By Bill Wilson — 41 percent. That was all the Euro establishment in Italy could get to vote in favor of ceding sovereignty to the European Union in that country’s latest parliamentary elections.
The elections came after former Prime Minister Mario Monti stepped aside after his unpopular budget was adopted. The financial plan was necessary to secure ongoing bailouts from the European Central Bank, which is purchasing Italian debt on secondary markets to keep interest rates low.
The top plurality, 31.6 percent, went to the country’s socialist coalition, the Democratic Party. And another rather pathetic 9.1 percent went to Monti’s coalition.
In the meantime, Silvio Berlusconi, who was deposed to pave the way for Monti’s technocrat government to implement the Brussels and Berlin-approved measures, has mounted a stunning political comeback, securing 30.7 percent of the popular vote and the largest plurality in the Senate, which is regionally elected.
In addition, the Five Star Movement — a brand new, anti-Euro party that wants a national referendum on whether Italy should participate in the Euro common currency — won another 23.8 percent of the vote.
That means a full 54 percent voted against the status quo in Italy. Against the Euro. Against the undemocratic installation of Monti by the Politeuro.
The results leave the Democratic socialists in command of the Chamber, Italy’s lower house, but with no mandate to govern. This could mean that another round of elections will be needed within the next few months.
In the meantime, the results afford Berlusconi the opportunity to make overtures to the Five Star Movement to create a majority governing coalition if not now, then after the next round of elections. In return, he could promise to give the Five Stars their national referendum on Euro participation.
And that is likely what riled markets all over the world on Feb. 25 when, for example, the Dow Jones Industrial average crashed by 216 points.
The success of the Five Star Movement could foreshadow a coming collapse of the Eurozone. It follows the remarkable success of Syriza in Greece, the M15 movement in Spain, the True Finns in Finland, the Independence Party in the UK, and the rejection by Iceland of bank bailouts — Euroskeptic parties all.
If Italy, with a €1.9 trillion debt, one of the largest in Europe, left the Eurozone and reverted to the lira, it would effectively be defaulting on its obligations. Instead of being paid with the stronger Euro, creditors would instead be reimbursed with the far weaker lira.
Banks would then be left without adequate capital to cover their losses, throwing the global financial system into disarray once again.
The question for Berlusconi is whether he wants to play that card. After being overthrown by the Eurocrats, it appears he has an axe to grind with Brussels and Berlin which sought to take him out. In his campaign, he railed against Germany for its imposition on Italy’s fiscal sovereignty.
In September, Berlusconi said, “With respect to Monti, I would have been less obedient to Germany, a hegemonic state that dictated to the other European countries the rules of rigor and austerity with the pretence that through austerity debt could be cut.”
If Berlusconi really wants to make good on that promise to be less obedient, the easiest path for his revenge would be to team up with the Five Stars and threaten to take out the Euro. Even if he wins the next round of elections, to govern the Five Stars with such a large bloc will need to be contended with.
But so far the Five Star Movement, led by comedian-politician Beppe Grillo, has ruled out any coalition whatsoever either with Berlusconi or the socialists. They want another round of elections, because they think they’ll win.
So, for Berlusconi, it’s a time for choosing. Does he favor the status quo such that he would form a coalition government with the socialists?
After being deposed by Brussels and Berlin, would he really go back to work for them to advance their Euro agenda? Grillo warns pretty explicitly Berlusconi from working with the socialists when he said, “They might go on another seven or eight months and produce a disaster, but we will be watching and working to keep it under control.”
In other words, Berlusconi teaming up with the socialists could play right into Grillo’s hands. It would prove that the two major parties are frauds, that they in fact work to implement the same agenda. Which sounds rather familiar to anyone who has followed U.S. politics of late. When the next Italian government fails, Grillo could easily come out on top in future elections, having destroyed the establishment electorally.
And then watch out and strap yourselves in — this could be a bumpy ride.
Bill Wilson is the President of Americans for Limited Government. You can follow Bill on Twitter at @BillWilsonALG.