Stalemate in Italy

Grillo Berlusconi Bersani

Berlusconi offer fails to end Italy’s political stalemate | Reuters.

Now that the Cyprus situation is solved for a few weeks, the media can move on to the next Eurocrisis saga, the Italian stalemate.  Italy has not managed to form a government one month after elections, and time is ticking down for a resolution to the impasse.

Bersani reached out to Grillo in an attempt to form a coalition but was rebuffed.  Meanwhile, Berlusconi has offered Bersani a deal to form a government with his party.  In exchange for becoming the junior partner in a grand coalition, Berlusconi wants to choose the next President of Italy.

That is a very high price, but it is not even being considered as a starting point in negotiations to form a new government.  Bersani refuses to work with Berlusconi and has called him a criminal on more than one occasion.  This is a classic case of the pot calling the kettle black. Bersani and his party are neck deep in scandals themselves including the Monti dei Paschi book cooking and bailout.

It does not appear that these three parties will abandon their positions on working with each other.  The most likely outcome to this stalemate is new elections.  Giorgio Napolitano, the President of the Republic, may attempt to form another technocratic government, but this gambit looks likely to fail.

Berlusconi’s or Grillo’s assent is required to break the stalemate. Both are gambling that they can improve their positions with a new round of elections and will not participate in a broad-based government.

Expect Napolitano to attempt to form a technocratic government.  When these effort fail, Italy will call new elections within a week or two after Easter.  At least they have a pope for celebration of the holiday.


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