RC (Ingroia): 4.8% and zero seats

PD+SEL+SVP (Bersani): 35.4% and 157 seats

Per Monti: 14.6% and 36 seats

M5* (Grillo): 13.4% and 29 seats

PdL+Lega (Berlusconi): 28.0% (83 seats)

UNDECIDED: 37%

Back in 2008, I wrote that the Italian electoral system had transformed Italy into a party system simplified by the elimination of many small parties. I was wrong in that the arrangement of parties for that election was an anomaly. It is now certain that this simplification will be reversed.

Italy’s party system works on the basis of pre-electoral coalitions – see my previous blogs that explain the mechanics of Italy’s electoral system for the Chamber of Deputies here and for the Senate here. To qualify for representation, each party must gain either 4 percent of the vote or be part of a pre-electoral coalition that claims at least 10 percent. In 2008, two coalitions qualified, of which the first was the Berlusconi alliance that included Gianfranco Fini’s National Alliance, as well as the Northern League. The second largest coalition and the largest opposition group was the alliance of the Democratic Party and Antonio Di Pietro’s Italy of Values. With 6 percent of the vote, the Union of the Centre also qualified for parliamentary representation. The Rainbow Left, the Socialists and the Extreme-Right each failed to reach the necessary 4 percent threshold to gain representation.

From Left to Right, what has happened since 2008? The Rainbow Left Alliance split, part of which remained on the extreme-left and part of which formed a new party: Left, Ecology and Freedom, which has allied with the more moderate Democrats. The Italy of Values movement has declined, losing some support to the new Liberal and Christian Democratic Centre (allied also with the Democrats). Most of the supporters of Italy of Values have ended their alliance with the Democrats and instead merged with the residual part of the Rainbow Left to form the Civil Revolution list, now led by a former anti-mafia prosecutor in Sicily. The Democratic Party lost some support among Catholics to the Democratic Centre, to the Union of the Centre and most recently to Mario Monti’s new Civic Choice movement. Meanwhile the tiny Socialist Party has decided to ally with the Democrats. On the Right, Silvio Berlusconi’s Freedom People saw the departure of Gianfranco Fini and his supporters, who set up Future and Freedom for Italy, now allied with Mario Monti and the Union of the Centre. The Freedom People also lost some other less moderate ex-neo-fascists to a new party called Brothers of Italy. The harder line neo-fascists in The Right have now formally allied with the Freedom People as well.

Finally, the joker in the pack is Beppe Grillo, who is leading a new protest party, the 5-Star Movement, which held primary elections by internet. Its message cuts across right and left with a populist, anti-system and Europhobic approach that is credited with 15 percent of the vote in the opinion polls. Grillo is taking support from left and right and his movement’s success or failure will be proven on 25 February.

The electoral system for the Chamber for Deputies rewards the largest pre-electoral coalition with at least 55 percent of the seats in the Chamber. The losing parties in the other pre-electoral coalitions then share out the remaining seats between each other in proportion to their share of the vote. This encourages larger parties like the Democrats or the Freedom People to stuff their coalitions full of small parties in the hope of maximising their vote. Very small parties also have much to gain by joining a larger pre-electoral coalition since their threshold for election will be 2 percent of the vote within a coalition rather than 4 percent if they run on their own. After an election, those small parties can exercise to the full their blackmail potential on their larger allies, since their support is what will guarantee a parliamentary majority. This is why Italy has been so unstable since the introduction of this electoral system in 2005. In 2008, the defection of one of these micro-parties brought down Romano Prodi’s government of 2006-8 and led to the election of Berlusconi that year in early elections.

Berlusconi alliance (PdL + Lega Nord): 28%

Monti alliance (Monti + UDC + Fini): 19%

Bersani alliance (PD + Vendola): 39 %

The centre-left alliance of Pierluigi Bersani is still ahead, but Berlusconi is catching up fast. Before his re-entry into politics in December, the PdL and Lega Nord together were set on 17%.

In our book on budget reform [click here], Charles Blankart and Gerrit Koester propose a new way to deliver public goods investment and to escape budget deadlock. They propose using enhanced cooperation to establish a parallel budget for public goods. This would be financed only by the member states that opt in. Every few years, programmes would require unanimous re-approval by the participating states, thereby avoiding irreversible lock-in of the kind that happened with the CAP in the 1960s.