instead dropped all trappings of democracy. His decision was fuelled by an ultimatum from his bully-boy affiliate Blackshirt leaders who demanded he crush the opposition — or they would do so without him. A revolt by his own militants was not on his agenda, and to be feared.

A fascist dictatorship was born in early January, marked by Mussolini’s speech before the Chamber. It was followed by several laws restricting or cancelling common democratic liberties, voted by a Parliament that was two thirds occupied by Fascists.

But how does this relate to where Italy stands today?

Well there are synergies. The ruling party was shaken by internal revolt in the aftershocks of the election result with a push for coalition with the populist Five Star Movement. The aim? To keep the centre-right out of power.

The complexity of the Italian voting system is such that there is room for doubt and, to be perfectly frank, it’s a challenge for most ordinary voters to understand it.

This election result did not provide clarity. Nor has it provided, from day one, a strong and recognisable core leadership.

The Democratic Party, leaders of the outgoing government, scraped a vote count of just 19 per cent.

Its head, Matteo Renzi, said: “The Democratic Party must be in the opposition in the next few years against extremists,” he said. “Five Star and the right have insulted us for years and stand for the opposite of our values. They are anti-European, anti-politics and use the language of hate.

“They said we are corrupt, mafiosi and that we have blood on our hands due to immigration, and I don’t think they will change their minds suddenly. Let them form a government if they can — we are out.”

Mr Renzi steps down as party leader with turmoil in his wake. Voters are not sure what their government looks like — at the moment it very much reeks of uncomfortable (and unworkable) compromise populated by members from opposing parties who will be unable to do little more than go head-to-head on every policy issue. This doesn’t make for any kind of decision making or leadership let alone a shared path for Italian prosperity.

The wider view is that, whatever government is cobbled together, it is unlikely to deliver consistency or longevity. So once again Italy will be disadvantaged, crippled by its own leadership. Time is short, we are already being outstripped by the economic recovery of other European countries who, post 2008, have had the luxury of stable governments while Italy has changed hers as regularly as yesterday’s socks.

Five Star took just under a third of votes on Sunday. A potential right-wing coalition with the anti-migrant League and the feared hung parliament is looming large. Yes, there are synergies with 1924’s election and yes, we should recognise a threat when we see it, even if it’s not marked by the colour of its shirt.

A Five Star-Democratic coalition would have at least 350 MPs in the lower house, exceeding the 316 needed for a majority, and approximately 170 senators in the upper house, well above the required 158.

A coalition like this would crush the way forward for a Five Star-League partnership, with its attendant crisis for capital markets. A Five Star-League coalition brings with it a number of fundamentally destabilising aspirations, not least the League’s expressed desire to remove Italy from the Euro and its open hostility toward Italy’s migrant population.

And the results of the weekend’s political upheaval have been divisive in more ways than one; with a North South divide clearly defined.

As the results of Sunday’s voting were finalised yesterday the true extent of the populist division of the country became evident, with the right taking the north and Five Star the south.

If the electorate was voting based on parties’ promises — and how else can the voting public make its decisions — it will now find itself in a stalemate. When one coalition government is home to two parties with two polarised views of the same issue and multiple and conflicting opinions on what to tackle first — what hope is there for progress?

Father of four. Consul @consolatorsmuk CEO of @Tratosgroup & @eShareLife Chairman. @CassBusiness MBA.