Italian politics does not cease to astonish. On March 4, 2018, Italian voters elected a new parliament, five years after the previous election had resulted in a major anti-establishment uprising. This year the electorate not only confirmed the success of the populist Five Star Movement (FSM), but it also rewarded the new nationalist strategy of the League (formerly Northern League) by making it the leading party of the right. But if these results were surprising even for Italy, they should be seen as the aftershock of the 2013 election. If anything, the 2018 election clarified the patterns of change and might therefore help us better understand the realignment that is taking place in most Western democracies.

In the beginning was the crisis, and the crisis was not just due to the global recession but traced back to Italy’s long-term decline in productivity and investment. During the double-dip recession from 2008 to 2013, Italy’s GDP shrank 9 per cent, and only half of this decrease was recouped in the following five years. During this slow and weak recovery – to which the expansionary monetary policy of the European Central Bank led by Mario Draghi certainly contributed – the small rise in average income of Italian families was offset by an increase in income inequality and in the proportion of people at risk of poverty. The economic situation was especially critical in the south, where unemployment remained at around 20 per cent. It is not surprising that in 2018 unemployment remained the key concern of Italian citizens (see figure 1).

The 2018 election produced the wholesale alternation that has marked Italian politics since the 1990s. After three successive centre-left governments, Italian voters severely punished centrist and left-wing parties. Governing can be costly, especially in times of economic stagnation, and the governments led by the Democratic Party suffered a steep decline in popularity. This was especially true for Prime Minister Matteo Renzi, whose economic and political reforms gave false hope to international observers even as they alienated Italian voters. The labour market reform passed in 2014 despite large-scale mobilization by the unions marked the start of his decline, and the convincing defeat of his constitutional reform proposals in the 2016 referendum marked its (almost definitive) end.

The Five Star Movement rode the wave of popular discontent against the Democratic Party–led governments. The FSM, which prefers to be called a “movement” rather than a party, went through a process of institutionalization after entering Parliament in 2013. When founding leader Beppe Grillo stepped aside in 2017, the movement elected 31-year-old Luigi Di Maio. Without any political (or professional) experience, Di Maio had served as vice-president of the Chamber of Deputies during the previous legislature, where he built a reputation as leader of the moderate wing of the FSM. To be sure, no factions exist in a party where internal democracy is reduced to occasional digital ratification of decisions taken by a small circle under the control of the Casaleggio Associati. The political role of this private company, which manages the party digital platform (and which passed into the hands of Davide Casaleggio after the death of his father in 2016), marks an unprecedented step in the history of party organization.

Meanwhile, right-wing parties had to deal with the fallout from the unsettling Berlusconi regime (1994–95, 2001–06 and 2008–11). Idiosyncratic leadership, organizational uncertainty of party structures, chronic factionalism and reports of corruption and legal problems destabilized the right-wing camp. This helps explain why the League – unlike populist, radical-right parties in northern Europe – did not initially capitalize on the economic crisis. Only after the 2013 election and under the new leadership of Matteo Salvini, when the transformation from a regional party to a national radical-right party was completed, was the League able to gain wide electoral support by exploiting the anxieties of Italian voters.

The anxieties were economic but also cultural. In the same period, Italy faced a major challenge as one of the main debarkation points for migrants. Each year from 2014 to 2017, more than 100,000 migrants reached Sicilian shores. The phenomenon regularly hit the headlines, putting wind in the sails of the radical right. A deal struck with Libyan tribes by the left-wing Interior Minister, Marco Minniti, to prevent refugees’ departures reduced the number of arrivals by 80 per cent, but the drop in the number of asylum seekers did not change the terms of the political debate. As media narratives matter more than reality, Italian concerns about immigration remained as high as ever.

Thus, the 2018 election campaign was dominated by the long shadow of the economic crisis, but also by the immigration issue. Figure 2 shows the prevalence of the issues debated by the political parties during the two months before the election. Economic issues, such as redistributive policies, welfare provisions, market reforms and budget constraints, featured among the most debated by all parties. Issues of democratic renewal and reforms of the political system were also debated, driven mainly by the Five Star Movement. The League, for its part, fanned the flames of the migration crisis. Salvini’s strategy of polarizing the debate was successful: European integration, immigration and security became the most contentious issues of the campaign (figure 3).

Approved just a few months before the election, the new electoral system (a mix of first-past-the-post in single-member districts for the allocation of one third of the seats and proportional representation in multimember districts for the remaining two thirds) assured no outright winner in a tripolar party system. The overall result, however, was a tale of many tales, as suggested by the geographical pattern of vote distribution (see table 1).

In the north, where the centre-right coalition obtained almost 45 per cent of the vote, the shift from Berlusconi’s Forza Italia to the League was massive. But the main news came from elsewhere – and testified to the success of the former regional party’s new national strategy. The League gained record shares of votes in central Italy and, with its racist rhetoric now directed at African migrants, even attracted some voters in the south. Still, the FSM won support from nearly half of southern voters. The proposal of extended unemployment benefits resonated widely in a region where only one in two young people has a job. The performance of the Democratic Party was particularly poor in the south, but the demise of the centre-left’s traditional strongholds in the central region is probably more revealing of the party’s long-term decline.

The day after the election, in the absence of a clear parliamentary majority, both the FSM and League claimed victory, the former as the party that won the most seats and the latter as front-runner of the winning alliance. The Democratic Party, still in shock after the worst result in its history, refused to consider participating in any coalition. After weeks of tactical delays, the once unlikely coalition of the two populist parties became inevitable, and Salvini and Di Maio signed an agreement around a program containing most of the election promises of each. President Sergio Mattarella vetoed the appointment of a Eurosceptic economist as Finance Minister, but once that small bump in the road was overcome, Salvini and Di Maio became the kingmakers of the new government. They agreed to appoint as Prime Minister an unknown law professor, Giuseppe Conte, while they would serve as Deputy PMs.

Was an FSM-League coalition really that unlikely? Their differences on economic issues seemed to speak against the possibility of an agreement; it is hard to reconcile the proposal of a flat tax with an extensive unemployment benefit scheme. Traditional party strategies were another obstacle. The Five Star Movement’s refusal to share government power seemed to be set in stone, as was the League’s prominence in the centre-right alliance. Nonetheless, other factors contributed to the outcome. Chief among these was the two parties’ shared opposition to the policies of the European Union (see figure 3). Further, the differences in priorities allowed for a degree of policy complementarity; while the League focuses on immigration and security, the FSM prioritizes economic issues.

Indeed, in the first months of the new populist coalition government, the two Deputy Prime Ministers acted as policy entrepreneurs in their respective areas of influence. The politicization of the migration issue has so far benefited the League, so much so that in October it ranked first with more than 30 per cent in the polls. Interestingly, Salvini’s increasing approval also affected FSM’s voters, who have grown increasingly opposed to immigration. By the end of the year, however, the cohabitation of the two parties will have to pass the crucible of the budgetary process, given their irreconcilable fiscal policies. If the government were to forcefully engage in a symbolic fight with a common enemy – the European Commission – over the deficit spending cap it could perhaps preserve the coalition. But in deciding what approach to take, the government will be under a sword of Damocles from investors refusing to further finance the massive public debt.

Italy is the laboratory of a political experiment. Its origins do not differ greatly from those that observers have identified in describing wider contemporary political changes. The Italian case, however, consists of a distinctive combination of elements missing in the rest of western Europe: long-term economic decline, a brittle social structure and uncertain institutional rules combined with a volatility of party organizations whose declining memberships have made them exceptionally vulnerable in critical moments such as those Italy has experienced.

But what we see happening in Italy might be contagious. The outcome of the Italian political experiment will test not only the durability of the new electoral alignments in Italy but also, potentially, the very stability of European institutions.

While many observers were shocked if not horrified by the election of Donald Trump, Italians were feeling a sense of déjà vu at what they saw happening across the pond. Pundits have tended to disregard developments in Italian politics in the last two decades, seeing the Italian experience as the product of idiosyncrasies of a rather peculiar country. However, time has shown that Italy’s flaws were not particularly idiosyncratic, as liberal democracy has come to face severe challenges in many Western countries. A trip through the past two decades of Italian political history could thus be most revealing as to what we may expect in other democracies that today are under stress.

During this period Italy experienced two major anti-elite uprisings. In both the 1994 and 2013 elections more people changed their votes than at any other time in Italian history. These two electoral earthquakes resulted from deep and widespread popular dissatisfaction with the political system and mainstream political actors. Both elections saw the sudden success of new political parties which transformed Italian politics. In 1994 the newly established Forza Italia, the party of the tycoon Silvio Berlusconi, won 21 per cent of the vote; in 2013 a quarter of Italian voters chose the Five Star Movement led by the former comedian Beppe Grillo, a record gain in Italian politics (table 1).

In 1994 the massive electoral realignment occurred in the wake of corruption scandals that ended up effectively destroying the party system of what is commonly called the “First Republic” (1948–1993). That system amounted to the continuous domination of the same governing coalition. In 1992, spectacular revelations started to emerge from investigations into almost every party represented in the parliament. That was the straw that broke the camel’s back, and it fuelled major structural changes in the party system. The result was the almost complete disappearance of most pre-1992 parties and their replacement by new political actors who were fundamentally different from their precursors in both identity and organization.

Among the new parties, Forza Italia deserves special attention, as Silvio Berlusconi quickly became the indispensable focus of Italian politics. The party system of the “Second Republic” was marked by sharp and lasting conflict around the figure of the Cavaliere, as he is – and likes to be – known. Although the explanation of his enduring success as being based on his control on the media and his effective use of political marketing has some truth in it, there is more to it. No one can have such a lasting impact on the political life of a country without a message that corresponds to what voters want.

At its core, Berlusconi’s ideology was a mix of populism and liberalism. He rejected the shared traditional portrayal by Italian political elites of a backward country that had to be modernized: for him, the Italian people were good as they were, with their vices and their virtues. Berlusconism built on the profound anti-Communism of the First Republic, putting an end to the cultural marginalization of the right in the pre-1994 era. Although Forza Italia initially brought to Italy the neoconservative ideology that had spread in the West in the 1980s, its leader gradually dismissed the economic liberalism of the early stages and moved the party to a more traditional conservative stance. The broad appeal of this recipe allowed Berlusconi to govern the country for more than ten years between 1994 and 2011.

In June 2011, the Economist published a 14-page special report on Italy. The cover of the issue featured a picture of a proud Silvio Berlusconi with the title “The man who screwed an entire country.” The report had a significant impact on public debate in Italy, as it was only in the spring of 2011 that Berlusconi had started to recognize publicly the dire situation of the Italian economy. A few months later, his inadequacy in dealing with the economic crisis led to pressures from the European Union and international markets for a change in government. The President of the Republic, Giorgio Napolitano, demanded Berlusconi’s resignation, and asked the former EU commissioner Mario Monti to form a cabinet of technocrats who would deal with the country’s economic and financial emergency. With almost no opposition, or indeed serious discussion, in its first months of office the Monti government pushed through two policy packages containing austerity and liberalization measures.

During 2012 the increasing unpopularity of the technocratic government’s policies drained support from both the mainstream left (the Democratic Party) and the mainstream right (the People of Freedom, heir to Forza Italia). The credibility of the People of Freedom was largely undermined by the failures of the Berlusconi government. The right-wing electorate was unhappy with the increases in taxation and the pension reform introduced by the Monti government. The left faced the dilemmas typical of social democratic parties in the postindustrial world; in particular, its pro-EU stance contrasted with its traditional position on worker protection. Moreover, in accepting the appointment of a technocratic executive rather than calling for new elections, the left made itself vulnerable to accusations of weakness.

In other words, neither the right nor the left seemed willing to take over the responsibility of solving the country’s pressing economic and financial problems. Confidence in the Italian mainstream parties’ capacity to govern – called into question by the appointment of a technocratic executive – as well as in the moral integrity of the Italian political elite was damaged during these crisis years. A large and growing number of newspaper articles and popular books raised these issues, and this in turn gave rise to popular indignation. It is only in this context that the astonishing success of the Five Star Movement can be understood.

The party founded by Beppe Grillo had its roots in the humus of the movements of the libertarian left. The five stars of the name represent the main pillars of its founding program: defence of the environment, public water service provision, zero-waste development, free internet connectivity and sustainable transportation. Along with these pillars, there is an emphasis on morality in public life, a central theme of Beppe Grillo’s blog since 2005. The “Clean Up Parliament” initiative and, later, the 2007 “V-Day” rallies (literal translation: “Fuck Off Day”) are manifestations of this reality.

While these early experiences can be fit into the various expressions of anti-Berlusconi mobilization promoted by left-wing grassroots activists that emerged in 2001, over time Grillo’s relationship with the parties of the left evolved from collaboration to competition. The dominant discourse now is anti-elitist. It refuses to distinguish between the left and the right, instead drawing a clear line between the morality of ordinary people and the corruption of the elites – so much so that today no concept captures the essence of this party better than populism.

The party’s approach to the internet shows just how pure its populism is. For the Five Star Movement, the web is more than a means of communications and organization; it is a key element in the party’s conception of politics and democracy. The exaltation of direct democracy, in its digital version, is the concrete expression of its conception of politicians as delegates constrained by an “imperative mandate” from the people. However, the leader often disavows its democratic principles in practice, imposing a three-line whip upon his MPs on controversial policy issues or intervening in the candidate selection process.

Yet the populism of the Five Star Movement has not been the sole challenge to Italian liberal democracy. The weakening position of Silvio Berlusconi, whose party still won more the a fifth of the votes in 2013, has since then favoured another party: the Northern League. Led by a newly elected leader, Matteo Salvini, the Northern League’s poll ratings are currently around 13 per cent nationally, even though it has long been active only in the northern part of the country.

The Northern League, the oldest party currently represented in the Italian parliament, has known ups and downs, from its semiclandestine early stages marked by ethnic regionalism to the national prominence of the controversial figure of Umberto Bossi, whose shifting personal popularity has been reflected in the party’s wavering support. It has always been hard to place the Northern League in any party family. The regional nature of the party has undergone significant changes through its phases of participating in coalition governments and being in opposition, but what remains consistent both for the grassroots and in its election campaigns is the stress on regional identity: the periphery versus the centre.

In every other way, populism for the Northern League is like a second skin. It dislikes politicians and intellectuals and wants to return to community traditions and look to charismatic personalities, to common sense, to the language “spoken by the people.” Although observers have been reluctant to include the Northern League in the radical right party family, the features placing it there became increasingly obvious over time, especially in its position on immigration, security and public order and in its hostility to the EU after Italy entered the Eurozone. The party’s platform has recently shifted in an attempt to extend its political activity to the rest of the peninsula. Even though this strategy is unlikely to succeed, it has enabled the party leader to present himself as leader of a national alternative to the centre-left government of Matteo Renzi.

Renzi, the young and ambitious leader of the Democratic Party, was appointed Prime Minister in February 2014. His honeymoon with Italian voters became rocky when his labour market reform alienated many former leftist supporters, and it came to an end in late 2016 with the rejection by referendum of a constitutional reform he had strongly advocated. The reform would have overcome the bicameral arrangement of the Italian parliamentary system by reducing the Senate’s powers both over the formation of governments and in the legislative process. However, the outcome of the referendum was mainly driven by widespread dissatisfaction with the government, especially in southern Italy, where the economy has not yet recovered from the crisis.

Following Renzi’s resignation, the Foreign Minister, Paolo Gentiloni, became Prime Minister, leaving the composition of the cabinet almost unchanged and Renzi with significant influence over government decisions. After his likely easy win over his internal rivals in the upcoming primary elections, he plans to present himself as a fresh candidate in the next general election, slated for 2018. As we can see in figure 1, the outcome is not at all certain.

In this context, the Five Star Movement and the Northern League have consolidated their position in the party system and gained further popularity. It is hard to tell in which direction they will push Italian politics as it is still unclear under which electoral law Italian voters will make their choices next year. The current proportional system – which resulted from a decision by the Constitutional Court abolishing the majoritarian bonus provided for by the previous law – has started to display its first effects in the increasing fragmentation of the party system.

On the left, the Democratic Party has recently suffered a split as two influential party leaders formed a new party in addition to the four or five already existing. However, they might eventually end up merging in a single list for the next election if they manage to overcome the traditional divisiveness of the Italian left. On the right, the rise of the Northern League has challenged the central role of Forza Italia (as Berlusconi’s party is once again called) as coalition builder. The radical right positions of Matteo Salvini seem irreconcilable with the moderate stances of the centrist parties once allied with Berlusconi. Furthermore, the uncertain future of Forza Italia is still tied to the destiny of its 80-year-old leader.

The current challenge to liberal democracy is, in the end, a challenge to mainstream politics and, in many respects, a reaction to the failures of established parties. The domestic consequences of globalization – in terms of economic competition, supranational integration and cultural diversity – have given rise to new political conflicts which, in turn, have uprooted the traditional reference points of “left” and “right.” The failure of mainstream parties to give voice to these new grievances and to propose and deliver practical solutions to these challenges has fuelled a vehement popular reaction. Thus, the economic crisis has only intensified a deeper political crisis which has been a long time coming.

Seen from outside, the Italian experience is certainly not encouraging. Italy has shown that democracies do not often learn from their mistakes. The politics of overpromising nourishes easy hopes and triggers strong disappointments. Populism can end up feeding more populism. If Italy manages to muddle through again, this time it must figure out a way to break out of this trap. The prospects are rather bleak.