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Mr Monti and Mr Bersani look to the future

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Mr Bersani’s PD has been leading in the polls ever since the election was called but, thanks in part to a proliferation of parties, with a share of the vote that is lower than when it lost to Mr Berlusconi five years ago. Mr Monti, a newcomer to electoral politics, will not win, but the new centrist block supporting him will take votes from left and right. The Five Star Movement, another newcomer which appeals to voters fed up with all political parties (seearticle) will also get a sizeable vote.

Things are made more uncertain by a crazily complex electoral system. Any coalition winning a plurality in the national Chamber of Deputies is guaranteed a premium that gives it a 55% majority. A similar premium is applied in the Senate, which has equal legislative power. But there the top-up is awarded by region, not nationally; so to win the Senate a party needs to win most of the largest regions.

The centre-left could win both chambers, but it is not certain of either. In recent weeks Mr Berlusconi has climbed back from the dead. A winter campaign has put more emphasis on television, a medium in which Mr Bersani is a weak performer and Mr Berlusconi a powerful proprietor; his Mediaset group still has a near-monopoly on private TV. He promises cuts in some taxes, cash refunds for others. He has also railed against euro-induced austerity.

In January Mr Bersani enjoyed an 11-point lead over Mr Berlusconi. The latest opinion polls (which were the last to be published before a pre-election blackout) show that has fallen by half, to less than six points. Mr Grillo’s Five Star Movement is on 15%, Mr Monti’s centrists at 14%. A new far-left party led by a former magistrate, Antonio Ingroia, is on 5%.

Investors who hoped they had seen the back of il Cavaliere in 2011 are spooked by his political resurrection. Italian bond yields have risen and the euro has fallen. Roberto d’Alimonte, a political scientist at Rome’s LUISS University, speaks for many when he says: “Two months ago I would have said it was impossible for Mr Berlusconi to win. Now I say only that it is extremely unlikely.”

Disturbing though the no-longer-impossible thought of a Berlusconi victory is, the risk should not be exaggerated. The right has lost a lot of support because of its economic failings and scandals in both the PdL and the Northern League. Mr Berlusconi’s poll ratings are far short of 2008’s. The real damage he does lies not in the slim chance of his re-entering government but in the opportunity cost his presence imposes. As James Walston of the American University of Rome says, “for most of the period since the war, Italy needed a respectable centre-left party. Now it needs a respectable centre-right party.”

The world is used to seeing Japan’s “lost decades” of stagnation in the 1990s and 2000s as a cautionary tale. But the case of Italy, Europe’s fourth-biggest economy, is in some ways even worse. In real terms, GDP per head in 2013 will be lower than in 1999, the year the euro was launched. Portugal is the only other euro-zone economy in such a predicament.


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