The need for nations to re-adapt their economic, political and social systems to meet the challenge of changing circumstances has been a constant throughout history and is particularly now so, in the current context of the GFC. This was especially the case in the twentieth century which was arguably the most turbulent, or at the very least, most transformational century ever.

As the world is now in the early stage of the twenty-first century lessons from the preceding century need to be appreciated with regard to applying a power-with approach in relation to solving complex problems. Particular reference in this article by David Bennett is made to Italy due to this country’s previous impact on the twentieth century and its great relevance to the current century.

This nation was on the cusp of completing its journey to being a mature democracy, only to miss ‘the final train’ in 1922. The consequences for Italy and the world of its failure to consolidate a democracy were detrimental not only to itself but to the world. Because Italy is again at a critical juncture not only for itself but for the world in the context of the GFC detailed reference to Italian history and politics is made in this article.

What Can be Done (?)

The question; ‘What is to be done’?* was the title of an article written by the Russian totalitarian, Vladimir Ilyich Lenin in 1902. The essence of this Leninist polemic was that a vanguard revolutionary party be formed to inform and lead the working class to seize and maintain power. Lenin envisaged that the Marxist transformation of society be deliberately engineered by a vanguard party seizing power instead of waiting for capitalism to wither away.

(*The title was inspired by a 1860s novel written by Nikolay Chernshevsky. He was the romantic inspiration of the Russian revolutionary movement and his Spartan lifestyle was a precursor to Lenin’s power over-maximalist approach).

The November 1917 ‘revolution’ was a betrayal by the Bolsheviks of the Russian working class because it deprived them of the chance to live and participate in a democracy in which there could have been a diversity of ideas and beliefs. In the current context of the Global Financial Crisis (GFC), the threat of political extremism on the part of both the left and the right could derive the world of the capacity to contend creatively and successfully with the profound challenges that have arisen. In this context, the more apt question is not what is to be done, but what can be done?

Analysis is undertaken with reference to Russian, British and Italian history with regard to the importance of maintaining a ‘power-with’ as opposed to ‘power-over’ approach to create the necessary scope to surmount profound socio-political challenges. The benefit of a power-with approach is also undertaken with regard to recent and possible future political developments in Australia and in the United States.

Leninism: Power for the Sake of Power

The Leninist totalitarian ‘power-over’ approach helps explain how and why communism was politically successful for much of the twentieth century despite its internal contradictions. Lenin appreciated that a well organised minority could impose itself on society by first instigating a societal breakdown as a prelude to seizing power.

Having imposed themselves on society by force, Marxist-Leninist regimes could ultimately only survive by intimidation. There were relatively popular communist regimes* that gained a degree of qualified acceptance by applying a limited degree of political liberalization. But such communist regimes were the exception to the rule as a pure ‘power-over’ approach cannot be indefinitely sustained without political coercion.

(*Poland under Wladyslaw Gomulka and Hungary under Janos Kadar gained a limited degree of genuine, if temporary, popularity. But this popularity was mainly derived from their easing Soviet imposed controls on their respective nations).

The current (2011) historical situation of the world is one which Lenin would have regarded as propitious for facilitating revolution due to the self-imposed crisis within the capitalist system. Indeed, Trotskyist parties such as the Socialist Workers’ Party (SWP) in Britain probably see great potential for promoting violent political change following the July riots in British cities.

Trotskyist parties such as the SWP erroneously claim that Stalin betrayed the November 1917 revolution by ensuring a transfer of power from the working class to a statist bureaucratic party following Lenin’s death in January 1924. This Trotskyist construct is false because it was Lenin who betrayed the working class by instigating the 1917 November ‘revolution’.

The Russian Bolsheviks Emasculate Working Class Power

The incentive for Lenin’s seizure of power was to prevent the Congress of Soviets from convening in November 1917 in Petrograd which would have confirmed the ascendency of Menshevik (i.e. social democratic) aligned parties at that congress. In March of 1917, a frustratingly avoidable revolution overthrew the three hundred year old Romanov dynasty.

The March 1917 revolution was historically unique because power was shared by the Duma (which was essentially democratically elected in 1912, despite weighting of votes in favour of wealthier people) and Soviets (councils) formed following the revolution that were composed of workers, soldiers and political activists from a variety of political parties. The period between March and November 1917 (‘Dual Power’) was the only time in history when the working class were organised on a collective basis to the extent that they were practically involved in the day to day running of a nation.

Had the communists (who were then known as the Bolsheviks) not seized power in November 1917, worker councils (Soviets) probably would have been institutionalized in a democratic Russian republican constitution. Elections to a constituent assembly did take place later in November 1917 that was still won by social democratic Social Revolutionary Party which had been the senior party in the recently deposed Provisional Government of Alexander Kerensky. The Bolsheviks won less than 25% of the vote in the November 1917 elections. Lenin closed down the constituent assembly within twenty four hours of it convening in January 1918.

Leon Trotsky at this time of the Bolshevik coup was avowed Menshevik. Lenin’s November 1917 ‘revolution’ (sic) could not have succeeded had Trotsky not defected from the Mensheviks to the Bolsheviks. The 1917 coup that deposed the Provisional Government was legitimised by Lenin claiming that full power was been transferred to the Soviet work councils. In fact, all power was transferred from an embryonic constitutional democracy to the Bolshevik Party, (which was later renamed the Communist Party of the Soviet Union, the CPSU); such that the Soviet work councils became obsolete.

Trotsky knew that Lenin’s conceptualization of a vanguard ‘democratic’- centralist party meant that a regime led by him would be repressive. As war minister, Trotsky was the second most powerful person in the Lenin dictatorship. During this time (1917 to 1923) Trotsky never supported any political liberalization or pluralism. In fact, Trotsky supported the violent repression of the Kronstadt revolt by sailors in March 1921 and of the Tambov peasant rebellion of 1920-1921. (This peasant rebellion was led by members of a Marxist agrarian party, the Social Revolutionary – Left Party).

In a form of poetic justice, Lenin’s ‘principle’ that there be a ruling vanguard party came to fruition following his death in January 1924 as a result of the politburo closing ranks to deny Trotsky succession to lead the Soviet Union. This irony was compounded because Trotsky’s insistence that the army be subordinate to the party also denied him a capacity to succeed Lenin.

It is true that Trotsky did call for inner-party democracy in the period between 1924 and 1929 but this was only because the party elite and bureaucracy united against him. Senior party leaders such as Zinoviev, Bukharin and Kamenev supported Stalin out of fear of Trotsky. But they would be executed in the 1930s having been officially labelled as Trotskyists!

From exile between 1929 and 1940 (which ended with his assassination in Mexico), Trotsky railed against Stalin without acknowledging that his previous support of Leninist ‘democratic’ centralism was in fact Stalinism*. The radicalism that Trotsky advocated from his exile had a radical tinge that was reminiscent of Nikolai Bukharin’s anarchist inspired theories. (Bukharin was executed in 1938 following a Stalinist show trial. He had inspired an initially based German communist movement in Europe that was opposed to both Stalinism and Trotskyism).

(*To be fair to Stalinism in relative terms, it is actually ideological to the extent of advocating that Marxism be advanced by a ‘democratic’ (sic) centralist party).

That all the ‘old Bolsheviks’ were eventually executed by Stalin was reflective of the pitfalls of trying to impose a pre-conceived ideology on society because a monster (in the form of a vanguard revolutionary party) was created which eventually devoured its off-spring. Despite the abject failure of contemporary Trotskyists to recognize Leon Trotsky’s internal contradictions and his hypocrisy, they are now acutely aware of the opportunities to facilitate social break down in the context of international financial uncertainty.

Marxism: Class Based Politics Leads to Power-Over

An intriguing aspect of Marxist approaches to analysis is a tendency to conceptualize ‘capitalism’ as an intelligent being that must be opposed by a consciously organised Marxist group. Karl Marx believed that capitalism was an organic system that emerged as a result of changing economic conditions. He was probably correct that social classes in society can be formed based upon power relations between capital and labour. But Marx* and Lenin refused to accept that individuals and groups can be formed to fulfil an important role to advance the general good of all as opposed to advancing the interests of a particular class.

(*Marxism is probably derived from Karl Marx’s rejection of religion. As a philosopher, Marx broadly accepted the concept of dialectics that was linked to the German philosopher Georg Hegel, 1731- 1831. Dialectics entails discovering an existing truth by investigation and analysis of history. Rejecting Hegel’s premise that God and morality independently exist, Marxists devised Dialectic Materialism in which truth is pursued within an economic framework of relations between different classes based upon the ownership of the means of production).

The class based nature of Marxism led to a notional rejection of legitimacy of the state because the legitimacy of other classes (beside the working class) was recognised as having a legitimate role in society. This rejection is ironic because many conservatives consider Marxism to be a statist philosophy due to its hostility toward private property. Alternatively, there are liberal/conservatives who regard state power as a threat to the well-being of civil society and of the individual.

In the context of the Global Financial Crisis (GFC) the world does face an economic crisis that could facilitate social ruin. Trotskyites disingenuously hailed the overthrow of Marxist-Leninist regimes in Eastern Europe in 1989 and claimed that the time would come that the capitalist system would also collapse because of its internal contradictions.

Unfortunately, the above mentioned Trotskyite construct is correct to the extent that capitalism is facing a grave crisis due to internal contradictions within the contemporary international financial system. Neither Marxist revolution nor Marxist inspired socio-political and economic systems offer a solution and would in fact, if adopted, (to say the least) make matters worse for the world.

What is needed in this time of profound international crisis is an appreciation that governments around the world must co-operate to fix the international economic system before it is too late. Such an appreciation will entail a realization by liberals and conservatives that, in this instance, economics will be the determinant of socio-political outcomes in relation to the future viability of civil society. Consequently, there should be an accompanying recognition that the state (i.e. government) has a vital role in saving the world.

Great Britain: Overcoming Problems by Evolution and Tradition

Great Britain is a nation in which an acceptance of the state has helped sustain a strong civil society that is crucial to the nation’s well being. It is difficult to definitely pinpoint when Great Britain was founded as a nation. Was it when King James of Scotland succeeded Queen Elizabeth of England in 1603, the Act of Settlement between Scotland and England in 1707 or Ireland’s union with Great Britain in 1801? A crucially important historical date which laid the groundwork for the miracle that is Great Britain was the Glorious Revolution in England in 1688. This bloodless revolution established the paradox of a monarchy’s survival being ensured by it subordinating its power to the parliament.

Great Britain, following the 1688 Glorious Revolution, was really ruled by a Tory English Anglican parliamentary oligarchy. Had the Stuart claimant Bonnie Prince Charles won the Battle of Culloden in Scotland in 1746, most English, including Anglicans, would probably have rallied to accept a reinstatement of the Scottish Stuarts in place of the German House of Guelph which had become the new royal house in 1714.

The House of Guelph gained patriotic acceptance in England because of the Napoleonic wars of the late eighteenth and early nineteenth centuries. The dynamic of a monarchy being the cornerstone of constitutional democracy came following the ascension of Queen Victoria in 1837 when Her Majesty accepted the formation of a Whig government, thereby detaching the House of Guelph (which became the House of Saxe Coburg Gotha upon the ascension of Queen Victoria) from the Tories, enabling the monarchy to be above politics.

Queen Victoria’s reign (1837 to 1901) was a superlative success because the monarchy became the linchpin for Britain’s unwritten constitution actually becoming democratic in practice and of the royal family fostering a civil society during a time of rapid industrial change which had the potential to create widespread social alienation. The monarchy’s scope to adapt to these changes was initially due to the genius of Queen Victoria’s husband, Albert the Prince Consort of Saxe-Coburg.

Prince Albert persuaded Her Majesty to accept what is now a mainstay of constitutional monarchy: that the sovereign is above politics. His Royal Highness aligned the monarchy to technological change by organising the great industrial exhibition of 1851. The Prince Consort also reorganised the staff of the royal household so that they were separated from party politics and dedicated to serving the royal family on a professional basis.

The overall impact of Prince Albert’s was that the royal family separated itself from partisan politics, ensured that sycophants did not come between royalty and the people and that Britain’s aristocracy did not come into conflict with a newly emerging middle class. Prince Albert also addressed the social dislocation caused by industrialization as His Royal Highness engaged in a range of philanthropic and charity undertakings which are now mainstays of British royalty. The most political stance Prince Albert adopted was his public opposition to slavery.

The system that Prince Albert helped devise was vital to ensuring that the British monarchy’s constitutional role was safeguarded by its important role in sustaining civil society by public service. At the time of his death in 1861, Prince Albert (who was forty-two when he died) was respected by the public as opposed to being loved but his cultural legacy was to live on. It is often forgotten that Prince Albert had a transformational impact on the British Royal Family that in turn almost transformed Germany for the better. Prince Albert bequeathed a cultural legacy by introducing Christmas trees and tinsel to England* from his German duchy of Saxe Coburg.

(*Christmas is celebrated in Scotland but the Scots tend to celebrate New Year with more gusto).

Much was made of the deep mourning that Queen Victoria fell into following Her Majesty’s husband’s death. However, the vital role of the monarchy in British civil society was such that, even with a semi-reclusive monarch, the royal institution remained one of great importance. Queen Victoria spent most of her time following her husband’s death at her Scottish estate of Balmoral which helped reconcile most Scots to the originally German imported dynasty.

Even though Queen Victoria was a semi-recluse as a widow, Her Majesty maintained a strong political influence upon Great Britain, the British Empire and Europe through the prodigious correspondence that she maintained. The queen’s correspondence was mainly with her children who married into European royalty. Her Majesty remained closest to her oldest child, Victoria, the Princess Royal in whom she confided by mail correspondence.

Germany Rejects Prince Albert’s Model of Constitutional Monarchy

The relationship between mother and daughter almost changed world history for the better. In 1858 Her Royal Highness married Prince Frederick Wilhelm who became Crown Prince of Prussia in 1861 following his father’s ascension to the throne. It is one of the world’s great tragedies that, as parents, Prince Wilhelm Frederick and Princess Victoria did not get along with their eldest son Prince Wilhelm (1859-1940) who would gain historical notoriety as Kaiser Wilhelm II (whose reign lasted between 1888 and 1918).

The Prussian Crown Prince and Princess’s marriage became a love one due to their common intellectual interests. Realizing that her husband would not have become an anglophile British liberal had it not been for his university education, Crown Princess Victoria was adamant that her eldest son receive a university education in addition to his military training. In trying to impose her will on her non-intellectual but intelligent and wilful son, Her Imperial Highness alienated him such that His Imperial Highness hated his mother.

The young prince found happiness and security with his paternal grand father King Wilhelm I of Prussia (and Kaiser of Germany after 1871) who revelled in the military. In stark contrast to his maternal cousins (of whom he was the eldest), Prince Wilhelm did not have a close relationship with Queen Victoria. Consequently, in contrast to Her Majesty’s other grandchildren, the queen did not have a beneficial impact on His Imperial Highness’s character*. The critical upshot of this family dysfunction was that the future Wilhelm II would consciously decline to liberalize Germany’s political system and become anti-British, thereby helping pave the way for the outbreak of the First World War in 1914.

(*Wilhelm II was alienated from his siblings, particularly Princess Sophie, who later became Queen Consort of the Hellenes (Greece). Contrary to popular belief Her Majesty opposed her husband Constantine I’s pro-German orientation during the First World War).

Distressingly, but still promisingly, the Prussian Crown Prince and Princess spent just as much time in Britain as in Germany due to the ostracism they encountered from Wilhelm I. Crown Prince Frederick Wilhelm did fight heroically in the Franco-Prussian War of 1870 but was incensed that Chancellor Otto von Bismarck did not release Napoleon III and his troops from captivity so that they would crush the Paris uprising of 1870 and facilitate the re-establishment of the Second French Empire.

At this juncture, reference must be made to Bismarck’s disastrous impact on history. Bismarck was very politically skilled in reconciling contradictions as a result of which he is generally considered to be a great historical figure. But it was Bismarck’s success in perpetuating the ultimate contradiction – a constitutional non-parliamentary monarchy- that set the scene for the outbreak of the First World War in 1914 and the fall of the German monarchy in 1918.

Europe might have avoided the horrors of the First and Second World Wars and the subsequent rise of communism and fascism had Europe’s revolutions of 1848 precipitated a conversion of absolutist monarchies into democratic constitutional institutions (which Britain under Queen Victoria and Prince Albert was transitioning to). As mentioned in a previous article (‘Japan: The Antithesis of Rent Seeking’), those monarchies in continental Europe that utilised the 1848 revolutions to become democratic constitutional institutions still exist while those who did not or fudged the transition were destined not to survive.

The system of constitutional non-parliamentary monarchy was one where there was a democratically elected parliament (albeit by male suffrage) with powers to legislate and approve budgets. The defining qualification of a constitutional non-parliamentary monarchy was that legislatures were denied the right to form a government as this prerogative remained with the sovereign who, more often not, represented the interests of an authoritarian military and a reactionary aristocracy. To maintain their domestic ascendancy, monarchical elites often kept their nations on tenterhooks by engineering military alliances as part of a power balance approach to foreign affairs.

Prussia was the epitome of a nineteenth century state that pursued a balance of power approach in nineteenth century Europe. This nation’s failure to become a democratic constitutional monarchy was crucial in contributing to the outbreak of the First World War in 1914. Lacking the political skill to maintain a constitutional non-parliamentary monarchy, Wilhelm I had appointed Bismarck Prussian Chancellor in 1862.

Reconciling Contradictions: Bismarck Sustains a Flawed System

Bismarck was the scion of a prominent Prussian Junker (aristocratic) family who had served as ambassador to both France and Russia where he unfortunately gained an invaluable insight into diplomacy and statecraft. The tragedy of Bismarck was that he was to use his political skill to reverse the potential of the 1848 revolutions to establish constitutional democratic monarchy in Europe.

The new Prussian Chancellor defied the Reichstag (parliament) by using indirect taxation as a means of bypassing the submission of a budget. To break the domestic deadlock, Bismarck entered into an alliance with Austria to go to war with Denmark in 1864 to take the Danish duchy of Schleswig- Holstein. Bismarck then engineered a dispute with Austria over this duchy that led to the Austro-Prussian War of 1866 (The Ten Weeks War).

Prussian victory in the 1866 War led to the creation of the German Confederation in which a swag of Northern German states came under Prussian domination as a forerunner to full German unification. This unification was finally accomplished in early 1871 with the proclamation of a German Empire (with the Prussian king reigning as Kaiser (Emperor) of a German federal empire) after Prussian victory in the Franco-Prussian War in 1870 whose outbreak Bismarck had engineered.

The Prussian victory in the 1870 war was a disaster because it aborted France’s conversion from a family dictatorship into a democratic constitutional monarchy. It is often overlooked that Napoleon III was one of the most important figures in modern European history and, had His Imperial Majesty’s Second Empire survived, the First World War might have been averted.

Napoleon III was a product of the revolutions of 1848 which were a vindication of the liberal aspects of Napoleon I’s impact on Europe. The Revolution of 1848 led to the deposition in France of the Orleans royal family (a cadet branch of the House of Bourbon). The regime of King Louis Philippe was ironically a parliamentary one*but its refusal to extend suffrage, which would have enfranchised the conservative peasantry, alienated the industrial working class thereby leading to the founding in 1848 of the Second Republic.

(*The House of Orleans came to power as a result of the middle class revolution of 1830 in which the Bourbon dynasty was deposed due its hostility toward even limited constitutional restrictions. The new dynasty attempted to identify with the revolution of 1789 by adopting Bonapartist terminology and precepts. For this reason King Louis Philippe was known as ‘King of the French’- French emperors were known as ‘Emperor of the French’- as opposed to ‘King of France’).

The idiocy of King Louis Philippe’s refusal to extend voting suffrage beyond the middle class was borne out when the Orleanist party (‘The Party of Order’) presidential candidate Louis Napoleon was overwhelmingly elected as the first French president in December 1848. The Orleanist leader Adolphe Thiers supported the Bonapartist claimant for president because he mistakenly thought that Louis Napoleon was an imbecile whom he could manipulate to secure a reinstatement of the Orleans monarchy. The fallacy of Thier’s mis-assumption became apparent after President Bonaparte suspended the constitution in 1851 and engineered his enthronement as Emperor Napoleon III in 1852 following a plebiscite.

The Second Empire of Napoleon III (1852 to 1870) had its mixture of spectacular successes and abject failures but, as a born politician, Napoleon III (who was possibly even more politically astute than his uncle) who was focused on the objective of ensuring that he was succeeded by his son, Prince Eugene (1856 to 1879) as a democratic constitutional monarch. For all the vicissitudes of his reign, it seemed that Napoleon III had secured his dynasty’s survival when a plebiscite held in May 1870 approved constitutional reform by which the Second Empire effectively became a constitutional parliamentary monarchy.

In a masterstroke, the electorate were asked to endorse the adoption of a parliamentary monarchy. If the voters refused to do so, then Napoleon III could retain his dictatorial powers but, if they approved the constitutional reform, then authoritarian monarchy became a constitutional one. Following the overwhelming success in the plebiscite, Napoleon III planned to abdicate in 1874 upon the *Prince Imperial Eugene gaining his majority to consolidate the transition to a democratic constitutional monarchy.

(*The Prince Imperial became de jure Emperor following his father’s death in Britain in Chislehurst in 1873. Queen Victoria was most impressed with Napoleon IV that she supported her daughter Princess Beatrice eventually marrying the Bonapartist claimant. To gain popular support for this arrangement, Napoleon IV went to fight for the British in South Africa against the Zulus, but alas His Imperial Majesty lost his life in battle in 1879).

It was therefore a terrible mistake on Napoleon III’s part that he fell for Bismarck’s trap of going to war against Prussia in July 1870. The French emperor erroneously believed that he was his uncle’s equal in terms of military ability. Despite His Imperial Majesty’s defeat and capture at the Battle of Sedan, the Second Empire might have survived had Empress Eugenie not dismissed the parliamentary government of Emile Olliver while her husband was at the battle front.

France’s defeat in the Franco-Prussian War was a national trauma which paradoxically endowed a chronically divided Third French Republic (1870-1940) with the requisite sense of national unity and purpose to seek revenge against the Prussian created Imperial Germany (1871-1918). Had Bismarck heeded Crown Prince Wilhelm Frederick’s advice that captured French troops be released, the Second French Empire could have been re-established. A democratic Imperial France consequently could have become reconciled to the existence of the new German Empire. The respective links that the Bonapartes and Hohenzollerns had with the British Royal Family would have augured well for a democratic and peaceful Europe.

Bismarck’s authoritarian power-over approach (which was encapsulated in his infamous catch cry of ‘blood, sweat and tears’) might have been justified up until 1870 in that a militarist approach was successful in achieving German national unity. The dominant party in a democratic elected (albeit on a basis of male suffrage) Reichstag was the newly formed monarchist National Liberal Party. Had Bismarck come to an accommodation with the initially supportive National Liberals, then Germany could have become a democratic constitutional monarchy that promoted peace in Europe.

Instead Bismarck sustained a constitutional non-parliamentary monarchy by weaving a series of intricate diplomatic and military alliances against a hostile republican France. There is no doubt that Bismarck had the temperance and brilliance to maintain such alliances but they helped prevent Germany from developing a political system in which she could be at peace within Europe.

Wilhelm II, 1888 to 1918: Bismarckianism Without Bismarck

The best hope for democratic progress was the succession of Prince Frederick Wilhelm as Emperor. This did occur in 1888 but the new Emperor, Frederick III, alas only reigned for three months! Having succumbed to throat cancer, Frederick III was unfortunately succeeded by his son, Wilhelm II. The new Kaiser had a massive inferiority complex due to his hatred of his parents that was manifested by his unrelentingly hostility toward Great Britain*.

(*Wilhelm II’s mother, Empress Dowager Victoria, was not allowed to take her late husband’s papers from the palace because her son believed that she would pass them onto the British. The late Dowager Empress’s request that she be laid naked at Her Imperial Majesty’s 1901 state funeral covered by only by a Union Jack flag was denied by her son).

Wilhelm II’s hostility to Great Britain had a political impact on the German political system in bolstering the military component within German society that was opposed to democratization. The Kaiser encouraged the development of a German Imperial Navy which only served to make an enemy of Great Britain which, at the close of the nineteenth century was orientated toward its own form of isolationism (‘splendid isolation’) from continental affairs. The Kaiser’s support for Afrikaners in the Boer Wars also served to gratuitously generate British ill-will toward Germany.

Bulow: The Failed Bismarck Who Tried to Avoid War

That is not to say that elements within the German elite were not concerned that Wilhelm II’s temperamental character would lead to war. The complexities of maintaining a constitutional non-parliamentary monarchy were beyond Wilhelm II (who had ironically been able to force Bismarck’s resignation in 1890 by denying the Chancellor the support he needed to defy a hostile Reichstag) such that His Imperial Majesty was obliged by the Junker elite to appoint Count Bernhard von Bulow as Chancellor in 1900.

Bulow was an aristocratic diplomat whose ability was so respected that he was appointed foreign secretary (i.e. foreign minister) in 1897. His success in mitigating Wilhelm II’s blundering in foreign affairs was such that the Kaiser had the support of both the Junker establishment and Reichstag in appointing von Bulow as chancellor in 1900. Bulow did a splendid job as chancellor in that he successfully juggled a variety of domestic and foreign policy challenges with great aplomb.

As much as von Bulow probably abhorred Wilhelm II, it was beyond the chancellor’s ambit to transform Germany into a constitutional parliamentary monarchy or to seek a rapprochement with Great Britain*. Chancellor von Bulow however did seem to achieve what had evaded Bismarck in that he apparently broke Wilhelm II’s political power when he humiliated the Kaiser in 1907 by authorising the publication in the British Daily Telegraph of His Imperial Majesty’s indiscreet personal opinions concerning Anglo-German relations.

(* A German reconciliation with France would then have been beyond even a political genius).

When von Bulow lost his de facto majority (the ‘Bulow Bloc’) in the Reichstag in 1909, the Kaiser refused Bulow’s request for an early parliamentary election thereby obliging the Chancellor to resign. Even at a later critical juncture in 1917, when Wilhelm II needed von Bulow to rescue the German monarchy, His Imperial Majesty utilized the vestiges of his lingering power to veto his return as chancellor.

Von Bulow was succeeded as chancellor by the hapless Thoe Bethmann Hollweg who was the epitome of a first minister in a non-parliamentary constitutional monarchy in that he administered as-opposed to ruled-the nation. The bureaucratic Bethmann Hollweg was so totally reactive that it was beyond his capacity to prevent the outbreak of the First World War in 1914 following the assassination of the Grand Duke Franz Ferdinand, Crown Prince to the Austro-Hungarian throne.

Bismarck had warned that Germany-to avoid fighting against Britain in a two front war (facing off against France and Russia)-to support a weak Austro-Hungarian Empire. The praise that Bismarck (who died in 1898) engendered for his strategic prescience is negated by the fact the deeper cause for a European war was the general absence of constitutional democratic monarchies in Europe that he had contributed to. This absence was all the more frustrating because Crown Prince Franz Ferdinand of the Austro-Hungarian Empire had been dedicated to fundamental democratic reform which, had it been undertaken, could have prevented the outbreak of the First World War.

Wilhelm II as a monarch who was opposed to parliamentary monarchy welcomed the outbreak of the First World War in 1914 believing that a German victory would consolidate his power. For similar authoritarian motivations the German General Staff which welcomed the outbreak of war believing that their long standing Shlieffen Plan would succeed. This plan had first been devised in 1905 following the first signs that Russia was moving into an alliance with France. Under the Shlieffen Plan, Germany would quickly overrun France and then concentrate on defeating a less formidable Russia.

The First World War: The Failure to Reconcile Contradictions

The above scenario almost came to pass as Germany overran most of northern France in the first weeks of the First World War. In an incredible demonstration of sheer grit and determination, the French rallied to halt the German advance such that there was a bloody and sustained four year stalemate (1914 to 1918) on what became known as the Western Front. In the midst of exchanging heavy artillery and tear gas, the Germans and Anglo-French forces (which included troops from the British and the French empires) charged at each other with great loss of life for negligible territorial gain.

Dogged Allied resistance on the Western Front led to an inversion of the Shlieffen Plan in that the German objective became to knock Russia out of the war so that German forces could be freed to win the war in France. For all the determination and valour with which the French fought, they probably would not have held out without the support of Great Britain. But the British were facing breaking point in 1917 on the Western Front so that the Entente would probably have succumbed had it not been for the United States entry into the war against the Central Powers that year.

Even with the United States entry into the war, Wilhelm II and the General Chiefs of Staff* believed that a great military offensive would deliver victory on the Western Front. Due to the release of troops from the Eastern Front following Bolshevik Russia’s defeat, the meticulously planned German Spring Offensive that was launched in April 1918 was in fact a series of offensives that were launched over a five month period.

(*A 1917 resolution of the Reichstag effectively broke Wilhelm II’s political power by declaring that Reich government must have the confidence of the General Chiefs of Staff. Between 1916 and 1918, the General Staff was under the command of Field Marshals Paul von Hindenburg and Erich Ludendorff).

Crucial American troop and material support halted these German offensives and the Allied capacity to launch a counter offensive in August 1918 exhausted the German capacity to continue offensive military action such that a prudent Marshal Ludendorff sued for peace in November 1918 (although he would later support the false claim that Germany had been stabbed in the back by cowardly politicians).

Field Marshal Ludendorff’s agreeing to a ceasefire also precipitated the military’s withdrawal of support for Wilhelm II who was forced to flee to the neutral Netherlands. Ludendorff and Hindenburg supported the Social Democratic Party leader Friedrich Ebert’s accession to the position of chancellor so that Germany could negotiate a peace treaty as a parliamentary constitutional monarchy. In a comedy (if not tragedy of errors), the monarchist Ebert, much against his will, became the first president of a German republic!

Aborted Potential: Russia’s Half Democracy, 1906 to 1917

The fall of the German monarchy was in keeping with the prediction that the Russian statesman Count Sergei Witte had made upon the outbreak of the First World War in 1914 that a general war endangered European monarchies. A former finance minister, Count Witte had brilliantly redeemed Russia’s position by diplomacy following her massive defeat in the 1904-1905 Russo-Japanese War. Count Witte had saved the Russian monarchy by persuading a reluctant Tsar Nicholas II in October 1905 issuing an Imperial Manifesto that converted Russia into a constitutional non-parliamentary monarchy by Tsar Nicholas II.

Serving as prime minister of Russia between 1905 to 1906, Count Witte might have compelled Nicholas II to accept a parliamentary monarchy if it was not for the hostility of the Duma (i.e. the new parliament) toward the imperial institution. To secure the monarchy’s position against a predominately republican Duma, Nicholas II appointed Peter Stolypin as prime minister in 1906. Stolypin was a minor aristocratic civil servant who possessed great administrative and political skills.

Due to a substantial low interest loan from France* to Russia, Stolypin, was able to dissolve the First Duma in 1906 and ensure that the Third Duma which convened in 1907 was forced to accept the imperial prerogative of appointing the government. Through a combination of repression and reform, Stolypin by 1909 broke the revolutionary environment that had existed since 1905. His land reform programme was perhaps Stolypin’s most impressive achievement in that it spawned the kulak category of land owing farmer that Stalin would violently purge in the 1930s.

(*The dividend for France in granting this low interest loan was primarily political because it helped bring Russia into alliance against Germany).

The Stolypin era (1906 to 1911) was one of social reform in which insurance for workers was introduced as well as the granting of political reform such as freedom of the press. The successes of the Stolypin government were due to the high calibre of ministers that were appointed and their working constructively with the Duma.

In the political system that emerged following the 1905 Revolution, Nicholas II fulfilled an important role. Had the Tsar not been born to royalty, His Imperial Majesty probably would have been the ideal secretary or a personal assistant. His Imperial Majesty did not have a personal assistant as he directly attended to his own office work. As such, the Tsar kept a keen eye on the performance of Stolypin’s ministers. His Imperial Majesty had such a technical mastery of ministerial briefs that he often provided crucial support to ensure that government policies and initiatives were implemented.

The 1905 Revolution therefore created the paradox that Nicholas II had more of a role in ruling the Russian Empire than in the first eleven years of his reign (1894 to 1905) when he was dominated by his paternal uncles and cousins. There was however one maternal cousin who had an undue influence on Nicholas II during the first part (1894 to 1904) of his reign – Wilhelm II of Germany!

The German Kaiser encouraged Nicholas II to resist any prospect of granting constitutional rule and often communicated his supposed envy to his cousin that he was not encumbered by either a parliament or a constitution. As a proponent of absolutist rule, Wilhelm II gained Nicholas II’s trust to persuade the Tsar to focus on expanding Russian influence in the Far East thereby giving Germany a free hand in the Balkans. The disastrous ramifications of this con led to the outbreak of the Russo-Japanese War of the 1904-1905 in which Russia was comprehensively defeated.

The ensuing ramifications of Russia’s defeat were such that it subsequently adopted a system of constitutional non-parliamentary monarchy that contributed to the tinderbox that was Europe in 1914. Had Stolypin not been assassinated in 1911 by a left wing terrorist, he might have had the requisite power to have prevented Russia from going to war in 1914. Stolypin’s power had previously been demonstrated when he had banished the Tsarina Alexandra’s confidant Gregory Rasputin from court in 1911 despite Her Imperial Majesty’s vehement protests.

Rasputin was a purported Russian Orthodox from Siberia who gained the Tsarina’s full trust and devotion because he seemed to have an hypnotic power that stopped the haemophilic Tsarevitch Alexei (1904 to 1918) from bleeding to death. Rasputin was in fact a licentious fraud who, as a brilliant actor, managed to convince the Tsarina that he was a holy man who was in accord with the Russian pious peasants who venerated the monarchy.

To be fair to Rasputin, he was disinterested in money and power. His main vice was his voracious sexual lust and his major abuse was that he wilfully deceived the over anxious Tsarina into believing that he was something that he was not. Had court officials, aristocrats and ministers left Rasputin alone, he would not have exercised the destructive political influence that he did during the First World War by having competent ministers dismissed. Rasputin did this to maintain his position with the Tsarina and to avenge himself against those who had previously supported his banishment from court.

The important ramifications of Stolypin’s 1911 assassination were that Nicholas II regained political pre-eminence so that Rasputin was able to return to court. The very capable ministerial team that Stolypin had assembled still remained in place and effective governance continued. The quality of government was also ensured by there being an effective Duma which had an effective system of committees to scrutinize legislation. Russia also had a promising party system which created interesting political dynamics.

The Attributes of Democracy: Party Formation in Tsarist Russia

The equivalent of a Russian Tory Party was the *Octoberist Party which was led by Russian aristocrats and members of the upper middle class. Electoral ‘reforms’ that were introduced in 1907 had increased the weighting of votes of land owners and higher paying tax payers which naturally benefited the Octoberist Party. Ironically, this electoral slanting later rebounded on Nicholas II because most Octoberist parliamentarians became strong proponents of a parliamentary monarchy. The unexpected rift between the Octoberists and the monarchy was important in contributing to the downfall of the Romanov dynasty in 1917.

(* The Octoberist Party was named after the manifesto that Count Witte had written that had been reluctantly issued by the Tsar in October 1905. Reactionary elements backed a populist right wing party, the Russian People’s Union, which was organised by the secret police, the Department for Defence of Public Security, the Okhrana).

The Russian equivalent of a Whig Party was the Constitutional Democrats (the Kadets). The Kadets were a liberal party that had republican elements within it which were in the ascendant when the First Duma convened in 1906. Due to fraternization between the Octoberists and the Kadets (an alliance was formed in 1915 called the Progressive Bloc that was composed of the Kadets, liberal elements of the Octoberists and the Progressive Party) the latter eventually became orientated, but not unreservedly committed, to a constitutional parliamentary monarchy.

To the left of the Kadets was the Russian Social Democratic Labour Party (RSDLP) which was internally divided into respective Menshevik and Bolshevik factions with the latter formally separating to become a distinct parliamentary faction in 1913. The mainstay of the republican left was not however the RSDLP but the agrarian based Social Revolutionaries (SRs) which had its own conflicting social democratic and Marxist factions. A loosely organised Party of Labourers and Toilers approximated to being the urban wing of the SRs and their most prominent parliamentarian was the eloquent Alexander Kerensky.

There were also a slew of ethnically based political parties, the most powerful and prominent of which was the Polish National Democratic Party led by Ronan Dmowski who was controversial for believing that Poland could gain sufficient autonomy within the framework of a constitutional Russia.

The First World War Creates A Profound Crisis for Russian Democracy

The outbreak of the First World War in 1914 found most Russians supporting the Entente due to a strong sentiment toward Orthodox Serbia. Amongst the politically aware, there was strong support for the Entente due to the belief that an Allied victory would usher in a full Russian democracy. Due to the positive impact of the Duma as a legislature in contributing to the quality of governance, the Russian armed forces fought better than expected against the Central Powers.

It was still beyond Russia’s industrial and military capacity to defeat Germany and Austria-Hungary. This should not have mattered because all Russia essentially had to do was hold out to divert valuable resources of the Central Powers so that victory could be achieved by the Allies on the Western Front. This objective would have been achieved had it not been for Nicholas II’s action of passing power to his wife after he left for the front in September 1915 to assume direct (if nominal) command of the armed forces.

The disastrous consequence of Empress Alexandra assuming control of the Russian government was that Her Imperial Majesty systematically dismissed competent ministers and replaced them with incompetents who were suggested by Rasputin. The Tsarina did this due to her determination to remove all the ministers who had signed a collective letter to the Tsar imploring him not to go to the front. For Empress Alexandra, the ministers who had opposed the Tsar’s decision to depart were to be dismissed because they were probably desirous of converting Russia into a parliamentary monarchy.

The terrible spectacle of the Empress misruling between 1915 and 1917 and the influence Rasputin exercised over the Tsarina until his assassination in late 1916 has more often been analysed as reflective of the degeneracy of the imperial system. This perspective is incorrect. Russia’s system of government between 1906 and 1915 was highly efficient and effective due to the quality of its ministers who more often than not worked well with the Duma.

The problem with the Russian imperial system was that it did not make the final transition to a democratic constitutional parliamentary monarchy that the political dynamics between 1906 and 1915 demonstrated were there. Instead, the potential for a transition to full constitutional monarchy was aborted by the Tsarina dismissing competent ministers during the critical time of war. Indeed, most members of the Russian aristocracy were supportive of Russia becoming a parliamentary democracy as they were well positioned to maintain their influence through the Octoberist Party.

Another incorrect assumption concerning the Russian monarchy during the First World War was that Nicholas II’s acquiescence in allowing Rasputin to exercise power was due to his being a weak character who was dominated by his wife. This perspective is too narrow because it negates that the Tsar had his own agenda which he worked toward until his morale was ironically broken by the assassination of Rasputin in December 1916 even though His Imperial Majesty had been ambivalent about him. The agenda that Nicholas II had was to pass on the full autocratic power that the Tsars had traditionally exercised until the issuing of the October 1905 manifesto and to re found the Byzantine Empire to re-establish an absolute monarchy.

Nicholas II’s hostility toward constitutional monarchy can be traced to the trauma he felt he felt when was thirteen due to the assassination of his grandfather, the Tsar-Liberator, Alexander II in 1881. Alexander II had courageously abolished serfdom and commenced political reform with the granting of elected local government as part of his objective of moving Russia to responsible parliamentary government. The ascension of Nicholas’s father as Alexander III ended political reform and the intense focus of government became to maintain the absolute power of the monarchy.

Alexander III believed that the forces of liberalism/anarchism (which for His Imperial Majesty were interchangeable) could be thwarted by establishing the moral and intellectual primacy of the Russian Orthodox Church. The only substantial innovation of Alexander III’s reign was the establishment in 1881 of the efficient *Okhrana secret police. The objective of perpetuating the cultural dominance of the Russian Orthodox Church was reflected by Alexander III’s ‘Russification’ that was imposed upon the non-Russian peoples of the empire. In stark contrast to his father’s policy of supporting Finland having an elected diet as a forerunner to a Russian parliament, Alexander III conducted a virulent campaign against Finnish autonomy.

(*The Okhrana’s effectiveness broke down during the First World War due to its inability to balance domestic spying and wartime espionage)

Despite personal tension that had existed between Alexander III (who died in 1894) and his son, Nicholas II essentially shared his father’s autocratic objectives. For Nicholas II the shift in power from the aristocracy to a capable middle class bureaucracy that the 1905 Revolution had facilitated was a source of anxiety because it ‘threatened’ to convert Russia into a constitutional parliamentary monarchy. The irony of such an outcome was that it would have saved the Russian monarchy such that the Russian Imperial Family could have today a level of prestige that surpasses that of the British Royal Family.

For all the power that Nicholas II devolved to Stolypin, he adamantly refused to countenance a transition to a parliamentary monarchy. Any minister that Nicholas II suspected of working toward this end was summarily dismissed by His Imperial Majesty despite Stolypin’s protestations.

Conflicting Agendas as to Why Russia Entered the First World War

For Nicholas II, the outbreak of the First World War in 1914 presented a dilemma because he knew that an Entente victory could create the momentum for Russia to become a parliamentary monarchy. The sympathies of the aristocracy, the middle class, the bureaucracy, the Duma and most cabinet ministers were with the Entente due to their desire and expectation that Russia would become a parliamentary monarchy in the advent of an Entente victory.

The Tsar could have prevented Russia’s entry into the First World War but did not due to his desire to dismember the Turkish Empire so that a new Byzantium Empire could be re-founded with Constantinople as its capital. For Nicholas II, the re-establishment of the Byzantium Empire would constitute the final victory over godless modernism.

The Byzantium Empire had been effectively destroyed when the Muslim Ottoman Turks took Constantinople in 1453. Bu the spirit and traditions of the Byzantium Empire lived on due to the success of missionaries who followed on from the success of the ninth century Byzantium Greeks Saint Cyril and Saint Methodius in converting the Slavic peoples to Christian Orthodoxy of the Byzantine eastern rite. It was almost standard practice for Slavic rulers in establishing new dynasties to claim to be the successor of the Byzantium emperors and Russian emperors were no exception.

Indeed, an argument could be put that the Byzantine Empire lived on in the Russian Empire due to attempts by its rulers to emulate the by-gone empire. The reigns of Peter the Great (1682 to 1725) and Catherine the Great (1762 to 1796) saw a re-direction toward western European modernism but did not constitute a repudiation of the Byzantine Empire due to the power of the Russian Orthodox Church.

The fear that Britain and France had of Russia taking advantage of the decline of the Ottoman Empire to re-establish the Byzantine Empire-precipitated the Crimean War of 1854 to 1856. Russia’s defeat in this war led the new Tsar, Alexander II (who reigned from 1855 to 1881) to embark upon a series of radical reforms which could have culminated in Russia becoming a parliamentary monarchy to secure future Russian greatness. The regicide of the Tsar liberator was therefore one of the great tragedies of Russian and world history.

For Alexander III and Nicholas II, this regicide demonstrated that liberal reform was an affront to God. From Nicholas II’s perspective, the First World War offered him the opportunity to gain through alliance with Britain and France what they had been determined to deny Russia in the 1850s – the re-establishment of the Byzantine Empire with Constantinople as its capital. To say the least, Nicholas II did not envisage his new Byzantine Empire being a non-parliamentary constitutional monarchy let alone a parliamentary one.

Nicholas II left for the front in September 1915 to remain close to the Russian officer corps and the troops so that, when the time came following victory over the Central Powers, His imperial Majesty would have the capacity to dispense with the Duma. The Tsar’s stratagem might have worked had it not been for Tsarina’s actions in dismissing parliamentary orientated ministers and replacing them with Rasputin nominees with the result that, by late 1916, Russia virtually had a non-functioning government.

Empress Alexandra: Noble Intention, Horrendous Outcomes

Much has been made of Empress Alexandra’s detrimental impact on Russian history. Empress Alexandra was not however the domineering personality that she was made out to be. Her Imperial Majesty was actually a deeply compassionate and self-effacing lady. It was Her Imperial Majesty’s determination to safeguard the life of her son by ensuring that Rasputin could never again be banished from court that led the Empress to wreak havoc on Russia during war time.

The Empress was really an English princess who was born in the German Grand Duchy of Hesse Darmstadt in 1872. She was the daughter of Grand Duke Louis IV and Princess Alice of Great Britain, a daughter of Queen Victoria. Her Serene Highness was devastated, when at the age of six, she lost her mother and a sister to diphtheria. She subsequently developed a profound religious faith and throughout her life which sought to discern if events had a deeper meaning that was reflective of divine will.

As the young princess grew up, she assumed the duties of the effective royal consort due to her mother’s death. Despite Her Royal Highness’s introverted nature, she gained widespread popularity and admiration in the close knit duchy due to the zest with which she took to her royal duties in Hesse Darmstadt. Similar to her maternal grandmother, Queen Victoria, Princess Alix was a dedicated mail correspondent such that she fell under the sway of the British monarch.

Although Princess Alix followed the Queen’s advice on how to conduct herself, she stunned her grandmother by refusing a proposal from Prince Albert Victoria (1864 to 1891), the eldest son of Prince Albert, the Prince of Wales. Queen Victoria delighted in arranging the marriages of her grandchildren who more often than not married their first cousins. Her Majesty was initially taken aback by Princess Alix’s refusal to marry the royal heir. However, Her Serene Highness consequently became Queen Victoria’s favourite grand-child for showing such strength of character in defying Her Majesty.

But the British Queen was therefore determined to have her way by arranging the marriage in 1894 of Princess Alix’s brother Grand Duke Ernest (who had succeeded his father in 1892) to his cousin Princess Victoria Melita, the daughter of Queen Victoria’s second son, Prince Alfred. Princess Victoria Melita’s mother was Grand Duchess Alexandrova, the daughter and favourite child of the Tsar Liberator, Alexander II.

Queen Victoria loathed her Russian daughter in-law who (with the backing of her over indulgent father) insisted upon having precedence at court as an imperial princess*. Despite her mother, Grand Duchess’s Alexandrova’s adamant opposition, Princess Victoria Melita (who erroneously believed that she was Queen Victoria’s favourite grandchild), dutifully consented to the marriage even though that she and her husband to be were, to say the least, incompatible.

(*It was rumoured that Queen Victoria arranged to be declared Empress of India in 1876 to outrank her Russian daughter in-law).

Princess Victoria Melita’s marriage to Grand Duke Ernest was resented by Princess Alix. Her Serene Highness regretted that she was going to lose her eminent role in Hesse Darmstadt society and she also resented her beloved brother marrying a major rival for her Grandmother’s affections. The marriage between Princess Victoria Melita and Grand Duke Ernest ended in divorce in 1901 (following Queen Victoria’s death that year). In an irony that often abounds in royal history, Princess Victoria Melita later married her paternal cousin Grand Duke Cyril of Russia in 1905, who in exile would declare himself Tsar in 1924. Thus Princes Victoria Melita would again step into a role that had once been filled by Princess Alix.

The marriage of Princess Victoria Melita and Grand Duke Ernest did surprisingly result in Princess Alix becoming Empress of Russia. Visiting Hesse Darmstadt for the wedding, Tsarevitch Nicholas unexpectantly proposed to Princess Alix. His Imperial Highness having previously met and fallen in love with Prince Alix on her visits to Russia to stay with her sister Princess *Elisabeth who had married Grand Duke Sergei, a son of the Tsar-Liberator.

(*Grand Duchess Elisabeth, 1864 to 1918, had a sad life. Her Imperial Highness had rejected Prince Wilhelm of Prussia’s ardent proposals of marriage. Had Princess Elisabeth married Wilhelm, the rift between the Houses of Hesse and Hohenzollern might have been healed. As Empress of Germany, Elisabeth could have moderated Wilhelm II by giving him the confidence and sense of security that His Imperial Majesty lacked.

Having married Grand Duke Sergei for love in 1881, Grand Duchess Elisabeth endeared herself to Russian people by voluntarily converting from Lutheranism to Russian Orthodoxy. Her Imperial Highness gained further public respect by forgiving her husband’s assassin prior to his execution in 1905 and subsequently forsaking her wealth to become a nun. Grand Duchess Elisabeth’s charity work was extensive and most appreciated during the First World War.

The only political intervention Her Imperial Highness undertook was to warn her sister and closest friend, Empress Alexandra in 1916 to break with Rasputin. Not only did this advice go unheeded but Empress Alexandra subsequently broke off contact with her sister.

Following the fall of the Romanov dynasty in 1917 the Grand Duchess refused to leave Russia and rejected pleas from Wilhelm II (who was later devastated by her murder) to go to Germany following the Bolshevik seizure of power. Her Imperial Highness was killed by the Bolsheviks throwing her down a well in July 1918. Even the most ardent anti-Russian Romanovs were shocked by Grand Duchess Elisabeth’s regicide.

Following White army troops finding her remains, her corpse was taken to Jerusalem where it remains interned in the chapel of Mary Magdalene. It was appropriate that, when communist rule effectively came to an end in Russia in August 1991, one of the first actions of the Moscow Patriarchate of the Russian Orthodox Church was to canonize Grand Duchess Elisabeth).

The Tragedy of Nicholas II and Empress Alexandra

Princess Alix was moved by the Tsarevitch’s proposal of marriage because she knew that his parents had tried to have him propose marriage to the highly intelligent Princess Helene of France*. Although Princess Alix was in love with the Tsarevitch, she initially refused his proposal because she could not renounce her Lutheran faith. It was due to her sister Grand Duchess Elisabeth in relating her experience of converting religion and Queen Victoria’s telling her grand-daughter that there was really no difference between Lutheranism and Russian Orthodoxy that Princess Alix consented to marry the Russian Tsarevitch.

(*Princess Helene later married into the Italian Royal Family to become the Duchess of Aosta. Even after Italy became a republic in 1946, Her Royal Highness maintained a high profile in her adopted country until she died in 1951).

Just prior to Nicholas and Alexandra’s (the name that Princess Alix assumed on converting to Russian Orthodoxy) 1894 marriage, Alexander III suddenly died. As a result, the soon to be Tsarina did not have sufficient time to prepare for her role as imperial consort. Empress Alexandra’s relations from the start were strained with her mother in law because Empress Dowager Marie had let it be known her reservations concerning her son’s choice of wife.

The frugal minded Empress Alexandra was taken aback by her mother in-law’s appreciation of the finer things in life, such as jewellery. Be that as it may, Dowager Empress Marie (who was originally a Danish princess) was adamant that royalty engage with the public as much as possible which her daughter-in-law considered to be vulgar and unbecoming. The imperial couple’s capacity to establish an extensive entourage or a social network at court was also restricted by Empress Alexandra’s intolerance of any extra marital affairs.

The Tsar and Tsarina were a solitary couple who enjoyed each other’s company. The Empress was happiest at the main imperial residence, Tsarskoe Selo, south of St. Petersburg. In the first ten years of her marriage Empress Alexandra had five children, -four daughters (Grand Duchesses, - Olga, Maria, Tatiana and Anastasia) and finally a son and heir, the Tsarevitch Alexei who was born in August 1904.

The joy of having a soon was soon tempered when it was discovered that Alexei had haemophilia. Indeed caring and worrying about the Tsarevitch’s absorbed much of the Emperor and Empress’s energy. When the Tsarevitch’s life was seemingly saved by Rasputin, the Empress became his most devoted supporter.

Until the outbreak of the First World War, Empress Alexandra was a remote figure from the Russian public and the elite. Her Imperial Majesty was prominent to the extent she was notorious for protecting Rasputin’s place at court. It is now forgotten that, due to the press freedom (which came with the issuing of the October 1905 Manifesto, the Fundamental Laws), Russian newspapers attacked Rasputin and his association with the imperial couple. Due to the concealment of the Tsarevitch’s haemophilia, it was mis-assumed that the Empress’s attachment to Rasputin was sexual.

The Empress did however become widely popular between 1914 and 1915 due to her dedication as a war nurse. In contrast to other aristocratic women who acted as nominal patronesses and honorary nurses, Empress Alexandra successfully undertook a nursing training course and administered the sprawling hospital that was established at Tsarskoe Selo. Her Imperial Majesty public gained great respect for the empathy that she showed to wounded patients. Therefore, Empress Alexandra’s insistence that Prisoners of War be recognized between 1914 and 1915 by the Russian public was reflective of her general humanitarian outlook rather than her German ancestry.*

(* Empress Alexandra was more English than German due to the close contact that she had had with Queen Victoria. English was the first language that the Emperor and Empress spoke with to each other and their children and it was in English that they corresponded to each other. However, the Empress was weary of Britain because Her Imperial Majesty feared that the British model of parliamentary rule would come to Russia in the event of an Allied victory.

Although relations between Empress Alexandra and her originally Danish mother-law, the Dowager Empress Marie, were personally strained, they both shared a deep dislike of Prussia which they blamed for German military aggression against their respective home countries. As a result, Her Imperial Majesty was a Russian patriot because her hopes for the future were centred upon her son being a future success as Tsar of Russia. The opprobrium of the ‘German woman’ that was later attached to the Empress after Her Imperial Majesty assumed control of the government was therefore misplaced).

Because Her Imperial Majesty had immersed herself in hospital work, her contact with Rasputin all but lapsed during the first months of the war. Indeed, the Tsar and Tsarina became temporarily estranged from Rasputin due to his opposition to the war. The Empress’s faith in Rasputin was powerfully restored when, against considered medical opinion, Her Imperial Majesty’s best friend, Anna Vyrubova, survived an horrendous train accident in January 1915 in accordance with Rasputin’s prediction.

The Failure to Reform Destroys the Russian Monarchy

In the period between 1915 and 1916, the Russian cabinet was overturned with capable and honest ministers being replaced with incompetents appointed by the Empress at Rasputin’s behest. The sorry saga had its comedic elements but the humour was counteracted by the horrendous consequences of a relatively effective war machine breaking down against such a formidable enemy.

Without going into the fascinating minutiae of the disintegration of Russia’s government and war effort during the Rasputin ascendancy, the worst excess of this period was the breakdown of Russia’s war time system of transportation and logistics. This development was due to the ineptitude of the interior minister, Alexander Protopopov. He had previously served as Deputy Speaker of the Duma where he had gained a reputation for sycophancy. The only reason that Protopopov maintained this position was due to his craven loyalty to the Speaker of the Duma, Mikhail Rodzianko.

Ironically, Protopopov was appointed interior minister in September 1916 at the suggestion of Rasputin to placate the Duma. Instead, most parliamentarians regarded his acceptance of the appointment as crass betrayal so that they were further alienated from the government and the monarchy. At Rasputin’s behest, responsibility for the administration of the nation’s rail system was transferred to Protopopov so that transportation bottlenecks could be ended by invoking the authority of the interior ministry.

But due to Protopopov’s monumental incompetence, the functioning of the rail and associated transportation systems virtually broke down. The ramifications of the breakdown of the transportation system laid the groundwork for the revolutions of March and of November of 1917. Disruption of weapons and rations supplies led to a breakdown in morale and discipline among junior officers and NCOs. The disruption of the transportation system also fatally compromised the operation of Russia’s relatively efficient rationing system that the leading cities of Petrograd and Moscow became threatened with mass starvation.

Under immense pressure from nearly everyone – family, ministers, generals, bureaucrats and courtiers - Nicholas II moved to dismiss Protopopov. The interior minister was only saved by the dramatic intervention of the Empress, who placed her marriage on the line to protect Protopopov’s position. Her Imperial Majesty supported Protopopov to the hilt due to his professed admiration for Rasputin.

Even the deputies of the ultra-monarchist All-Russia People’s Union joined with most other parliamentary parties (the Bolsheviks and ethnic secessionists deputies were conspicuously silent on this issue) in the Duma in demanding Protopopov’s dismissal. For Empress Alexandra, Protopopov became the defensive barrier against granting parliamentary rule. The Empress ensured that Protopopov was not dismissed believing that this would help the Tsarevitch inherit the full autocratic powers of a Tsar so that his reign would be easier than his father’s. Nicholas II’s failure to dismiss Protopopov fatally compromised His Imperial Majesty’s capacity to continue as Tsar.

Nicholas II sought to maintain his position by cultivating the support of the senior ranks of the armed forces. But the actions of the Tsarina and Rasputin even undermined this objective. At the behest of Rasputin, the Empress interfered with military decisions at the front to minimize military casualties. The disastrous military impact of Her Imperial Majesty’s interventions substantially undermined Russia’s military position that gave credence was given to the entirely false belief that Her Imperial Majesty was acting in Germany’s interests.

Having witnessed first hand as a nurse the carnage of war, the Empress believed that the army generals were sinfully bereft of humane considerations. As a Christian, the Empress believed that it was incumbent upon her to stop unnecessary carnage. The full support that the Empress had from Rasputin, who regarded war as inherently evil, reinforced Her Imperial Majesty’s belief in the moral correctness of her interventions on the front. The similarly deeply religious Nicholas II found it almost impossible to go against his wife because His Imperial Majesty knew that she was sincerely motivated.

However sincerely motivated the Empress was, Her Imperial Majesty’s mis-rule imperilled the viability of the Romanov dynasty. The assassination of Rasputin that was carried out in December 1916 by Prince Felix Yusupov and Grand Duke Dimitri (Nicholas II’s first cousin) was intended to save the monarchy. The conspirators believed that by killing Rasputin that the Empress would lose her capacity to rule (or more to the point mis-rule) Russia. They did not understand that Empress Alexandra had her own will to power and motivation which was derived from her determination to ensure her son’s succession as Tsar as an autocratic ruler.

In fact, Rasputin’s assassination consolidated the Empress’s power because Nicholas II (who had always been ambivalent about Rasputin) was so shocked by the murder that it precipitated an incapacitating nervous breakdown. By contrast, Empress Alexandra steeled herself so that Rasputin’s death (which for Her Imperial Majesty was a martyrdom) would have meaning in pursuit of a higher purpose.

Ironically, the new government that the Empress appointed in January 1917 following Rasputin’s assassination was (with the notable exception of Protopopov who was stubbornly and stupidly retained as interior minister) bereft of former Rasputin nominees. This government, which was headed by Prince Nicholas *Golitsyn, was mainly composed of aristocrats, who, similar to the prime minister, had previously been involved in administering the Empress’s vast war-time charities. Despite the honesty and competence of the new ministers, their government was ill-received due to their association with the Empress.

(*Prince Golitsyn happily returned to his non-political existence following the overthrow of the monarchy in March 1917. Foolishly, His Serene Highness refused to flee Russia after the Bolsheviks seized power. Hounded by the communists because he was the most senior remnant of a by-gone era, Prince Golitsyn was arrested in 1924 and executed the following year. Ironically, descendants of the late non-political prime minister claimed in 1990, the year that the Russian Monarchist Party officially surfaced, that they had helped organise this covert party in the 1920s and participated in subsequently leading it to avenge Prince Golitsyn’s execution).

Russia’s Forgotten March 1917 Revolution

The fall of the monarchy came in March 1917 when chronic food shortages in Petrograd precipitated violent bread riots. Cossacks garrisoned in the capital refused to suppress these riots that there was the prospect of military mutiny breaking out in the city. It is often forgotten that Empress Alexandra, in an inspirational speech to the sailors who guarded the capital’s Winter Palace, almost rallied them to crush the rebellion and endow Her Imperial Majesty with the possible power to have dispensed with the Duma.

Had the above scenario occurred, books, plays and movie scenes may have been written immortalizing Empress Alexandra’s dramatic rallying of the troops. Instead, the palace troops defected therefore precipitating the outbreak of a broader rebellion in the capital and across much of the nation. The defection of the palace guard was caused by the Tsar’s cousin, a senior but non-active naval officer, Grand Duke Vladimir Cyril (the husband of Grand Duchess Victoria Melita), declaring his support for constitutional parliamentary rule.

Grand Duke Vladimir Cyril along with Prime Minister Golitsyn and most cabinet ministers (with the notable exception of the hated Protopopov) made their way to the Tauride Palace where the Duma was housed to meet with deputies to call for the introduction of parliamentary rule. The Tsar, following an urgent telegram from his wife, tried to lead units of loyal troops to crush the rebellion but was thwarted by a rail strike.

Nicholas II therefore agreed to meet a parliamentary delegation led by the Speaker of the Duma, Mikhail Rodzianko which had been despatched by the Duma to meet the sovereign. The Tsar erroneously believed that the delegation was meeting with him so that a new parliamentary government led by Rodzianko would be appointed. Instead the delegation demanded that the Tsar abdicate.

Due to the hopeless political situation that he found himself in, Nicholas II complied with the demand to abdicate. The Tsar first abdicated in favour of his son Alexei, designating his brother Grand Duke Michael to serve as regent. But, concerned for his son’s health, the outgoing Nicholas II had the abdication document altered so that his brother succeeded him as Tsar.

The Romanov dynasty might have survived had the liberal Grand Duke Michael not refused to ascend the throne. The Tsar’s younger brother was a respected officer and a political liberal. His Imperial Highness had had a torturous life as the second in line to the throne. In courageous defiance of his brother, His Imperial Highness had married morganically in 1912. It took little persuading on the part of the Duma deputy Alexander Kerensky to have Grand Duke Michael* to renounce his rights to succession. This action was the final point of rupture between Michael and Nicholas as brothers.

(*Ex-Grand Duke Michael refused to leave Russia following his brother’s abdication. Michael declared his allegiance to the Russian republic upon its proclamation in September 1917, conditional on him been allowed to remain in Russia as a free citizen. Following the Bolshevik seizure of power, Michael attempted to flee Russia in March 1918 but was unfortunately apprehended at the last moment and executed in June that year with his British secretary).

Due to Grand Duke Michael’s non-ascension, His Serene Highness, Prince Georgy Lvov was appointed by the outgoing Tsar to be the new chief of state and it was in that capacity that the prince (who was the leading monarchist in the Kadet Party) appointed himself prime minister. With Nicholas II’s abdication Russia’s constitutional status was converted from an empire to a ‘state’. Russia’s eventual constitutional status was to be determined by a constituent assembly that was to be elected upon the expiration of the Duma’s term toward the end of 1917.

Prince Lvov’s ascension to office was ironic because he was descended from the ancient House of Rurik that had preceded the Romanovs as the rulers of the Grand Duchy of Moscow. (Romanov rule commenced in 1613). This prince’s ascension was not only due to his noble birth but due to the respect that His Serene Highness was held in as a member of the Duma.

The other leading candidate to be prime minister had been the parliamentary speaker, Mikhail Rodzianko. He was the leader of the liberal wing of the Octoberist Party and
a staunch constitutional monarchist. Ironically and tragically, Nicholas II and Empress Alexandra hated Rodzianko (whom they privately called the ‘fat Rodzianko’) due to this Ukrainian nobleman’s role in bringing the Octoberist Party over to the cause of constitutional parliamentary monarchy away from absolutist Tsarist rule. Had Nicholas II made Rodzianko* prime minister of a parliamentary government following Rasputin’s murder in December 1916 or during the early stages of the 1917 Petrograd revolt, then the Russian monarchy might have survived.

(* An impoverished Rodzianko prematurely died in 1924 in the Serbian capital of Belgrade due to the unfair hounding he unfairly received from Russian monarchist émigrés on the incorrect premise that he had betrayed the monarchy).

Between Epochs: Russia’s 1917 Provisional Governments

The new ‘Provisional Government’ that was formed in March 1917 was initially a coalition between the Kadets (which Prince Lvov belonged to) and the Progressive Party, which was a party of liberals that had split from the Octoberists in 1908 and were a key party within the Progressive Alliance*.

(* The Progressive Alliance (or Bloc) was a parliamentary coalition between the Progressive Party, the Kadets and the Rodzianko wing of the Octoberists that was formed in 1915).

With regard to the Octoberists, Rodzianko had them remain in official opposition to the new provisional government to convey their support for the reinstatement of the Russian monarchy. Octoberist Party support for the first Provisional Government was subtly conveyed by their founder, the rich and powerful industrialist, Alexander Guchkov (who had been a vehement critic of Rasputin’s) serving as the new War Minister, which was the only cabinet position that the Octoberist Party held .

The apparent maverick in the Provisional Government was Alexander Kerensky, who served as Justice Minister. Kerensky was the de facto leader of the urban wing of the rural based Social Revolutionary Party (the SRs). It was widely and erroneously believed that Kerensky’s power in the Provisional Government was due to his links with the Soviets as he became the first vice-chairman of the Petrograd Soviet upon its formation in 1917.

The Soviet Councils were formed following the March 1917 Revolution and were composed of workers, peasants and soldiers. Soviets varied in size and were either regional or workplace based. The power of the Soviets was initially not on a par with the Provisional Government. The potential for the Soviets to exercise and later take power was dependent upon the support that they received from rank and file soldiers.

So long as most junior officers and/ or NCOs remained onside with the Provisional Government’s objective to continue the war against the Central Powers, then the government’s position remained relatively secure. It was due to Kerensky’s impressive rhetorical powers in persuading troops to continue to fight that he was appointed Justice Minister upon the Provisional Government’s formation in March 1917.

Lenin himself realized that the way to power was through rank and file soldiers. Therefore, upon his arrival in Petrograd in April 1917, Lenin called for bread and peace to undermine war morale so that Soviets and rank and file soldiers and sailors would link up to seize power. Lenin’s opposition to the war’s continuance*put him at odds with the major parliamentary parties. These parties, which ranged from the Octoberists to the Mensheviks of the RSDLP, advocated continuing to fight the war against Germany so that their respective visions for a new Russia would come to fruition.

(*Lenin’s opposition to the war was disingenuous for, after seizing power, the new Bolshevik regime launched a military offensive against the Central Powers in February 1918).

The importance of keeping rank and file troops on side was manifested in May 1917 when the Provisional Government was obliged to reshuffle after the Foreign Minister and Kadet Party leader Pavel Milyukov offended rank and file troops by stating that Russia’s existing commitments to the Entente remained unchanged regardless of domestic political changes.

The importance of keeping troops at the front supportive of the war and of the government was such that Pavel was dropped from the cabinet as was Guchkov (thereby ending any lingering Octoberist Party involvement in government), his place as War Minister being taken by Kerensky. The government’s move to the left was reflected by the Mensheviks (who were then more strongly positioned than the Bolsheviks in the Soviets) entering the cabinet.

The issue of Russia’s continuing the war was the key issue of contention at the First All Russia Congress of Soviets held in early June 1917 in Petrograd. With a notional Menshevik majority at this congress, any prospect of the Soviets withdrawing their support for the war effort should have been negligible. However, Lenin’s oratorical skills were considerable that the Congress wavered in supporting Russia continuing with the war.

To counteract Lenin’s growing influence, the ‘Kerensky Offensive’ was later launched in June 1917. This offensive was aptly named because it was due to Kerensky’s extraordinary powers of persuasion that troops (who more often than not took orders from rank and file soldier’s committees) were motivated to take the offensive against the Germans. With the benefit of hindsight, the offensive should not have been undertaken because, no matter how inspired the Russian troops were, they could not withstand the firepower and discipline of the still formidable Germans.

Lenin was quick to take advantage of the debacle of the Kerensky Offensive. Bolshevik agents exploited rank and file discontent amongst soldiers and sailors at the home front to attempt a seizure of power in early July 1917. The Bolshevik coup attempt failed due to regular army officers maintaining discipline in the cities and Kerensky rallying troops at the front to return with him to Petrograd to crush the revolt. With the failure of the July Revolt, Kerensky took over as prime minister from Prince Lvov, who remained on as chief of state.

With Lenin fleeing to Finland and his activists either in hiding or in prison, it seemed that Russia was safe from the Bolsheviks. There was sufficient discipline within the armed forces for Russia to fight on in the war in a defensive capacity until the Allies won the war on the Western Front. There also seemed to be a consensus within the government, Duma and the Soviets that fundamental questions regarding Russia’s future would be resolved by a democratically elected constituent assembly to be elected in November 1917.

Lenin Exploits Internal Disunity

The reason that Lenin was able to snatch victory from the jaws of defeat was due to General Laur Kornilov’s attempted coup in September 1917. In fairness to General Kornilov, the coup attempt was precipitated by Kerensky’s heavy handed action in dismissing him. General Kornilov vehemently opposed the operation of soldier committees at the front because they undermined the traditional lines of authority between officers and soldiers, whereas Kerensky supported them as a safeguard against a possible Tsarist coup.

With the benefit of hindsight, Kerensky and Kornilov should have agreed to disagree so that elections to a constituent assembly had been finalised after which it have been very difficult for there to have been any extra-legal seizure of power. Emboldened by his success in crushing the Bolshevik coup attempt, Kerensky dismissed Kornilov in September thereby almost compelling the general to attempt a coup to safeguard the position of the officer corps. Kerensky himself only narrowly survived the coup attempt by freeing imprisoned Bolsheviks and co-operating with existing Bolshevik agitators within the armed forces to mobilize soldiers at the front to crush the Kornilov coup attempt.

Whether Russia would have been a better country had the Kornilov coup succeeded is a moot point, even though the ramifications of the revolt’s failure were disastrous for Russia and the world. The failure of the Kornilov coup enabled the Bolsheviks to re-activate their network within the armed forces which became even stronger than before their abortive July revolt. This was due to the vacuum that was caused by the purging of officers associated with Kornilov and the general undermining of lines of authority within the armed forces, with the power of soldier committees being consolidated.

The abortive Kornilov coup also destroyed the legacy of the 1905 Revolution. This revolution was initially a working class revolution against Tsarist autocratic rule but its traditions and political dynamics became liberal-conservative due to the issuing of the October 1905 Manifesto creating the potential for a parliamentary constitutional monarchy. Possibly, as Kerensky had intended by provoking Kornilov into attempting a coup that was crushed, the prime minister was subsequently in a position to politically remould the country by eliminating a still potent conservative-liberal right.

Furthermore, due to the failure of the Kornilov coup attempt, Menshevik traitors, such as Trotsky, defected over to the Bolshevik camp in September 1917 thereby facilitating their later gaining control of the key Petrograd and Moscow Soviets. The Bolsheviks still remained in a minority position in most Soviets across the country. But this would not matter if Lenin could (as he did) gain support amongst rank and file soldiers and sailors for a Bolshevik seizure of power.

The failure of the coup attempt did result in Russia immediately being declared a republic even though the sentimentally monarchist Prince Lvov (who was arguably the Rurik claimant to the throne) stayed on as titular head of state. Due to this abortive coup the Octoberist and Kadet parties were banned from participating in the November 1917 constituent assembly elections, although a republican rump of the Kadets participated gaining just over 5% of the vote.

The Regicide of the Romanovs

The more recently deposed Romanovs - up until the abortive 1917 September coup - were relatively secure in that they were safeguarded against any harm possibly coming to them. This was because there was still strong monarchist sentiment within the armed forces, amongst a caste of then powerful politicians and a formidable Russian Orthodox Church that was unwavering in its support for the confined Romanovs. Many Russians remained concerned for their captive former imperial family. A storekeeper in Tobolsk, where Nicholas’s family was confined, ensured that the imprisoned Romanovs were supplied with as much food and clothing as possible, free of charge.

Nicholas II’s family had first been first confined to their Tsarskoe Selo estate in comfort. Relieved of the burden of political crisis, the former Tsar regained his physical and mental health as his family drew closer together. The relative happiness and relief that the family held was tempered by a strong desire to depart for Britain where Nicholas and Alexandra’s family had spent their happiest times with Edward VII and then with George V.

The British king betrayed Nicholas II and his family by using his influence to deny them sanctuary in Britain for fear that their arrival would precipitate dangerous revolutionary unrest. The Romanov family were removed to the Siberian city of Tobolsk in August 1917 where they were still relatively well treated until the Bolshevik seizure of power in November. The family were taken further east in April 1918 to Yekaterinburg where they were held at Ipatiev House (‘the House of Special Purpose’) where they were all murdered in July that year along with their loyal servants.

Even before the advent of Glasnost and Perestroika under Mikhail Gorbachev in the 1980s, Russians from the 1950s onwards took private pilgrimages to Yekaterinburg (which during Soviet times was known as ‘Sverdlovsk’). Despite, or perhaps because of the vilification that Nicholas II was subjected to by the Soviet authorities, His Imperial Majesty became a revered figure for many Russians. This was perversely manifested in 1977 when the Politburo specifically ordered a regional party boss named Boris Yeltsin to demolish the Ipatiev House.

Yeltsin, as president of the Russian republic, later made amends by authorising and attending an official state funeral in 1998 in which the remains of Nicholas II, wife and children were interred in the Romanov family crypts at the Peter and Paul Cathedral in St. Petersburg. A church, which translates as the ‘Cathedral of the Blood’, was built in 2003 as a memorial to the martyred imperial family in Yekaterinburg.

The religious and secular veneration that Nicholas II is held in by many Russians is contemporary testament to the failure of communist rule following the fall of the Romanov dynasty. This is also ironic because the communists had intended that Lenin live on as a socialist demi-god with the late Tsar consigned as a footnote to Lenin’s supposed legend.

Historical Disaster: The November 1917 Coup

The failure of the Kornilov coup set the scene for the November 1917 Bolshevik coup. This coup coincided with the convening of the Second All-Russia Soviets Congress in Petrograd in which the misnamed Mensheviks (‘Menshevik’ meaning minority) were in the majority. Bolshevik activists were able to deceive soldiers and sailors to depose the Provisional Government on behalf of the Soviets (i.e. work councils) when in fact power was transferred to an elitist vanguard party which would late eliminate the Soviet councils.

The coup might have been crushed had Kerensky remained at the Winter Palace where the Provisional Government was headquartered. The prime minister should have remained in the capital and liaised with his Menshevik allies to utilize their working class support base within the vital Petrograd Soviet to stop the Bolshevik coup. The Bolsheviks shrewdly allowed Kerensky to flee in an American diplomatic car to the front to rally troops so that they could take control in Petrograd. By the time Kerensky reached the front, Petrograd was already so securely under Bolshevik control that it was impossible to rally any troops at the front to go to the capital to dislodge them.

The most touching resistance to the coup came from a group of Duma deputies (whose terms were about to expire) attempted to form a picket at the entrance to the Winter Palace to defend it from the Bolsheviks. The coup did not seem radical or undemocratic at the time because Lenin very cleverly allowed the national elections to proceed later that month. This gave credence to the lie that his new government would exercise power to protect the interests of the working class until the constituent assembly drew up a new democratic constitution.

In the period between the November 1917 elections and the convening of the constituent assembly in January 1918, the new government established a secret police (the Cheka) and restored discipline in the army using the pretext of launching an offensive against the Germans to eliminate soldier councils. Former Tsarist officers, such as Mikhail Tuchachevsky*, made their pact with the devil by supporting the new regime so that the authority of the officer corps could be re-asserted. These actions provided the new Bolshevik regime with the requisite capacity to dissolve the constituent assembly as part of establishing a one-party state.

(*Tuchachevsky was later executed in 1938 in the Stalinist purges as were most other former senior Tsarist officers who had collaborated with the Bolsheviks).

The impetus for the re-imposition of hierarchical authority in the armed forces was due to the new regime (which had seized power on a pretext of seeking an immediate cessation of hostility with the Central Powers) launching a new offensive in February 1918. Although this offensive failed, its more immediate objectives were achieved in that the new regime gained control of the military so that it could assert its authority.

The colossal failure of the 1918 February Offensive could well have precipitated the collapse of the new regime had it not sued for peace and signed the disgraceful Treaty of Brest-Litovsk in March 1918. Under this treaty, swathes of territory were ceded to the Central Powers and massive reparations inflicted on Russia. Lenin was not put out by this treaty because cessation of hostilities enabled his regime to focus on internal repression to avoid collapse and successfully prosecute the Russian Civil War which raged from 1918 to 1920.

The Democracy that Might Have Been: Analysis of the Results of the 1917 Russian Elections

The Russian Civil War initially broke out in January 1918 with the establishment by SR deputies (who had been prevented from taking up their seats in the dissolved constituent assembly) setting up a rival government in Siberia. That the SRs were at the forefront of opposition to the Bolsheviks was not surprising because they had come first in the November 1917 constituent assembly elections with over 40% of the vote. To be fair to the Bolsheviks, they came second with nearly 25% of the vote having appropriated most of the Mensheviks’ (who ran as the RSDLP) electoral support that they came fourth with just under 4% of the vote. Amongst the top four nationwide parties that ran, the republican rump of the Kadets who came slightly ahead of the Mensheviks.

Had the Bolsheviks not seized power, the Russian constituent assembly undoubtedly would have drawn up a federal republican constitution. The abortive September 1917 Kornilov coup had so altered the political dynamics that a viable liberal-conservative political tradition was eliminated because the majority monarchist faction of the
Kadets and the entire Octoberist Party were precluded from participating in the 1917 constituent assembly elections.

A post-1917 non-communist Russia probably could have had a strong agrarian political movement similar to what Bulgaria had in the early 1920s Alexander Stamboliyski ruled this nation as prime minister between 1919 and 1923. Stamboliyski’s peasant movement seemingly encapsulated the populist political traditions of Slavic peasantry. The Bulgarian Peasants/Agrarian Party before the First World War was at the forefront of a republican south Slav political movement that was known as ‘Yugoslavism’.

A political success of Kerensky’s brief period as prime minister was that he expanded the electoral base of the SRs into the cities to encompass the support of the Mensheviks and supporters of the Kadets and Octoberists. This was ironic because Kerensky was not a conventional SR but rather a member of the urban based and loosely organised SR aligned Labourers and Toilers Party. (Kerensky’s micro party was separate from the RSDLP and as such he was never a Menshevik as is commonly believed).

Had there been no Kornilov coup attempt, the participation of the Kadets and the Octoberists would have made for more interesting and representative electoral politics. Going by political trends, the relatively liberal Rodzianko wing of Octoberists probably would have formed a political configuration with the Kadets while conservative Octoberists could have aligned with the far right Russian Peoples’ Union.

There were ethnic based parties which participated that would have strongly agitated for a federal Russia. Touchingly, the SRs received a high vote in the Ukraine which would have created strong pressure for a federal republic had there being a constituent assembly. During the Russian Civil War of 1918 to 1920, the SRs were prevented from forming a Green army due to respective persecution by both the Bolshevik Reds and the generally reactionary Kolchak led ‘Whites’. Consequently, there were ethnic Russian SRs who made their way to fight in the Ukraine to unsuccessfully support the Ukrainian SRs. These Russian SRs may not have been primarily fighting for Ukrainian independence but they were at the very least out of necessity against the Russian and Ukrainian Bolsheviks.

That the Mensheviks won representation in the 1917 constituent assembly elections was due to the disproportionate vote they garnered in Georgia. Similar to the SRs, the Mensheviks lingered on in a non-Russian component of the aborted democratic Russian Republic where they effectively found themselves ambiguously supporting the subsequent Georgian struggle for independence by fighting against the Bolsheviks.

The Future Contagion Germinates: The World Fails to Support the Russian Whites

The White anti-communist Siberian based government, established in January 1918, was initially SR led but supported by conservative (if not reactionary) officers until a coup led by Admiral Alexander Kolchak in November 1918 eliminated the SRs and Mensheviks from this Siberian based government. The subsequent Kolchak regime main civilian political support base came from former Octoberists (which surprisingly included Rodzianko) who did not formally re-constitute as a political party. The only remotely liberal senior member within this White regime was Victor Pepleyayev, *Kolchak’s prime minister who was a former Kadet.

(*Kolchak declared himself ‘Supreme Ruler of Russia’ and it was plausible that had he won the Russian Civil War he might have declared himself Tsar of a new imperial dynasty).

What potential that existed for a future Russian constitutional monarchy paradoxically lived on in Finland. To maintain the pretence that his government was democratic in order to gain valuable time between the November 1917 elections and the scheduled convening of the constituent assembly in January 1918, Finnish independence was ostensibly recognised by Lenin in December 1917. In light of future events, it was ironic that a Russian communist regime delegation led by Stalin visited the Finnish capital of Helsinki in December of 1917 to notionally accept Finnish independence.

Lenin’s recognition of Finnish recognition provided a cover by which he could disassociate his government from a Bolshevik faction within the Finnish Social Democratic Party that attempted to seize power in January 1918. The Finnish Reds probably would have won the Finnish Civil War had the Finnish Whites not been led by the brilliant General (later Marshal) Carl Gustav Mannerheim. He was a Swedish speaking aristocrat who belonged to the Swedish elite in Finland who in return for supporting Russia rule in Finland were accepted into the Tsarist establishment.

It is not known if Mannerheim supported the Kornilov coup in September 1917 but he made a daring escape, departing from Petrograd Central Railway Station, reputedly dressed as an old woman, to avoid probable arrest, to return to his long since departed homeland. Having subsequently established himself as Regent* of Finland in 1918, Mannerheim was in a position to help the Russian Whites.

(* Mannerheim could have founded a new royal Finnish dynasty but refused to do so and made way for a Finnish republic in 1919 after also declining to be the first president of the new Finnish Republic. This Finnish statesman would subsequently protect Finnish democracy from fascism during the inter-war period, brilliantly extricating Finland from its forced alliance with Nazi Germany in 1944 and simultaneously thwart a Soviet attempt to foist a communist regime on the nation. During his time as Finnish President between 1944 and 1946, Marshal Mannerheim prominently displayed a framed photo on his desk of himself as a military cadet meeting with Nicholas II).

A Mannerheim backed Russian North Western Government was established in Finland in 1918. This alternate White coalition government was composed of monarchists, SRs and Mensheviks. Wisely, this government deferred important issues such as Russia’s form of government to be decided by a new elected constituent assembly. This government’s army was commanded by the conservative monarchist but widely accepted General Nikolai Judenich.

While the Bolsheviks were distracted by fighting against Admiral Kolchak’s forces in Siberia (who they were unfortunately beating) Mannerheim devised a brilliant plan for White Russian forces, using Finland as their base, to launch the liberation of Petrograd. Mannerheim had worked out the logistical details of what was required with the British military attaché in Helsinki, General Hebert Gough, for a successful military operation. Grand Duchess Victoria Melita*conveyed in her letter to King George V an outline of Mannerheim’s plan and the resources that were needed from the Allies for success.

(*Mannerheim had provided protection to the Grand Duchess and her husband Grand Duke Vladimir Cyril who he hoped would be a future Tsar of a Russian constitutional parliamentary monarchy).

George V in a reply letter to Grand Duchess Victoria Melita refused to help which reflected the stance of Lloyd George’s government. The French government and the French armed chiefs of staff however were prepared to provide crucial help but would not do so without the support of Britain. (This probably reflected the then anglophila France’s ruling ‘Radicals’).

The failure (or refusal) of the Allies to help the Whites (particularly the North Western Whites) destroyed any prospect of a post-war democratic Russia emerging. This had been a key objective of Russians from various political backgrounds in supporting their country’s membership of the Entente. A post-war democratic Russia would have been morally indebted to Britain and France. This would have augured well for a democratic and peaceful Europe because France was a staunch supporter of the independence of successor states such as Poland.

There was limited Anglo-French, as well as American and Japanese military support for the Admiral Kolchak Whites in the Far East but this was ineffective due to the war wariness of Allied governments. Had foreign support for the Whites been more forthcoming, this would also have helped create a democratic Russia with successor states such as the Ukraine and Georgia coming into being that the First World War might ultimately contributed to a better world.

The significant cultural impact that Russian émigrés had in exile (most notably in Paris) was reflective of the brilliant future that a non-communist Russia might have had on the world. Exiled Russian political parties lived on in quality émigré newspapers that were a reflection of what might have been had there been a Russian democracy. In non-political terms, the cultural impact of Russian émigrés in Paris in art and ballet was also a sign of the greatness that might have been, had Leninism as a power-over ideology not hi-jacked Russia.

The shrewdness of Russian political émigrés was reflected in 1934 when the leadership of the RSDLP (the Mensheviks) closed up their Paris based party when they surmised that most of their members were probably Soviet NKVD spies. This action was probably a blow to the Soviets because they were denied an important de facto spying agency. Ironically, the Menshevik tradition lived on in the United States in the Russian émigré newspaper, The Socialist Messenger.

The establishment of a communist Russia was, to say the least, one of the great disasters of modern history. The ramifications of this development included the loss of lives of millions of people, the subsequent emergence of fascism in the inter-war period and the later artificial division of the world following the Second World War into two nuclear armed power blocs.

The ideological legacy of Russian communism may still return to afflict the world. There are Trotskyite-Leninist parties that could emulate Lenin’s power-over approach by entrenching powerfully organised but destructive minorities if the world does not pull out of the GFC crisis that now threatens to precipitate great social destruction.

A Democracy Consolidates: Britain Before and After the First World War

A nation that did tremendously benefit from being on the winning side in the First World War was Britain because her democracy was accepted by nearly all of her people thereby constituting its final application. Great ideological struggles in Britain (albeit within a generally classical liberal framework) in the nineteenth century between Benjamin Disraeli and William Gladstone not only established the contemporary framework for Britain’s traditional two party system but helped create a strong British civil society (as opposed to a strong state).

The Tory (Conservative) Party’s protectionist orientation gave it a strong working class support base (which still lingers today) but this was not converted into profound social and economic reform due to a limited voting franchise. Tory opposition in the late 1840s against repeal of the protectionist Corn Laws expanded their support amongst the peasantry and the emerging industrial working class despite their support for the maintenance of a relatively narrow voting property-owning suffrage.

Tory/Whig rivalry of the nineteenth and early twentieth century was normally good natured (except for the issue of Irish Home Rule). A positive ramification of this rivalry was that talented members of the establishment or aspiring middle class often committed themselves to entering electoral politics such that Britain had a generally higher calibre of politician than most nations. Administering the world’s largest geographically spread empire also helped spawn a critical mass of able bureaucrats and soldiers who became adept problem solvers.

For all of Great Britain’s greatness, this nation and empire would have been ill-equipped to handle the major struggles that came with the outbreak of the First World War had it not been for the legacy of Edward VII (1841 to 1910) who reigned from 1901 to 1910. This monarch is probably most famous for his bon vivant character, but when he was Prince of Wales, His Royal Highness’s frustration at having to wait to succeed to the throne had to endure difficult personal relations with his mother. It is too frightening to think of how disastrously history might have turned out had the Prince of Wales become personally warped by his challenging maternal relationship as Wilhelm II was.

For all the frustration that Edward as heir to the throne as the Prince of Wales felt, His Royal Highness’s time (contrary to appearances) was productively spent. This was due to his friendship with Napoleon III of France helping give the British heir an understanding of continental politics that the most political of his countrymen did not share due to their immersion in the British Empire. From 1851 to the last years of his life, the future Edward VII made a point of annually holidaying in France so that he could secure an Anglo-French alliance.

The Prince of Wales was naturally distressed by the fall of Napoleon III’s Second Empire in 1870 but was determined that the fallen Emperor’s objective of an Anglo-French alliance be achieved. Prince Albert Edward was often subjected to taunts (which were expressions of hostility derived from negative memories of the Napoleonic Wars) during his annual French holiday. The usually extroverted prince surprised all by his cool stoic non-response which was derived from his overwhelming determination for Britain and France to enter an alliance to safeguard against a future bellicose Germany.

Prince Edward Albert’s first holidays to France were probably motivated by his profound admiration for the political acumen of Napoleon III and mutual wish that the memory of the Napoleonic Wars not lead to permanent ill-feeling between the British and French peoples. This desire for Anglo-French reconciliation was increased on Prince Albert Edward’s part due to his concern with regard to the emergence of a Prussian led Germany in 1870.

Due to long visits to Britain by his sister Princess Victoria and her husband Crown Prince Frederick, Prince Albert Edward realized that unless the German monarchy restrained Prussian militarism an authoritarian Germany would dominate Europe. The death of the three month reigning Frederick III of Germany (German sovereigns went by the reign date of Prussian kings) in 1881 was such a hideous blow to both Prince Edward and Queen Victoria that mother and sone were partially reconciled.

For all Queen Victoria’s shrewd insights that Her Majesty gained through her prodigious royal correspondence, (which gave Her Majesty an intelligence system that rivalled a national spy service), Her Majesty did not have the stamina and tenacity to forge a British alliance with France. The irony was that the Queen’s virtual exclusion of her son from the affairs of state gave him the necessary time to devote to his serious project when His Royal Highness was not enjoying the good life. The determination of the French to avenge the defeat of 1870 also endowed Prince Albert Edward’s project with the scope for future success.

The forging of the Entente Cordiale in 1904 was therefore a testament to the success of French foreign policy and the personal diplomacy of Edward VII. Due to the failure (or more to the point the conscious refusal) of Wilhelm II to restrain Prussian inspired militarism (which he actually encouraged), German militarism probably would have dominated Europe had Britain not entered the First World War in 1914.

Britain’s ostensible entry into the First World War to defend the integrity of plucky Belgium has now been dismissed as a cynical excuse to go to war. But it should not be forgotten that Belgium had been established in 1830 with Queen Victoria and Prince Albert’s uncle, Prince Leopold of Saxe-Coburg-Gotha becoming King of the Belgiums in 1831. Due to the influence of the Prince Consort Albert, an important objective of British foreign policy in continental Europe (such as it was) which crossed over into the early twentieth century was to safeguard Belgium independence.

The British entry into the First World War may have been due to the Asquith government’s desire to delay Irish Home Rule to avoid a unionist revolt in Northern Ireland. But the German violation of Belgium neutrality hit on a raw nerve within Foreign Office circles due to the royal family’s concern for this relatively small kingdom. Popular enthusiasm for Britain’s entry into the war was derived from Wilhelm II’s widespread unpopularity which His Imperial Majesty had foolishly stoked.

There was a widespread belief in military circles and among the peoples of Europe that a general war in Europe would be relatively brief, similar to the Franco-Prussian War of 1870-1871. There was an erroneous assumption, that as with the aforementioned war, artillery would decide the outcome and therefore make for a sharp and short war. This was an untenable premise because Anglo-French and German artillery were so much on a par with each other that a bloody stalemate ensued.

The First World War Threatens Europe’s Social Structure

As the Russian statesman Count Witte insightfully observed, a sustained all-out war threatened the social structures of participating nations to the point of imperilling their political-social systems. Unfortunately for the Count, his prediction was to prove only too prophetic for Russia.

The development of the ‘Great War’ (as the First World War was known until the outbreak of the Second World War) into a protracted war did present a profound challenge to the British establishment which helps explain why a radical Whig Welshman, David Lloyd George, (who radical in the context of the then Tory-Whig dichotomy) became prime minister in 1916 at the head of a national coalition government.

Lloyd George had previously gained fame (or notoriety) for his courageous support of the Afrikaners during the Second Boer War. He saw the Afrikaners as similar to the Welsh, to the extent that they were fighting against a stronger power for their national identity. The Welsh parliamentarian’s stance established himself as the leading radical within the Liberal Party so that he became the Minister for Munitions in 1915. His real task in this portfolio was to maintain the patriotic war morale of munitions workers by making inspirational speeches. The success of Lloyd George in his ministerial endeavours was such that he became War Secretary in 1916, and by the end of that year, he had succeeded the lacklustre Hebert Asquith as prime minister.

Prime Minister Lloyd George’s successfully led his nation to eventual victory in 1918 by ensuring that, in the preceding two year interregnum, British morale had withstood the incredible tribulations of war. The role that Lloyd George fulfilled in the immediate post-war period was by contrast far from illustrious. In the post-war period, Lloyd George helped inflict respectively harsh peace treaties against Germany and Hungary, refused to provide sufficient support to the Russian Whites and despatched the Black and Tan death squads to Ireland.

The general hope amongst the British that the world would be a better place was reflected by strong bi-partisan support for the new League of Nations. As terrible as the war had been there had been, technological changes which helped improve the standard of living with the advent of new factory technologies and home gadgets.

An important socio- political change that came to Britain following the First World War were granting initially limited female suffrage and extending full male suffrage to men twenty one and older. (Full suffrage for women aged twenty-one and over was granted in 1929). Further socio-political change was also manifested by the impact of the war in regard to changes to Britain’s party system.

British Party Formation Following the First World War

The most important political change that the war helped usher in was the British Labour Party displacing the Liberal Party in the 1920s as one of Britain’s two major political parties (with the Tories remaining the other major party). The British Labour Party was founded in 1906 as a parliamentary party following on from the *Labour Representation Committee that had been founded in 1900. This committee had first co-ordinated trade union backed candidacies for parliament-a practice that had first began in the 1880s.

(*Confusingly, an Independent Labour Party, the ILP, continued on as a more or less Labour Party aligned political party. The ILP notionally represented the interests of unionists and labour activists associated with the Labour Representation Committee that did not formally join the Labour Party founded in 1906).

Increased class consciousness as a result of the demands made of workers during the First World War combined with the Liberal Party splitting into Asquith and Lloyd George wings had helped the Labour Party become a national contender for power. The Labour leader Ramsay Mc Donald formed the first British Labour government in 1924 (which lasted between January and November that year) and heading a minority Labour government between 1929 and 1931 that received support from the Liberal Party.

The Conservative Party (Tory) also experienced profound change, gaining strong middle class support due to the steep decline of the Liberal Party. The Tory Party’s change was manifested in 1922 when party backbenchers formed the 1922 Committee which essentially took the party out of the National Coalition Government. *This committee ensured the succession in 1923 of the first Tory leader from the middle class, Stanley Baldwin. He first served as prime minister from 1924 to 1929.

(*The Conservative Party formally adopted a formalised selection process in 1965 by which parliamentarians then elected the party leader).

The advance of the Labour Party to be one of the nation’s two major political parties was a reflection of increased working class consciousness. Britain’s new second force was closely connected to the British union movement. An important political tradition in British trade unionism was that of voluntarism. In contrast to the American version of voluntarism (which emphasises civic involvement in society) the British version was (and is) trade union focused.

British voluntarism refers to the important role of trade union shop stewards (workplace delegates) in organising and often leading a virtual parallel force within the working class in regard to the interests of employers. Voluntarism has often been strong in coal mining communities. Ironically, an impact of British union voluntarism has been to facilitate a strong sense of working class identity and rank and file support for union organisation without a necessarily strong institutional bargaining position due to shop stewards arriving at ad hoc arrangements with management*.

(* The British scenario is almost the inverse of what occurred in Australia where a coherent and effective system of state backed arbitration was developed from the 1900s onwards enabling Australian unions, which were often craft based, effectively representing their members’ interests. The dilution of arbitral supports in the 1990s has led to a focus within the Australian union movement upon generating rank and file support to facilitate union effectiveness but achieving this outcome is still a work in progress).

The mobilization of working class support for the war effort was an important factor in the Labour Party displacing the Liberals in the 1920s as one of Britain’s two major parties. The Mc Donald led Labour Party’s refusal to support the May 1926 General Strike (which was precipitated by a coal miners strike after draconian changes in pay and conditions were imposed on mine workers) ensured that the party essentially remained a social democratic party despite Marxist sentiment amongst many rank and file members and some affiliated unions.

Mc Donald’s staunch refusal to support the 1926 General Strike resulted in the Labour Party gaining sufficient public acceptance to increase its number of seats in the 1929 elections to form a government with Liberal Party support. The new government essentially had no strategy to deal with the trauma that beset Britain and the world with the onset of the Great Depression in October 1929. The need for the Labour government to take ‘radical’ action to solve the problems was encapsulated in the advocacy by Oswald Moseley’s of Keynesian economics.

Labour’s Refusal to Adopt Keynesianism Spawns Mosley’s Fascism

Mosley, at this time (1929 to 1931) was the Chancellor of the Duchy of Lancaster (i.e. Minister without Portfolio outside the cabinet). This war hero was elected at the age of twenty-one to parliament in 1918 as a Conservative candidate and feted as a future prime minister. The young Mosley demonstrated great courage by breaking with the Conservatives due to their support for violent oppression in Ireland during the immediate post-First World War period. After a stint in the ILP, Mosley formally joined the Labour Party with the enthusiastic support of Prime Minister Mc Donald.

The relatively young minister might have had a very important positive impact on history had Prime Minister Mc Donald endorsed and implemented Mosley’s then radical Keynesian economic ideas. Keynesianism, (which was derived from the ideas of the great economist, John Maynard Keynes, 1883-1946) basically entailed increasing government spending to boost demand so that employment is generated. This economic approach became the economic orthodoxy in Britain following the Second World War.

Had Ramsay Mc Donald adopted a Keynesian approach to economics, Britain might have come out of the Great Depression earlier than what it did with his government being remembered as an important historical success. A political ramification of Mc Donald’s refusal to adopt Keynesianism was that Mosley broke with the government in 1931 to found the New Party. This party was probably the world’s most explicit politically Keynesian operation.

Due to the two party nature of the British political system, the New Party failed to win any parliamentary seats in the 1931 General Elections. Mosley should have taken the rump of the New Party which had an array of intelligent people to later transition them and their ideas into the political mainstream. Mosley’s political time could have come during and after the Second World War when Keynesianism virtually became the norm of government economic policy. Instead, Mosley fell under the sway of Italy’s ambassador to the Court of St. James (i.e. Britain) Count Dino Grandi. With secret Italian fascist regime funding, Mosley stupidly founded the British Union of Fascists (BUF) in October 1932.

Prospects for Keynesian economics being adopted before the Second World War were also ended by Prime Minister Ramsay Mc Donald in August 1931 breaking with his party to form a new coalition government composed of his personal Labour supporters (later known as ‘National Labour’), the Liberals and most importantly, the Conservative Party. The development of the National Government ended any prospect of Keynesianism being used to get Britain out of the Great Depression.

Indeed, the Mc Donald government between 1929 and 1931 had been a centre-left government which had refused to take the plunge by moving to a Keynesian economic paradigm. This refusal was probably due to uncertainty that deficit financing could work and the related fear that Britain’s existing banking-financial system might be consequently imperilled.

Both the Labour and Liberal parties missed a golden opportunity to innovatively lift Britain out off the Great Depression by utilizing Keynesian economics. National Labour and the National Liberals (those Liberals that remained in the National Government following the October 1931 elections) supported a Conservative Party dominated government that rejected Keynesianism.

The main non-parliamentary activity of interest of the National Labour Party (which was essentially a Tory satellite party that was first led by Ramsay Mc Donald and after his death in 1937 by his son Malcolm until this party was formally closed after the Second World War) was its publication, ‘The News Letter’. From a counter historical perspective, the National Labour might have avoided its inevitable decline had the publishers of the ‘News Letter’ linked up with former members of the defunct New Party to provide ideas and a sense of policy direction.

Future Labour foreign secretary Aneurin Bevan and future Conservative prime minister, Harold Mac Millan had been supportive of Mosley’s advocacy of Keynesianism but declined to follow him into the New Party. Both Bevan and Mac Millan would later be instrumental in having their respective parties adopt Keynesianism following the Second World War.

Mosley was thwarted in 1930 in his attempt to have the Mac Donald Government adopt his Keynesian ideas by his arch-rival, James Thomas, the Lord Privy Seal (i.e. Member without Portfolio within the cabinet). Thomas’s opposition was primarily derived from his deep personal dislike of Mosley. Although Thomas was undoubtedly correct in his character assessment of Mosley, the Lord Privy Seal’s opposition was unfortunate in that it probably denied Britain a possible means of getting out of the Great Depression.

A Stolid Centre Holds: Extremism Fails to Destroy British Democracy

The Mc Donald National Government (which was confirmed in office in the October 1931 elections) from 1931 to 1935 was really dominated by the Conservative Party. It is now seems ironic and seemingly inexplicable that the Baldwin-dominated Mc Donald government was then popular. The major accomplishment of this government was that it maintained general socio-economic and political stability.

During the Great Depression, Britain had the advantage of having a strong pound sterling as its currency. The value of the British pound sterling was partially derived from British banks and financial institutions having long term and diverse international investments. The value of the pound helped Britain to avoid the hyper inflation that Germany suffered in the 1930s that would be crucial to facilitating Hitler’s rise to power.

The real crime of the Mc Donald-Baldwin era was that the government allowed the heavy industrial and coal producing north of Great Britain to bear the brunt of massive unemployment. The more service orientated south survived in more modest but still relatively prosperous circumstances due to the government’s fiscal prudence.

Baldwin was considered to be the ‘strong man’ in the Mc Donald Government as its Chancellor of the Exchequer and because the Conservative Party was the biggest party within the coalition. The boorish Baldwin was popular due to his steady and uninspired safe handling of the economy. His stolid personality helped the Tories maintain their popularity with, if not the allegiance of most of the middle class and some of the working class during the 1930s.

The National Government maintained its internal cohesion due to the interest of Prime Minister Mc Donald in foreign affairs in preference to domestic concerns which were left to the narrow minded Baldwin. Prime Minister Mc Donald did have a passion for foreign affairs that was focused on making the League of Nations into the pre-eminent power in international relations. There was a bi-partisan belief in Britain that the horrors of the First World War could be avoided if there was an effective League of Nations

With regard to Britain’s domestic context, social and economic stability was also maintained in Britain during the Great Depression because the hard hit industrial north remained staunchly loyal to the British Labour Party instead of the unattractive Stalinist Communist Party of Great Britain (CPGB). The November 1935 elections paradoxically solidified the Labour Party’s position despite the Conservative Party maintaining its majority as the opposition party took seats from the National Labour Party whose prestige had been eroded after Mc Donald stood down as prime minister in June to be formally succeeded by Baldwin.

Political extremism in Britain in the 1930s was confined to the working class areas of East London. However, it was rumoured that elements of the aristocratic establishment financially supported the BUF to fight against the communist presence in East London so that the fascists would not threaten the Conservative Party on a nationwide basis, particularly by to appealing to the lower middle class. Another benefit of the BUF’s presence in East London was that it diverted the CPGB’s resources from potential bases of support in northern Britain.

The British Nexus Between Patriotism and Democracy

Traitors within the British establishment following the Fall of France in 1940 believed the BUF established the foundation for a future collaborationist regime. Such a regime probably would have been a coalition between deluded aristocrats and mindless East London working class toughs.

The idea of there being a collaborationist Britain was inherently ridiculous because the overwhelming majority of Britons were opposed toward any accommodation with Hitler. Indeed, Hitler had initially not been inclined toward conquering Great Britain after the 1940 Fall of France because he believed that the British government would acquiesce to German dominance of Europe in return for Germany forgoing an invasion of Britain and allowing the preservation of the British Empire.

The German dictator did not realize that, for most British, the war was more than a struggle for military supremacy but was an ideological one in which victory would be measured by the destruction of Nazism. Hitler, in deciding to conquer Britain, intended to impose the cruellest occupation regime that Mosley would probably have had a marginal role in heading a collaborationist regime.

Italy’s Failure to Consolidate Democracy Facilitates Fascism

For all the determination of Britain’s people and leadership to not only to resist Hitler but to destroy his regime there was still a strong British sentiment toward the Italian dictator Benito Mussolini until Italy’s declaration of war against France and Great Britain in early June 1940. Due to the current importance of Italy in determining whether the European debt crisis precipitates a profound international economic crisis, an overview of modern Italian history was overtaken.

The purpose of this review is to identify key themes so that possible courses of action to avert an international financial catastrophe can be averted by placing advocated solutions in a broader historical context to assess their viability.

Benito Mussolini’s (1883 to 1945) impact on Italian history was immense. In Europe in the 1920s and in the 1930s Mussolini was widely admired for apparently giving his nation a sense of purpose and achievement following the horrors of the First World War. It now seems bizarre that such a seemingly strange person as Mussolini, who came to power in 1922 by an apparent combination of bluff, opportunism and caprice, was internationally admired. In fact, Mussolini had already made a substantial impact on Italian history before being appointed prime minister and, had he never become dictator of Italy, he might have now an honoured place in Italian history.

The future Duce had been a socialist agitator with a great flair for journalism due to his simpatico writing style. His success in journalism was apparent when he edited the Socialist newspaper Avanti between 1912 and 1915. Avanti under Mussolini gained a nation wide circulation due to the paper’s compelling written style and lay out as opposed to its subject content. The avowedly Marxist and pacifist Mussolini stunned his Socialist Party (the PSI) and politically aware Italians in 1914 when he declared his support for the Entente which contradicted his party’s position of supporting neutrality.

Mussolini’s amazing about face led to amazing paradoxes that were partly reflected by his helping to sustain improbable alliances. The term ‘fascist’ that would notoriously become synonymous with Mussolini was coined in 1914 in reference to the improbable interventionist alliance between the liberal Italian Republican Party (PRI) and the authoritarian monarchist Italian Nationalist Association (ANI). Fasces originally referred to the bundle of sticks that had been used by officials in ancient Rome to symbolize the unity and justice of the state regardless of differences in rank. The fasces symbol was used to denote the temporary alliance between the PRI and the ANI.

The political polar opposites of the PRI and the ANI came together between 1914 and 1915 in joint rallies to agitate for Italian intervention on the side of the Entente to complete Risorgimento (‘Resurgence’) or the unification of Italy by taking the Italian speaking components of the Austro-Hungarian Empire. Mussolini through his rhetorical talents and the publicity he generated by flamboyantly resisting arrest helped forge the ‘fascist’ alliance between the two domestic opposites.

The future dictator might have been consigned to being an interesting footnote in history whose agitation had moderately contributed to Italy joining the Entente in 1915 by declaring war on Austro-Hungary had it not been for his role in subsequently sustaining the Italian war effort. Through the propaganda agitation of the French secret-service funded-Popolo d’ Italia, the commitment of Italy’s mildly anti-clerical middle-class to supporting the war effort was sustained. Without the determination of Italy’s middle class (who were the back bone of support for the Italian monarchy), the Italian war effort probably would have collapsed.

As the editor of Popolo d’ Italia, Mussolini succeeded in lifting home morale. He somehow managed to maintain his paper’s readers’ interests in himself by despatching egocentric but enthralling articles about his experiences at the front between 1915 and 1917 as a front line soldier. Although Mussolini’s first fascist electoral slate only garnered 54,000 votes in the 1919 national elections he still had a dedicated national following that extended beyond his then paltry voting base which would later be manifested by his seeming improbable rise to power.

Italy’s Royal House of Savoy

The later rise to power of Mussolini to power was due to the support that he received from the Italian ‘liberal’ monarchist elite and the Italian middle class. Italian unification was essentially achieved in 1861 due to the brilliance of Count Camilo Cavour and the supportive role of the House of Savoy.

The royal House of Savoy, which had originated in what is now Switzerland, ruled over territory for over one thousand years until Italy became a republic following a rigged referendum in early June 1946. A unique characteristic of this royal family was that they it did not remain stationary by ruling over a particular territory. As a result, the House of Savoy retained close links to its officer corps and troops to provide a sense of continuity when and after a territorial shift had occurred.

Therefore, the House of Savoy’s autocratic King Charles Albert of Piedmont-Sardinia was probably an insincere constitutional democrat when he aligned his kingdom with the revolutions of 1848 that swept the Italian peninsula that year. Despite the Austrian defeat of the 1848 Italian revolutions, the House of Savoy gained belated acceptance as the standard bearer of national aspirations among most Italian liberals desiring national unity against the dynasties of various Italian kingdoms and duchies whose survival was ultimately predicated upon Austrian support. Due to political necessity, Piedmont-Sardinia adopted an ambiguous constitution, the 1848 Statute.

The 1848 Statute was ambiguous because it fudged the issue of whether governments were responsible to the king or to the parliament. The fact that, between 1848 and 1922 (with a brief period of constitutional ambiguity in the 1890s under the authoritarian prime ministership of Francesco Crispi, whom Mussolini would later cite as his political inspiration) Piedmont- Sardinia was a parliamentary monarchy, due to the political legacy of the great liberal Italian statesman, Count Camilo Cavour.

The authoritarian-inclined King Victor Emanuel II in 1849 (who succeeded his father Charles Albert following his abdication) due to political necessity was compelled to accept parliamentary rule in 1849 and to appoint Count Cavour as prime minister of Piedmont-Sardinia in 1852. Count Cavour was a dedicated constitutional monarchist who held Victor Emanuel II in personal contempt due to His Majesty’s disdain for the 1848 Statute.

The political achievements of Count Cavour as prime minister are too numerous and the political skills he utilized to achieve them too complicated for them to be briefly overviewed. His major political accomplishments that can be briefly listed are the foundation of the Kingdom of Italy in 1861 and forcing a very reluctant Victor Emanuel II (who reigned as king of Italy from 1861 to 1878 until his death) to not only accept the 1848 Statute but to appoint governments based upon parliamentary support.

The achievement of Italian unification in 1861 was due to Count Cavour aligning Piedmont- Sardinia with Napoleon III’s Second Empire in 1859 to go to war against Austria. The French Emperor’s objective had been to destroy Austrian power on the Italian peninsula so that an Italian confederation could be established under the leadership of the pope. Because the temporal rule of the popes in the Papal States had been reliant since the 1848 revolutions on the support of French garrisons, Napoleon III envisaged that Italy would be dominated by the French and that he would be able to gain and maintain Catholic domestic support for his regime.

Napoleon III’s scenario did not come to pass because the vacuum caused by Austria’s military defeat in 1859 was so great that Italian unification was achieved in 1861 under the leadership of Piedmont-Sardinia instead of by a French backed papal led Italian confederation. This tremendous achievement of Cavour’s created too much a strain on his health and he died within weeks of Italian unification been achieved.

It has been said Napoleon III’s reign could have ended in great success had His Imperial Majesty not had to contend with the superior political skills of Otto Bismarck and Count Cavour. That may have been true, but in the case of Cavour (as opposed to Bismarck) it was his intention to consolidate the newly created state as a constitutional parliamentary monarchy whereas Bismarck had wanted to maintain autocratic rule via domestic and foreign policy manipulation.

Stalled Party Formation Retards Italian Democracy

That the Kingdom of Italy did not consolidate as a parliamentary monarchy was due to the dysfunction of the Italian party system which was reflective of unresolved religious and class differences in Italian society. Due to papal hostility toward the Italian Kingdom (which resulted from the Italian incorporation of the Papal States in 1870 following the withdrawal of French troops to fight against the Prussians), too many Catholics initially refused to participate in national politics.

Ironically, to guard against possible Catholic infiltration, the ‘party’ of the Italian liberal elite, the Italian Liberal Party (PLI), was not a conventional political party with branches. Instead government appointed prefects (who acted as representatives of the national government at a local government level) more often than not organised PLI electoral tickets and campaigns.

The Italian liberal elite also maintained its power by initially restricting the voting suffrage and gerrymandering and manipulating votes in the south of Italy as male suffrage was extended. As a result, when the working-class supported Italian Socialist Party (PSI) was founded in 1895, it was strongly Marxist orientated and staunchly republican. This militated against Italy being a functioning parliamentary constitutional monarchy with widespread public acceptance.

Furthermore, due to the covert power that Italian kings exercised through having a secret service, links to the Piedmontese officer corps and personal network within the diplomatic corps, Italy’s capacity to have a non-political constitutional monarchy was further constrained.

In the light of subsequent events, it was ironic that the accession in 1900 of Victor Emanuel III (1869 to 1947) as king seemed to herald Italy becoming a genuine constitutional parliamentary monarchy. The new king (who succeeded his assassinated father Umberto I) was then considered to be a political liberal. His Majesty was considered to be an intelligent man in his own right. But Victor Emanuel III’s intelligence was overwhelmingly derived from the cynical deductions that His Majesty made.

The king’s cynical nature was manifested when he went into a political alliance with another cynic, Giovanni Giolitti (1842 to 1928). This liberal statesman was a cynical operator but his political aims were sincere in that he considered himself to be the political heir of Count Cavour. As such, Giolitti’s political objectives were to create an overwhelmingly accepted constitutional democratic parliamentary monarchy. Therefore, as *prime minister, Giolitti often took either a neutral stance or pro-labour stance in industrial disputes as part of his strategy of converting the PSI into a parliamentary orientated party that accepted the legitimacy of the Italian monarchy.

(*Giolitti served as prime minister from 1903 to 1905, 1906 to 1909, 1911 to 1914 and from 1920 to 1921).

Giolitti’s intermittent absences from office as prime minister were strategic withdrawals. Until 1915, the Italian governments that were formed were based upon Victor Emmanuel III acting on Giolitti’s advice or parliamentary majorities that he had assembled. When there was pressure for political reform, such as extension to the voting suffrage, Giolitti cynically granted reform to strengthen his political position.

This Italian statesman’s cynical approach to reform was manifested in the 1900s when voting suffrage was expanded so that electoral manipulation could be undertaken by government-appointed local-government prefects in the south. As cynical as Giolitti was, he still believed the foundation for Italy becoming a genuine democracy was being set by expanding voting suffrage to help convert the PSI into a social democratic party.

Giolitti in Eclipse? : Italy Enters the First World War

Giolitti was opposed to Italy’s entry into the Second World War in 1915 and his power went into temporary political eclipse after Victor Emmanuel III defied him by exercising the royal prerogative of declaring war on Austria-Hungary. The socio-political ramification of Italy’s agonising involvement in the First World War was such that there was a widespread demand for political reform emerged at the war’s end.

The post-war groundswell for political reform was such that the parliament in 1918 heeded calls from a determined, if war weary public, to pass legislation (over Giolitti’s strenuous objections) that introduced a proportional system of parliamentary representation elected on a list system instead of on a single member constituency basis.

Giolitti’s fears that Liberal dominance would be ended were seemingly confirmed when the PSI and the Christian Democrat Populari slates won a parliamentary majority between them in the 1919 elections. Profound differences within the PSI and the Populari as well as internal party differences within the two respective parties enabled the politicians from the liberal elite to hold onto power. This was reflected by Victor Emanuel III recalling Giolitti as prime minister in 1920.

In his last tenure as prime minister (1920 to 1921) Giolitti was his last and least auspicious because he inadvertedly paved the way for fascism to come to power in 1922. Under Giolitti’s orders, prefects and city police chiefs helped organise fascist squads to overthrow Marxist orientated PSI councils and break up industrial strikes. Giolitti supported these actions in pursuit of his objective of transforming the PSI into a democratic centre-left party and the PLI into a conventional political party.

The role that Giolitti fulfilled in cultivating Italian fascism has been condemned but his objective was always to break the power of the Marxist wing of the PSI. For this reason, Giolitti bolstered Mussolini’s position as the leading fascist on the basis that this former socialist would eventually return to the PSI to facilitate its transformation into a social democratic party. To support Mussolini’s political standing the prime minister placed fascists on his electoral slates for the May 1921 elections. Thirty five fascists (including Mussolini) were elected to parliament out of five hundred and thirty five seats. From the parliamentary caucus that was formed Mussolini instigated the establishment of the Italian Fascist Party in August 1921.

Mussolini did his covert mentor (Giolitti) a favour following the 1921 elections by entering into an ostensible alliance with anti-Giolitti ANI. This seeming act of ingratitude provided Giolitti with the pretext to resign as prime minister so that he could continue his work behind the scenes to transform the PSI. The two succeeding prime ministers (Luigi Facta and Ivanoe Bonomi) between 1921 and 1922 were covertly aligned to Giolitti that they continued his strategy of discreetly supporting the fascists.

The possible turning point in Italian history was almost reached in June 1922 in relation to Giolitti reaching his long fought goal of transforming the PSI when a general strike was crushed due to government backed fascist counter mobilization. The general strike of June 1922 was called by the Italian General Confederation of Labour (CGIL) to mobilize working class opposition to fascism. The failure of the general strike led to the PSI severing its links to the Marxist dominated CGIL.

To prepare his way for a return to power in coalition with the PSI Giolitti called an inaugural congress of the PLI in October 1922 to convert this ‘party’ into a conventional middle class centre-right one instead of a loosely organised political operation that served the interests of Italy’s elite ( of which Giolitti belonged). Giolitti might have succeeded in his transformation of Italian politics had it not been for the intense resistance of the authoritarian ANI.

The ANI was an elitist authoritarian organisation founded in 1910 by nationalists who advocated territorial irredentism and Italian colonial expansionism with a government that was responsible to the king rather than the parliament. From the outset, there were different ideological tendencies within the ANI but Italian nationalists had an overriding belief that Italian national renewal could be achieved via power being exercised by national elite that was dedicated to the acquisition of an Italian colonial empire in Africa.

The most important ANI leader was Luigi Federzoni who secured his pre-eminence within the nationalist organisation by being elected to parliament in 1913. The ANI first made its mark on Italian national politics by linking up with its nemesis the PRI to demand that Italy enter the First World War against Austria-Hungary to secure Italian speaking territory that was part of the Hapsburg Empire. The ANI was vehement in its condemnation of the 1919 Treaty of Versailles which it considered had sold Italy short with regard to the territory that had been promised under the secret 1915 Treaty of London with the Entente.

The real power of the ANI was derived from its support for Antonio Salandra who became the major rival to Giolitti within the Liberal camp, when as prime minister he defied the Liberal statesman, to help instigate Italy’s entry into the First World War in 1915. After the war’s conclusion the ANI established its own blue shirt militia which was mainly based in the south that was primarily composed of war veterans. Although the ANI only had a handful of seats in the Italian parliament, it was a powerful party because right wing Liberals denoted their anti- Giolitti stance via their support for the ANI.

Who is Using Who? The 1922 ‘March on Rome’

In response to Giolitti convening a PLI congress in Rome in October 1922, the ANI, which also had links to anti-Mussolini elements within the Fascist Party, convened a meeting of fascists in Naples where it was resolved that there would be a ‘March on Rome’ to seize power. The aim of the March on Rome was not to bring Mussolini to power but to make Salandra prime minister so as to prevent Giolitti’s return to office.

The four leaders (the quadruvirs) who led the October 1922 March on Rome were Michele Bianchi, Italo Balbo (who was a fascist republican), Emilo De Bono and Cesare de Vecchi (who was a staunch monarchist). The quadruvirs, with the possible exception of de Vecchi, probably did not know that the March on Rome was being used by pro-ANI elements at the royal court to facilitate Salandra’s return to power.

Mussolini knew that the objective of the ANI backed March on Rome was to prevent Giolitti’s return to power without which he himself could not re-enter the PSI. Consequently, Mussolini took refuge in the Milan offices of Popolo d’ Italia so that he could escape to Switzerland if the March on Rome was crushed. Much would be made of Victor Emanuel III’s refusal to sign the state of emergency to authorize military action against the fascist Black Shirts. But the king’s decision to thwart military force was derived from His Majesty’s desire to restore Salandra’s return to power and to finally politically eliminate Giolitti whom His Majesty had been compelled to restore to power in 1920 to end Gabriel d’Annunzio’s occupation of Fiume.

The ever astute Giolitti, knowing that the March on Rome was intended to politically eliminate him, moved to protect Mussolini. Even though a state of emergency had not been declared due to the king’s refusal to authorize one, the outgoing Facta government still issued an order for Mussolini’s arrest to prevent his possibly coming to power. (There was also a theory that Facta was covertly aligned to Salandra). However, the police chief and prefect in Milan who were loyal to Giolitti refused to arrest Mussolini.

The fascist entry into Rome with Mussolini still free in Milan ironically enabled Giolitti to turn the tables on Salandra and the ANI that he could return to power in coalition with a domesticated PSI. Such a development would have consolidated Giolitti’s position within the Liberal camp and marked a point of no return with regard to Italy’s transition to an unambiguous democracy. The international ramifications of such a scenario would have also been very positive because Giolitti’s political heir was the former Foreign Minister and diplomat Count Carlo Sfroza (1872-1952).

The anglophile Milanese Count was a staunch supporter of the League of Nations and in contrast to his mentor Giolitti, Count Sfroza was never prepared to manipulate democratic processes. A restored Giolitti probably would have appointed Sfroza Foreign Minister thereby paving the way for him to later become prime minister or at the very least be a future PLI leader.

Salandra’s realization that the fascist March on Rome would now precipitate return of Giolitti to power led him to offer Mussolini by phone the position of deputy prime minister. Mussolini refused that a desperate Salandra offered him the prime ministership! The prime minister-to-be insisted that the king send him a telegram commissioning him to head a new government. With the necessary telegram from the king’s secretary in his shirt pocket, Mussolini departed by train from Milan to Rome to take up his appointment as prime minister.

It was Mussolini’s original intention to appoint PSI members to his cabinet but, on arriving at the Termini central train station in Rome and being met by Salandra and Federzoni the prime minister designate was compelled to relent. The cabinet that was formed, still initially contained pro- Giolitti Reformist Socialists (who had previously split from the PSI in 1912), respective Giolitti and Salandra Liberals and the Populari with Federzoni being the only ANI cabinet minister as Colonial Secretary.

The immediate political ramification of Mussolini’s appointment as prime minister was that he actually gained control to discipline fascist Black Shirts by turning them into a state funded and controlled militia. The Fascist Party merged with the ANI in 1923 to form the National Fascist Party (PNF). This merger helped regularize the fascists within a more regular political framework while providing them with a base south of Rome which had previously been the base of the ANI.

What is Fascism? The Mussolini Regime in Transition, 1922-1926

The major abuse of Mussolini’s regime between 1922 and 1924 was stacking the parliamentary gallery with Black Shirts to coerce the parliament to pass the Acerbo electoral law in 1923 which allocated a two thirds majority of parliamentary seats to a winning national list. The PNF ‘National List’ won the requisite two thirds majority in the April 1924 elections with varying degrees of intimidation across the nation.

Impressively, the major opposition parties, encompassing the Populari, Reformist Socialists, PSI, the PRI and Sfroza Liberals still won a majority of the vote in northern Italy which helped them gain a third of the seats in the lower house despite their failure to form a united slate. (The Reformist Socialists and the Populari had separately withdrawn from the cabinet in 1923 and 1924 to go into opposition).

Mussolini’s April 1924 election ‘victory’ did not necessarily mean that a fascist dictatorship was going to be established. A majority of the candidates on the National List were Salandra ‘Liberals’ and it was Mussolini’s intention to bring the former PSI leader Claudio Treves into the cabinet. Such a development might have changed the course of Italian history had the social democratic parliamentarian Giacomo Matteotti not been murdered in June 1924 following a heated exchange with Mussolini in parliament.

Most Italians were so shocked by Matteotti’s murder that Mussolini was moved to resign in favour of Treves, who had recently broken with the PSI to form a new party, the Unitary Socialists, the PSU. Had Mussolini resigned, he actually would have been succeeded by Salandra who then had the most supporters in the Chamber of Deputies. That Mussolini did not resign was due to the intervention of the * Queen Mother Margherita who adored him.

(*The Margherita Pizza is named after Queen Margherita).

A listless Mussolini lingered on as prime minister in a zombie type fashion for six months. Power probably would have passed from Mussolini to Salandra had Federzoni not moved into the political void by becoming interior minister. Between June and December 1924, Federzoni turned Italy into an authoritarian nation state in which power was exercised through the state bureaucracy. During this six month period, elected local government was abolished and strict press censorship was imposed.

Roberto Farinacci: Fascism’s Fascist

Federzoni probably would have displaced the beleaguered leader to establish an authoritarian regime had Roberto Farinacci (‘Fascism’s fascist’) not burst into the Prime Minister’s office at the end of 1924 to force him in early January 1925 to make a speech before the Chamber of Deputies in which Mussolini repudiated parliamentary democracy and assumed implicit responsibility for Matteotti’s murder.

The January 1925 speech probably precipitated a nervous breakdown on Mussolini’s part that between January and February 1925 he disappeared from public view. Although details are unclear it seems that Federzoni, Giolitti* and Salandra moved with Victor Emanuel III’s support to form a secret ruling triumvirate reflective of the interests of the ruling liberal elite. This may have occurred with Mussolini being dispensed with had the prime minister not capitulated to Farinacci by appointing him PNF Secretary in March 1925.

(*Giolitti, who due to his prestige retained his seat in parliament, denounced the regime in a parliamentary speech before he died in 1928, thereby disassociating himself from fascism. A message was discreetly, if curtly conveyed, by the Giolitti family to Victor Emanuel III that it would be best that His Majesty not attend the former prime minister’s funeral).

During his six months as PNF Secretary (March to August 1925), Farinacci established the basis by which the ruling fascist party became a regimented vanguard semi-totalitarian party similar to the CPSU in the Soviet Union. The strengthening of the PNF led to a reconfiguration of the liberal elite into a new fascist corporatist framework that would rule all of Italy until 1943. The formation of a strong fascist party so helped Mussolini consolidate his power that he became ‘head of government’ at the end of 1925 which meant he was only responsible to the king who had the prerogative to dismiss him.

Reconciling Contradictions: The PNF Activist Bureaucratic Regime, 1926 to 1943

The convoluted ways by which Italy became a dictatorship in the four years following the ‘March on Rome’ in 1922 has helped make the Mussolini regime between *1926 and 1943 difficult to politically categorize. In broad terms, the 1926 to 1943 PNF regime was a statist bureaucratic one, which in contrast to such regimes had a strong mobilization capacity based upon a charismatic leader who appealed to nationalism. Co-option as opposed to domination or elimination of powerful institutions such as the monarchy, big business and the Catholic Church was a key determinant of the regime’s success. Mussolini’s strongest asset was his capacity to synthesise different interests to make himself practically indispensable.

The dictatorship’s power was exercised through both a bureaucracy and a well organised and state funded ruling party*. The technical skills of the nation’s elite, which had previously constituted the pre-fascist liberal establishment, were co-opted by the regime. Through its avowed corporatism, the regime utilized the support of big business into helping formulate and implement the regime’s economic policies.

(*In 1926, Italy formally became a one-party state and Federzoni was removed as Interior Minister, although he remained a member of the Great Council of Fascism).

With regard to the statist dimension of the regime the PNF was a bureaucratic organisation with most of its members (or officials) coming from the middle class. Nevertheless, the PNF gained widespread support among poorer Italians by servicing their local needs. This was due to there being an efficient system of local government in place because Rome-appointed prefects directly took control of local government.

Although prefects were compelled to join the PNF, Mussolini did not allow the party bureaucracy to exercise any power over them. Instead, parallel party structures at a local government level were established that were headed by party chiefs known as ‘Rases’. The role of a Ras was to build up local support for the PNF and to proselytize among local inhabitants. Even in small hamlets, Rases (or their representatives) established a party presence which often conveyed the impression that Mussolini’s power was omniscient.

The regime may have seemed omniscient to most Italians because it consciously made a difference in everyday lives. ‘Fascism’ now generally denotes a reactionary negative approach to new ideas. But in the 1920s and in the 1930s, this term then conveyed an avant guard acceptance of novel ideas and approaches. Mussolini gained his greatest notoriety for supporting Hitler’s anti-Semitism but in the 1920s he was the first major European leader to publicly support the establishment of a Jewish state.

The German Nazi regime also gained infamy for its mistreatment and murder of the mentally ill but a conference that Mussolini addressed in Rome in 1930 was the beginning of psychology being accepted as a legitimate branch of medicine. Although Mussolini was a self declared male chauvinist, he appointed Maria Montessori as the de facto Education Minister as Inspector of Italian schools. But the first signs of anti-Semitism led Montessori to break with the regime and leave Italy in 1934.

Montessori’s break with Mussolini was a sign that he was not infallible. Even though Mussolini’s post-war reputation would become the inverse of what had it had previously being, that of being overwhelmingly admired many Italians and non-Italians still regard him as a brilliant ruler whose chief mistake was that he aligned Italy to Nazi Germany. In fact, Mussolini’s very coming to power in 1922 was a disaster because it occurred at the point at which Italy was transitioning to become an unambiguous constitutional democratic monarchy by having a coherent democratic competitive party system.

The economic and social achievements of the PNF regime would have occurred anyway had Italy had a coherent party system with a social democratic PSI, a Christian democratic orientated Populari and a lateral PLI. Such a coherent party system would have brought to the fore the talents and energy of Italian society within a context of public acceptance of the state as represented by their monarchy. The ultimate benefit of a constitutional monarchy with a coherent party system would have provided sufficient safeguards against Italy pursuing an aggressive foreign policy that culminated with entry into the Second World War in 1940.

With regard to the regime’s successes they reflected Mussolini’s leadership skills which were derived from a superb opportunism that reflected his amoral pathology. As a result, Mussolini was able to turn seeming hopeless situations to his advantage and square stark contradictions to seemingly achieve spectacular results. The Italian dictator also had an often endearing capacity to combine sternness with a droll sense of humour.

But for all of Mussolini’s simpatico, his great failing was his adamant refusal (until after his 1943 dismissal) to admit that he could be wrong or fix mistakes that he had made thereby admitting that he had initially being wrong. Mussolini therefore (with the exception of his beloved brother Aranaldo who died in 1932) denied himself competent and honest advisers who could have warned him of possible pitfalls of his decision making.

Count Dino Grandi: The Regime’s Intelligent Fascist

Due to the skill of one of his key advisers, Count Dino Grandi (1895 to 1988) Mussolini’s leadership deficiencies did not become apparent until Italy’s opportunistic and ill-considered entry into the Second World War in June 1940. Count Grandi was a sycophant, but in contrast to most sycophants, he normally gave good advice and was usually successful in persuading the dictator to accept his counsel. The successes of the Mussolini regime were primarily due to the ability of Count Grandi so that a brief biographical overview of his life is warranted.

Count Grandi returned to complete his law degree at the University of Bologna after the end of hostilities in 1918. At university, Grandi possibly formed Italy’s first squadristi of university student/war veterans in 1919 which was based in the Po Valley. In the pay of big landowners and industrialists, the Grandi led squadristi terrorised the PSI in the Po Valley. This massive valley in Italy’s north-west is the industrial heartland of the nation.

It cannot be said that fighting against tenant farmers who were trying to gain an equitable rent was a noble undertaking by Grandi’s squadristi. But Grandi was shrewd enough to realize that the strong support that tenant farmers gave to their PSI commune (communes were and are the lowest level of Italian local government and as such are not to be confused with Mao’s version of Chinese agricultural collectivism) was based upon inequitable rents. Count Grandi therefore had his landowner political masters agree to reduce rents and improve conditions for their tenants in return for their withdrawing support for the PSI.

The Count’s success in Bologna established the model that Giolitti and succeeding Giolittian governments applied between 1920 and 1922 of supporting squadristi gangs (which were usually composed of war veterans) attacking the PSI local councils, newspapers and unions. This Giolitti backed strategy was undertaken to crush the Marxist wing of the PSI to ultimately transform this party into a social democratic party.

Elected to parliament in 1921 with thirty four other fascists on the Giolitti slates, Grandi unsuccessfully tried to become leader of the Fascist Party upon it being formally constituted a party in August that year. As a result, Grandi was initially on the outer when Mussolini came to power in October 1922. Due to his party power base in the Po Valley, Count Grandi was involved in the negotiations with Federzoni (who similarly came from Bologna) which helped lead to the formal merger of the Fascist Party and the ANI to form the National Fascist Party (PNF) in 1923.

Utilizing his friendship with Federzoni, Count Grandi was appointed undersecretary (i.e. deputy) secretary for the interior in 1924 and in this position he helped Federzoni as interior secretary to establish a statist bureaucratic authoritarian regime. Despite Count Grandi’s initial support of Federzoni, he ingratiated himself with Mussolini by vigorously defending the prime minister in parliament following Matteotti’s murder. Grandi’s rhetorical skills in defence of Mussolini probably saved his government from a successful parliamentary vote of no-confidence. Mussolini’s subsequent capacity in asserting his power over Farinacci and Federzoni by dismissing them respectively in 1925 and 1926 was assisted by Count Grandi’s support.

The basis for the fascist regime’s economic strength was also derived from Count Grandi. In 1925 he made a very successful visit to the United States in 1925 where he negotiated a loan that enabled Italy to repay its wartime debts. This loan also provided the financial base for industrialization and public works programmes to be successfully undertaken by the regime in the 1920s and 1930s. Count Grandi was appointed undersecretary (i.e. deputy) foreign sinister in 1926 to then become of one of Europe’s most respected foreign ministers after he was promoted to that position in 1929.

As foreign secretary (i.e. foreign minister) Count Grandi helped negotiate the Lateran Treaty in 1929 in which the Vatican and Italy established diplomatic relations thereby recognizing each other’s legitimacy. This was probably the Mussolini regime’s most impressive achievement because it reconciled many still recalcitrant Italian Catholics into accepting the legitimacy of their state. The regime’s international power was also manifested due to Count Grandi’s skill that was demonstrated in 1931 when helped block a customs union between Germany and Austria.

To clip Count Grandi’s wings, Mussolini sent him into diplomatic exile by appointing him Ambassador to Great Britain in 1932. As previously mentioned, he mis-advised Mosley into founding the BUF in October 1932. The ambassador to the Court of St. James more substantially made his mark on history during the Italian invasion of Ethiopia (then known as Abyssinia) between October 1935 and May 1936.

The Italian invasion was a military shemozzle, and had the League of Nations imposed oil sanctions on Italy, the invasion would have failed and the Mussolini regime would probably have fallen. Exploiting the then British elite obsession with the League of Nations, Count Grandi helped persuade British Foreign Secretary Sir Samuel Hoare to oppose the League of Nations imposing oil sanctions on the basis that the viability of the League would be undermined by alienating Italy. Count Grandi sent Mussolini coded daily messages from London relaying his progress in stalling the British. Knowing that possible international action was being stalled by Count Grand, Mussolini sent daily urgent messages to commanding officers in Ethiopia to continue their advance.

Mussolini Enters Hitler’s Orbit

While the ill-considered Italian conquest of Ethiopia in 1936 had essentially placed Italy within Germany’s sphere, Count Grandi’s influence in London remained strong. This was because Britain’s Tory leadership believed that Count Grandi could prevent Mussolini from entering into an alliance with Nazi Germany. This misassumption helped lead British prime minister, Neville Chamberlain to support having Mussolini as a mediator at the September 1938 Munich Conference.

The Munich Conference was a farce because there was no mediation on the part of the Italians, British and French between the Czechoslovaks and the Germans. The Czechoslovak delegation was shut away from the proceedings as Hitler was given Czechoslovakia’s Sudetenland territory without any qualifications. The great political loser (besides Czechoslovakia) of the Munich Conference was France as once stalwart allies such as Roumania and Yugoslavia breaking with the French to go into alliance with Italy.

Italy’s industrial and military capacity was not as great as France’s but, between 1938 and 1940 Italy superseded France in political power in Europe due to the Munich debacle. Count Grandi helped arrange the visit of Prime Minister Neville Chamberlain and his Foreign Minister Lord Halifax to Rome in January 1939 so that Italy’s power could be consolidated as a bulwark against Nazi Germany. Instead of heeding Count Grandi’s advice to accept the British offer of alliance, Mussolini and his alter ego son-law, the Foreign Minister Count Galeazzo Ciano, scorned Chamberlain and Halifax’s offer of an alliance considering it to be a sign of the weakness of a declining empire.

Mussolini and Count Ciano therefore sealed their personal future doom and that of fascist Italy by solidifying an alliance with Nazi Germany by concluding a treaty in May 1939 that was called ‘Pact of Steel’. Hitler, on his visit to Rome in May 1939 to sign this treaty personally insisted upon Count Grandi’s recall from London because he regarded the then Italian ambassador to the Court of St. James as the major obstacle to an effective Italian-German alliance.

The July 1939 recall of Count Grandi (who was subsequently appointed Justice Minister) initially rebounded on the Germans. The German invasion of Poland in September 1939 was a shock to Mussolini because the Polish regime was an Italian ally and because the Italian dictator knew that his country was militarily unprepared to go to war. The self-generated dilemma for Mussolini was that his regime’s projected bellicosity was such that it would seem incongruous for fascist Italy to declare neutrality following the outbreak of war. Acting on advice from Count Grandi, Foreign Minister Ciano forwarded on to Mussolini the concept of ‘non-belligerence’ as the official stance for Italy’s status in regard to the state of war.

Count Ciano: The Feckless Heir Who Still Changed History

Having officially adopted the official stance of ‘non-belligerence’ Mussolini then appointed a new cabinet in September 1939 primarily composed of ministers that believed it best that Italy not go to war. The ministers were appointed by Mussolini on Count Ciano’s recommendation which seemed to consolidate the foreign minister’s unofficial status as the regime’s heir apparent. In reality, the newly appointed ministers were originally suggested to Ciano by Count Grandi and as such these ministers were staunch monarchists whose deeper loyalty was to Victor Emanuel III.

For all his faults, Count Ciano (1904-1944) remained a monarchist until his execution, at Hitler’s instigation, in January 1944. Count Ciano’s appointment as foreign minister was not only due to the nepotism of being Mussolini’s son-in- law but also as the son of Admiral Costanzo Ciano. Admiral Ciano’s historical importance was that he helped secure aristocratic support for Mussolini without which he probably could not have established a dictatorship in the 1920s. The marriage of Galeazzo Ciano and Mussolini’s daughter Edda in 1930 essentially constituted a political consummation of the alliance between Mussolini’s middle class support base and the Italian elite as represented by Count Ciano.

Following the Second World War, Mussolini’s widow, Donna Rachele Mussolini, erroneously attributed her husband’s 1943 fall to her son-law whose power she had overrated and reviled. Senora Mussolini was incorrect because Ciano’s domestic power was ultimately derived from Mussolini and Count Grandi.

As feckless as Ciano was, he was a very powerful foreign minister (1936 to 1943) because he bypassed official diplomatic structures to personally conclude alliances with national leaders. He was singularly similar to his father-in-law in that he was an amoral opportunist for whom treaties and agreements, even if at first sincerely entered into, would be cynically discarded for immediate gain.

This approach of Count Ciano’s was manifested when he utilized his rapport with Yugoslav Prime Minister Milan Stojadinovic to forge a de facto alliance with Yugoslavia in 1938. Up until this time, Yugoslavia had been Italy’s main rival in the Mediterranean. Nevertheless, Italy participated in the invasion and temporary dismemberment of Yugoslavia in 1941 which ultimately helped bring Italy under further German domination.

As evidenced in his diaries, Count Ciano was an often perceptive but cynical analyst, particularly with regard to Italy falling under German domination. His diaries also revealed someone who despite his anti-German reservations, still supported the Axis alliance with Germany as a means of advancing Italian power. This contradictory approach of Ciano’s was sustained because his anti-Gestalt, day to day approach helped determine his subsequent actions on an opportunistic basis.

Count Ciano’s real impact on history was that he crucially helped his father-in law-exercise domination in foreign policy by bypassing diplomatic channels, which eventually led to Italy becoming subordinate to Nazi Germany. The only time that Ciano had even a potential capacity to more laterally determine events was when he took advice from Count Grandi.

Ironically, the only actual nominee of Ciano’s that was appointed in 1939 to the cabinet was Alessandro Pavolini, who became the Minister for Popular Culture (i.e. propaganda). Pavolini would break with Ciano by opposing Mussolini’s July 1943 dismissal to become the number two in Mussolini’s Italian Social Republic *(RSI) as head of the new Italian Fascist Republican Party.

(* The RSI was created in September 1943 by the Germans and lasted until they were finally defeated in Italy in April 1945).

In the period between the outbreak of the Second World War in September 1939 and the Fall of France in June 1940, Victor Emanuel III, Ciano and Count Grandi formed a de facto triumvirate that was sufficiently powerful enough to have prevented Mussolini from entering Italy into the Second World War. Had Victor Emanuel III and Count Ciano not broken with Count Grandi to support Mussolini’s declaration of war on Britain and France in June 1940, Italy would have avoided entering a war in which at best she could only be subordinate to a successful Germany or at worst, as did eventuate, go down to military defeat.

The king, Mussolini and Count Ciano knew that Italy was militarily unprepared to fight a war but they believed that the Fall of France meant a ‘peace settlement’ similar to the 1938 Munich Agreement would be arrived at in which Britain would acquiesce to German domination of Europe in return for allowing the British to keep their empire. Due to persistent British attempts to cultivate fascist Italy right up to June 1940, it was erroneously believed by Mussolini and the traditional elite-dominated Italian diplomatic corps that Italy could fulfil a mediating role at such a ‘peace’ conference between the Germans and the British.

The Italian declaration of war was cynically envisaged by the Mussolini regime as a means of appropriating most of France’s North African Empire and gaining subsequent domination in the Mediterranean as Italy’s ‘sphere of influence’. The problem was that the Italian elite having moved from supporting an ostensible liberal framework to a fascist one were too cynical not to understand the Great Britain was a genuine democracy for which any accommodation with Hitler was an anathema.

Exits for Italy Close as the United States Enters the Second World War

The disaster of Italy’s declaration of war against Britain was consolidated by Mussolini declaring war on the United States in December 1941 following the Japanese bombing of Pearl Harbour. The United States entered the war with the determination to ensure regime change in Germany, Italy and Japan. With American support, the British and Free French had driven the Germans and Italians out of North Africa by May 1943, and in early July of that year, Allied landings were undertaken in Sicily.

In relative fairness to Mussolini, he did appreciate in February 1943 that with the German defeat at Stalingrad the Axis could not win a two front war. The Italian dictator then moved with his unique skill (which he had utilized on coming to power in October 1922 and in mastering the political fallout from the 1924 Matteotti assassination) of turning seemingly hopeless situations to his advantage to break with *Germany.

(* Unaware of his earlier attempt to break with the Axis, Hitler met with Mussolini in Germany in September 1943 following his daring rescue by German paratroopers. A dejected Mussolini reluctantly agreed to Hitler’s demand that he head the new RSI regime. Ever the opportunist, Mussolini, who now knew that an agreement with the western Allies could not be obtained, suggested to Hitler that a cease-fire be reached with Stalin so that the Axis could fight against the British and the Americans. Hitler gruffly ignored Mussolini’s suggestion.

What autonomy and effectiveness that the RSI had was in regard to its propaganda output. Hitler’s status as German Fuehrer had been partially linked to the German people revering Mussolini (the ‘Duce’) as a demi-god whose rule over Italy had presaged the Nazis coming to power in Germany in 1933. It was therefore more than an act of friendship on Hitler’s part to Mussolini that he was restored to nominal power as ‘president’ of the RSI.

Due to Hitler’s desire that Mussolini retain his mystical status as Duce, the only substantial concession that Mussolini was granted by Hitler was to direct RSI propaganda. RSI propaganda projected the regime as left-wing based on the mainly unimplemented ideas of Mussolini’s new confidant, Nicola Bombacci, who was a former communist. Mussolini’s forlorn hope that a political settlement be reached with the Soviet Union was subtly conveyed in RSI propaganda and derisively tolerated by the Germans due to its inherent non-viability).

Firstly, to both ingratiate himself with the Germans and to deceive them, Mussolini dismissed Count Ciano and Count Grandi from the cabinet in February 1943 following the German defeat at Stalingrad. The cabinet revamp was intended to convey to the Germans that their Stalingrad defeat would not result in Italy breaking with the Axis. However the appointment of Count Ciano as Italian ambassador to the Vatican was made so that the former foreign minister could initiate contacts with Allied diplomats. The dismissal of Grandi similarly conveyed that Mussolini was ostensibly distancing himself from ablest and most anti-German fascist, Count Grandi.

The break that Mussolini intended to make with the Germans centred upon the convening of the Great Council of Fascism (the Council) on July 24-25th. The Council was the highest organ of state and was not as has been assumed the fascist equivalent of a Communist Party type of Politburo. The Council was essentially a corporate statist encapsulation of the ruling elite rather than the supreme directorate of a ruling vanguard totalitarian party.

This Council had been created by Mussolini to ensure that, in case he was to die in office, his power would not transfer to the monarchy. Indeed, the royal laws of succession were changed in 1930 to stipulate that Crown Prince Umberto’s (who was officially titled the Prince of Piedmont) accession to the throne be approved by the Council. Due to this qualification (which Victor Emanuel III strongly resented), there was the prospect that the royal succession could be diverted to the Aosta cadet branch of the House Savoy. The strong support that the Aosta branch had within the aristocracy became all the more committed to Mussolini on the basis that the royal succession might be changed.

The creation of the Council was therefore a source of power to Mussolini rather than a restraint. Prior to the July 1943 meeting of the Council, Rome (which had just been subjected to an Allied aerial bombing) was agog with rumours of conspiracy against Mussolini. The dictator had been warned by family members and PNF officials of a conspiracy against him and they urged him to arrest leading members of the Council and even move against the king. Instead, Mussolini not only proceeded with the Council meeting but permitted Count Grandi to table his motion that was critical of the regime.

July 1943: Mussolini’s Abortive Defection Precipitates His First Fall

It is often forgotten that Grandi’s motion did not call for Mussolini’s resignation but rather that his prerogatives of head of government and commander in chief of the armed forces be transferred to Victor Emanuel III. The proposed diminution of Mussolini’s powers also offered the prospect of enhancing the Council’s powers.

The Council proceedings lasted over seven hours because they were further complicated and delayed by a motion tabled by Farinacci that was similarly critical of Mussolini but instead proposed that the Italian armed forces to be placed under German command. In what seemed to be an incredible blow to Mussolini, the Grandi motion was passed by nineteen votes out of the Council’s twenty-eight members.

Mussolini did not actually consider the vote to be adverse because he was prepared to transfer his former prerogatives to the king so that Victor Emanuel III could negotiate an armistice with the Allies. The dictator envisaged that the king would allow him to remain on as prime minister so as to not arouse German suspicion. Although Mussolini was displaying his uncanny skill of turning an impossible situation to his advantage, he did not realize that in this instance circumstances were against him.

The Allies, particularly the Americans, were insistent upon an unconditional surrender and would not have agreed to an armistice if Mussolini remained on as prime minister. Furthermore, Mussolini did not realize that the king intended to break with him. The dictator was correct that Victor Emanuel III was a sincere admirer of his but did not realize that the king would move against him to save the Savoy dynasty. Mussolini was therefore stunned the day after the Council vote (26th of July) to be dismissed by the king and arrested as he left Villa Savoia following his royal audience*.

(Queen Elena* was most put out by Mussolini’s deposition and conveyed this by criticising her husband for having the former prime minister arrested as he left the palace grounds which Her Majesty denounced as a violation of the ‘laws of hospitality’).

Count Grandi actually knew that the adverse vote against Mussolini would result in his dismissal and arrest by the king. The Count envisaged that Mussolini would be replaced by a new cabinet composed of bureaucrats and PNF aristocrats headed by Marshal Enrico Caviglia*. Guided by him, Count Grandi intended that a Cavallero government would repudiate the alliance with Germany and resist the consequent German invasion so that the Allies would be compelled to accept Italy as an ally. This would avoid Italy having to conclude an armistice in which sovereignty would be surrendered thereby allowing former fascists such as himself to remain in power.

(*The courageous Marshal Caviglia* attempted to defend a virtually abandoned Rome in September 1943 from the Germans).

It is probable that Count Grandi envisaged himself being appointed prime minister by Victor Emanuel III after Marshal Caviglia had utilized his military skill to affect Italy’s change of sides. But similar to Mussolini, Grandi mis-anticipated the king’s subsequent actions. Instead of Marshal Caviglia being appointed prime minister that position went to Marshal Pietro Badoglio. This marshal owed his appointment to involvement in a separate anti-Mussolini conspiracy that had centred on the king’s estranged daughter in law, the Crown Princess, Maria Jose.

Crown Princess Maria Jose Almost Rescues Italy

The Crown Princess was a Belgium princess of the Saxe-Coburg Royal Family. Her Royal Highness married Crown Prince Umberto in January 1930 in what, until Prince Charles and Lady Diana’s July 1981 wedding, was considered to be Europe’s most spectacular royal wedding. The Belgium princess’s betrothal to Umberto had not been unexpected because the House of Savoy and House of Saxe-Coburg were then considered to be Europe’s two leading Catholic royal houses.

The prior education that Princess Maria Jose received at Italy’s most exclusive ladies’ finishing school (which was also attended by Edda Mussolini) helped ‘Italianize’ the Belgium princess. Although Her Royal Highness looked forward to marrying the handsome Crown Prince, and despite their having four children, the marriage was not to meet the new Crown Princess’s expectations.

Adhering to the injunction of her mother Queen Elisabeth of the Belgiums (who was originally a Bavarian princess) that royalty remain close to the people, the new crown princess did exactly that. Her Royal Highness often surprised passengers when she rode on city trams and her love of music also endeared the princess to her adopted country. The Crown Princess’s intelligence so impressed Mussolini that he repeatedly assured Her Royal Highness that her husband’s accession to the throne was guaranteed. Indeed, Mussolini let it be known that he looked forward to Princess Maria Jose becoming Queen Consort of Italy.

The Crown Princess’s major political conviction (even though she was ethnically German) was a detestation of Germany which went back to the First World War. Italy’s 1940 entry onto the German side so enraged Her Royal Highness that she became determined to overthrow Mussolini. The Crown Princess first met with Marshal Badoglio in 1941 following his dismissal due to the debacle that was Italy’s unprovoked invasion of Greece in October 1940.

Her Royal Highness’s civilian contacts commenced and were subsequently facilitated through Ivanoe Bonomi. The former Giolittian social democratic prime minister (who had served as prime minister between 1921 and 1922) had established his own party in the 1940s, called the Labour Democratic Party, (PDL) whose active membership was essentially his personal entourage.

Through Bonomi, Crown Princess Maria Jose established links with the PLI which had been secretly re-founded under the leadership of the Neapolitan philosopher, Benedetto Croce in November 1942. The Crown Princess’s Vatican connections were utilized by Her Royal Highness to establish contact with the Populari which was covertly reconstituted in 1942 as the Christian Democrats (DC) under the leadership of the Vatican librarian and former parliamentarian, Alcide De Gasperi. The intrepid princess also established contact with the Communist Party of Italy (PCI) which was then secretly led by academics based at Rome University. In an ominous future sign, the Crown Princess’s approaches to the republican Action Party (Pd’A) and the PSI were rebuffed.

The Crown Princess’s ties to the Vatican were also utilized to establish contact with American and British officials. The plan that Her Royal Highness eventually formulated was that of deposing Mussolini, with Marshal Badoglio heading a cabinet initially composed of Giolittian liberals and social democrats that would take Italy immediately over to the Allied side. Had this plan eventuated, the war would have ended much sooner in Europe*. Italy could consequently have been utilized as a base from which Allied land troops could land in the Balkans to prevent the future artificial division of the continent by keeping the Soviets out of Central and Eastern Europe.

(*Indeed, King Michael of Roumania’s daring coup against Marshal Ion Antonescu in August 1944 shortened the war in Europe by six months).

The feasibility of Crown Princess Maria Jose’s plans was challenged by American reservations. From an American perspective, the utility of a military campaign on the Italian peninsula was that it was to be long and drawn out so that German troops would be drawn away to undertake a successful Allied liberation of France. An expeditious Italian defection, by contrast, would have facilitated the Churchill strategy of using Italy as base to liberate the Balkans. This strategy did not gel with President Roosevelt who was misguidedly more afraid of Britain establishing dominance in Europe rather than the Soviets.

The prospects for the Crown Princess’s plan being successfully carried out by Her Royal Highness were terminated after her father-in-law was informed of them by the Minister of the Royal Household, the Duke Pietro d’ Acquarone. The Duke had been in close contact with the Crown Princess and Count Grandi so that the Quirinale Palace had links to both conspiracies. When the king was informed by the Duke of his daughter in law’s plotting, Her Royal Highness*, whom His Majesty had not met for two years, was confined to her palace apartments without use of a phone. Although the king had ended the Crown Princess’s involvement in politics, His Majesty moved to take advantage of the political actions that Her Royal Highness had put in place.

(*Crown Princess Maria Jose and her four children in August were soon sent close to the Swiss border where they crossed over as the Germans invaded Italy in September 1943. The Crown Princess’s refuge in Switzerland also removed Her Royal Highness from the royal court of the future ‘Kingdom of the South’).

The day before his appointment as prime minister, Marshal Badoglio had an audience with the king who handed him a list of the ministers who would serve in his cabinet. Badoglio’s request that Giolittian liberals and social democrats be appointed was vetoed by the king on the basis that they were ‘ghosts’. The king made the point to Badoglio that, since no armistice had been previously made with the Allies, the alliance with Germany would continue until one could be secretly negotiated. The ministers that were to serve in the Badoglio cabinet were those that had previously been proposed by Count Grandi to be in a Caviglia cabinet.

Armistice Politics: The Scramble for Italy

Count Grandi himself met with the king following Badoglio’s appointment. The Count was disappointed that Marshal Caviglia had not been appointed prime minister and that an immediate break with the Germans had not been made. But the king, as future events would show, was not prepared to break with the Germans until an armistice with the Allies had been signed, so that he could guarantee the continuance of the Italian state by his person escaping to Allied occupied Italy.

To help facilitate the above mentioned outcome, the king personally gave Count Grandi a diplomatic passport and designated him as a royal envoy with instructions to contact the British embassy in the Spanish capital Madrid to negotiate an armistice. Madrid was the logical destination for Count Grandi to depart for because the British ambassador to Spain was none other than Sir Samuel Hoare, the former British Foreign Secretary who had previously supported the Count during the Italian invasion of Ethiopia.

Count Grandi’s departure for Madrid in August 1943 marked the scramble for Italy between the Americans and the British. Marshal Badoglio despatched his son to Malta to seek an armistice with the British and Marshal Giuseppe Castellano to the Portuguese capital Lisbon to negotiate an armistice with the Americans. The public’s general toleration of the Badoglio regime was the expectation that under him Italy would defect to the Allied side.

The fall of Mussolini was greeted with euphoria across Italy, particularly in Rome, on the false premise that it was tantamount to Italy changing sides or extricating itself from the war. The continuance of the war, even if there was a common expectation that Italy would soon defect, caused widespread unease as did the new regime’s heavy handed approach to maintaining public order which seemed more fascist than the preceding fascist regime.

Although the PNF was dissolved and its assets seized, the ban on non-fascist political parties remained in place and strict press censorship was maintained. The only remotely liberal concession that the Badoglio regime made was a nominal legal retention of the 1848 Statute because it entailed Italy remaining a monarchy. Most Italians (and German troops and diplomats stationed in Italy) were amazed at the overnight disintegration of the PNF and associated agencies such as the secret police, the OVRA. The rapid collapse of Mussolini’s first regime was derived from its statist nature and because the PNF was really a bureaucracy rather than a Soviet or Nazi type of totalitarian party which was separate from the state.

There were no massacres following Mussolini’s first fall in July 1943 as there would be when his second regime was overthrown by partisans in April 1945. However, a critical mass of former PNF officials was sufficiently incensed by Mussolini’s first overthrow that they would become committed to his future republican regime.

With regard to Mussolini’s successor regime, the only really substantial task that confronted the Badoglio government was how and when to break with the Germans. The achievement of this objective was complicated by whether the Badoglio regime should negotiate an armistice with either the British or the Americans. In this regard, the major leverage that the Badoglio regime had was Anglo-American rivalry due to Roosevelt’s and Churchill’s conflicting objectives as to how Italy should be strategically utilized for war time purposes.

An American policy objective was to keep the British at bay by pre-empting them from concluding an armistice with Count Grandi. The American General Walter Bedell Smith (acting on behalf of the Allied Supreme Commander in Europe, General Dwight Eisenhower) expeditiously signed an armistice with Marshal Castellano on the third of September 1943. The armistice was to take effect on the 9th of September but the Americans broadcast the terms on the 8th of September so at compel the Badoglio regime to honour the armistice.

The pre-emptive American revelation was also probably undertaken to forestall the Badoglio government from making alternative arrangements with the British. A German invasion almost immediately followed the American broadcast. Rome was therefore subjected to American bombing and hostile German military action before the armistice took effect. German paratroopers landed in Rome and German troops stationed outside the capital moved in to take control.

Hitler ordered the commander of the Rome operation, Marshal Albert Kesselring, to arrest the government and the royal family. Kesselring shrewdly and subtly ignored Hitler’s orders. By allowing the royal family and members of the Badoglio government to escape, Marshal Kesselring knew that it would be consequently easier for his troops to take the capital. The royal family (i.e. the king, the queen and crown prince*) along with Badoglio, an assortment of cabinet ministers and generals made their way to Crecchio, a village east of Rome where they stayed for the night. They then departed from a small port in Ortona to sail on the Baionetta to the port city of Brindisi in south eastern Italy.

(*The German dictator did not believe that Crown Princess Maria Jose as a woman was capable of co-ordinating a conspiracy against Mussolini. The German dictator erroneously believed that Her Royal Highness was a front for her husband. As a result, a major priority of Hitler’s was Crown Prince Umberto’s arrest even though His Royal Highness was a marginal participant in the recent political intrigues).

The king’s flight discredited the monarchy to the extent that a sufficient and dedicated support base among Italian public opinion was created to abolish the Italian monarchy. Following the armistice, the Germans seized two thirds of Italian territory including the industrial north. Despite public uproar and hostility toward his person, Victor Emanuel III was at ease with himself when he arrived in Brindisi because His Majesty believed that his escape had ensured the legal continuity of the Italian state as represented by his person. Indeed, the king’s escape from Rome enabled His Majesty to establish the ‘Kingdom of the South’.

‘The Kingdom of the South’: 1943 to 1944

The Kingdom of the South has generally been derided as phantom state similar to Mussolini’s doomed RSI in northern Italy, consequently warranting little historical study. However, the Badoglio regime adroitly thwarted Sicilian secession which might have destroyed the Italian state before Rome’s 1944 liberation and maintained a substantial degree of de facto independence due to the Allied focus on fighting the war against the Germans.

In legal fact, since the armistice took effect, Italy came under the legal authority of the Allies as represented by the Allied Control Commission (ACC). The ACC was a three man committee composed of the British General Sir Frank Mason-Mac-Farlane and two civilians, the American diplomat Robert Murphy and the British politician, Harold Mc Millan. The major challenge that confronted the ACC was that of exercising their authority over Victor Emanuel III who, as previously mentioned, had a degree of latitude while the Allied primary military objective was focused on liberating Rome.

Without consulting the ACC, Victor Emanuel III declared war on Germany and Japan in October 1943. This fait accompli presented a dilemma for the Allies that they resolved by granting Italy the status of a ‘co-belligerent’. To disengage with his previous association with fascism, Victor Emanuel III also reluctantly renounced his titles of Emperor of Abyssinia and King of the Albanians.

To re-establish a new political support base, Victor Emanuel III granted a royal audience with a recently returned exile, Count Carlo Sfroza. This count, the liberal political heir of Giovanni Giolitti, believed that the king granted him the audience to gain his support for the continuation of the monarchy by abdicating. To Count Sfroza’s astonishment, the king not only refused to abdicate but offered to appoint him prime minister!

Count Sfroza declined the king’s offer and made his way to meet Marshal Badoglio to inform him of the king’s attempt to dismiss the marshal as prime minister. The count asked the Marshal to depose the king and become regent for Crown Prince Umberto’s six year old son Prince Victor Emanuel who was then domiciled in Switzerland. The count proposed that he would serve as prime minister under a Badoglio regency. Marshal Badoglio declined to support Count Sfroza’s scheme but relations between the prime minister and the sovereign became strained.

Another attempt by the king to boost his position had previously been made in late September 1943 by trying to recall Grandi from his Spanish exile to become foreign minister! This suggestion was officially made by Marshal Badoglio but at Victor Emanuel III’s behest. Count Grandi as foreign minister would have undoubtedly changed the course of modern Italian political history as the king would probably have later appointed him prime minister to safeguard the Italian monarchy. Although Churchill was supportive of Grandi’s return, the Americans were aghast at the proposal.

From the American point of view, Count Grandi was a war criminal who should have been tried as such rather than a candidate for a senior ministry that he could possibly use to come to national power! The American veto of Grandi’s appointment ended his political career and ensured that he remained exiled from Italy until the 1950s*.

(Grandi’s* later return to Italy was facilitated by his acquittal by a special anti-fascist tribunal in 1947. Count Grandi returned to Italy as a living historical curiosity as the most senior figure of the Mussolini regime to have survived the Second World War. The fact that Grandi had no role in post-war politics and that the post war neo-fascist movement was hostile to him until his death in 1988 resulted in the public underestimating his major impact on Italian history).

The king’s failure to restore Count Grandi to political office denied His Majesty the only real chance he had of holding onto his throne. Nevertheless, the king was relatively safe from deposition so long as the royal army remained loyal to him and the Allies pre-occupied with military objectives before they liberated Rome.

In the mean-time, prior to Rome’s liberation, through calculated indolence, the Badoglio regime allowed a flowering of press freedom which often served as a safety valve that counter-acted potential popular unrest in the south. Due to overwhelming hostility to the Germans, there was no discernable neo-fascist movement* in the south and many former PNF members joined either the DC or the PLI.

(*There was however a very effective RSI spy ring that operated in Rome between 1944 and 1945 and its members served as contacts with the political establishment which later helped lay the groundwork for a neo-fascist presence in republican Italy).

There were gripes among many southern Italians about Allied heavy handedness, such as requestioning hotels, which helped establish the House of Savoy as representative of Italian sovereignty and national pride. This was an ironic development because the Kingdom of the Two Sicilies incorporation into the Kingdom of Italy in 1861 was then considered to be a colonial conquest such that the House of Savoy was hated in much of the south for most the nineteenth century with this hostility lingering into the twentieth century. Renewed or newly acquired popularity for the House of Savoy was evidenced by the strong support in the south for the monarchy’s retention in the June 1946 ‘institutional’ referendum.

The most important accomplishment of the Kingdom of the South was its valuable contribution to the Allied war effort between 1943 and 1944. This was reflected when Naples became the first city in German occupied Europe to free itself by local uprising without external assistance in October 1943 as the Kingdom of the South (which was still officially the Kingdom of Italy) declared war on Germany.

Although it still fashionable to ridicule the Italians as hopelessly inept during war-time, the Italian resistance movement in German occupied Italy was one of the most formidable in Europe. The performance of the regular armed forces after 1943 in fighting the Germans was markedly better than when Italy was aligned to Nazi Germany. The change in Italian fighting quality was due to a change in morale that came with the motivation to free Italy from German domination. Nevertheless, for many Italians, politics remained an area of focus regardless of the war.

The Italian Resistance and the Future Republic

Italy probably stood out as a nation at war that was still convulsed with politics because there was still a functioning state behind the front that was at odds over its future direction as were Italians awaiting liberation from German domination. Resistance to the German occupation was co-ordinated by the Committee for National Liberation (CLN).

The CLN had been proclaimed upon the German occupation of Rome in September 1943 and was a six party coalition that co-ordinated resistance against the Germans. The Rome CLN, which was chaired by Ivanoe Bonomi, was the most important of the CLNs which operated throughout the country.

The CLNs in the Kingdom of the South convened a conference in January 1944 in Bari where they called for Victor Emanuel III’s abdication and for Crown Prince Umberto to renounce his right of succession. This call fell just short of declaring a republic. The king scornfully ignored the CLN Bari congress and attempted to expand his support base by re-shuffling the Badoglio cabinet.

In a seemingly extraordinary turn of events, the recently returned PCI leader Palmiro Togliatti declared his temporary support for the king on the basis of the need for wartime unity. The communist preparedness to enter the cabinet compelled the PLI and the DC which belonged to the CLN to join the Badoglio cabinet following a reshuffle in March 1944 despite their previous insistence that the king abdicate.

The Americans became alarmed that Victor Emanuel III might be able to stay on his throne following the March 1944 cabinet reshuffle. Consequently in April 1944 the three member ACC met with King Victor Emanuel III to demand His Majesty’s immediate abdication. The king at first obstinately refused but His Majesty was informed by the delegation that their request directly came from the American and British governments. (This was not quite true because in the case of Britain Prime Minister Winston Churchill was opposed to Victor Emanuel III’s abdication).

The king seemingly relented but undertook to abdicate upon Rome’s liberation. Having gained this concession, the king later further hedged by declaring that he would transfer his prerogatives so that his son became Lieutenant-General of the Kingdom of Italy with His Majesty remaining as titular king. Later, Victor Emanuel III moved to change his son’s title to that of ‘Lieutenant –General of the King of Italy’.

The liberation of Rome came in June 1944 after the Germans declared the capital to be an open city. Victor Emanuel III announced his intention of transferring his prerogatives following his personal return to the capital. The Americans responded by threatening to arrest the king for fear that, once in Rome, His Majesty would repudiate any transfer of prerogatives.

Confronted by an impeccable American veto which could now be militarily enforceable due to the German abandonment of Rome, Victor Emanuel III reluctantly signed the transfer of his royal prerogatives to his son. This action legally constituted an abdication and, which under then Italian constitutional law, compelled a prime minister to resign. Prime Minister Badoglio however advised the Crown Prince to remain outside the city until he informed His Royal Highness when it was safe to enter the capital.

Realizing that Marshal Badoglio was possibly moving to secure his position at the monarchy’s expence, Crown Prince Umberto took the first and only really independent and politically astute action of his life by defying the prime minister to enter the capital on the fourth of June 1944. To the Crown Prince’s relief and obvious happiness, His Royal Highness was welcomed by most Romans as he entered the capital.

His Royal Highness may not have then known his arrival in Rome not only secured his succession as Lieutenant –General of the Kingdom of Italy but it possibly saved Italy from then being declared a republic! The executive of the Rome CLN (CLN Central) was considering declaring Italy a republic as the Allies entered the capital. The declaration of a republic by the CLN Central was prevented because the Crown Prince had the option of withdrawing to Naples to support a continuing Kingdom of the South led by the PLI leader, Benedetto Croce. Had this occurred, Italy would have had three governments: a Kingdom of the South, a Rome based republic and Mussolini’s RSI in the German occupied north.

The Allies refused to support a declaration of a republic by the CLN Cental so as to avoid complicating the war effort. Nevertheless, the Allies insisted that executive and legislative power by vested with the CLN Central. Consequently, the CLN Central reluctantly accepted Crown Prince Umberto’s Lieutenancy (i.e. regency, the ‘luogotenente’). This acceptance was clinched by Rome CLN Chairman, Ivanoe Bonomi’s preparedness to serve as prime minister under Crown Prince Umberto

The new cabinet was overwhelmingly republican and Crown Prince Umberto’s role was uncertain because executive and legislative power was vested with CLN Central. There was also initial ambiguity as to whether Crown Prince Umberto as Lieutenant-General would exercise the powers of head of state or Ivanoe Bonomi as CLN Chairman*. Bonomi also served as prime minister. Promisingly, Bonomi was the only member of the new cabinet to swear the optional oath of allegiance to the Italian Crown.

(*Throughout the luogotenente it was an ambiguous point as to whether CLN laws had to be sanctioned by subsequent royal decrees).

The Luogotenente, 1944 to 1946: Umberto II’s De Facto Domiciled Reign

The historical aspect of the Bonomi cabinet’s assumption of office was that it marked the end of the rule of an elite that could be traced back to Count Cavour. This elite had first exercised its power in Piedmont-Sardinia and then in a united Italy through a parliamentary system between 1848 and 1922. Mussolini’s ‘March on Rome’ resulted in the Cavourian elite reconfiguring within a fascist framework and then becoming an integral component of the quasi-military regime of Marshal Badoglio.

That the CLN regime constituted a break from the Cavour elite was manifested when a law was passed by the CLN executive on the 25th of June 1944 that elections be held to a constituent assembly following the end of the war to determine Italy’s constitutional status (‘the institutional question’) and to draw up a new constitution. Considering that it was nearly impossible for a monarchist party to garner a sufficient vote over the six parties in the CLN, two of which were monarchist inclined, (the PLI and the PLD), it was then considered a certainty that an elected constituent assembly would declare Italy a republic.

The major political asset that Crown Prince Umberto then had was the sincere support of Winston Churchill and of the opportunistic support of Prime Minister Bonomi. This political balance was evidenced in November 1944 when Bonomi moved to resign as prime minister after the PSI and the Pd’A criticised him for not removing officials with fascist backgrounds from the bureaucracy. This criticism carried over from complaints by Count Sfroza who headed the commission charged with purging the bureaucracy of former fascist elements.

Due to criticism from Count Sfroza, Bonomi as prime minister submitted his resignation to Crown Prince Umberto in his Royal Highness’s capacity as Lieutenant-General. The resignation could have been presented to the Chairman of the CLN Executive. Bonomi however argued that because he was both prime minister and CLN Chairman he could present his resignation to himself. As CLN Chairman, Bonomi acting on instructions from the executive of the CLN Central, commissioned Count Sfroza as prime minister. Sfroza would have formed a cabinet had it not been for the British representative on ACC (on direct instruction from Churchill) vetoing that count’s appointment.

Churchill’s vetoing of Count Sfroza’s appointment enabled Bonomi to form a new cabinet (minus the PSI and the Pd’A) in which he received his new commission from Crown Prince Umberto as Lieutenant- General subject to majority endorsement from the executive of the CLN Central. This manufactured crisis enabled His Royal Highness to gain royal prerogatives by which he became Italy’s head of state as Lieutenant-General instead of the CLN Chairman. It was ironic that, as a Giolittian social democrat, Bonomi had apparently shown himself to be more of a monarchist than Count Sfroza, who was a Giolittian liberal.

The position of the monarchy was also strengthened by the publication and distribution from late 1944 of the ‘Average Man’ Uomo Qualunque (UQ) newspaper. This newspaper was founded and edited by Guglielmo Giannini. The UQ was popular in the south and in Rome due to its trenchant criticism of CLN politicians who seemed to be condescending towards too many people that they considered to be insufficiently anti-fascist. Giannini coined popular and populist phrases such ‘Down with Everybody’ and ‘We Were Better off When We Were Worse Off’ which seemed to encapsulate public discontent toward the elitism of the CLN republican parties.

Integral to the UQ’s populism was its implicit anti-republicanism. For many Italians, particularly south of Rome, republicanism was considered to be a form of elitist Jacobinism that was been imposed on them by unelected politicians. But for Italians in the German occupied north, republicanism was a potent and positive force that would create a better future. For most northern Italians, Victor Emanuel III’s flight from Rome was a national betrayal that had forfeited the legitimacy of the Italian Crown.

Stipulations were made by the CLN Executive with the re-constitution of the Bonomi government in November 1944 that a successor government would be formed following the liberation of the north from German rule. It was anticipated that a new government would re-inject further republicanism because leaders of the northern CLN, the CLNAI (Committee for the National Liberation of Northern Italy), would later join the cabinet and serve on an expanded executive of the CLN Central.

The liberation of northern Italy eventuated with an uprising on April 25th 1945 that was co-ordinated by the CLNAI. This uprising led to the violent overthrow of Mussolini’s RSI. In an irony that abounded in a political career as contradictory as Mussolini’s, he tried to enter into an anti-monarchist and anti-communist alliance with the PSI in the final days of his life.

The Last Days of the RSI

At a meeting in Milan mediated by Cardinal Idelfonso Schuster between Mussolini and representatives of the CLNAI that was supposed to negotiate the terms of surrender and safe treatment of RSI troops and officials, Mussolini brazenly attempted to forge an alliance with the PSI representatives. This belated reconciliation attempt by Mussolini with his old party had been aborted in 1922 and 1924 and was now being attempted one last time by the doomed fascist leader. In fact, this late April 1945 meeting marked the end of Mussolini’s alliance with Nazi Germany*.

(*Mussolini still tried to flee German occupied Austria in the back of a German army transport truck but local partisans were tipped off by a German informant. He was captured and executed by communist guerrillas the following day in a village just outside of Milan. Most unfairly, the communist partisans acceded to a request from Mussolini’s unreservedly loyal and brave, but profoundly stupid mistress, Clara Petaci, that she be allowed to join her lover to be executed with him).

A PSI representative at the mediation meeting, Alessandro (‘Sandro’) *Pertini, brusquely informed Mussolini that the Germans under General Karl Wolff had negotiated a deal with the CLNAI for their safe passage out of Italy in return for allowing them to commence their uprising to overthrow the RSI. Mussolini, on being informed of this deal, fled the meeting and it was that point it is considered that the RSI came to an end.

(*Sandro Pertini was probably the most beloved public figure in modern Italian history. He had been a Matteottian socialist, and as such, Pertini was both strongly anti-fascist and anti-communist. This respected maverick politician was elected by the parliament as president of the Italian republic on the thirty-fifth ballot in 1978 as a compromise choice.

President Pertini also endeared himself to Italian monarchists by publicly calling on the Italian parliament to vote to rescind the constitutional ban on Umberto II (whom he corresponded with) and His Majesty’s male descendants from being domiciled on Italian territory before the exiled king died from terminal cancer. No such parliamentary vote was taken and Umberto II died in Switzerland in March 1983. His Majesty is presently buried in Hautecombe in Savoy, France as is Queen Maria Jose who died in January 2001.

As matter of historical justice their Majesties should be buried in the Pantheon in Rome (where the first two kings and the first queen of Italy are interned) in partial acknowledgement of their patriotism in preventing a civil war by leaving Italy in 1946).

The RSI Defence Minister Rodolfo Graziani, having initially complained to Mussolini that he was besmirching Italian honour by attempting to negotiate with the PSI representatives, fled the meeting. Being forewarned of the Germans arrangements, Graziani made his way to RSI regular troops under his command to hold against CLN partisans until surrendering to the Americans. Due to his being in American protective custody, Graziani was the most senior RSI official to survive the war.

Tried by an Italian court in 1948, Graziani was sentenced to twenty five years prison but was pardoned in 1950 to help a DC backed faction take control of the post-war neo-fascist Italian Social Movement (MSI). Graziani (who during Mussolini’s time in power denied that he was a fascist) was honorary president of the MSI from 1950 until his death in 1955.

Most RSI officials were not as fortunate as Graziani as senior to minor fascist republicans that were apprehended by CLN partisans were invariably executed. Support for the RSI at the time of the April 25th 1945 uprising was relatively small but still very committed.

Mussolini himself had been probably relatively popular because RSI propaganda had successfully conveyed the message that the German occupation would have been harsher had it not been for his ‘sacrifice’ in heading the RSI*. This personal popularity was apparent when Mussolini received a rapturous response on making an unannounced visit to Milan in December 1944 which astounded the Germans. This surprising reception probably deluded Mussolini into thinking that he had sufficient support to make a strong last stand.

(*Had Mussolini not been freed by German paratroopers led by Colonel Otto Skorzeny at the high Alpine mountain resort of Gran Sasso in September 1943, the collaborationist regime would have been headed by Roberto Farinacci).

The Politics of Plebiscite: The Institutional Question, 1945 to 1946

The success of the April 25th 1945 uprising placed most of northern Italy in the control of the CLNAI. Even with the CLNAI accepting Allied authority, northern Italy remained under strong left-wing domination at the time of the June 1946 referendum which helped facilitate the tampering of the ballot count in the North that resulted in Italy becoming a republic. Furthermore, the bloody excesses following the April 1945 uprising created a sense of revulsion against the hard left in the north. This helped provide the MSI with an anti-leftist voting base in the North, as opposed to a fascist voting base, which came into being at with the 1972 general elections.

Public concern regarding CLN rule in Italy south of Rome became an issue when the former chairman of the CLNAI, Ferrucio Parri, was selected prime minister by the CLN Central in June 1945. Parri was a leading member of the Pd’A and as such a staunch republican. The new government was then Italy’s most left wing regime and Parri openly advocated a republic even though it had been agreed that no ministers would publicly comment on the ‘institutional question’.

Prime Minister Parri did not conceal his contempt toward the Lieutenant-General and hostility toward the continuance of the Luogotenente. The only benefit for the Lieutenant-General of Parri’s prime ministership was that his unpopularity in Rome and in the south gained support for the monarchy which was reflected by increased circulation of the UQ newspaper.

The Lieutenant-General’s political position was essentially derived from the monarchist bloc on the CLN Executive was known as ‘ONB’. This acronym referred to the respective surnames of Vittorio Orlando, Francesco Nitti and Ivanoe Bonomi who had successively served (but not in immediate succession) as prime ministers of Italy between 1917 and 1922. These prime ministers were constituted the survival or revival of the ‘historic left’. This ‘left’ referred to ideological differences within the pre-1922 Italian elite as opposed to broader national ideological discordances.

Orlando and Nitti were leading members of the PLI by dent of their being former prime ministers and Bonomi’s PLD was a manifestation of a Giolittian variant of social democracy within a revived historic left. The PLI and the PLD were so relentless in their attacks on Parri on the CLN Executive that, when the DC and PCI withheld their support for Parri, he submitted his resignation in November 1945 to the Lieutenant –General.

The CLN Executive’s selection of Alcide De Gasperi and his subsequent commissioning by the Lieutenant-General as prime minister in December 1945 was then considered to be an anti-climax because he was apparently a compromise choice. In fact, De Gasperi’s appointment as prime minister was to ensure that Italy became a ‘politician’s republic’ and the ramifications of this development are still manifested by the close between Italy’s mainstream political right and former Prime Minister Silvio Berlusconi’s corporate empire.

Indeed, the formation of DC led the De Gasperi government to inaugurate a political dominance by a political party which Western Europe did not experience in the post-war period. The DC supplied Italian prime ministers between 1945 and 1981, from 1982 to 1983 and from 1987 to 1992. Contrary to the popular stereotype of Italy being the most unstable country in Europe, if not the democratic world, the fact that Italian republic until 1992 was very stable because power always remained with an oligarchy of party politicians whose capacity to form new governments was testament to their actual control.

De Gasperi could not have become prime minister and the DC gained their subsequent political domination in the future republic if it was not for the support, if not instigation of the PCI leader, Palmiro Togliatti. At the time of Parri’s resignation, it seemed that there would be a left-right divide (loosely correlating with a republican- monarchist dichotomy) between the respective candidacies of Pietro Nenni and Vittorio Orlando.

*Nenni was then the PSI leader and a lifelong republican. Exiled to France in 1926 Nenni was captured by the occupying Germans in 1943 and extradited to Italy. Due to his previous friendship with Mussolini, Nenni was sent into internal exile on the island of Ponza instead of prison. Ironically, Nenni had more freedom on Ponza than Mussolini did when he too was briefly detained on the island after his deposition.

(* In his youth, Nenni was a member of the PRI and as such involved in supporting the then ‘fascist’ alliance between the Republicans and the monarchist ANI which advocated Italy joining the First World War as an ally of the Entente. Nenni had been a strong supporter of Mussolini’s between 1914 and 1915 and during the war but, to convey his personal and political break with his former friend, he left the by then middle class PRI in 1921 to join the PSI as opposed to the Fascist Party which was then an option for him).

Vittorio Orlando, by contrast to Nenni, was the epitome of an establishment political figure (albeit one on the notional left within the Italian elite) and a staunch monarchist who was a long time admirer of Prince Umberto. It was not surprising that the Lieutenant-General supported Orlando’s selection as prime minister. It was expected that the PSI, PCI and the Pd’A would ardently support Nenni’s selection while the PLI and the PLD backed Orlando. The question was would the republican orientated DC, which essentially held the balance of power on the CLN, capitulate to pressure from the apparently monarchist Vatican to support Orlando becoming prime minister?

Advance By Retreating: The Brilliant Manoeuvres of Palmiro Togliatti

In an apparently gracious concession, Togliatti broke the deadlock by supporting De Gasperi becoming prime minister. This seemed (and is still erroneously regarded) as a good choice in the national interest. The new prime minister was known to be emotionally calm, intelligent and rational. It was widely believed that De Gasperi in contrast to the leadership and the rank and file of his party was a monarchist which seemed apparent in his cordial relations with the Lieutenant –General.

The subsequent actions that De Gasperi took as prime minister (with PCI support) seemed moderate, if not monarchist inclined. The major issue of contention between monarchists and republicans was whether there should be a referendum to decide if Italy became a republic. A referendum was opposed by the republican parties of the CLN because they seemed to have a stronger chance to prevail in constituent assembly elections due to the comparative weakness of monarchist or monarchist inclined political parties.

It was therefore something of a seemingly amazing concession when the CLN executive scheduled (on the First of March 1946) that a referendum by compulsory vote on the ‘institutional question’ be held simultaneous to the election of a constituent assembly by compulsory voting to be held on May 25th-26th*. Compulsory voting had been a key demand of monarchists to boost voter turn out because it was believed that monarchist support was not as committed as the republican support. The 1946 elections was the only one where voting was compulsory in Italian political history.

(*The referendum was later moved back a week to be held on the June 2nd -3rd 1946).

The ‘concession’ of a referendum by compulsory voting actually (as subsequent events would show) benefited the DC more than the monarchy. How and why this occurred is explained in the following overview of events leading up to and following the 1946 referendum.

Party Manoeuvring in the Context of Plebiscite Politics

The first really free elections in Italy in twenty five years were held in March and April 1946 at a local government level. These elections were conducted and contained to the strongly republican north and in Tuscany. It was therefore not surprising that committed republican parties (mainly the PCI and the PSI) prevailed with over 40 % of the vote. The DC (which was officially uncommitted on the ‘institutional question’ but would endorse a republic by a two-thirds majority shortly after at its national convention in April) garnered 34% of the vote and the monarchist inclined PLI gained just over 6% of the vote. (The PLI’s late April 1946 national convention by majority vote advocated retention of the monarchy but there was a strong republican minority sentiment among northern party delegates).

The monarchist vote in the March/April 1946 northern local government elections was just over 11% which was principally garnered by the UQ. This was a relatively impressive performance for a southern orientated party and a warning that the UQ could appropriate a substantial, if not most of the DC vote in the June constituent assembly elections due to the Christian Democrats’ republican orientation. The introduction of compulsory voting also compelled many political Catholic voters to the polls. *Pope Pius XII’s subtle but distinct endorsement of the monarchy in an Italian wide radio broadcast the day before the referendum, influenced many Italian monarchists to support the DC even though its leadership and rank and file were republican.

(* Whether Pope Pius XII, who reigned from 1938 to 1958, was sincerely a monarchist will never be definitely known. His Holiness did however refuse to meet with future Italian presidents to convey his ostensible non- acceptance of the legitimacy of the Italian republic).

Containing elections to the republican north and Tuscany also provided a practical means for local councils to appoint partisan republican poll officials who could, if need be, rig the count with regard to the ‘institutional question’. As events were also to show, scheduling local government elections to be held in the south in November 1946 led to the future equivalent of a DC-PCI ‘*diarchy’.

(*The term ‘diarchy’ referred to the co-existence of respective and often rival, monarchist and fascist state institutions in the 1930s and 1940s. E.g. the Chamber of Deputies, which became a corporatist legislature in 1939 was considered to be fascist, even if the Speaker between 1939 and 1943, Count Dino Grandi, was a monarchist. By contrast, the Senate was regarded as a monarchist bastion. The essence of the duality of power that the term diarchy infers was transferable to the pervasiveness of post-war divisions within society based upon respective partisan allegiances to the DC and to the PCI).

It should be pointed out that rigging the referendum was a fall back by the political mastermind of the Italian republic, the 1945 to 1946 interior minister, Giuseppe Romita. He was a stalwart of the PSI who initially led the remnants of his party in Rome on an ad hoc basis. The major anti-fascist resistance organisation was the Giustizi e Liberta (GL) (Justice and Liberty). GL was an émigré organisation that was primarily based in France but its members were prominent during the Spanish Civil War (1936 to 1939) fighting for the Second Spanish Republic. This opposition organisation went into seeming decline 1937 when its two primary leaders, the brothers Carlo and Nello Rosselli, were assassinated in France at the instigation of the Mussolini regime.

Invoking the memory of the Rosselli brothers, GL aligned academics at Italian universities founded the Pd ‘A in 1942. The Pd’A seemed to be the principal domestic resistance party with the PCI coming a strong second. Indeed, 1942 seemed to be the year for founding or re-founding political parties in Italy as the entry of the United States into the Second World War in late 1941 seemed to herald the impending end of the fascist regime.

The communists had gained strength by infiltrating Fascist Party organisations during the Second World War. Although the story may be apocryphal, it was widely believed in political circles that the PCI covertly printed and distributed its underground newspaper from the offices of the stridently fascist Ill Tevere newspaper. The disintegration of the PNF, with Mussolini’s dismissal in July 1943 and the collapse of the Italian state with the armistice in September 1943, helped the communists move into the void by utilizing the clandestine operations they had previously established within the Fascist Party.

Although Togliatti realized that an immediate PCI takeover was impractical (for fear of precipitating a military coup) he considered that his party could achieve the status of the leading anti-clerical force in society. Appreciating the brilliant insights of his late party comrade, Antonio Gramasci (1891 to 1937), Togliatti knew that Marxist transformation and power could be achieved through a ‘levers of power’ approach. This entails a Marxist party foregoing seizing control of the government to focus on infiltrating the bureaucracy, trade unions, the educational institutions and party front organisations thereby gaining control of the state. In the long term, Togliatti envisaged that with the onset of secularization of society, Italians would eventually move away from clerical influence to support the PCI*.

(*The PCI leader was correct that Italians would become more secularized but failed to envisage that, due to the impact of the pontificate of Paul VI, 1963 to 1978, that Italian clerics in the twenty first century would help turn the tables on the communists by fulfilling a vital role in establishing a social democratic party in place of the PCI).

But, for Togliatti to help create a divided society with a Marxist reference point, it was first necessary to eliminate the monarchy. The ‘concession’ of granting a referendum did not seem fatal to the republican cause because Crown Prince Umberto and Crown Princess Maria Jose were considered to be too far behind in regaining support for the monarchy. When Rome was liberated in June 1944, American military intelligence estimated that support for the monarchy was at best between 10% and 15%.

When Personal Courage is Insufficient to Win: The Courage of Umberto II and Queen Maria Jose

The increasing popularity of the UQ newspaper in the south and in Rome indicated that the position of the monarchy was improving. The Crown Prince and *Crown Princess extensive war relief work (part of the Quirinale Palace was turned into a hospital) won them considerable personal popularity even amongst republicans. The royal court was noted for its openness and that the Crown Prince and Crown Princess undertook a hectic social schedule. Many of the contacts that their royal highnesses established during the luogotenente would be maintained by Umberto II as an exiled king.

(*As head of the Red Cross from 1940 to 1943, Crown Princess Maria Jose gained considerable popularity. After Her Royal Highness’s return from Swiss exile in April 1945 the Crown Princess resumed an important role in war relief and charity work until she was unfortunately permanently banished from Italy in 1946).

The most political undertaking of Umberto as Lieutenant- General was the appointment of Falcone Lucifero as minister of the Royal Household Department. This was because Lucifero was a Matteottian socialist and most of the royal household officials came from networks that had supported Matteotti’s PSU which was founded in 1922 and had re-united with the French based PSI in exile in 1926. Romita did not mind former PSU members joining the PSI with the backing of the Royal Household Department as he did not anticipate the monarchy surviving the referendum and because their entry served to dilute communist influence over his party.

A major asset that the Italian monarchy had going into the June 2nd-3rd 1946 referendum was the Crown Prince’s and the Crown Princess’s personal popularity. It was commonly said of His Royal Highness that had he not been born to royalty he could have been an actor who made his living by merely appearing on stage due to his good looks. The tours that His Royal Highness undertook during the referendum generated considerable enthusiasm among female voters. Furthermore, the Crown Princess’s intelligence and approachability was even acknowledged by many republicans.

The Lieutenant- General demonstrated considerable personal courage by touring republican strongholds such as Turin and Milan where His Royal Highness was threatened with being lynched! Indeed, Italian monarchists north of Rome also demonstrated courage trying to organise rallies that more often than not were broken up by resistance veterans and RSI supporters (some of whom were released to support the republican campaign) with the connivance of local police.

By contrast, Italian republican rallies in Rome and in the south were rarely attacked. This difference was due to the influence of the PCI and because republicanism in the north was more intense due to the strong resentment as a result of the recent memories of the German occupation. The communist press also threatened civil war if the monarchy ‘was to unexpectedly prevail’ to influence voters against retaining the Crown.

Although Crown Prince Umberto and the Crown Princess Maria Jose had clawed back substantial support for the monarchy, it was widely considered to be too late. Ironically, the real impact of their referendum campaign was to bolster support for the republican DC so that this party became the standard bearer of the conventional right.

The impending defeat of the monarchy in a legitimately conducted referendum was averted on the 9th of May when Victor Emanuel III stunned the nation by abdicating! Historical reference to Victor Emanuel III’s abdication invariably cites it as a desperate and belated political manoeuvre that was destined to fail because it was left too late. In fact the abdication was brilliantly timed because the CLN Central would never have authorized a referendum on the institutional question had Crown Prince Umberto previously ascended the Italian throne as king.

The republicans correctly surmised that the electorate would not retain the monarchy with *Victor Emanuel III remaining as titular king because His Majesty represented the monarchy’s previous collaboration with fascism and military defeat. For this reason the king’s abdication on the 9th of May was cleverly timed because it represented a symbolic break as that date was the tenth anniversary of Mussolini’s declaration of an Italian empire with the conquest of the Ethiopian capital Addis Ababa.

(*The former king and former queen departed for Egypt where they were most hospitably treated by that nation’s Italophile monarch, King Farouk. Victor Emanuel died in Egypt in December 1947 and was given a grand state funeral that was arranged by the Egyptian king. Former Queen Elena died in Montpellier in the southern France in November 1952 where Her Majesty is buried. Both late monarchs are separately buried because the late queen could not be interred with her husband in Egypt due anti-monarchist miliary coup in 1952 and because the French were not prepared to bury Victor Emanuel III in their country).

The intensely hostile reaction of the republican press reflected that the abdication had greatly strengthened the monarchy. The potential turning point in the campaign were celebrations that were held in Rome on the *25th of May to celebrate Umberto II’s recent ascension to the throne. It seemed that nearly all of Rome turned out for the rally which was to be the highlight of the domiciled component of Umberto II’s thirty-seven year reign. (Umberto II would later be dubbed the ‘May King’ by Italians). The outpouring of support at the rally emboldened many wavering Italians to vote in favour of retaining their monarchy.

(*As previously mentioned the referendum and national elections had originally been scheduled for the 25-26th of May 1946. Romita agreed to the week delay to gauge the level of support for the monarchy so as to decide whether or not it would be necessary for him to arrange for the padding of the vote north of Rome. The interior minister knew that the May 25th rally was an important indication of support for the monarchy. His acquiescence to the delay was ironic because, as Romita later admitted, a six month re-scheduling of the referendum would have been fatal to the republic because the monarchy was gaining so much support it would not have been impossible to have rigged the referendum vote.

Due to the importance of timing, monarchists swamped the office of the ACC in Rome with telegrams demanding that a referendum on the institutional question be held six months later with an elected government in place. Had the Americans and the British granted the request to delay the referendum for six months they might have spared themselves the later anxiety of having a communist party as the major opposition party in a vital NATO nation. This was because the establishment of the Italian republic in 1946 set the scene for PCI becoming the principal opposition party following the 1948 general elections).

Even though Victor Emanuel III’s unexpected last minute abdication had probably gained the monarchy sufficient support to win the institutional referendum, Romita held his nerve. The interior minister now realized that he would have to rig the referendum by padding the vote in the north of Italy to make the country a republic. Because the Italian government was never going to conduct a fair referendum in which the monarchy was retained, with the benefit of hindsight, Victor Emanuel III should have abdicated in April 1946 and Crown Prince Umberto renounced his rights of succession following the local government election results in northern Italy and Tuscany.

His Royal Highness could have stayed on as regent as Lieutenant- General for his son, the Prince of Naples, Victor Emanuel, until the constituent assembly voted on whether Italy should become a republic or not . It had been mooted just before the April announcement of the June referendum that Victor Emanuel III and Crown Prince Umberto make way for the Prince of Naples as titular king with a new luogotenente to be headed by Cardinal Schuster. The benefit of such an arrangement was that it could have orientated DC representatives in the constituent assembly to have voted to retain the monarchy.

Alternately, further pressure could also have been applied by King Umberto II withdrawing to Naples to secure either a vote by the constituent assembly in favour of the monarchy or authorization of a referendum on the institutional question to be conducted six months later following the convening of the provisional legislature thereby preventing electoral possible republican electoral fraud.

An important reason why the DC’s leadership ensured that the institutional referendum and the election of the constituent assembly vote occurred simultaneously was so that a monarchist party could not have appropriated Christian Democrats voting base. It was estimated that six million of the eight million DC voters supported the monarchy in the June 1946 referendum.

The strong monarchist vote that the DC was expected to receive (and did receive) combined with pressure from the Vatican could have induced some monarchist inclined DC deputies to combine with PLI, UQ and PLD deputies as a majority to vote for the monarchy’s retention. There were also PSI constituent assembly deputies with political links to Lucifero Falcone, the Minister of the Royal Household Department, who would have voted to retain the monarchy.

Republican Myths Concerning the 1946 Referendum

Due to the historical importance of the June 2nd-3rd 1946 referendum, there are mythologies concerning this vote that have been perpetuated which require refutation because they have helped provide legitimacy to the tampering of the ballot count. The first myth (besides that the referendum was not rigged) was that the popular Queen Maria Jose was a republican who expected to be allowed to return following the promulgation of a new republican constitution due to Her Majesty’s previous role in contributing to Mussolini’s 1943 deposition.

(*The constitutional banishment on Her Majesty was rescinded by a parliamentary vote in 1987 but only after Umberto II had died four years previously. The Queen initially refused to return to Italy until the ban on her son and grandsons was also rescinded but eventually made emotional return visits to her adopted homeland.

Queen Maria Jose died in Switzerland in January 2001, where Her Majesty had made a cultural impact through her involvement in music and the arts. The gracious funeral condolences from President Carlo Ciampi to Her Majesty’s son, Victor Emanuel IV and her grandson, Emanuel Filberto, the Prince of Venice, were crucial to clearing the way for the Italian parliament to vote in November 2002 to rescind the constitutional ban on male descendants of Victor Emanuel III and Umberto II returning to Italy).

The fiction that Queen Maria Jose was a republican was given credence by the fact that Her Majesty cast a blank ballot on the issue of the institutional question and because she let it be known that she voted for the republican PSI. In fact Umberto II also a cast a blank ballot on a premise, similar to the Queen’s, that His Majesty was an interested party concerning the institutional issue. Because the CLN had made voting compulsory (which is a worthwhile principle in itself that all nations should apply to promote democratic participation) members of the royal family were obliged to vote in 1946 elections even though the 1948 republican constitution would later deprive them all of their franchise rights.

Which party Umberto II voted for (unless he also cast a blank ballot) was a secret that His Majesty took with him to his grave. The Queen’s vote for the PSI (and Her Majesty’s admission of it) was not really surprising because most Socialist Party voters in the south voted for the monarchy. The Royal Household Department had been encouraging Matteottian social democrats to join the PSI to bolster a moderate Italian polity. Had the votes on the issue of the institutional question been fairly and accurately counted, (i.e. the monarchy had been retained) then the Queen’s vote for the PSI would have been regarded as a masterstroke by contributing to Italy having a stable two party orientated political system.

Following the elections, Queen Maria Jose and her four children flew from Rome to Naples to leave by ship for Portugal to await the referendum results. The send off that the royal family received from Naples was tumultuous which reflected the then strong monarchist sentiment in the south. Indeed, as the votes came in from the south, indicated a landslide in favour of the monarchy that there was too much ground for the republican option to legitimately make up. Therefore Romita brazenly held back the release of the figures in the north of Rome in favour of the monarchy so that they could either be discarded or altered.

(* Voters were given a ballot with the Savoy royal coat of arms on it and a symbol of a woman very similar to the Madonna representing the republic. Preference for either a republic or a monarchy was to be indicated by marking one of the two symbols).

The Politics of Disingenuousness: The Birth of the First Italian Republic

The fact that the monarchy had really prevailed was indicated by a letter (dated the 4th of June) that the Minister of the Royal Household Department Lucifero Falcone received from Prime Minister De Gasperi which acknowledged the vote in favour of the monarchy. But when His Majesty received De Gasperi for an audience on the 5th of June at the Quirinale Palace, instead of discussing how to overcome the rigging of the vote the prime minister respectfully insisted that His Majesty accept the referendum result by leaving the country!

The prime minister was probably not a privy to the rigging of the referendum but it is plausible that his personal secretary, Giulio Andreotti, was. A stunned king subsequently departed from the palace to stay incommunicado with his friend, the journalist Luigi Barzini. The official, but rigged, result in favour a republic was declared on the 6th of June. The formal result indicating that, by a margin of two million votes (officially ten million votes for the republic and twelve million votes for the monarchy) was met mostly with outrage in the south and in Rome because it was too brazenly apparent that the referendum vote had been rigged.

The Dilemma of Exiting: Losing After You Have Won

Usually, when there is an adverse outcome in a referendum or an election, the losing side accepts the result however grudgingly. The massive demonstrations and celebrations north of Rome indicated a determination that the referendum result be accepted, regardless of how nefariously it had been arrived at. This determination was reflective of deep seated hostility toward the House of Savoy in the north because Victor Emanuel III’s flight from Rome had helped cause nearly two years of suffering in the form of the German occupation and subsequent fighting.

There were also massive protest rallies in support of the monarchy in the south and in the capital where four monarchists were killed in rioting that was violently dispersed by the police. But despite counter massive monarchist support, Umberto II was still confronted with the dilemma of the prospect of civil war if His Majesty did not accept the rigged vote. It was strangely unfair that the onus had been placed on the king to decide whether or not to plunge Italy into a civil war when it had been the republicans who had initially forced the issue by rigging the vote on the institutional question.

The king’s personal situation was also undermined due to His Majesty’s inability to contact his three main counsellors, the former prime ministers, Orlando, Nitti and Bonomi. The queen’s absence also undermined Umberto II’s position. Her Majesty might have provided intelligent counsel as to how the king could have proceeded in a very difficult situation. Having the benefit of hindsight, it is plausible that it was engineered for Queen Maria Jose to quickly depart so that, in Her Majesty’s absence, the king would take advice from his friend Luigi Barzini who was not a committed monarchist.

With the nation on the brink of a civil war, Prime Minister De Gasperi convened a cabinet meeting on the 10th of June to demand that the king leave the country. The prime minister at the cabinet meeting disingenuously claimed neutrality on the issue of whether the vote had been rigged by declaring that there was an ambiguity regarding the legitimacy of the referendum result because the two million blank votes cast (which were really deliberately spoilt monarchist northern votes) meant that the republic had not received a majority of valid votes cast.

With the cabinet’s *authorization, it was decided that De Gasperi as prime minister would assume the prerogatives of head of state on June 13th to await the decision of the 18th of June of the Supreme Court of Cassation concerning the validity of the referendum result.

(*There was only one dissenting vote in the cabinet against the demand that Umberto II leave the Quirinale Palace and that His Majesty’s prerogatives be transferred to De Gasperi. There were more than one PLI and PLD cabinet members at the time which raises the question as to how sincerely monarchists these two parties really were).

The PLI did however withdraw its representatives from the cabinet as an ostensible protest against Italy becoming a republic. However, the first two presidents of the Italian republic Enrico De Nicola, 1946 to 1948 and Luigi Einaudi, 1948 to 1955, both came from the PLI. The determination of the DC and the PCI to secure conservative acceptance of the Italian republic ensured that only two PLI members, Einaudi and Orlando, were candidates for president in 1948 parliamentary election despite the PLI’s paltry legislative representation.

Orlando’s failed 1948 presidential candidacy was a deep disappointment to an exiled Umberto II because His Majesty believed that the former prime minister was a sincere monarchist. The sincerity of the PLI’s monarchism was also suspect in that its representatives in the constituent assembly fulfilled an important intermediary role between the DC and the PSI in drawing up the new republican constitution. The fact that PLI constituent assembly members were able to incorporate specific laws associated with the Luogotenente was testament to their squandered potential to help draw up an excellent monarchist constitution to replace the Statute of 1848 which provisionally applied with a presidential head of state between 1946 and 1948.

Many Choices, But Few Options: The Banishment of Umberto II

Although the king had gone incommunicado, the Minister of the Royal Household Department Falcone Lucifero still held the fort at the Quirinale Palace. The king on returning to the palace on the 13th of June was presented with two options by Lucifero. The first plan was to arrest De Gasperi and the cabinet and form a military backed government headed by General Adolfo Infante, who had previously served as the king’s aide de camp when His Majesty was Lieutenant- General. The second option was for the king to withdraw to Naples to re-establish the Kingdom of the South.
The first option was viable to the extent that the armed forces were overwhelmingly monarchist. But had a militarily backed government been formed, there undoubtedly would have been a rebellion north of Rome that would have precipitated a civil war. The second option of the king withdrawing to the south was more viable due to overwhelming popular monarchist support in that part of Italy. But there was no guarantee that a government of a northern backed republic under PCI influence would not have induced a ‘war of liberation’ to retake the south with the support of southern communist partisans.

Another complicating factor with regard to Falcone’s plans was that Italy was still technically under Allied occupation with occupying troops (Italy regained national sovereignty in September 1947 when the constituent assembly under protest ratified the Treaty of Paris which had been signed in February 1947). Uncertainty with regard to Allied intervention was a practical obstacle regarding the viability of Lucifero’s plans. Had a Kingdom of the South been established, the Allies undoubtedly would have recognized the legitimacy of the Italian republic as having legal suzerainty over all Italian territory, thereby denying a separatist kingdom international diplomatic recognition.

The immediate insurmountable obstacle to Lucifero’s plans was Umberto II’s reluctance to possibly plunge Italy into a probable civil war. The king was counselled that his defiance of the referendum result would result in a civil war in which might imperil the Vatican. Through intermediaries between the government and the Vatican, His Majesty agreed to go into exile while a new republican constitution was being drawn up. Secret undertakings were given that, following the promulgation of the new republican constitution, His Majesty and family would be allowed to return as an honoured citizens on the condition that they refrain from politics to enable the new republic to consolidate.

Umberto II would leave Italy in 1946 for an exile that became embittered because it became permanent. The republican constitution of 1948 banned His Majesty’s return. Under the new constitution *Umberto II and former king Victor Emanuel III, their wives and male descendants were banned from Italian territory. This constitution also forbade any constitutional amendment that would alter the republican system of government.

(*From his exile in Cascais in Portugal, the king often arranged foreign travel excursions. But the king’s desire for air travel was so that His Majesty could make stop overs in Rome and other Italian cities. Although His Majesty was not allowed to disembark he was still able to see Italy from the air and from his window seat and when plane landed on the airport tarmac).

The king, in rejecting Falcone’s counsel, did so for a combination of patriotic and personal reasons. The patriotic reasons entailed avoiding a civil war. Furthermore, His Majesty was taken with the idea that, by going to Naples the House of Savoy’s fundamental achievement of uniting Italy in 1861 would be undone. Ironically, Umberto II’s refusal to withdraw to Naples terminated the one thousand years secret of the dynasty’s survival: the Savoyard stratagem of withdrawing to secure territory when a military or political position had become untenable.

It is probable that, had Umberto II withdrawn to Naples, a civil war would have ensued. Therefore the king should have withdrawn to the island of Sardinia to ostensibly wait the promulgation of a republican constitution that allowed His Majesty’s return. The subsequent prohibition against the king’s return under the 1948 constitution would have enabled His Majesty to have established a permanent separatist monarchist regime on Sardinia. An Italian republican invasion of Sardinia was not viable because monarchist sentiment in the armed forces would have been too strong and monarchist opinion on the mainland would have been alienated.

Sardinia until 1718 had belonged to either Spain or Spanish kingdoms until the island was awarded to the House of Savoy in exchange for their ceding the Kingdom of Naples and the Two Sicilies which went to Spanish Bourbons. Throughout the Bonapartist occupation of mainland Italy in the late eighteenth and early ninetieth centuries, the Savoys survived by being based on Sardinia.

Even though over two hundred years of House of Savoy rule was to ‘Italianize’ Sardinia, the regional dialects on the island remained closer to Castilian and Catalan. Consequently, there was an argument that there would have been no violation of Italian unity by Umberto II going to Sardinia and that the Savoys had a right to return to an island that they had brought to Italy and which had overwhelmingly supported them in the 1946 referendum.

Instead of withdrawing to a new bastion, Umberto II on returning to the Quinrale Palace on the 13th of June publicly over-ruled a visibly and understandably distressed Lucifero* and released all officials from their oaths of allegiance to the Italian Crown. Determined to leave Italy before De Gasperi appropriated his prerogatives as chief of state, Umberto II inspected an honour guard at Quirinale Palace and departed with the royal standard still flying over the palace.

(*Lucifero later reconciled with Umberto II by becoming the king’s official representative to the Vatican after indignantly refusing a presidential nomination to the Senate in 1948. He later accepted a knighthood from Umberto II as a Cavaliere in 1969).

The king was driven to Rome’s Ciampino Airport to depart for Portugal. The crowds that gathered along the king’s route to Ciampino Airport probably did so for a variety of reasons. For some, it was to witness history as a king permanently left his country. Others undoubtedly turned up to demonstrate their continuing allegiance to the monarchy and this was reflected by exhortations from the crowd that His Majesty not leave.

Whatever Umberto II’s motivations in deciding to go into exile, it cannot be denied the His Majesty had spared Italy civil war that would have politically embittered Italians for generations. His Majesty’s departure reflected that, had the referendum been fairly conducted, Italy would have had a democratic constitutional monarchy serving the genuine national interest by fostering national unity and honest governance.

Predictably, the Supreme Court of Cessation on the 18th ruled that the referendum result was valid; clearing the way for the constituent assembly on its inaugural meeting on the 28th of June declared Italy a republic and elected Professor Enrico De Nicola as provisional president. The choice of De Nicola was surprising because he was a former Salandra liberal who had served as Speaker of the Chamber of Deputies from 1920 to 1924 and who had been Victor Emanuel III’s chief constitutional advisor after His Majesty had fled South in 1943. Indeed, it was De Nicola who had formulated the legal concept of the luogotenente in 1944.

The choice of a southern liberal monarchist in the person of De Nicola as provisional president was part of a DC-PCI strategy to have the public accept a republic. The new head of state was a Neapolitan whose home city had voted by over eighty percent in favour of the monarchy. De Nicola was persuaded to accept the new position by Andreotti but he later tried to resign as president and adamantly refused to stand for election in 1948. The new president (who everyone knew had voted for the monarchy) gained a degree of good will amongst monarchists by making gestures such as allowing servants and staffers at the Quirinale Palace to remain in their jobs if they so desired.

Turning Negatives into Positives: Togliatti Consolidates The Italian Republic

A more substantial action that De Nicola took in consolidating the Italian republic was to issue a presidential pardon upon the proclamation of a republic on the 28th of June of minor to middle ranking officials of the PNF regime between 1922 and 1943 and of the RSI. (To establish the legitimacy of the rigged referendum, the anniversary of the Italian republic is celebrated on the date of that vote, the 2nd of June, as opposed to the formal proclamation of the Republic on the 28th of June 1946). The pardon was instigated by the then Justice Minister and PCI leader Palmiro Togliatti.

As with other Togliatti actions that were ostensibly conciliatory, there was a sinister ulterior motive. Even without rigging the referendum, the DC- PCI leadership had the challenge of overcoming monarchist sentiment in the south. In fact, Togliatti not only overcame southern monarchist sentiment, he gained a strong base of communist support in the south as part of a carefully pre-arranged plan. As previously mentioned, local government elections were not held in Rome and south of the capital in March/April but took place in November 1946 after the referendum.

Due to outrage in the south over the rigging of the referendum, the avowedly monarchist UQ party performed sensationally in the November 1946 local government elections. In Naples and Foggia, the UQ received over 45%, in Lecce and Catania this ‘party’ gained over 35% of the vote and over 25% of the vote was garnered in Palermo while in Rome the UQ received just under 20% of the vote. Considering the voting system that was in place, these results were outstanding and no single party since has ever received over 45% of the vote in Italian local government elections.

These election results should have institutionalized a strong Italian monarchist movement/party in republican Italy. But, alas, these election results had been anticipated by PCI and DC strategists who ensured that the candidates that the UQ ran were former fascists, many of whom had received the recent presidential pardon and to say the least were not really monarchist.

The UQ leader Guglielmo Giannini was a monarchist but his greater commitment was to the PLI. Giannini had really intended that the PLI become a mass based party by riding on the wave of the UQ’s successes of the November 1946 local election. Indeed, some UQ local government officials did go into the PLI which helped facilitate a functional merger between them in the 1948 general elections.

However, some of successful UQ candidates went into the MSI which was founded in December 1946. Without the entry of successful UQ local government candidates, there could have been no politically viable neo-fascist party in post-war Italy. Promisingly, some of the elected UQ councillors almost immediately broke with their ostensible party to join the National Monarchist Party (PNM) which had been founded by Alfredo Covelli in July 1946. (He had previously been the leader of the monarchist Italian Democratic Party which had been the key component of the Bloc of Freedom, BLN).

But the real historical impact of the UQ’s stunning electoral success was that most of that electoral configuration’s successful local government candidates went into the PCI! This development was not as strange as it seemed because it was pre-arranged by Togliatti whose pardoning of former fascist officials had enabled them to successfully run on UQ tickets.

With regard to the 1946 constituent assembly results, the DC had come first with 34% of the vote, followed by the PSI with 20% and the PCI with 18%. The PLI and PLD had combined to form the National Democratic Union (NDU) which gained over 6% of the vote. The monarchist vote and subsequent parliamentary representation would have been considerably strengthened had the NDU, the UQ (5% of the vote) and the National Bloc of Freedom, BLN (with just under 3% of the vote) combined to form a single monarchist slate.

The monarchist vote would have been further bolstered had Count Sfroza (whose title was retained because the 1948 republican constitution recognized titles that were awarded before Mussolini came to power in October 1922) run on a united monarchist slate. Instead, Count Sfroza ran with the *PRI which came sixth with just over 4% of the vote.

(*The PRI 1946 vote was really a northern middle class Liberal Party vote that went to the Republican Party because of hostility toward the monarchy in that part of the country at the particular time and because of Count Sfroza’s support. Had Count Sfroza run with the PLI, or on a united monarchist slate and endorsed a democratic constitutional monarchy, the liberal monarchist vote would have been crucially stronger in the north. Ironically, the ultimate beneficiary of the PRI vote was the Pd’A which gained just over 1% of the vote. This pathetic performance of the principal non-Marxist resistance group was due to the Pd’A being a party of ‘too many chiefs and not enough Indians’.

But the Pd’A was to live on in the PRI because most Action Party leaders and members went into its fold at the 1947 Republican Party Congress. This development provided Italy’s second oldest but then virtually moribund political party with a much needed rank and file structure enabling it to be a political force into the 1990s. The PRI averaged 2% in general elections and its branches were usually based around university campuses).

The UQ councillors who entered the PCI by dispensing patronage enabled the communists to leap frog their ostensible PSI ally to become Italy’s principal opposition party in the April 1948 general elections. Without Italy becoming a republic in 1946, or perhaps more to the point without the rigging of the referendum, the political dynamics would not have been there for the PCI to subsequently become the principal opposition party in the 1948 general elections.

The Italian Republic Spawns A Blocked Democracy

Concerning the ramifications of the 1948 general elections, Italy became what in political science terms is known as a ‘blocked democracy’. This is where an extremist party’s status as the major opposition effectively precludes its winning office so that the ruling party can indefinitely hold onto power. Republican Italy’s notoriety for frequent changes in government was not due to the proportional electoral system facilitating a proliferation of small political parties having parliamentary representation but the incapacity of the PCI to win a majority in its own right.

The superseding of the PSI by the PCI in the April 1948 elections was also helped by Pietro Nenni’s stubborn refusal to break his party’s alliance with the communists. His stubbornness was based on the notion that the rapture in working class unity had enabled the fascists to come to power in 1922. Nenni’s refusal to realize that the threat to democracy came from communism and not fascism led Giuseppe Saragat, a leading anti-communist member of the PSI, to beak away to found the Italian Socialist Workers Party in January 1947.

Saragat’s new party was primarily composed of Matteottian social democrats who had joined the PSI. The new social democratic breakaway party was mildly strengthened later in 1947 when Bonomi took his small PLD into this new party. Even though many Matteottian social democrats had previously joined the PSI at Falcone’s instigation, they did not later object to the Italian Socialist Workers Party merging with the United Socialist Party to form the Italian Democratic Socialist Party (PDSI) in 1951. The reconstituted United Socialist Party, the PSU, (which had split from the PSI in 1949) was led by the founder of the Italian Republic, the former interior minister, Giuseppe Romita.

The PSI’s shift to the communist orbit was further advanced in May 1947 when Nenni socialist ministers followed their communist comrades in resigning from the De Gasperi government due to their opposition to acceptance of financial and economic support from the United States under the new Marshall Plan.

That the communists were in a position to win the April 1948 general elections due to the base that they had established at a local government level following the rapid 1946 demise of the UQ and the Nenni socialists combining with the PCI to form the Popular Democratic Front (PDF) for the 1948 poll. It should be pointed out that Togliatti probably did not want the PDF to win the 1948 elections due to his plausible fear that a military coup would ensue. Nevertheless, the PCI exploited to the full the opportunity to establish themselves as the major opposition party in a Western European nation.

The April 1948 elections were the most intense in Italian history. The full resources of the Catholic Church were understandably mobilized to prevent a possible communist takeover. Catholic parish based Civic Committees (CCs) were formed to harness maximum support for the DC. A wide range of Catholic lay groups also supported the Christian Democrat campaign. With the open encouragement from the Vatican, parish priests read pastoral letters advocating a vote for the DC.

The DC not only had the support of the Vatican in the 1948 elections but also that of the Untied States. The first major political operation of the American Central Intelligence Agency (CIA) was undertaken in relation to these elections. The United States had established a major military intelligence operation in Italy during the Second World War under the auspices of the Office of Strategic Services (OSS). Consequently, the Americans were well placed to co-ordinate election campaign operations against the PCI because the OSS was the direct precursor of the CIA.

American support for the DC was wide ranging and it encompassed funding and helping to organise anti-communist radio broadcasts and printing and distribution of election campaign material.

The polarizing intensity of the 1948 anti-communist election campaign was such that the issue of monarchy versus republic temporarily receded to virtual irrelevance. This development was ironic because the Vatican’s support for the monarchy, coupled with the one-off provision of compulsory voting, had paradoxically bolstered support for the republican led DC in the 1946 constituent assembly elections such that the Christian Democrats had come first with 34% of the vote. The DC consolidated its position as Italy’s dominant ruling party in the 1948 elections (with 48% of the vote) as the major bulwark against a communist takeover.

Quality Democracy: West Germany Gains While Italy Does Not

For reasons that have already been detailed with regard to the UQ, had the votes in the 1946 institutional referendum been counted as they were cast, (i.e. the monarchy been retained) the PSI probably would have retained its status as the major opposition party after the 1948 elections or won government in its own right. The upshot is that, as a post-war constitutional monarchy, the Italian party system could have provided Italy with a democracy similar to the Federal Republic of Germany (West Germany).

Even though Germany had inflicted more harm on Europe and the world as a member of the Axis than Italy ever had, West Germany emerged with a better quality of democracy which was reflected by its post-war party system. Similar to Italy, a Christian Democratic Party (the CDU) with a strong trade union wing emerged in West Germany as the principal standard bearer of the mainstream right. In contrast to Italy, the West German CDU did not become a corrupt catch-all party
because the opposition Social Democratic Party (SPD) was not displaced by the stalinist Communist Party (KPD).

Another potential parallel in relation to political party dynamics that could have existed between Italy as a constitutional monarchy and a post-1949 West Germany was a centrist liberal party having a worthwhile role in domestic and international affairs. The German Free Democratic Party (FDP) was similar to the PLI in that post-war dynamics were such that it had to give way to a Christian Democratic party as the standard bearer of the conventional right. But due to there being the viable prospect of the SPD winning government, the FDP was in a position to positively exercise a balance of power position with its impact being felt in promoting European unity.*

(* Since 1969, FDP leaders have served as foreign ministers in a succession of either CDU or SPD led German governments).

Had there been a CD –PSI dichotomy in a post-war Italian constitutional monarchy, the PLI could have been in a similarly positive balance of power position similar to that of the German FDP. Indeed, Count Sfroza ably served as foreign minister from 1947 to 1951. But the Count, as a member of the PRI, belonged to an electorally minor party due to the polarizing impact of the 1948 elections. Therefore, both the PLI and the PRI consequently operated as DC satellites until De Gasperi respectively dispensed with them from government in 1950 and in 1951.

If Count Sfroza had supported the monarchy in the 1946 referendum and/or led the PLI, Italian liberalism would have been stronger in a post-war context. Indeed, the scope for Count Sfroza being foreign minister and leader of a democratic PLI holding the balance of power between the PSI and the Populari had been there had it not been for the so-called fascist ‘March on Rome’ in 1922.

The weakness of post-war Italian liberalism was also a factor that later contributed to the survival of post-war neo-fascism because anti-communists in the northern Italy voted for the MSI rather than a DC-dependant PLI in the 1972 elections. By contrast, the relative strength of the FDP in West Germany was such that it helped prevent its support base going over to a neo-Nazi right.* Ironically, Italian neo-fascism was weaker in the immediate post-war period than neo-Nazism but the former was to gain a relatively secure niche in the Italian Republic while the latter abysmally failed to do so in the German Federal Republic.

(* The Nazi vote rapidly increased between 1930 and 1932 by gaining support from people who had previously abstained from voting and from the voting bases of the then two parties of German liberalism, the republican German Democratic Party and the monarchist inclined German People’s Party).

However, contrary to popular opinion, republican Italy was one of the most stable countries in Western Europe because changes in government were really a re-arranging of ministerial deck chairs with the same faces in new positions under a continuously ruling catch-all type of party. The really detrimental dimension of the Italian republic being a blocked democracy was the artificial polarization that was inflicted upon Italian society which had ramifications in promoting engrained corruption.

When Bi-Partisan Rivalry Facilitates Societal Division

This societal polarization was brilliantly caricatured in the world famous Don Camillo stories written by the Italian monarchist, Giovannino Guareschi* (1908-1968). The Don Camillo series tell the humorous stories of the DC supporting priest, Father Don Camillo Tarocci, sparring with the communist town mayor, Peoppone. The stories of Don Camillo’s ‘small town’ being divided by DC and PCI football teams disturbingly reflected the general situation in Italy.

(* Guareschi was interned by the Germans in the Auschwitz concentration camp in Poland following the 1943 German invasion of Italy. As editor of the monarchist magazine Candido Guareschi was briefly imprisoned in the 1950s for refusing to pay a fine for defaming President Luigi Einaudi by describing the former monarchist traitor as ‘The President of Wine’ when he visited a wine vineyard).

In either the lead up to or following the 1948 general elections, important institutions such as trade union confederations divided upon communist and anti-communist fault lines. This phenomenon was also manifested in 1950 when anti-communist elements within the then peak union confederation, the PCI/PSI dominated CGIL broke away to form three new rival union confederations: the DC backed Italian Confederation of Trade Unions (CISL), the PDSI and PRI supported Italian Labour Union (UIL) and the neo-fascist Italian Confederation of National Workers’ Unions (CISNAL).

More vivid divisions in sync with the emerging DC-PCI dichotomy from the 1950s onward were community splits within towns and villages where even social clubs were formed on party lines. Although there was a comedic ridiculous dimension (as the Don Camillo stories attested) to these divisions, they were ultimately a counterproductive waste of time that empowered self-seeking party bureaucracies. Had post-war Italy been a democratic constitutional monarchy, there could have been a viable transparent two party system with a non-partisan monarchy inspiring civic virtue, national unity and serving as a focal point for an impartial civil service.

The societal divisions caused by Italy being a blocked democracy were avoidable had De Gasperi been prepared, following the 1953 election, to make an accommodation with the PNM. That the prime minister would not was testament not only to his refusal to come to terms with the rigging of the 1946 referendum but also to his determination to personally dominate Italian politics. For all the elaborate checks and balances that the 1948 republican constitution supposedly put in place to prevent Italy again becoming a dictatorship, there was no constitutional protection against the passage of the Scelba electoral law of 1953 (‘the swindle law’).

The Scelba electoral law (named after the DC Interior Minister, Mario Scelba) was eerily similar to Mussolini’s 1923 Acerbo Law in that it awarded two thirds of parliamentary seats to the party (or electoral coalition of parties) that won 50% or more of the popular vote. Had the DC polled 50% or more of the vote in the 1953 elections, then Italy may have become a de facto one party state, with the smaller parties squeezed out and the PCI permanently consigned as the major opposition party.

Thankfully, the DC fell way short with 40% of the popular vote in 1953. Yet, the Nenni-led PSI still refused to terminate its alliance with the PCI. Nevertheless, the prospects for Italian democracy were strengthened by the PSI at least running a separate list from the communists which diminished the sense of urgency for anti-communists to vote for the DC. The June 1953 elections saw the PMN come fourth (after the DC, PCI and the PSI) with nearly 7% of the vote giving the monarchists forty lower house seats!

Keeping the Monarchists in the Wilderness

The relatively strong monarchist vote in the 1953 elections was not really surprising because there was still residual resentment in the south over the rigging of the 1946 referendum. Due to the absence of an immediate threat of a communist takeover, Neapolitans felt secure in 1952 to elect *Achille Lauro of the PNM as mayor of Naples. The PNM vote was nearly double that of the monarchist inclined PLI which came seventh with 3% in the 1953 vote. Consequently, the PNM was positioned to become the standard bearer of the conventional right. At the very least, the PNM had the capacity to consolidate monarchist sentiment in the south and possibly secure a future monarchist voting base in the north.

(*Lauro served as mayor of Naples from 1952 to 1957 and from 1960 to 1962. The monarchist lost the Naples mayoralty in 1962 to the DC and, after 1963, were not part of the city’s ruling coalition).

The entrance of the monarchists into the mainstream of Italian politics could have orientated the DC to being a centre-right party so that the PSI (which broke with the PCI in 1956 over the Soviet invasion of Hungary and temporarily re-united with the PDSI between 1966 and 1969) could eventually have become a viable competitor for national government in its own right. But, in De Gasperi’s last dis-service to Italy, he effectively ensured that the PNM remained outside the ‘constitutional arc’ by refusing their support.

Having failed to ensure de facto one party rule by passing the Scelba Law, De Gasperi tried to present himself as a principled democrat by refusing to form a centre-right coalition with the PNM and the then monarchist inclined PLI. In his August 1953 resignation speech, De Gasperi referred to the PNM deputies as ‘these strange gentlemen’ who had brought Italy to the brink of civil war. This denunciation was inaccurate as it was unfair because the outgoing prime minister rejected the reality that the referendum vote had been rigged by the republicans and that it was Umberto II’s action in leaving the country that had averted bloodshed.

De Gasperi, by spurning the support of the PNM, ensured that the DC remained a catch-all party that operated in a polity that blurred the distinction between left and right. It was in this political context that De Gasperi intended to wield predominate power as DC General Secretary. Although De Gasperi was DC General Secretary between October 1953 to his death in August 1954, he was not able to exercise the equivalent power of a Communist Party General Secretary because, with all the DC’s faults it could not operate as a regimented Leninist type of party.

The succeeding DC led caretaker government of Giuseppe Pella (August 1953 to January 1954) was a three party coalition with the PNM and the PLI. The fact that the exiled Umberto II was prepared to support a republican government with PNM cabinet ministers did not lead to any reciprocation on the part of the political establishment with regard to accepting the legitimacy of monarchist involvement in republican politics. In fact, the major purpose of the Pella government was to serve as a stop gap to prepare the DC to form amorphous cabinets.

Keeping the Monarchists Out Spawns Calculated Instability

This pattern of nebulous DC governance commenced in February 1954 with the formation of the Scelba government which was a coalition between the DC, the PLI and the PDSI. Over the next nine years, there was a pattern of successive DC led coalitions involving the PLI, the PDSI and the PRI. After 1963, following the so-called ‘opening to the left’, the PSI entered the coalition mix.

The rapid turnover of governments (which usually lasted six to eighteen months) encouraged the factionalization of the DC. Because parliamentary votes were by secret ballot, tight factional groups within the DC were formed which more often than not had links to junior coalition parties that were based upon patronage capacity as opposed to ideological considerations.

Avowed monarchists perversely became part of the patronage politics of the Italian republic when Achille Lauro, a ship builder who had previously supported the Mussolini regime, broke away from the PNM to form the Popular Monarchist Party (PPM) in 1954. The PPM was really a conduit for Lauro to gain patronage for his supporters and further his business interests. The utility of the PPM for the DC was that this party undermined the capacity for the PNM to be sufficiently strong to be accepted into the mainstream of Italian politics.

The impact of the PPM undermining the PNM was manifested in May 1958 elections when the MSI garnered 4.8% of the vote thereby coming fourth. The combined vote of the two monarchist parties was nearly the same as the MSI’s with the PPM and the PNM respectively gaining 2.6% and 2.2 % of the vote. The cumulative monarchist vote was still greater than the PLI’s 3.5% of the vote.

Covelli and Lauro as respective leaders of the PNM and the PPM met with Umberto II as mediator in Paris in April 1959 to thrash out the re-unification of the two monarchist parties. A reconciliation was reached which was manifested by the formation of the Democratic Party of Monarchical Unity (PDIUM) following the royal mediation. But the damage was done due to the impact of the previous split undermining monarchist leverage to be accepted into the mainstream of Italian politics.

Due to apprehension among southern conservative voters regarding the impending entry of the PSI into government (‘the opening to the left’), there was a transfer of monarchist votes in the April 1963 elections to the PLI which came fourth with just over 7% of the vote. The PDIUM came seventh with 1.8% of the vote behind the fifth placed PDSI and sixth positioned MSI but still marginally ahead of the PRI.

The electoral weakness of the monarchist movement in Italy in the 1960s did not reflect the high levels of sentimental support for the House of Savoy in the south of Italy. It was not uncommon in the 1960s for the Italian tricolour to be flown in the south with the royal standard. Portraits of Umberto II and Queen Maria Jose often adorned town halls in southern Italy. Across Italy, articles and photos on the royal family still featured prominently in newspapers and magazines. A lucrative travel industry by the 1950s had emerged of organising tours to the royal court at Villa Italia in Cascais, Portugal.

The royal court secretariat at Villa Italia in Portugal maintained regular contact with Umberto II’s supporters. The king’s cause was also helped by having an efficient personal Rome office which maintained communication links with monarchists throughout Italy while also keeping His Majesty appraised of contemporary developments.

But by the mid 1960s, the political electoral developments in Italy for Umberto II were not promising because it was near impossible to convert sentiment for the monarchy into electoral support. This was due to advances in communications (such as the widespread availability of television) diminishing regional differences between north and south which adversely affected the PDIUM and the MSI which had essentially become southern protest parties.

Post Monarchism or Post Fascism? Forming a New Italian Right-Wing Party

The non-viability of the PDIUM became apparent in the May 1968 elections when its vote fell from 1.8% to 1.2% (six seats). The monarchist party came second last in the elections, just ahead of the South Tyrolese People’s Party which represented the German speaking minority of the South Tyrol region of northern Italy. Monarchist electoral support by the time of the 1968 elections was concentrated in the south, was based on upper middle aged to elderly diehard royalist support and the so-called women’s magazine vote.

There was still a monarchist impact on the 1968 elections in that retired general, Giovanni de Lorenzo, was elected to parliament on the PDIUM ticket. The election of de Lorenzo to parliament provided him with parliamentary immunity which he needed because the L’ Espresso newspaper revealed during the 1968 election campaign that he had planned a military coup in 1964 as head of military intelligence, the Service Information of the Armed Forces, SIFAR.

The 1968 press reports concerning a planned military coup combined with General de Lorenzo’s demurral denials ultimately benefited the DC because the message was subtly conveyed that it was best to vote for the ruling party to avoid the danger of a PCI victory precipitating a military coup.

De Lorenzo’s narrow election to parliament was reflective of the PDIUM’s declining fortunes such that its leader Alfredo Covelli realized that monarchist interests would be secured by becoming part of a new right wing conservative party. The PLI’s move to the left in the 1960s, in which it adopted secular, if not libertarian social positions similar to the PRI’s, created the space necessary to create a new right wing party.

The MSI leader, Giorgio Almirante (1914 to 1988) with his party’s declining vote (4.5 % of the vote) also had the objective of creating a new conservative party. Although Covelli and Almirante were initially to work together after the 1968 elections they were to become rivals in the 1970s with the latter ultimately winning out. Because Almirante’s surprisingly substantial impact on modern Italian history continues to the present a brief overview of his political life is undertaken.

Giorgio Almirante: The Political Winner Who Backed a Losing Cause

Almirante was born in northern Italy to a family of theatre actors that originally came from Sicily and were of Spanish descent. He attended Rome University in the 1930s where he graduated with degrees in law and literature. At university, Almirante became a fascist and, following his graduation, he worked as a journalist with the hardline fascist newspaper Ill Tevere. During the Second World War, Almirante served in the Italian army. Following the September 1943 Armistice, he refused to flee to the ‘Kingdom of the South’ and instead made his way north to join Mussolini’s RSI.

The paradox of Almirante supporting the doomed RSI (1943 to 1945) was that he gained a relatively senior position in the republican fascist regime which he probably would not have gained had Mussolini still ruled all of Italy. From 1944 to 1945, Almirante was the chief of the Ministry of Popular Culture (MINCULPOP) which he later asserted made him a junior minister in the RSI government. A major success of the RSI was that it established an effective propaganda agency that was focused on defending Mussolini’s 1922 to 1943 regime and in claiming that Mussolini’s collaboration with the Germans mitigated the effects of their occupation of northern Italy.

Almirante later claimed that he became personally close to Mussolini when he was based in the Lake Garda of northern Italy that the RSI ‘president’ had wanted to establish secret contact with the Allies. These contestable claims helped advance Almirante’s post-war political career. The first claim bolstered Almirante to press his case to lead the MSI while the second claim helped him disassociate from the Nazis.

The future neo-fascist leader first demonstrated his acute survival skills by evading arrest and probable execution following the RSI’s violent overthrow in April 1945. He avoided arrest and eked out a living between the war’s end and the June 28th 1946 declaration of the Italian republic when an amnesty for minor to middle ranking fascist officials of both the 1922 to 1943 PNF regime and the RSI was granted.

As previously analysed, the benefit of this 1946 amnesty, (which was instigated by PCI leader and then Justice Minister Palmiro Togliatti), was that it enabled former fascists to run with the UQ in local government elections in November 1946 in Southern Italy. Due to uproar in the then monarchist south that the monarchy had been overthrown in a rigged referendum, the UQ performed spectacularly well in the southern local government elections. But, as Togliatti had previously arranged, most former fascists that had run under the auspices of the UQ subsequently joined the PCI therefore creating a strong communist base in southern Italy.

Not all successful UQ local government candidates joined the PCI and, due to their fascist backgrounds, it was not unnatural that some of them would want to join a neo-fascist party. At the end of the war in 1945, the best organised fascist grouping was a former RSI spy cell that was based in Rome. This cell metaphorised as the MSI in December 1946 and adopted Almirante as its leader due to his claim that he could bring former RSI officials into the fold of the new party. In fact, the only political asset that the MSI had at the time of its founding was that it provided a base for pro-fascists who had successfully run with the UQ to subsequently join a neo-fascist party.

Almirante consolidated his leadership of his party when he demonstrated tremendous physical courage by being the chief campaigner for the MSI ticket that ran in council elections in Rome in September 1947. MSI candidates were heckled and beaten up in the staunchly anti-fascist capital which had voted to retain the monarchy in June 1946. Nevertheless, the MSI polled strongly in the district of Rome where civil servants lived. These civil servants had first made their careers under the Mussolini regime, had served in his subsequent RSI regime and maintained their positions following the Allied liberation of Rome in June 1944. They were orientated to a party such as the MSI and ultimately voted for this party due to advocacy that a strong bureaucratic state be maintained.

There was public astonishment regarding the Rome vote that MSI had garnered in Rome because the aberrant factor of the civil service vote was not taken into account. The relative success of the MSI’s Rome vote helped provide the momentum for this fledgling party to garner 1.9 % of the vote in the April 1948 elections. This was a credible result due to the intensity of the DC/PCI polarization, the still strong anti-fascist sentiment and the MSI’s lack of resources. It was ironic that the MSI 1948 vote was concentrated in the south because fascism had been non-existent south of the capital in 1922 and neo-fascism probably would not have re-emerged in a post-war context had it not been for the existence of the northern based RSI.

Had Italy introduced the five percent minimum threshold for the 1948 general elections, (similar to the requirement that the Federal Republic of Germany introduced in the 1950s), for a party to gain parliamentary representation, then there probably would have been no neo-fascist parliamentary presence in the Italian republic. Senior DC strategists decided that it was useful to maintain the MSI as a factor in Italian politics to help divert votes in the south from going to the PCI.

Accordingly, Almirante was denied his parliamentary immunity in 1949 by a vote of the parliament and sentenced by a court to one year’s house arrest after being found guilty of trying to revive the fascist party which was (and is) expressly forbidden under the 1948 constitution. A 1950 MSI party congress was held at the instigation of the DC eventually provided the base for Augusto De Marsanich to succeed Almirante as party leader in 1951.

Even though De Marsanich came from Rome, he led the southern based component of the MSI that identified with the PNF regime of 1922 to 1943. This dominant wing of the MSI was prepared to work in alliance with the DC, the PNP and the PLI against the communists in local government elections in the 1950s. The benefit of these anti-communist electoral alliances for the MSI was that they not only undermined the PCI but enabled this party to gain a degree of patronage from access to local government. Almirante remained within the MSI as a focal point of nationalist hostility towards De Marsanich’s de facto alliance with the DC.

Ironically, Almirante’s prominent presence within MSI still helped this party to increase its vote by over a million in the 1953 elections (5.9% of the vote, 23 seats) due to his prominence in demanding Italian sovereignty over Trieste. This massive increase in the MSI vote reflected widespread hostility toward Allies for not allowing the Italian component of the Free State of Trieste to return Italian sovereignty. Had it not been for the Trieste issue in the 1953 elections, the MSI might not have been able to have continued as a viable electoral party.

The 1953 MSI vote still fell behind the PNM and, had the De Marsanich wing of the neo-fascist party subsequently joined up with the Covelli led monarchists, Italy could later have had a monarchist inclined party that was entrenched as a conservative/centre right party. Instead, a DC instigated split within the PNP was engineered in 1954 which led to the foundation of Achille Lauro’s PPM which not only thwarted a De Marsanich-Covelli configuration but eventually split the monarchist vote. Consequently, the MSI superseded the two competing monarchist parties in the 1958 elections even though the neo-fascist vote had fallen by 1 % when compared to the 1953 election results.

The entrenchment of a neo-fascist presence in Italian politics was not a threat to Italian democracy. This was because the major objective of the MSI under the successive leaderships of De Marsanich and from 1954 under Arturo Michelini (who was a Florentine who had links to the Vatican) was to support DC rule as a bulwark against the PCI. Most MSI members supported this unstated objective due to their success in gaining patronage at a local government level by broadly supporting the DC.

Ironically, for a party whose roots were with an undemocratic regime, there was abundant inner party democracy due to Almirante leading an institutionalized faction that vehemently and openly criticized the MSI’s incumbent leadership. The MSI’s implicit accommodation within the political system in the late 1950s and 1960s by the DC establishment aroused strong anti-fascist opposition. This was manifested when massive riots broke out in 1960 because a relatively junior DC official, Fernando Tambroni (who was a former PNF member), formed a five month government that was reliant upon MSI and PDIUM parliamentary votes.

The 1960 riots were reflective of the strong anti-fascist tradition that existed in Italy particularly in the north where there had been an extensive anti-German resistance movement between 1943 and 1945. Almirante’s faction of the MSI had provocatively convened a party congress in Genoa in 1960, thereby sparking violent riots in that staunchly anti-fascist city.

The Opening to the Left: The DC Goes into Coalition with the PSI

The fall of the Tambroni government consequently raised the question of the so-called ‘opening to the Left’: should the DC should enter into a coalition with the PSI? This had notionally been an option for the DC since the PSI had split with the communists following the Soviet invasion of Hungary in 1956 but had not been pursued due to opposition from the DC’s Vatican supported right wing.

The papacy of John XXIII (1958 to 1963) led to an ideological reconfiguration of DC factions with the supposed right wing faction based upon Luigi Gedda’s Catholic Action essentially becoming non-ideological as it passed into Giulio Andreotti’s orbit at the 1962 DC party congress. Andreotti established himself as leader of the DC’s right wing by passionately speaking against his party entering into a coalition with the PSI at the 1962 party congress, only to then serve in a newly formed cabinet as defence minister in a government formed by Amintore Fanfani later that year that was reliant on PSI parliamentary votes.

The Vatican’s support for the Fanfani cabinet helped the new prime minister (who had once belonged to the PNF) reposition himself as ‘a man of the right’ to a centre-left political position by declaring there to be common ground between the DC and PSI with regard to their both supporting government economic planning.

It was due to Fanfani’s support that the leading figure within the DC’s left, Aldo Moro, was able to form a series of coalition governments with the PSI (which as previously mentioned re-united with the PDSI between 1966 and 1969) between 1963 and 1968. Moro’s position was also bolstered by his friendship with Pope Paul VI, the former Cardinal Giovanni Battista Montini, who was elected pope in 1963 following the death of John XXIII in June that year.

The DC’s ‘opening to the Left’ essentially ended their supporting the MSI and the PDIUM at a patronage local government level as clientistic parties. As previously mentioned, the DC’s so-called move to the left provided the MSI and the PDIUM with a limited degree of support by appealing to anti-communist southern Italians who opposed the Christian Democrats’ 1963 accommodation with the PSI. But even this niche was threatened due to the upsurge in support for the PLI in the 1963 elections emerged both as an anti-communist standard bearer and as the possible future leading national centre right force. The PLI’s increased 1963 vote came from one time anti-communist DC voters and from former PDIUM voters.

The PLI failed to become the fulcrum of Italy’s centre-right because its leader Giovanni Malagodi lacked the inclination and perhaps necessary political skill to win over MSI and lingering PDIUM voters and key activists into his party. Between 1963 and 1972, the PLI was excluded from any access to patronage due to its remaining outside the centre-left coalition governments of this period. This probably did not unduly concern Malagodi because the PLI had a solid middle class vote that supported its economic policies as opposed to gaining benefits from the party’s patronage capacity.

Patronage shortfalls were compensated by the PLI’s links to Italy’s leading employer confederation, the Confidustria. The Confidustria often helped supply the PLI with candidates and logistical support as it later did for the PRI. From Malagodi’s perspective advances in communication and economic development were bridging the gap between northern and southern Italy so that it would only be a matter of time before MSI and PDIUM support base passed over to the PLI.

That the PLI*did not supplant the MSI and the PDIUM was due to these parties forming an electoral alliance for the 1972 elections called the MSI – National Right (MSI-DN). The formation of this electoral alliance occurred after Almirante resumed the leadership of the MSI following the death of Arturo Michelini in June 1969.

(*Indeed, the PLI vote declined to 3.9% in the 1972 elections and, after joining successive centre-left coalitions, its vote fell to 1.3% in the 1976 elections. Thereafter, until the 1990s, the PLI survived as a patronage satellite party of the DC. What continuing quality input the PLI had into Italian politics was derived from its links to the Confidustria. Any capacity that the PLI had to be a centre-right party was undermined by espousing liberal social policies from the mid-1970s onward which alienated many Catholics).

Almirante Attempts to Move from Neo to Post Fascism

Prior to Almirante’s 1969 return to the MSI leadership, he had formed an activist party faction (‘The National Platform’) whose potency had been undermined by the DC forming centre-left governments in the 1960s. This development circumvented anti-fascist demonstrations that Almirante had previously utilized to support his then hardline fascist position within the MSI. In the 1950s and 1960s, a bedrock support base for Almirante within the MSI came from underemployed uneducated male youth who gloried in street fighting. By contrast, staunch monarchist support disproportionately came from wealthy middle aged to elderly women.

Almirante gained a political advantage from 1963 onward within his party and over the PDIUM when he parlayed the support of an educated militant youth to establish MSI university clubs. The recruitment of anti-communist student activists brought in a more intelligent critical mass to the MSI. At a university context in the 1960s with the DC being entwined in centre-left governments, there was a gap with regard to there being a right wing anti-communist force at university campuses. This gap was filled by Almirante initiating the foundation of an MSI university student wing, the University Front for National Action (FUAN).

The FUAN and its successes in university campus elections (particularly in winning control of the student union at Rome University in 1965) provided Almirante with a strong inner party base MSI which he utilized to resume party leadership in 1969. The MSI’s student wing also established for Almirante a conduit to middle class families which saw a maturation in some of his policy positions.

Almirante shifted his position from opposing Italy’s membership of the North Atlantic Treaty Organization (NATO) - which Italy had joined as a foundation member in 1949 - to being an ardent supporter of the military alliance as a bulwark against communism. Similarly, Almirante went from being an opponent to a supporter of Italy’s membership of the European Economic Community (ECC, which is now known as the European Union, the EU). With regard to economics, Almirante moved from being avowedly anti- capitalist to a policy position of a pre-1980s French Gaullist: having the state support a market economy.

The MSI-DN alliance received 8.7% of the vote in the 1972 elections which was nearly a one million increase on the combined neo-fascist and monarchist vote in the 1968 elections. This respectable showing was due to the new electoral alliance holding existing support, garnering the support of some ardent anti-communist DC voters in northern Italy, and appropriating the PLI’s voting base across the nation.

The benefit for the former PDUIM being in the DN alliance was that a monarchist presence was retained in parliament that probably would not have been had an overt monarchist party run in the 1972 elections. Monarchist support for the DN alliance helped prompt non-neo-fascist conservatives, such as the retired Admiral Gino Birindelli, to run as alliance candidates. The MSI might (as Almirante wanted) have dissolved itself as a party following the 1972 elections so that the DN could become a conservative/anti-communist centre- right party had Pino Rauti’s fascist New Order Party (ON) not been re-admitted to the MSI as part of the process of forming the DN alliance.

Rauti had been a strong supporter of Almirante’s following his DC instigated deposition as MSI leader in the early 1950s. He was therefore put out when Almirante refused to split from the MSI to form a new neo-fascist party when it had been Almirante’s public opposition of the return of the Italian section of the Trieste Free state to Italian sovereignty that had resulted in the MSI gaining an increase of one million votes in the 1953 elections over the 1948 election results.

Rauti’s action in splitting from the MSI to form ON in 1956 probably later benefited Almirante because a hardline fascist presence in FUAN in the 1960s would have undermined the MSI from moving toward becoming a conventional right wing party. Ironically, Rauti’s return to the MSI was initiated by Almirante to undermine fascist terrorists groups, such as Prince Valerio Borghesese’s National Front (FN), by having hardliners move into a legal political framework.

In keeping with the cyclical nature of Italian politics, Rauti’s return to the MSI fold rebounded on Almirante with regard to achieving his objective of converting the DN alliance into a conventional right wing political party. At a 1973 convention of the constituent groups of the MSI-DN was held to establish such a new political party. At this convention, even some of Almirante’s staunchest supporters rallied to Rauti by blocking the MSI’s dissolution. Due to the productive working relationship that Covelli (who was MSI-DN president) had established with Almirante, the monarchist leader did not then utilize the convention’s failure to establish such a new party to break with the MSI to achieve this objective.

Because Almirante and Covelli still shared the common objective of establishing a new post-fascist party, they both supported a DC initiated referendum in 1974 to repeal a divorce law that had been passed by the parliament in 1972. The failure of the referendum (the anti-divorce proposition garnered 40% of the vote) undermined the DC to the extent that it almost set the scene for the PCI later coming to power in a strategic scenario that had been initially envisioned by Togliatti. The late PCI leader believed that, as Italian society ‘matured’ by becoming more secularized there would eventually be a shift of power to the PCI from a clericalist DC both at gross roots electoral level.

Togliatti’s Post-War Impact on Italy Re-Capped

Due to Togliatti’s impact on modern Italian history, his role in shaping the nation should be re-overviewed particularly because the DC’s post-war political hegemony had really been engineered by Togliatti. Despite all Victor Emanuel III’s fundamental mistakes in appointing Mussolini prime minister in 1922, supporting the subsequent establishment of a dictatorship and almost botching Italy’s defection to the Allied side, His Majesty was still later able to blunder by allowing the communists into government in 1944 to try to hold onto his throne.

The PCI leader’s support for Victor Emanuel III to remain as king had enabled the communists to enter the cabinet in March 1944 and subsequently have an important role in ruling Italy after the liberation of Rome later in June that year. PCI support on the executive of the CLN Central was crucial in ensuring De Gasperi’s appointment as prime minister in December 1945. Togliatti also helped ensure that the DC became a catch all party by ensuring that most monarchists voted for the Christian Democrats (instead of a secular centre / centre-right monarchist party) by supporting the proposition that that Italy’s constitutional status be determined by popular vote as opposed to a vote of the elected constituent assembly.

As Justice Minister, Togliatti granted an amnesty to minor to middle ranking fascists upon the proclamation of the Italian Republic on June 28th 1946. This enabled them to successfully run (due to outrage that the referendum had been rigged) under the auspices of the UQ in local elections held in southern Italy in November that year. As Togliatti had previously arranged, most UQ local government officials joined the PCI to establish a strong communist base in southern Italy.

The strong base that the PCI established in southern Italy through exploiting the UQ, combined with its existing support in other parts of Italy and Nenni’s naiveté of aligning the PSI to the communists, enabled the PCI to become the dominant opposition leader following the 1948 elections. Togliatti was too shrewd to want to see the PCI outright win national elections because he knew that this would precipitate a military coup. Instead, Togliatti envisaged a scenario that, as Italians (from his perspective) ‘matured’ by moving away from the mores of the Catholic Church, a communist backed left-of-centre regime led by a party such as the PSI would eventually displace the DC.

The above scenario of Togliatti’s was not fanciful. Had the Vatican not supported the DC’s ‘opening to the Left’ in the 1960s by having the PSI admitted to cabinet then the ruling Christian Democrats might have imploded over the issue of neo-fascist involvement in government. The formation of DC led centre-left governments therefore later presented a fundamental challenge to the PCI in achieving power.

That Togliatti* still had a strategy in the early 1960s of the PCI taking power through an avowedly centre-left party was reflected by discreet communist support that was provided in establishing the Italian Socialist Party of Proletarian Unity in 1964 (PSIUM). This party was mainly composed of former members of the PSI who were initially disillusioned by their party’s re rapprochement with the DC and then the PSI’s brief re-unification with the social democratic PDSI between 1966 and 1969. The major utility to the communist of the PSIUM was the maintenance of a non-PCI neo-Marxist party that could be utilized by the communists to help them win national elections as part of a broad left front.

(*Togliatti died in August 1964. To the end, he demonstrated political shrewdness by adopting an ostensible neutral stance in relation to the Peking-Moscow split which emphasised the PCI’s supposed independence and therefore as supposed legitimate competitor for national office).

The PSIUM polled respectably in the 1968 elections with 4.5% of the vote but, following the 1972 elections, (in which the PCI and the PSIUM formed a joint senate ticket) this party split three ways: one group formally entered the PCI, another returned to the PSI and a third group continued as a fringe party. The first two mentioned factions both served the PCI’s ultimate purpose of maintaining a viable pro-PCI socialist party through which the communists could win power.

Enrico Berlinguer: The Great Who Could Have Been of Italian Politics

Although the 1972 election results indicated that the PCI was still entrenched in second place (27.2 % of the vote), this party was still a long way from defeating the DC which had garnered 38% of the vote. Nevertheless, visitors to Italy during the 1972 election campaign could have been forgiven for thinking that the two major protagonists were the PCI and the MSI-DN. Newspaper coverage focused on the seeming titanic struggle between Almirante and the new PCI leader Enrico Berlinguer. Ultimately, the high profile of the leaders of the two respective extremes of Italian politics influenced moderate voters to support the DC.

The 1972 elections were historically significant because they marked the emergence of Berlinguer (1922 to 1984) as a major political leader in Italian politics. Berlinguer is probably the most respected political figure in post-war Italy. There is now little doubt, that had Berlinguer lived to see the fall of the Berlin Wall in 1989 and subsequently transformed the PCI into a social democratic party, that he would have become Italian prime minister.

The late communist leader was actually born into an aristocratic Sardinian family which had once been loyal to the House of Savoy. Although it was understandable that Berlinguer became an anti-fascist in his youth, he did not have to become a communist in 1943. His meeting with Togliatti in 1944 probably set Berlinguer on the path to becoming future leader of the PCI. Togliatti recognised in Berlinguer some-one who had the charisma and the intelligence to eventually take the communists to power after Italians broke with the DC as they became more secular inclined.

The PCI’s opposition in the 1974 referendum to repeal the 1972 divorce law marked the point at which millions of Italians who admired Berlinguer were prepared to go to the next step of voting for the PCI. Admiration for Berlinguer had previously been generated by his public opposition to the Soviet led invasion of Czechoslovakia in 1968, his declared independence from Moscow and his avowed support for a pluralistic political party system.

The increased support for the Berlinguer led PCI was reflected by the communists increasing their vote by 10% in the June 1975 local government elections to win 34% of the national vote (while the DC received 38% of the vote). Eerily enough, the respective DC and PCI voting percentages for the June 1976 general elections were almost the same as the local government elections results the year before.

The increased PCI vote in the 1976 Italian general elections sent shockwaves across Western Europe and the Soviet bloc. Momentum developed following the elections for the DC and the PCI to form a government of national unity! Ironically, the relatively strong performance of the PSI (which was now pro-DC and had come third with 9% of the vote) saved the Christian Democrats from having to go into coalition with the communists.

The DC vote held up because some of the voters who usually supported the centrist parties of the PRI, PDSI and the PLI as well as some MSI-DN stalwarts transferred their support at the last minute in the 1976 elections to the Christian Democrats to prevent the communists from winning a plurality of the vote. But the DC was still confronted by the prospect that PSI voters eventually going over to the PCI.

The worst case scenario for the DC was that an MSI-DN vote would hold up thereby creating the scenario for the Christian Democrats would have to rely on neo-fascist support. Such a development could at best have precipitated a break up of the DC and at worst plunged Italy into civil war due to still strong anti-fascist sentiments in Italian society.

Following the 1976 elections, the leadership of the DC closed ranks against entering into a coalition with their second placed rivals, the PCI. But, from Berlinguer’s perspective, the break through that then had to be made was that of the PCI having some role in government as a means of eventually being able to formally enter government. Considering the perilous state of affairs for Italy’s parties following the 1976 elections, an arrangement was made in which the PCI, the PSI and the centrist parties agreed to the formation of a DC minority government led by Giulio Andreotti.

The selection of Andreotti as prime minister by the DC was clever. His previous impact on Italian politics had been in the 1960s when his support for the PSI’s entrance into government had resulted in the DC’s right wing either ideologically moving to the centre-left (or following his lead) becoming more focused on patronage and power.

The virtual disappearance of an ideological right in the DC had paradoxically brought the DC’s left wing led by Aldo Moro closer to the Vatican which had helped underpin the viability of centre-left governments in the 1960s and early 1970s. Andreotti himself had close links to the Vatican which helped anti-communist elements within the DC broadly accept loose PCI policy input into the Andreotti government*.

(*The really positive impact of the PCI’s ill-defined support and input into the Andreotti government was that the DC’s monopoly over television through the RAI television network was ended in 1976. For all the supposed protections of freedom under the 1948 republican constitution, the DC had been able to establish a television monopoly. Berlusconi’s media empire can be traced back to the precedent that was set by DC’s previous television monopoly).

The Historic Confrontation: The Soviet Backed Red Brigades versus Berlinguer

The prospect of the PCI eventually entering and even leading an Italian government caused alarm in Moscow. The Soviet leader Leniod Brezhnev was afraid that a communist led government in a western democracy would set a precedent for pluralistic political reform and economic reform in Soviet bloc nations. *The Soviet leader therefore organised a summit of European communist leaders in June 1976 in East Berlin to counteract the spread of Eurocommunism. This form of communism was one which advocated that communist parties come to power through democratic elections and consequently maintain a pluralist democratic system.

(*The major victory that Brezhnev achieved at the 1976 East Berlin summit was the attendance of Yugoslav dictator, Marshal Josip Bronz Tito. For all Tito’s supposed independence from the Soviet Union, he supported Brezhnev’s opposition to Eurocommunism so that he could resist calls for multi-party democracy in Yugoslavia).

The only communist party in Western European nations that in the main accepted Eurocommunism was, naturally enough, Italy because the PCI had a remote but still viable chance of winning power electorally. There was also minority strong support for Eurocommunism in the generally stalinist French Communist Party (PCF) due to the limited but loyal voting base that this party then had.

Even if it meant that the brilliant French Socialist Party (PS) leader Francois Mitterrand appropriate PCF votes, Brezhnev insisted the French PCF leader Georges Marchais oppose Eurocommunism. Marchais’s later reluctant repudiation of Eurocommunism eventually enabled the PS to appropriate the PCF’s electoral base even though the presently marginalized PCF is now an avowedly Eurocommunist party*.

(*The only real benefit of Eurocommunism to European democracy was that it helped Spanish Communist Party (PCE) leader Santiago Carrillo provide crucial support for Spain’s transition to democracy in the 1970s. Carrillo, in contrast to Marchais, did not later capitulate to Soviet pressure by renouncing his previous endorsement of Eurocommunism.

That the PCE later repudiated Eurocommunism in the 1980s was due to the influence of the deplorable Dolores Ibarruri (‘La Pasionaria’) who, despite her sweet grandmotherly persona and endorsement of the 1978 Spanish constitution always remained an unreconstructed Stalinist until she died in late 1989. Whatever Carrillo’s previous excesses, his role in supporting Spanish democracy and the Spanish monarchy in the 1970s can never be legitimately denied).

For Brezhnev, a Berlinguer led Italian government could be as ‘dangerous’ to Moscow as what Alexander Dubcek’s 1968 Prague Spring had been. Indeed, some of Dubcek’s communist supporters who had fled Czechoslovakia following the 1968 Soviet Union invasion wreaked vengeance on the Soviets by going to Italy and France to promote Eurocommunism. Conversely, the hardline Czechoslovak Gustav Husak regime (1969 to 1987) became covertly involved in Italian politics in the 1970s by supporting the terrorist Red Brigades (BR) in order to undermine Eurocommunism.

The BR were founded in 1967 by university academics who were avowed Marxist radicals that were supposedly anti-Soviet. This Marxist group was opposed to the PCI entering government and taking office legally because such developments would entail an acceptance of the bourgeois state. Berlinguer seemed to move Italy toward such a progression by instigating the fall of the Andreotti government in January 1978 and insisting that a new DC minority government be formed, based upon specific PCI support and direct policy input.

The above mentioned Berlinguer conditions became plausible because they had the support of Aldo Moro, the leader of the DC’s left wing. The day (March 16th 1978) on which a new Andreotti DC communist supported minority government was to be sworn in, the BR kidnapped Moro. The former Italian prime minister was ostensibly kidnapped to provide the BR with leverage to have imprisoned left wing extremists released from prison. Most politically aware Italians realized that the real BR objective was to disrupt the functioning of a DC minority government that was reliant upon PCI support.

The ensuing two months (March to May 1978) of Moro’s covert imprisonment were a national agony for Italy. Most graciously and dramatically, His Holiness Pope Paul VI* offered to become a hostage for the BR to secure the release of his friend Aldo Moro. Prime Minister Andreotti’s refusal to negotiate with the BR caused bitterness within the DC amongst the left to centre-left because there was a widespread belief that Moro’s death would sabotage a DC-PCI governing modus operandi. This fear became a reality after Moro was killed by the BR.

(* The offer of Paul VI -born Giovanni Montini, 1897 to 1978- to take Moro’s place as hostage for the BR was in keeping with the character of one of the most underappreciated but greatest popes ever, who respective self-declared Catholic Church conservatives and liberals have both unfairly condemned from their differing perspectives.

For Church ‘conservatives’, Paul VI unnecessarily diluted the authority of the Catholic Church by seeing through the Second Vatican Council (1962 to 1965) which was initiated by his transformational predecessor Pope John XXXIII (born Angelo Roncalli, 1881 to 1963) who stunned everyone by being more than an elderly stopgap pope). Vital reforms that the Second Vatican Council implemented were the introduction of a church liturgy in the vernacular and removing artificial barriers between the clergy and laity and between Catholics and non-Catholics (such as allowing Catholics to attend the funerals of non-Catholics).

It is often forgotten that Paul VI was the first reigning pope to leave Europe and it is now insufficiently appreciated that, by His Holiness’s visit to Jerusalem in 1964, the Church effectively repudiated anti-Semitism. The most notable aspect of Paul VI’s reign was that His Holiness was prepared to engage with people of all backgrounds of good will regardless of their perspectives. His Holiness permitted critics within the Church who challenged official teachings to have their say without excommunicating them while not forgoing the integrity of those teachings.

The most important legacy of Paul VI was that His Holiness prevented the Catholic Church from becoming Integralist - in which laity and clergy withdraw or condemn people who disagree with them or those that they judge to be sinful. The onset of improved communications after the Second World War opened up new vistas for many Catholics that challenged the traditional power-over approach that they had paradoxically expected to be exercised over them.

Had Paul VI not seen through the Second Vatican Council, the Church might only have appealed to neo-Jansenists who regard submission to a higher authority in and of them a form of earthly redemption in and of itself.

The neo-Jansenist approach, in assuming that those so-called modernists ‘who are not with us are against us’, can ultimately only drive away from the Catholic Church people who are not similar minded, thereby marginalizing the acceptance of the values that underpin the Catholic Church.

A touching aspect of Paul VI’s pontificate was that His Holiness was a Vatican bureaucrat/ technocrat who probably would not have initiated the Second Vatican Council but, out of a sense of duty to John XXXIII, saw the Council’s reforms through. Therefore, His Holiness often consulted widely with regard to reform, finally making up his mind as to what he believed God guided him to do to support the fundamental values of the Church that had to be applied to the situation.

This balanced approach of Paul VI was manifested with regard to the issuing of Humanae Vitae (Of Human Life) in 1968. So-called Church ‘liberals’ and many non-Catholics frankly did not understand that Paul VI’s opposition to abortion and contraception was not based on a desire to exercise social control but from a determination to defend those (unborn) who cannot defend themselves. For Paul VI, because the truth was truth, the Church had to value every single person and be of service to all regardless of who they were- a stance which is the antithesis of Integralism and neo-Jansenism.

For all the vitriol to which Paul VI was subjected, His Holiness still maintained the Church’s capacity to engineer cause and effect by conveying that Humanae Vitae is reflective of the broader mission of fighting for everyone because of their inherent worth as human beings. For Paul VI, as it must be for all Catholic popes, recognising and defending human dignity cannot be relativist.

For all the criticisms that the Catholic Church was subjected to concerning the anticipated impact of over population in the Third World, it was in poorer countries that the Church gathered strength in during the remainder of Paul VI’s reign. This was due to an appreciation in less materially resourced nations that the Catholic Church was an institution of service arising out of the determination to serve others by living by the golden rule of ‘doing onto others as they would do onto you’.

Despite changed social mores in the 1960s due to increased travel, improved communications, enhanced education opportunities and the widespread use of contraception, Paul VI’s stance regarding artificial birth control was still widely respected (even if not adhered to) by Catholics and non-Catholics because its underlying premise was still conveyed. In this regard, Paul VI was an authoritative pope as opposed to an authoritarian one.

As the world enters a period of even more radical change, the Catholic Church will find that an authoritative pope as opposed to an authoritarian pope will be more appropriate. It is therefore ironic that most Catholics and non-Catholics consider the pontificate of John Paul II (Karol Wojtyla, who was born in 1920 and reigned from 1978 to his death in 2005) to have been a more successful pontificate than Paul VI’s. This assessment has been due to John Paul II’s importance in crucially helping bring down communism in the late 1980s.

In the struggle against Marxist-Leninist regimes in Europe, an authoritarian power – over approach by the Catholic Church was often accepted in East European nations by laity and clergy due to overriding the need to maintain a unity of purpose. Naturally, following the end of communism in Europe by the 1990s, the power of the Catholic Church declined because the threat of communism receded.

But in the case of Joh Paul II, ‘a them versus us attitude’ was accelerated, particularly in regard to ecclesiastical appointments. Bishops, archbishops and even cardinals, regardless of their qualifications or experience, were appointed on a basis of their disposition to adhere to an unqualified acceptance of the Vatican line.

Under John Paul II, Integralist lay organisations, such as Opus Dei, had more resources allocated to them after the fall of communism in Europe in the late 1980s. Such a development can only ultimately bolster neo - Jansenism to the point that such insularity becomes equated with Catholicism. As important as John Paul II’s pontificate was in bringing down communism, an authoritarian approach in and of itself is not viable in the long term. This is because mores in societies around the world are continuing to change. But, as Paul VI demonstrated, the Catholic Church can be adaptive to change without sacrificing its values by engaging and serving society in accordance with unchanging and non-changeable principles.

The current Pope Benedict XVI (who was born Joseph Ratzinger in Germany in 1927 and became pope in 2005) is not a neo-Jansenist but rather a traditionalist in relation to liturgy and interpretation of church teachings. As a non neo-Jansenist pope, Benedict XVI has reverted to the approach of Paul VI in making appointments of bishops and archbishops based upon qualifications, experience and personal qualities as opposed to a criterion in which an inflexible authoritarian approach is expected which could ultimately leave the Catholic Church as an institution that is ‘all Chiefs but no Indians’.

The Catholic Church is not the only church that is confronted with the challenge of Integralism and neo-Jansenism. The Anglican Church is confronted with challenges of ecclesiastical issues surrounding the ordination of female priests which are reflective of broader issues of authority which reflect Anglicanism’s interaction with secular society.

In the case of Anglicanism, the distinction between ‘conservative’ and ‘liberal’ has been more pronounced than in the Catholic Church to the point that two churches in one have effectively co-existed. Let this continue to be the case because a formal break away of ‘conservative’ Anglicans will have two broad consequences: Firstly, it will lead to Integralism/neo-Jansenism insularity on the part of conservatives as they draw inward, eventually leading to nothingness.

A second possible consequence will be that ‘conservative’ breakaway Anglicans take up pre-existing arrangements that have been made for them to join the Catholic Church. Such a development may affect the dynamics concerning the election of Benedict XVI’s successor, possibly leading to a reversion of neo-Jansenism. This would be a ‘lose-lose’ scenario as there could be a net loss for Anglicanism and a shift toward Integralism and neo-Jansenism within the Catholic Church.

The Catholic Church in Australia has experienced its form of neo-Jansenism with regard to the so-called ‘Mannix Tradition’. This approach supposedly maintained that Catholics laity should be active in secular affairs by promoting Catholic social teachings but achieved the exact opposite. This tradition was promoted by the Catholic polemicist B.A. Santamaria (1915 to 1998) in honour of Daniel Mannix (1864 to 1963), Catholic Archbishop of Melbourne from 1917 until his death. Santamaria promoted what he later dubbed the ‘Mannix tradition’ through an organisation that from the 1940s was known as ‘The Movement’.

The Mannix Tradition, as propounded by Santamaria, involved Catholic laity thinking critically for themselves and then applying Catholic social teachings in broader society. This was done with Movement supporters opposing communism in trade unions and in the Australian Labor Party (ALP). The Movement fulfilled an important role in inspiring Catholic union members to form groups within their unions, as a result of which they became known as the ‘Groupers’.

Movement involvement in the ALP was then considered almost natural since a party split over conscription during the First World War had helped make the Labor Party a predominately Catholic party.

But there was still anti-sectarian sentiment within the ALP which was exploited by the Communist Party of Australia (CPA) and by the paranoia of then ALP federal leader H.V. Evatt which led him to proscribe the Groupers at the illegal ALP ‘Hobart Conference’ in 1955. This purge led to terrible divisions in Australia as families were divided and religious sectarianism became a national problem.

As a result of the Evatt Purge, the predominately Catholic Democratic Labor Party (DLP) was formally formed in 1957 and the Movement (which had officially been the Catholic Social Studies Movement) became the National Civic Council (NCC) in January that year. Santamaria’s intention that the DLP become an insular Catholic party was manifested when he helped sabotage an attempt to re-unite the ALP and the DLP in the 1960s. Other actions on Santamaria’s part strained relations between him and the DLP’s leadership.

DLP leaders in the 1960s were less than impressed with Santamaria (who was never a DLP member) when he presumptuously negotiated a preference deal with the ruling Liberals which fell short of the longstanding party demand that non-government schools receive state funding. Even though the Liberals only gained the preferences after the DLP leaders intervened to demand education funding for non-government schools, Santamaria disingenuously later claimed in the 1990s that he had gained this funding.

The overall impact of Santamaria’s impact on the DLP was to ensure that it was a ‘Catholic’ party which gained garnered Catholic votes to keep the ALP in opposition at state and federal levels. This approach only allowed the Communist Party of Australia (CPA) to eventually help foster a left wing faction in the ALP that became known as the Socialist Left (SL). As a result, a powerful left wing presence within the ALP was institutionalized.

Through Santamaria’s negative influence on long term DLP federal leader Senator Vince Gair, the prospects for Australia’s third force to be a lateral centrist balance- of- power party in the Senate were undermined. Santamaria used what influence he had on the DLP to ensure that it would be the narrow ‘Catholic party’ that its left wing critics derided it as.

Santamaria’s worst betrayal of the supposedly activist Mannix tradition that he espoused was to purge the union wing of his organisation at a stacked out NCC Conference in 1982 by expelling and then denying former staffers of access to their offices. As NCC president, he timed the 1982 purge knowing that it would (as it did) fatally undermine the capacity of his union supporters (or perhaps former supporters) in the Queensland branch of the Federated Clerks Union (FCU) to win branch elections that year. The loss of the Queensland branch of the FCU enabled the hardline component of the SL of the ALP to later gain control of all of that-then-vital white collar union.

The SL capture of the FCU cleared the way for the long held CPA policy of union amalgamation to take place in 1980s, in which craft based unions were destroyed as they merged into impersonal industry unions with less than satisfactory union rank and file democracy and servicing. The union amalgamation policy led to a concentration of power, establishing the groundwork to foist rent-seeking on Australia.

In the 1990s, Santamaria decried union amalgamation, the de-unionising ramifications of which are that just over 20% of the Australian workforce is unionised, as opposed to 51% in 1976. But Santamaria never acknowledged his own role in helping facilitate union amalgamation by previously undermining the FCU.

Furthermore, the four ‘Grouper’ unions that continued had no reason to be grateful to Santamaria, for in 1984, he publicly endorsed their re-admission to the ALP knowing that this would make it more difficult for them to return to the Labor Party. This disingenuous action on Santamaria’s part conformed to a leadership pattern of destroying what he purported to fight for one that reflected his neo-Jansenist outlook.

The major ‘benefit’ for Santamaria of the 1982 Purge was gaining control of funds. But without a viable political party or a union wing for the NCC to support, it was difficult for Santamaria to have political influence. The major impact that Santamaria did have after 1982 was for the NCC to support neo-Jansenist Catholics who were disillusioned with the onset of ‘modernism’. Despite Santamaria’s focus on ecclesiastical matters, he more often than not was critical of Catholic clergy for being unorthodox.

For all Santamaria’s decrying of the secularisation of society, he never appreciated that his neo-Jansenism contributed to this process by encouraging Catholics to retreat from the world. By contrast, Italian clergy fulfilled an important role from the 1960s onwards in engaging in society. In a political context, the support of some clergy was vital to the eventual emergence of the centre-left Democratic Party (PD) in 2007. Consistent clerical and Catholic lay support since the 1940s for Italy’s second biggest union confederation, the CISL, was also of great benefit to broader Italian society.

The current GFC is testament to the major challenges confronting the world. Phenomenal technological change is also creating opportunities to downgrade the value of labour and for people in general to lose their innate worth as humans unless they have a utilitarian value. For over two thousand years, the Catholic Church as well as most other religions be they Christian or not, have been of great significance because they have recognised the intrinsic value of all people.

Consequently, millions, if not billions of people, have been prepared to voluntarily submit to ethical frameworks based on religious faith which is often seen to be reflected in the values and sense of service of the organisations to which they actually belong. The continuance of religious organisations in which people can help themselves might be challenged by future technological advances. Be that as it may, the world will be confronted by the challenge of potential massive de-employment.

To help prevent the massive social dislocation that now, due to rapid change, confronts the world, organisations that believe in the sanctity of every person regardless of who they are, such as the Catholic Church, must have a commitment to serve and accept all as Paul VI did. A transition on the part of the Catholic Church to insular neo-Jansenism will not only be very detrimental to those who might be vulnerable in the future but possibly fatal to the Catholic Church).

That the intended Soviet objective of *BR generated terrorism undermining the position of the PCI was achieved was reflected by the June 1979 election results in which the PCI vote (30%) fell by eight percent in comparison to the 1976 elections. The respective DC and PSI national voting percentages for the 1979 elections remained almost unchanged from previous elections (38% and 9% respectively) so that, with the decline in PCI vote, it was safe to resume the previous pattern of forming unstable DC led coalition governments with the centrist parties.

(* The BR went into steep decline after 1981. This was attributed to more effective counter-terrorist measures by Italian security agencies and an apparent split in the BR in 1981 between pro and anti-Soviet factions. In fact, because of unrest in Poland in 1981, Moscow realized that it was too dangerous to foster terrorism in a NATO country by having the Husak regime continue to support the BR. Brezhnev’s success in undermining Berlinguer’s capacity to win power through elections had also rendered Soviet induced Czech support for the BR unnecessary).

The Post-Fascists and Monarchists Split

The 1979 election results were also noteworthy because the MSI vote still held up electorally with 5.3% of the vote which was down from 6.1% of the vote in the 1976 elections. The strong stance that Almirante had taken against neo-fascist terrorism during the 1976 to 1979 period of BR terrorism helped him hold the support of the predominately anti-communist middle class vote that the MSI received. That Almirante had held this vote for the MSI was all the more impressive because he beat off a serious challenge from the non-fascist conservative right.

The ambiguous role of the PCI in supporting DC minority governments between 1976 and 1979 had led to calls within the MSI-DN for a repudiation of neo-fascism by forming a new conservative party. Almirante was open to such a transformation but refused to commit to such a course of action because he knew that most of his supporters would go into Rauti’s camp as part of a continuing MSI.

The non-neo fascist elements within the MSI-DN were not prepared to wait for Almirante and subsequently formed National Democracy (DN) in February 1977. This new party seemingly did everything correct in terms of securing its position as new a conservative force in Italian politics. Half the MSI-DN’s parliamentarians joined the new party, thereby helping DN to acquire public funding as the successor to the previous parliamentary alliance.

By using the ‘DN’ of the acronym, National Democracy had seemingly staked a claim amongst non-neo fascist supporters of the former MSI-DN alliance to vote for the new party. Indeed, the DC’s ambiguous alliance with the PCI created a seemingly strong rationale for anti-communist Italians to vote for the DN. That National Democracy very unfortunately only garnered 0.6% of the vote in the June 1979 elections was due to anti-communist Italians voting with the MSI out of personal respect for Almirante.

The respect that anti-communist Italians had for Almirante was undoubtedly derived from his withstanding an attempt to expel him from parliament in 1974 supported by the DC and the PCI. Almirante’s support for the repeal of the divorce in the 1974 referendum to help create a new post-fascist conservative party was a threat to the DC’s right wing which had tried to use the popular vote to politically revive. The move to expel Almirante from parliament was undertaken to politically eliminate a right-wing threat the DC’s base.

Almirante’s tenacity in defying the expulsion attempt was manifested by his speaking for a record twenty-four hours in a parliamentary speech in his defence! The MSI leader consequently consolidated a national following among anti-communist Italians which would have resulted in the DN supplanting the MSI had Almirante joined the new party that he seemed more ideologically in sync with. This did not occur because most of the DN’s leading members, including the party leader, Alfredo Covelli, were former stalwarts of th PDIUM

(The MSI leader since the time of the RSI had been a republican and was the first prominent Italian politician to advocate an executive presidency similar to France’s Fifth Republic).

Had Almirante joined DN, this would have enabled the defunct PDIUM to acquire a new voting base under the auspices of a new party. Under this scenario, Almirante would have cut off from his old party base without any guarantee that he would not later be deposed as DN leader by former PDIUM stalwarts. From Almirante’s perspective, it was better to stay on as party leader to utilize his power to orientate the MSI toward his evolved ideological outlook.

The failure of the DN to win any parliamentary seats in the 1979 elections essentially ended over thirty years of a monarchist parliamentary presence in the Italian Republic. The vicissitudes of Italian politics have since been such that Italian monarchists later re-entered parliament in the 1990s and there are now monarchist cabinet ministers even though no electorally viable monarchist party has been revived. These developments have occurred due to the structural weaknesses of the Italian republic which date back to the rigging of the June 1946 referendum.

Be that as it may, how and why the Italian republic has been able to survive and indeed prosper economically (which is distinct from political structural weaknesses of the Italian republic) are now important questions in the context of the current European financial crisis.

The Italian Miracle: Italy’s Post-War Economic Recovery

No nation in western Europe benefited more than Italy from the generous European Recovery Program (ERP) or the Marshall Plan as it was more commonly known. The Marshall Plan was the initiative of then American Secretary of State George Marshall. This American economic assistance programme commenced in 1947 and ended in 1951 due to its outstanding success.

The Marshall Plan crucially helped provide Italian industry with sufficient financial capital so that. by 1950, industrial output surpassed pre-war levels. Communication and roads had been damaged by war time fighting but otherwise industrial facilities such as factories in northern Italy had remained remarkably intact. Trading opportunities with the United States and Northern Italy’s geographical proximity to Western Europe also helped Italian industry to revive.

Expanded industrial output in northern Italy throughout the 1950s and the 1960s helped soak up unemployment as many southerners made their way north to take up industrial jobs and employment opportunities in related services. A Southern Development Fund launched by the De Gasperi government in 1950 had a negligible impact in closing the economic gap between northern and southern Italy. The Land Reform Law of 1950 was a limited success in breaking up big landed estates and distributing them to former tenant farmers*.

(*Had Mussolini come through with the land reform that he had ruminated about undertaking in southern Italy in the late 1930s, he would now be an overwhelmingly revered figure in that part of Italy despite his regime’s terrible failures in other policy areas).

Post-war migration of Italians to countries such as Australia in the 1950s and 1960s also helped alleviate post-war poverty. The development of a booming tourist industry in the 1950s also promoted economic development and the goodwill that was generated by foreign visitors to Italy helped bad memories associated with the war to recede. Furthermore, Italy’s 1943 defection from the Axis and the fact that most Italians clearly disdained Mussolini’s 1939 anti-Semitic laws helped Italy regain international respectability before the West Germans did.

Italian economic recovery was due to Foreign Minister Count Carlo Sfroza’s success in engineering Italy’s prompt international rehabilitation. The emergence of a domestic communist threat paradoxically helped Italy quickly become an important ally to the United States in the Cold War. For this reason, Italy was an important foundation member of NATO in 1949 such that the United States respected the Italian republic as a key ally.

Italy’s international rehabilitation was also facilitated by its pivotal role in forming the European Coal and Steel Community (ECSC) in 1952 which was the forerunner to the EEC (which is now the EU) which was formed with the signing of the Treaty of Rome in 1957. The nation was also well served by retaining a high quality diplomatic corps which might not have been in place had Umberto II not released Italian diplomats from their oaths of allegiance to the Italian Crown. The exiled king also used his influence to dissuade PNM leader Alfredo Covelli from having the monarchist party become what is now known as a ‘euro sceptic’ party.

Foreign Relations Under the Italian Republic

The foreign policy of the Italian Republic was renowned for placing a premium on promoting inter-European co-operation at the expence of an assertive foreign policy. Even though Italy was a strong supporter of Britain’s entry into the EEC, Italian governments never publicly protested French president Charles De Gaulle’s vetoing of British ECC membership in the 1960s. With regard to the issue of Italian sovereignty in Trieste, where there was still considerable and strong nationalist feeling, the Italian republic did not depart from the post-war orthodoxy that the nation always refrain from armed conflict.

Acceptance of NATO bases was a mainstay in Italian defence policy and only became an issue of limited controversy when American bases were used to bomb Yugoslavia in 1999 with the acceptance of the centre-left Olive Tree alliance government. A paradox of Italian politics was that the left, which included elements of the PCI, was often reluctant to criticise the United States due to the widespread appreciation in northern Italy that liberation from the Germans might not have been achieved without American support.

Berlinguer gained the ire of the Soviets when he intimated in the 1970s and 1980s that should the PCI enter government, or even lead a government, the Italian communists would support Italy’s continuing membership of NATO. The legacy of Berlinguer’s acceptance of Italian membership of NATO helped explain why a former senior official of the PCI, Massimo D’Alema, was able to co-operate with the Americans when he served as prime minister between 1998 and 2000 as the leader of the centre-left Olive Tree alliance government.

Similar to Japan, the Italian republic gained a degree of international respectability as a stalwart member of the United Nations, which Italy was admitted to as a member in 1956. Prior to Italy’s re-admission to the United Nations the Italian republic effectively regained control of the former Italian colony of Somalia in 1950 when it was granted to Italy as a UN trusteeship.

Restored Italian rule in Somalia under UN auspices made amends for previous repressive colonial rule due to the provision of health services and education. The fact that Somalia was later to become a failed state was due to the legacy misrule (1969 to 1991) of General Mohamed Siad Bare whose 1969 coup terminated the democracy that restored Italian rule had previously help lay the groundwork for.

The Italian republic also established cordiale relations with the restored Empire of Ethiopia under Haile Selassie who was reinstated by the British in 1941. The post-war Italian desire to make amends for their brutal rule (1936 to 1941) paradoxically helped foster a relatively close relationship between Italy and Ethiopia that has endured despite radical changes in regime in Addis Adaba.

Umberto II’s Personal Diplomacy from Exile

(Had the Italian monarchy been retained, cordial links with former Italian dominated nations would have been established. A major objective of Umberto II in exile was to reconcile with royal families that had been deposed by Italian military intervention. Most graciously, His Imperial Majesty Haile Selassie accepted Umberto II’s overtures.

The exiled Albanian royal family accepted Umberto II’s apology and Queen Geraldine (widow of King Zog) of the Albanians eventually became a friend of Umberto II’s sister, Queen Ioanna, the exiled Queen Consort of Bulgaria. Reconciliation between the House of Savoy and the Yugoslav royal family, the Karageorgivics, was manifested in 1955 when Umberto II’s eldest child, Princess Maria Pia married Prince Alexander of Yugoslavia).

The Italian Republic Gains International Respectability

With regard to Libya, the Italian republic established pointedly close relations with the successive regimes of King Idris and Colonel Qaddafi. Cordial relations with Libya helped Italy maintain generally amicable relations with the Arab world such that even so-called ‘radical’ Arab regimes grudgingly accepted Italy’s alliance with the United States and support for Israel.

The international respectability that the Italian republic gained was evident when Italian soldiers served with distinction in Lebanon as UN peacekeepers to protect Palestinian refugee camps in Beirut between 1982 and 1984. Italy’s strategic location in Europe, proximity to Africa and the Mediterranean has positioned the nation well to positively contribute to international organisations. Until the 1935 invasion of Ethiopia, Italy was a leading member of the League of Nations.

Indeed, had Mussolini not come to power in 1922, Count Sfroza undoubtedly would have succeeded Giolitti as PLI leader and been a long serving foreign minister of a liberal Italy. Count Sfroza would have bolstered Italian prestige as a leading member of the League of Nations and European and world history might have been very different. Be that as it may, Count Sfroza utilized his anti-fascist credentials as foreign minister between 1947 and 1951 to help Italy regain international credibility by promoting European unity and ties with the United States.

Had the Italian monarchy been retained in 1946, (the prospects for retention would have been bolstered had Count Sfroza run with the PLI and not the PRI in the 1946 constituent assembly elections) aristocrats and royals from families who had been deposed in 1861 could have been utilized as diplomats as a form of reconciliation between them and the House of Savoy which had traditionally had its own private foreign service with direct representatives of the king serving unofficially in Italian embassies.

This practice could have continued under Umberto II but in pursuit of promoting European unity which was an ideal that was close to His Majesty’s heart. Even as an exiled king, Umberto II retained cordial but unofficial links with some Italian diplomats. In exile, Umberto II was known to reigning and non-reigning European royalty as ‘Zio Beppo’ (‘Uncle Beppo’) and His Majesty was still considered a doyen even to royal families that had previously fought against the Axis.

The Economic Successes of the Italian Republic

The international successes of the Italian republic were also reflected by economic advances. To be frank, these post-war successes were partially derived from the Mussolini regime having established the Institute for Industrial Reconstruction (IRI) in 1933. The IRI was a conduit through which state finance and managerial assistance was provided to struggling industrial concerns. This institute provided trained managers to companies that received state financial assistance to ensure that they ran efficiently.

Although the state through the IRI more often than not acquired shares in companies that were provided with assistance, they still remained privately owned or, if the state did acquire a controlling interest, often still had private shareholders. The main benefit of the IRI was that it provided Italian industry with needed capital which enabled Italy to develop strong steel, shipping and hydroelectricity sectors by the 1930s and ensure that the nation had a strong infrastructure sector. Economic growth was also spurred by Italian genius in industrial engineering.

The IRI was also important in that its role in facilitating massive industrialization also strengthened the Italian banking sector which had a strong capital base. As a result, Italy was able to stave off mass unemployment during the Great Depression due to the fostering of a strong infrastructure base, cheap electricity sector and an efficient transport system. These developments helped foster the development of new industries and innovative production techniques in the 1930s.

The statist approach of the fascist regime was surprising because the Mussolini government between 1922 and 1925 - as the then continuation of the ruling liberal -elite was initially free trade inclined. The success of Count Grandi in negotiating an American loan in 1925 not only helped Italy to pay off its foreign war debts but provided the state with a capital base to become involved in Italian industry which established the basis for fascist corporatism.

The establishment in 1926 of a notionally corporatist economic and political Italian state paradoxically helped facilitate the establishment of a powerful, autonomous and cogently organised corporate business-industry structure. To Mussolini’s credit, he initially respected the autonomy of the business sector which helped lay the groundwork for the establishment of the IRI in 1933. The IRI operated effectively throughout the 1930s even though the regime moved toward self-sufficiency (‘autarky’) and diversion of resources for re-armament purposes following the adverse international reaction to the Italian invasion of Ethiopia in 1935.

The IRI remained intact following the government’s flight from Rome in September 1943 as some of the RSI’s ministries and agencies including the IRI were located in Rome which was ruled by the pro-German mayor, Riccardo Motta. The declaration of an ‘open city’ in June 1944 facilitated the peaceful liberation of Rome by the Allies. The peaceful liberation of Rome ensured a degree of continuity as bureaucracies and civil servants that had successively served the PNF regime, RSI, the luogotenente (1944to 1946) and into the Italian republic. This continuity ensured the survival of the IRI so that it similarly fulfilled an important post-war role in promoting Italy’s impressive financial and industrial recovery.

The major positive impact of the IRI was maintaining a strategic connection between industry and the financial sector was helping ensure that Italian banks were adequately capitalized. Having successfully served its purpose there was apparently no need for the IRI that it was dissolved in 2002.

Italy’s Successful Industrial Relations System

Italian post-war prosperity was sustained not only by the financial assistance of the Marshall Plan and staunch Italian support for European integration but also because of the high quality of Italy’s pre-eminent employer association, the Confederation of Italian Industry (Confidustria) which had been founded in 1910. The Confidustria has fulfilled an important role in promoting industrial productivity, European integration and bolstering Italy’s international trading position.

The Confidustria also judiciously stepped in to support declining political parties such as the PLI and the PRI in the 1970s and 1980s. This employer confederation also established productive relationship with the CISL and UIL union confederations.

A very important role of Italy’s four rival trade union confederations is their role in administering employee pension funds. Rivalry between the four union confederations has often ensured that there is a substantial role for rank and file union workplace delegates in formulating agreements with employers which has resulted in workplace productivity gains. The major contentious issue with regard to Italian industrial relations has been that of the inflationary impact of wage indexation.

Prosperity in the first Italian Republic (1946 to 1993) was also facilitated by there being an excellent civil service which efficiently operated inspite of, or perhaps because of, the frequent changes in government. This professional civil service was drawn from outstandingly successful university graduate recruitment programmes.

The existence of an efficient and honest civil service counteracted the impact of a corrupt self-seeking party patronage system that was derived from the rigging of the 1946 referendum and sustained by Italy being a ‘blocked democracy’ due to the PCI becoming the major opposition party in 1948. Had the Italian monarchy been retained, not only would a corrupt party system have been averted but the civil service would have had a strong focal point in the Italian Crown to have inspired excellence in governance.

A Strong Banking Sector: The Key to Italian Economic Well-Being

The need to have strong institutional supports to compensate for Italy not being a constitutional monarchy was reflected by the post-war role of the Bank of Italy (Banca d’Italia) in facilitating national economic recovery. The Bank of Italy is the nation’s central bank. Due to fascist corporatist ‘reforms’ in the late 1920s, an enduring relationship between private and public capital has been established with regard to the Bank of Italy that is rare among national central banks.

The Governor of the Bank of Italy is appointed by the Italian government (confirmed by presidential decree). The Governor is responsible to a Board of Directors that is elected by private shareholders at an Annual General Meeting (AGM) which usually represent major industry concerns. The nexus between private capital and the state helped the Bank of Italy to make grounded and inspired strategic decisions that immensely benefited Italy. The input of major industry facilitated capital formation while the state component of the bank ensured that fiscal prudence was undertaken.

The previous role and success of the Bank of Italy in bolstering Italy economically (particularly in the post-war period) was reflected by it issuing the lira, Italy’s former currency which was replaced in 2002 by the Euro. Jokes were previously told about the lira with regard to its low exchange rate value compared with other currencies. A visiting non-Italian tourist could be an Italian ‘millionaire’ having exchanged a couple of hundred American dollars for hundreds of thousands of Italian lire.

The traditionally *low exchange/ conversion rate of the lira provided Italy with the flexibility to bridge the gap between the industrial north and the predominately agricultural south. This was because the lira realistically reflected the state of goods and services in the Italian economy which helped support a small to medium size business sector. The comparatively low rate of the lira led to financial boom in the 1950s because foreign tourists to Italy could undertake relatively cheap but quality holidays which considerably bolstered the secondary services sector of the economy.

(*One of the worst economic mistakes of Mussolini’s was to intervene to overvalue the lira in 1926 for reasons of what he considered to be international prestige. This action damaged Italy’s international trading position).

There were ostensible problems with the Italian economy with regard to high public budget deficits and high inflation from the 1970s onward but Italy had a strong informal sector of the economy which counteracted these official problems. Furthermore, Italians tended to be high savers with relatively low levels of private debt. Therefore, comparative criteria against international standards and official economic data were not necessarily indicative of the actual socio-economic situation.

A strong source of comparative / international advantage for Italy was the strength of the nation’s private banking sector which had judicious links to the Bank of Italy. This is not to say that issue of public sector debt and local government corruption (that came with the inherently corrupt nature of the party system of the first republic) was not of concern. But the relatively low value of the lira actually helped this currency to maintain its purchasing power despite officially high inflation rates.

Structural problems in the Italian economy were often addressed through the trading advantages that came from EU membership such as access to relatively close European markets. Italian bureaucrats in Brussels often had previous experience in Italy’s civil service, the banking sector (particularly the Bank of Italy) and private industry which was often of benefit to their home country.

Italy and European Unity: Balancing Integration and Independence

European integration helped Italy to avoid accruing financial debt. This was evident with regard to the installation of the Euro Rail train service in the late 1990s, which was instrumental in closing the infrastructure transportation gap between northern and southern Italy. It was therefore not surprising that Italian governments in the 1990s of either the right or the left were enthusiastic supporters of European economic integration.

Indeed, the groundwork of post-1990s European integration was probably established by post-war DC Italian governments strongly supporting European unity by bolstering is known as the EU. This was probably the main substantial and consistent ideological objective of the post-war DC.

The centre-left governments of the Olive Tree alliance (a key component of which was the left of centre of the superseded DC) between 1996 and 2001 consistently supported European integration to the point of preparing the way for the abolition of the lira in 2002. Italy’s full entry into the Eurozone had the support of the nation’s mainstream left and right. There was even a degree of public acceptance of austerity measures so that gaps in the Italian economy such a sub-standard housing in some urban pockets could be addressed in the future through greater European integration being facilitated.

There was still grumbling that the price of everyday goods effectively rising due to the higher value of the Euro but, in the main, Italians seemed to adapt to their country’s entry into the Eurozone. The policy of currency substitution was adopted in 1999 with the lira becoming a sub-unit of the Euro. This helped clear the way for the abolition of the lira in 2002.

Whatever the pros and cons of the lira’s abolition, Italy was generally able to adapt to the adoption of the Euro due to the inter-related strength of the Bank of Italy and the domestic Italian banking sector which was an international power house (particularly in a European context) in its own right.

The 2008 GFC and its continuing effects are therefore of crucial importance to Italy in an international context. If the GFC banking contagion undermines the viability of the Italian banking sector, then the international ramifications will be grave to say the least.

Italy and the GFC

An unfortunate cause of the 2008 GFC was that European banks brought collateralized loans that were owed on American home mortgages on the misassumption that they were secure because they were based on property. In the cases of Ireland and Spain, the financial crises that confronted these nations were due to speculative property booms in which the bubble burst and their governments had to step in to cover awry bank loans.

For all the doom, gloom and understandable concern regarding the GFC hitting Europe, it has often been overlooked that sovereign governments (with the exception of republican Greece) have generally been able to bail out the banks. The acute inter-related issues of contemporary concern are. Where do sovereign European governments now gain further finance capital after having bailed out their banks and will they have enough capital resources if another banking contagion breaks out?

Already the Italian government is under pressure to cut expenditure and raise taxes as part of EU advocated austerity measures to keep Italy solvent. These advocated domestic measures are being coupled with an EU push to establish a European Stability Fund (ESF) in which member states would provide sufficient capital to cover the credit of European banks and governments. This is probably a worthwhile and sensible policy approach. However, there are questions to how and where governments are going to obtain future sustained sources of capital.

Uncertainty with regard to capital formation is the most vexing issue. This is particularly so because the GFC has challenged the viability of the traditional (but often opposing) Keynesian and monetarist policy options. The need for European sovereign governments to master the debt levels has challenged the viability of a Keynesian approach of spending to stimulate demand.

Regardless of the merits or otherwise of a Keynesian approach, it is difficult to envisage it successfully working in the current situation due to the EU demanding austerity measures which in the short term will deflate demand. There is also the grave danger that austerity measures could precipitate considerable social unrest conducive to political extremism. When it is all said and done, political extremism essentially entails a maximalist power-over approach which is focused upon a minority imposing itself on society.

Whatever the ideological correctness of Marxism (which is probably non-existent) the driving objective behind the ‘radicals’ (as was the case with Lenin) is to impose domination on society by a vanguardist minority. A ‘win-lose’ invariably ensues but as recent history has shown, a lose-lose situation invariably eventuates because a self-appointed minority cannot in the long run rule in the genuine public interest.

Why History Must Not Repeat Itself

The threat of Marxist totalitarian rule or disruption caused by ‘left-wing’ social movements (such as the ‘Occupy Wall Street’ protest movement in the United States) can lead to elites within democratic states resorting to populist authoritarian alternatives that have support from a threatened middle class. In the historical case of Italy, the elite turned to Mussolini whose political skill, for a time, provided popular and effective government by way of co-opting talent.

Unfortunately for Italy, and the world, the German Junker elite regained power in 1932 and foolishly ceded power to Hitler the following year to definitively bury democracy, erroneously thinking that they could manipulate him. The German Junker elite did not realize that the application of a ‘Mussolini model’ on Germany was not transferable due to Hitler’s focus on waging wars of conquest as ends in themselves. All in all, even though right wing movements may have the laudable objective of preventing undemocratic ‘left wing’ forces from seizing power, they can often destroy more than what is gained if they move against democracy*.

(* The only exception to this historical pattern was the Franco regime in Spain, 1939 to 1975. Due to Franco applying the precepts of the Spanish monarchist leader Jose Calvo Sotelo (1893 to 1936), Franco stopped Spain from becoming communist and subsequently established the basis for Spain to become a democratic constitutional monarchy following his death in November 1975).

If there is a financial implosion in Italy due to the Sovereign Banking Crisis (SBC), not only will the world suffer but there are terrible political consequences for Italy that could serve as a template for other European nations. This is because Italy’s two major parties, Berlusconi’s People of Freedom Party (PdL) and the Italian Democratic Party (PD)*both have respective fascist and communist roots. At the very least, there are continuing Marxist and neo-fascist groups that could well appropriate the bases of support of Italy’s two leading parties should social melt-down follow on from an economic implosion.

(*Everyone seems to forget that Alfredo Covelli led the monarchist Italian Democratic Party into the constituent assembly elections of June 1946 as part of the Bloc of Freedoms electoral configuration which later gave way to become part of the PNM).

How and Why European Banks Need Capital Formation

The main challenge that confronts the Italian economy (and probably all other EU economies) is that of capital formation in the banking sector. It is probably appropriate that the Italian government and the Cameron government in Britain impose spending cuts and contribute to the ESF to help stave off a banking contagion. However, a longer term perspective needs to be developed to shake off the threat of the GFC because it has caused the problem of there being a lag in relation to capital formation.

The EU needs (with input from member nations) to find capital (finance) for their banking sectors as soon as possible. The best source for international credit is Japan. Japan has more than ample financial reserves of capital in its private sector that, in liaison with that nation’s Ministry of Economy, Trade and Industry (MEITI), can be utilized as a credit stream to European banks. The International Monetary Fund (IMF), hopefully with input of funds from Russia and the PRC, can also contribute to both the EFS (to cover existing debts) and as a source of credit supply to support small to medium banks in Europe engineer economic and employment growth.

The balance that needs to be struck in Europe is that of implementing austerity measures to cover the sovereign debts of Europe states and their bonds with other sources of capital that support the banking sector so that it can help stimulate needed employment growth during a period of austerity. This would not be a social credit approach because the lending would be undertaken by privately owned banks. The major state intervention, in possible conjunction with the EU, should be the setting of realistic prudential guidelines to ensure credit solvency and the monitoring of those guidelines in action.

The Italian banking sector, with or without the support of the Italian state or the EU, should be initiating contact with MEITI, Japanese banks and industry or all the aforementioned parties to obtain further financial credit. The massive industrial capacity of northern Italy is incredible. It is crucial to world trade and therefore to the future economic viability of Japan as a trading nation. Italians themselves (despite challenges of public foreign debt) are renowned savers. Such savings have previously underpinned a strong service sector in southern Italy.

But due to the impact of the GFC, Italian banks are facing grave problems with regard to credit formation. As challenging as the situation is in Italy, it is not as bad as it was for Japan in the immediate post-war period due to the destructive impact of the Second World War. Indeed, the situation in Japan was all the more grave because the United States did not have the money to support Japan, having decided to give priority to Europe.

For all the ingenuity of Japanese industry and support of the American led occupation authorities, there could have been no ‘Japanese economic miracle’ had the alliance of Japanese financial conglomerates, the Zaibatsu, not had billions of Yen salted away in Swiss bank accounts. These funds were judiciously utilized by the Zaibatsu (which became the Keiretsu) in conjunction with the Japanese state to facilitate an economic recovery by helping facilitate the capitalization of Japanese banks.

This capitalization of banks provided Japanese industry with the capacity for recovery which could not have been sustained without foreign trade. Furthermore, the lending capacities (with a degree of state intervention via considered prudential settings) helped support small to medium business engineer employment growth. Since then, (despite a downgrading by the Japanese elite of promoting employment) the Japanese state has helped guide economic activity by MEITI providing technical and strategic advice to Japanese industry.

This advice has not been resented by the Japanese corporate and private sectors because it has been crucial in filling in gaps with regard to Japan’s geographical distance from important trading partners and the nation’s lack of natural resources. MEITI, in formulating international trading strategies, has often analysed and subsequently advised Japanese companies to undertake specific domestic investments to indirectly facilitate trade with Japan.

Japanese capital formation capacity, combined with the realistic approach of the Japanese state and private sector to assess the nexus between investment and trading opportunities, make Japan the ideal nation to crucially assist the EU, individual European countries and the banking sectors of European nations. The Japanese also possess the capacity to link the possible future re-foundation of European currencies to replace or co-exist with the Euro depending on economic circumstances, with regard to factors such as debt servicing, trade competitiveness and inflation.

Overall, Japan is now a very important country because the Japanese state and corporate sector have the available finance and strategic appreciation of how to revive the European banking sector while helping sustain crucially important trade links.

Japan: The White Knight that can Save Itself By Saving the European Banks

In a macro context, Japan should also be considered to help bail out Europe as an
option because current trends indicate that the Franco-German dominated European Central Bank (ECB) will attempt to be the capital source force for European banks and for cash strapped European governments. The ECB can probably cover, through the European Stabilization Fund, (ESB) the debts that Greek banks have accrued. However, the ECB is demanding austerity measures that may cause more socio-economic problems than what they solve.

Furthermore, the economic well being of France and Germany could ultimately be imperilled if both nations have to carry the burden of financing the ECB-which probably cannot provide sufficient finance capital to European banks to re-generate economic activity and employment growth. An associated issue with regard to European recovery is the operation of the Euro Zone.

Italy is a nation where there are now difficulties in aligning the value of the goods and services of its economy to the exchange rate value of the Euro. This problem, since 1999, had been overcome due to the strength of the Italian banking sector. But the current GFC induced sovereign debt crisis has placed pressure on the operation of Italy’s formidable banking sector. Therefore the following option should be considered:

- central banks in the European System of Central Banks (such as the Bank of Italy) assuming pre-eminent responsibility for either issuing Euros and/or re-introduced domestic currencies that operate within a substituted currency regime of convertible currencies that co-exist with Euros.

- and if necessary having domestic currency as the sole currency that can be used in a country, as is the case with Britain.

If Japan were to supply credit lines to European banks or provide new loans to stimulate economic growth, repayment options would naturally be a determinant of success. A problem for a nation such as republican Greece is that she could be burdened with generations of foreign imposed austerity because of the comparatively high value of the Euro. An indefinite austerity regime for republican Greece in itself would be self-defeating to the extent of challenging the viability of its service based market economy.

The Nexus between EU Currency Reform and Needed Capitalization for Banks

A re-introduced Drachma might allow Greece the flexibility to repay future loans* because they can flexibly be devalued to reflect domestic economic fluctuations. That is not to say that Greece’s new national unity government should not proceed with the EU backed austerity programme. The importance of acceptance of this financial package is that it will enable republican Greece to cover its public sovereign debt and thereby re-assure global markets.

(* Existing debts would probably have to be re-paid by republican Greece in Euros).

The question that emerges is how can republican Greece regain economic vibrancy if it is weighed down by a perpetual fiscal austerity programme and cursed with under capitalized banks? The re-capitalization of banks therefore must be a priority for Greece. This could be facilitated by Japan or the IMF loaning money to support small to medium domestic Greek banks so that they can help revive the service and trading sectors of the Greek economy*.

(*When Her Majesty, Anna Maria, was domiciled Queen Consort of the Hellenes, between 1964 and 1967, she was involved in supporting one of the world’s first micro-credit schemes. Under this programme, small no-interest loans were provided to economically disadvantaged women to help them establish financially viable small businesses that provided them with an independent and/or supportive income.

The principle of this micro-credit programme-which low risk loans are directly provided to the small, medium and informal sectors of the economy- so that the macro impact of national austerity measures can be counteracted).

Strict prudential controls would have to be put in place and-due to advances in internet technology monitoring processes-can be put in place. The radical shift that needs to be made is for the Japanese or the IMF to transition to a process of supporting the small to medium sectors of a service economy. This has normally not been undertaken because the focus of the IMF has usually been on financing nation states.

The question therefore might be asked as to why should Japan or the IMF (including donor nations within this fund) provide capital to private banking sectors to support small to medium sectors of a domestic economy? The answer is that the nature of the GFC is such that this crisis now shows the financial interconnectedness of the world economy which includes economies that relatively economy’s such as Greece which need help both in the short and in the long term. Short term help for Greece can be provided in the form of the current bail out package while longer term support can occur by loaning capital to Greek banks to specifically support the ‘people on the ground’ who are the backbone of Greece’s service economy.

There is also the question of Greece (and other so-called ‘PIGS’ nations) re-introducing domestic currencies to assist with the needed capitalization of their banks and flexible repayment of future loans of money to the ‘grass-roots’ sections of their economy? There is no hard and fast answer to this question except to say that EU bureaucrats and politicians must take into account and respect the individual circumstances of each affected European nation.

Should a comparatively small economy such as Greece receive financial support from Japan for a revived Drachma - and a domestic currency creates the *flexibility for new future loans to be repaid - then Greece’s right to have its own currency (which could co-exist with a Euro) should be respected by the EU. The fundamentals of European unity were essentially achieved in 1992 when trade barriers were removed as opposed to currency union necessarily facilitating economic integration. If there can be a viable and non-inflationary revived Drachma, then the EU should assist Greece in such a development.

The immediate danger of Italy or so-called PIGS nations defaulting can be overcome in the short-term by raising money for bail outs. The more important long term issue is that of capital creation to revive activity within a small to medium sectors of economies while also protecting and promoting international trade. It is in this context that currency reform within Europe should be carefully assessed*.

(* Argentina was a nation that was devastatingly hard hit in the 2000s by a collapse in its banking sector and the loss of purchasing power of its then currency. However, this nation defied the odds to economically recover. This was due to the introduction of a new currency which reflected the value of the goods and services in its economy so that this nation could economically revive while servicing its foreign debt. How Argentina did this deserves analysis with regard to both the specific European context and the overall challenge of the GFC.

I have a deep interest and knowledge of Argentine history and politics which encompasses that nation’s financial crisis. To spare the reader an exhaustively boring overview of Argentine history and politics, an analysis of Argentina’s former debt crisis was not undertaken).

Nations such as France, Germany and the Netherlands*probably do not need to re-introduce a domestic currency to complement or substitute the Euro because this currency reflects the value of the goods and services of their economies. Because Austria’s banking sector is closely connected to Germany’s, it would not be practical for that country to re-introduce its old currency, the Schilling.

(The Netherlands, similar to Britain, has a very strong banking sector which is derived from extensive investment portfolios that date back to their trading power during an earlier colonial era).

Indeed, if there were EU nations that left the Eurozone (or re-introduced new domestic currencies within the zone), they would have to be careful of possible inflationary impacts. However, the need for capital formation for European banks has created the scope for financial institutions with state support to underpin new domestic currencies to facilitate flexible repayments for new loans. The critical point however is that European banks need an expeditious injection of capital if the Euro is to be sustained on a European basis or if new domestic European domestic currencies are to be re-introduced.

It needs to be restated that the 1992 abolition of trading barriers between EU nations is the most important and beneficial reform that has guaranteed (and will continue to guarantee) European economic unity. The EU consequently has the capacity to negotiate new trading arrangements with Japan in return for an infusion of Japanese capital into European banks, loans to European governments or underpinning future EU backed bonds.

Why China Should Save Itself Rather Than the World

The scenario regarding the EU looking to Japan for crucial assistance is not fanciful in the context that the People’s Republic of China (PRC) is a mercantilist power that is already moving to cheaply buy assets in Greece in return for financial assistance. If a mercantilist regime such as the PRC can potentially position itself as a source of capital funds during the GFC, then why can’t a democratic but natural resource deprived Japan do so if it has massive un-utilized capital?

Japan is presently preferable to the PRC as a capital source for Europe because of political structural problems China. The Chinese mainland economy is essentially state directed in despite there being a substantial private sector. The late Chinese paramount leader *Deng Xiao-ping actually remained a committed Marxist. He knew that, by the state controlling the banking sector and supporting State Owned Enterprises (SOEs), private capital would be subservant to the state.

(* The other prescription that Deng laid down was that central controls be applied so that there would not be any discrepancy between regions with regard to rates of economic growth).

Deng’s model of state capitalism has transformed the PRC into an economic powerhouse. Indeed, an argument can be put that the PRC’s bureaucrats and technocrats have been far more astute than American and EU policy makers with regard to handling the GFC. Be that as it may, the current Chinese power-over approach is vulnerable in that it possibly could not cope with unforseen developments.

The recent crisis concerning the raising of the American debt ceiling is a case in point with regard to the PRC possibly not having the requisite flexibility to deal with unforseen circumstances. Had the American Congress not raised the debt ceiling, an estimated US $1.4 Trillion in Chinese investments in American Treasury bonds may have been lost which could have plunged the PRC into an economic crisis similar to the inflation spiral of the 1940s which was crucial to bringing down the Nationalist regime of Chiang Kia-shek.

The consequence of such a PRC financial crisis probably would have plunged the world into its worst economic crisis which would have cancelled out the United States current capacity to get away with printing money to pay debts because the American dollar is still effectively the international currency reserve. Therefore, although the PRC probably has a brilliant technocratic brains trust, there are structural problems within the Chinese mainland economy which make it risky for China to fulfil the role of ‘white knight’ for Europe and the world.

The PRC’s model of state capitalism is viable so long as annual economic growth rates of 9% are sustained. Due to brilliant co-ordination by the PRC state, these growth rates are being sustained but this cannot be done on an indefinite basis. If the PRC were to fulfil the role of bailing out European banks and states, the overall impact would eventually rebound due to inherent weaknesses in mainland China’s current economic and political systems which are too focused on short term financial and trade manipulation to sustain high rates of long term economic growth.

There is now the prospect of a European banking crisis but there could also be a future ‘China Crisis’. But there need not be because mainland China has a massive domestic market base which could support full employment if the state was to strategically withdraw from utilizing Sovereign Wealth Funds (SWFs) and eventually allow private shareholders to assume majority control in what are currently SOEs. The need for social equity, if there is to be a transition from a state socialist system to a market economy, could be ensured by permitting genuine trade unions that both protect labour rights and potentially facilitate employee input to achieve productivity rises and consequently secure employment.

The current coercive controls* that are in place in the PRC, (which are probably now accepted by the Chinese middle class due to a critical appreciation that they have facilitated economic growth), could be parlayed into the formation of a Chinese equivalent of MEITI. The problem with the operation of MEITI for Japan is that the Japanese state and private sectors are seemingly immobilized. It is understandable that Japan is cautious but international economic events are now bigger than Japan, so that new approaches to international trade and finance should urgently be considered by Tokyo.

(* It is a great pity that Berlinguer died in 1984 and that Zhao Ziyang broke with Deng in 1989. Had Berlinguer lived longer and Zhao inherited Deng’s power, then there could have been a PRC transition to a Chinese democracy with the adoption of the previous Japanese model of achieving full employment because the two communist reformers had communicated with each other).

Why Self-Fulfilling Prophecies Must be Avoided

Even though the PRC is not a democracy, care should be taken by the United States with regard to relations with mainland China. There is a fine line between appeasement and counterproductive confrontation that the United States and other countries may not be taking account with regard to the PRC. This is not to say that the United States should decline offers of alliance or closer ties with existing allies. Indeed, the Obama administration is garnering substantial international good will towards the United States as a nation that can be trusted.

But trust in the United States should not be based upon fear of a country as important as the PRC. The Eighteenth Chinese Communist Party Congress is scheduled for October 2012. The future domestic and foreign policy setting for China for the next ten to fifteen years will be set because a new generation of senior Chinese Communist Party (CCP) leaders will assume office. Undoubtedly, compromises will be made regarding China’s future direction which will reflect different outlooks and priorities within the senior echelons of the CCP.

Compromises in CCP policy eventually pan out with circumstances and unfolding events determining which competing approach should prevail. Over the next ten to fifteen years, the CCP’s leadership will have to decide whether to support SOEs or take steps to allow an independent corporate sector, transparent capital formation and supporting a labour sector that is free from the control of a single party but connected to a Chinese state with a strong civil society conducive to national unity.

Attacks and/or military alliances against mainland China may only serve to bolster the position of CCP hardliners who have a cynical interest in not progressing with future economic and political reform. A counter-productive cycle may ensue where political and economic reform is retarded or abandoned due to the CCP’s senior leadership perceiving there to be international hostility.

Abandoned economic reform could result in the PRC consolidating a mercantilist approach to trade which actually causes international tensions. This could lead the PRC to bolstering its armed forces, thereby further undermining the prospect of needed economic and political reforms being adopted over the next ten to fifteen years.

The final determiner of power and the nation’s strategic alliance in the PRC is the armed forces, particularly the People’s Liberation Army (PLA). The PLA since 1949 has applied the Confucian precept that civilians rule the country and that the army will not divide to avoid imperilling national unity which could occur by the armed forces directly ruling. A paradox of this approach has been that foreign policy and defence concerns have often determined who rules China and determined what domestic policy directions should be followed by national leaders.

Mao-Tse Tung probably made a colossal political blunder by inviting former American president, Richard Nixon, on a private visit to Peking in February 1976 to commorate the fourth anniversary of RN’s historic visit to China. The importance and prestige that was accorded to RN’s visit helped influence PLA commanders to block the Gang of Four’s taking power upon Mao’s death so as to not risk China forgoing crucial American from the then *Soviet threat.

(*Due to their long border, there is an inherent disposition toward Sino-Russian which rivalry has been long standing. In terms of contemporary comparison between China and Russia, the latter is probably doing better in terms of economic reform. Although Russia probably could not have broken with Marxist-Leninism in the 1990s and after without there being a so-called crony/oligarch class, substantial progress is being made due to state support for an emerging private bank sector.

In contrast to China’s so-called ‘shadow banks’ and to the unwise lending practices of American and European banks, Russian banks have, subject to sensible prudential controls, being supporting a growing private sector that is conducive to having a stable civil society.).

Deng Xiao-ping’s domestic consolidation of power in 1979 following a brief border war with Vietnam was primarily due to the PLA’s assessment of external defence considerations to support Deng as the nation’s paramount leader. The PLA will subordinate external defence considerations if China’s national unity is seemingly threatened. For this reason, the PLA compelled Deng to acquiesce to the violent suppression of a civil reform movement whose symbolic centre was Peking’s Tiananmen Square. The massacre in this square in June 1989 of demonstrators almost ended Deng’s rule but he was able to re-assert his power due to renewed PLA support due to the strategic ramifications of the Soviet Union’s break up in late 1991.

The world is in a perilous economic situation and the PRC’s help and expertise will be needed for the international good. China similarly faces formidable socio-economic challenges. Adopting a bellicose stance toward the PRC could well orientate the PLA’s senior leadership away from supporting the introduction over the next ten to fifteen years of positive socio-economic domestic reforms. The enactment of such reforms will help guarantee Chinese national unity and a respected role in international relations. Furthermore, China clearly has a very talented technocracy that can provide innovative ideas and support that should not only be of domestic benefit but could greatly help the world.

The United States: Capitalism Needs Finance Capital

Japan and the EU will probably need American support for an international plan that protects the world economy. This is particularly so because the contemporary GFC crisis is one which, in comparison to the Great Depression, is relatively easier to fix but a failure to do so will plunge the world into a worse catastrophe than the crisis that the1929 Crash caused. This unsettling paradox is due to the fact that there is sufficient finance capital around the world to cover credit shortfalls but a failure to utilize this capital-by adroitly engineering an allocation of existing funds to cover credit shortfalls-will lead to a financial contagion that will be infinitely worse than the ramifications of the 1929 Crash.

Due to similarities and differences between the contemporary GFC and the Great Depression, broad comparisons are undertaken between these two economic crises for the sake of avoiding an international financial cataclysm. The Great Depression can be traced to the October 1929 Crash on Wall Street. This crash was essentially caused by banks (who had been liberally loaning money) calling in some of their debts in response to the Federal Reserve tightening credit availability. The attempt by bank debtors to sell some of their shares helped cause the 1929 stock market crash as too many shares were overvalued and could not be sold quickly enough to cover existing bank debts.

In many ways, the fundamentals of the 1929 Crash were similar to the current GFC: a chasm between money owed and incapacity on the part of the state or banks to cover the credit shortfall. From a broad right wing/market perspective, the economic crisis that ensued following the 1929 Crash was primarily due to the emergence of protectionism impeding the flow of international trade which in turn stilted economic growth thereby prolonging the agony of the Great Depression. Alternately, from a broad left-wing viewpoint, insufficient demand sustained the economic downturn which was exacerbated by inadequate public spending.

Whatever perspective is accurate regarding the Great Depression, a shortfall in capital was the major factor which caused that economic crisis in the first instance. By contrast, with regard to the current GFC, there is sufficient finance capital in the world to avoid a fundamental economic crisis. But the key issue is how capital that currently exists can best be applied to address the capital-shortfalls in global banking sectors and for the sovereign states that have had to cover credit gaps.

The above question is complex but it is one that the United States must lead the world in addressing with regard to its domestic economy. The benefits of Washington successfully grappling with the crucial issues by covering credit shortfalls of capital (i.e. money) formation is vital not only to the United States but to the world. The United States cannot indefinitely persist in printing money to cover spending and borrowing. This approach is presently only viable due to the American dollar being the world’s reserve currency and due to the purchasing of American Treasury Bonds.

Stopgaps are Worthwhile if they Provide Scope for Future Integrative Unity

But an end point will eventually be reached when the money printed will not validly align with the value of the goods and services in the American economy. The lifting of the American debt ceiling was a vital stopgap, but just that, a stopgap. The formation of the congressional *super committee following the raising of the debt ceiling was a very promising development because such a committee had the potential to establish a fiscal regime conducive to necessary capital formation that could save the world from profound economic crisis.

(*The super committee is, or was, composed of three House Democrats and three House Republicans with six senators, three from each of the two major parties).

The super committee divided on the contemporary Democrat-Republican fault line of increased tax and spending versus tax cuts to stimulate economic and employment growth. This dichotomy misses the fundamental GFC induced problem: that the American banking sector is facing a liquidity crisis due to a shortfall in finance capital. A dangerous development since 2008 in the United States has been that too many small and medium banks have undergone because of under-capitalization.

The issue of bank capitalization could be the focal point for future integrative unity in relation to establishing a ‘law of the situation’ for President Obama and the eventual Republican Party presidential nominee and the Congress to co-operate to overcome the GFC over the course of next year.

The concept of ‘Law of the Situation’ was formulated by the American political scientist Mary Parker Follet* (1868 to 1933). The Law of the Situation can refer to a particular problem (or problems) in which there are different parties with their own ideas as to how to meet that challenge. For Follet, authority and power should be exercised by focusing on the cause of the problem and then synthesizing different perspectives to formulate and apply a solution which might not have been devised without an overall approach conducive to integrative unity.

(*Although Follet is dead, she will be referred to in the present tense to denote the continuing relevance of her ideas).

The paradox of integrative unity is that the more parties there are involved in a situation, the more scope there is to devise a very effective and enhanced solution than what there otherwise might have been. Conversely, there is also corresponding scope for conflict when there are more parties (or using contemporary neo-liberal jargon, ‘stakeholders’) in a power situation. Consequently, adoption of a ‘Law of the Situation’ framework can identify the often delicate fine line between success and failure. Whether failure or success is achieved by applying ‘Law of the Situation’ depends on the approach that is adopted in relation to conflict.

For Follet, conflict is potentially positive if there is a canvassing of different ideas to synthesise an enhanced outcome. It is in relation to the exercise of authority that the various combinations of ‘win-win’, ‘win-lose’ and ‘lose-lose’ are determined. These aforementioned combinations more often than not correlate with whether a ‘power-over’ or a ‘power-with’ approach to authority is applied.

There is a tendency to regard the above mentioned approaches, particularly ‘win-win’, as insipid and naïve. It should be pointed out that the ‘guru’ of modern management Peter Drucker (1909 to 2005) adapted Follet’s concept of ‘Law of the Situation’ from a political context to a business one to formulate Management by Objective (MBO). MBO has provided a framework for managers to apply diversity management to synthesize different perspectives and, very importantly, to devise new ideas/modes of operation from a rational and hard headed analysis of the existing context.

Follet regarded achieving a ‘win-win’ outcome as reflective of skilful leadership having been applied. Consequently Follet abhorred compromise which she regarded as taking aspects of different (and often competing) proposed solutions. This is correct because it is impossible to synthesize contradictions.

Integrative Unity: Why Co-operation as Opposed to Compromise is Needed

Mikhail Gorbachev, as Soviet ‘President’ in 1990, helped lay the groundwork for his own fall in 1991 by trying to combine the competing and contradictory ‘500 day plan’ and the ‘800 day plan’ for economic reform. What Gorbachev probably regarded as skilful leadership only produced failure because his ‘compromise’ only resulted in an unworkable plan.

Therefore, as heretical as it may seem to say, ‘compromise’ in the current context of the United State’s leadership in contending with the GFC compromise, should be avoided. It was because the super committee sincerely strove to achieve a compromise that no solutions ensued as contradictions cannot be synthesized. Indeed, the conciliatory approaches of super committee members failed- and members of other Congressional and Senate committees will fail- to find a solution by seeking common ground via compromise. It is co-operation not compromise that is needed.

Co-operation in Washington to achieve a ‘win-win’ outcome is still needed to overcome the fundamentals challenges that confront the United States and the world in relation to the GFC. For a ‘power-with/ win-win’ result to be achieved in the current context, a hard headed, dispassionate and non-ideological radical approach (‘radical’ meaning going to the roots of a problem as opposed to causing gratuitous disruption) is required of America’s leadership.

Let there be a focus on determining what the actual technical causes of the GFC are and then implementing practical solutions which not only remove dangers but improve the situation from what is was previously. Arguably the key economic danger in the United States is that of undercapitalization of small to medium financial institutions. At the very least, a dispassionate analysis of bank capitalization as both a cause and a possible solution to the GFC should be analysed.

The Vital Need for American Banking Diversity

A key contributor to the realization of the ‘American Dream’ was the existence of small to medium sized banks or financial institutions in American towns, regional cities and rural communities. An important reason why the new American Republic consolidated was because banks were established in local communities. The wealth of farming communities and small businesses in regional towns was productively invested by banks. This in turn, enabled financial institutions to grant viable loans to working and middle class people which helped facilitate productive wealth creation and further capital formation.

The United States could not have geographically expanded and gained the deep patriotic commitment of all its citizens to become the miracle that is America had there not been a strong banking sector in place since the 1800s. The major danger of the GFC is that small to medium sized domestic American banks will collapse and that large financial institutions will consolidate on a monopoly basis. It is improbable that dominant corporate backed mega-banks will have a commitment to fostering business and employment growth at a local level that has been an important foundation of American prosperity.

Change We can Believe in: The Need for American Bank Capitalization and Diversity

President Obama when running for office promised ‘change we can believe in’. This catchcry conveyed that there would be an interconnection between making profoundly beneficial progress and a practical capacity to achieve such advancement. The current context is now one more than ever when a synthesis between the inspirational and the practical is required.

Funds raised by cuts in wasteful spending and increased taxation will help facilitate the needed capitalization of domestic American banks. A synthesis between the best of *Democrat and Republican brains will be needed to devise a regulatory framework that protects the domestic American banking sector as the future driver of prosperity and employment growth.

(*The Democrat proposal for an infrastructure bank is an excellent idea and one which the Republicans should consider supporting as a valuable quid pro-quo for Democrat acquiescence for approving spending cuts of wasteful programmes. The deflationary potential of spending cuts needs to be countered by newly capitalized banks, such as an infrastructure bank, lending money to support small to medium business as engines of employment growth).

The growing gaps in the American financial sector resulting from the reduced number of small/medium banks and credit unions essentially renders irrelevant the Democrat-Republican debate as to whether there should be increased spending or reduced taxes to stimulate employment facilitating higher economic growth. There is actually merit in both the Democrat and the Republican perspectives regarding cutting taxes and increased spending. However, in the current context, the inadequacies of both approaches as stand alone policy options need to be assessed.

Cutting taxes alone will not, in the current economic environment, stimulate sufficient employment growth in the United States because of the depth of the downturn caused by the 2008 GFC. In the current context, there is no guarantee that tax cuts will stimulate employment growth due to economic uncertainty being a disincentive toward spending. Therefore, any tax increases should be considered by Congress on the basis that they reduce the public foreign debt and facilitate prompt and needed capitalization of American banks.

If there are to be tax increases, they should be directed at those who can afford them as opposed to the economically vulnerable. Regressive taxation in the current economic American context will only deflate demand. By contrast, temporary increased taxes for those who can afford it will be generally accepted by them on an interim basis if the increased revenue helps the United States reduce its dangerously high foreign debt to GDP ratio and vitally contribute to capital formation for small to medium sized banks and/or credit unions.

Banking Diversity Saved Australia from Going ‘Down Under’

Australia was effectively insulated from the2008 GFC because the former federal Treasurer (1996 to 2007) Peter Costello had presciently put in place effective prudential controls that ensured that Australian banks and building societies were sufficiently capitalized if there was an international credit crisis. Australia’s public foreign debt had previously been paid off by Treasurer Costello and he had secured a budget surplus that also vitally contributed to financial and fiscal security.

The upshot of Costello’s financial preventative maintenance was that Australia’s secondary services sector was sufficiently strong to withstand the 2008 GFC that the subsequent stimulus packages introduced by the Rudd ALP government were not only unnecessary but they were part of a long term strategy (which has the covert support of elements of the Liberal Party) to create an over-dependence on mineral exports to the PRC. The great myth that needs to be debunked is that Australia’s relative success in weathering the2008 GFC was due to the so-called ‘China Boom’.

The debunking of Australia’s ‘China Boom’ myth is not only important domestically but also in an international context. This is because Mr. Costello’s financial policies established a valid model that is salient in the contemporary global economic context: that of a capitalized banking sector crucially supporting the domestic services component of an economy. Consequently, even if there had been a collapse of the international banking systems, Australian banks would have remained solvent, thereby helping underpin the domestic secondary sector of the Australian economy regardless of how detrimental the GFC’s impact was.

There are aspects of what Mr. Costello did with regard to protecting domestic banks that are not transferable in a non-Australian context but the principles of establishing effective prudential banking controls to bolster the small and medium sectors of the economy is broadly applicable. It should also be emphasised that prudential regulations (such as deposit to loans ratios) were the means by which Mr. Costello helped protect the secondary sector of the economy as opposed to implementing a prescriptive social credit style economic approach.

Because the Costello policies were cumulatively a judicious form of preventative maintenance, Australian banks and building societies were not confronted with the challenge of de-capitalization. (Although credit shortfalls and an incapacity of Australia to service its public foreign debt may become critical problems if the nation continues on its current rent seeking path). For countries whose banking systems and governments were hit hard by the GFC, bank re-capitalization is a crucial challenge that is worth being met if prudential controls are established which extend vital credit lines to small and medium sectors of an economy to engineer needed employment growth.

Australia is a medium sized economy so, to state the obvious, the United States and the EU will have to make the running with regard to surmounting the GFC. Therefore, in the American context, further borrowing to fund government spending must begin to be phased out because the United States cannot afford to go into more public debt. The current stop gap that the United States has, of being able to print money, will eventually become unviable.

Win-Win Outcomes: Reducing Debt and Capitalizing Small to Medium American Banks

It is therefore imperative that the United States pay off (or substantially reduce) existing debts and have an actual revenue base to underwrite the value of Treasury bonds and currency and to facilitate needed bank capitalization. This can be achieved by temporary tax increases, allowing tax cuts from the previous Bush administration to lapse and cuts in wasteful spending that the American Congress* will hopefully occur as a result of Democrat- Republican co-operation in response to the GFC.

(*Going to the default positions of steep spending cuts in defence and health care is a ‘lose-lose’ scenario. Not only will such spending cuts fail to help the United State’s credit and fiscal position but they will precipitate domestic political polarization and social dislocations at a point when America and the world can least afford it).

The situation in the United States is so topsy turby that the American Congress could simultaneously advocate cuts in wasteful spending programmes with new spending increases. New spending increases should only be granted if they are genuinely aligned to generating demand that facilitates actual employment growth.
The Democrats have shown considerable promise with regard to moving to the vision advocated by the late Congresswoman, *Barbara Jordan (1936 to 2009) when she gave a keynote address at the National Democratic Convention in New York in 1992.

(*Congresswoman Jordan still fulfilled an ignominious role as a member of the House Judiciary Committee by making a sterling speech in 1974 which helped legitimise Senator Ted Kennedy’s entrapment of President Richard Nixon in the so-called ‘Watergate scandal’ (sic). Furthermore, Ms. Jordan later effectively moved away from her position as a civil libertarian by opposing basic rights for illegal migrants in the United States).

In that 1992 speech, Ms. Jordan mentioned various long term policy positions of the Democrats, paused, cited a corresponding alternative improved policy, paused again and then invoked the term ‘change’. Her most effective call was for the Democrats to ‘change’ from being the party of ‘tax and spending’ to that of ‘savings and investment’.

Savings and investment is now really code for capitalization of American banks and financial institutions. This policy orientation is in itself worthwhile but now has a considered urgency in the current context of the GFC. It must be emphasised that an important cause of the 2008 GFC was regulatory authorities forcing banks to lend money to recipients who were not in a position to repay. These loan recipients often did not help the overall situation by abandoning ‘their’ houses after they failed to sell them.

Therefore, ‘regulation’ in the more recent contemporary context should mean government assistance in bank capitalization to help protect and advance the position of small to medium banks and credit as opposed to the state dictating who the money should be lent to. The Obama administration is already reforming real estate laws so that housing mortgages cannot be simply abandoned. Republican Party co-operation in supporting the administration’s efforts in real estate reform could be expanded by lateral input in formulating legislation that creates a new regulatory system that shields and improves the lending capacity of small to medium domestic American banks and credit unions.

The point concerning the need to support the small and medium American banking sector cannot be over-emphasised. The 2008 GFC was caused by an undermining of the operation of the American banking system and this crisis can be overcome by the American president and the Congress co-operating to revive the American domestic banking sector which have been traditional bulwarks of both American prosperity and equity. Reforming and protecting the domestic American banking sector will not be an easy task so it will be essential that there be high powered bi-partisan co-operation.

If the Congress and the President do not take a lateral lead to achieve high powered bi-partisan co-operation, the initiative could pass to extreme political movements with equidistant opposite agendas that will lead to failure that, in the current GFC context, could be catastrophic.

Coffee or Tea? Failed Presidential and Congressional Leadership will Facilitate Economic Failure and Destructive Political Extremism

The anxiety caused by the GFC has already generated a hard left wing protest movement that is viable due to social media. Across the world, the Marxist methodology of focusing on a common grievance upon which to agitate is now successfully being applied. Practical solutions to grievances (such as supposed Wall Street greed) that will actually improve the situation are never advocated by protest organisers. Instead, the common grievance is focused upon which invariably leads to a common enemy/culprit being agitated against to generate a destructive mass protest movement.

If there is a failure on the part of political leadership to redress the underlying causes of anxiety, the left wing social movement becomes stronger until a critical mass is constituted that can challenge the existing socio-economic and political system.

The United States is probably not in a situation where the ‘Coffee Party’ (the left wing version of the Tea Party that was founded in 2010) will gain sufficient strength that the United States will become a Marxist dictatorship as Cuba, did following the failure of talks in 1956 (‘the Civic Dialogue’) between the democratically inclined Batista government and the moderate opposition. However, a political impasse over how to address the GFC could lead to a political polarization in the United States not seen since the Civil War (1861- 1865).

A Coffee Party backed hard left ascendancy could be facilitated by incumbent Democrat congressmen and local and state officials adopting non accommodating political positions to win primary endorsement. A more left wing Democratic Party will undoubtedly support President Obama’s 2012 re-election bid. But should a non-moderate Congress be returned next year, a power–over/win-lose approach to governance may ensue that undermines the social cohesion that is needed to help make the American dream a reality.

An Obama-Biden combine offers the best hope for a moderate but still potentially brilliant Democrat presidential ticket. President Obama has a skill similar to the late Barbara Jordan of using rhetoric to articulate practical directions that are needed to advance the general good. If the president is to win re-election, he will have to propose worthwhile legislative policies that address the fundamental challenges posed by the GFC and then articulate during the campaign why the Congress should pass them.

The proposed Jobs Act of the President’s is a promising indication of lateral and appropriate public policy of the Obama administration. The Republican majority in the House of Representatives may not agree with this proposed legislation as it is but this bill still serves as a basis for the GOP to have lateral input by legislative amendment. Effective co-operation can be reached if common underpinning objectives are achieved by synthesizing different ideas.

The outcomes that President Obama and the Congress will hopefully achieve will be these of reducing the American public debt to GDP ratio and recapitalizing the operation of the federal government and of domestic banks/credit unions, particularly small to medium ones. The practice of printing money to perpetuate endless borrowing of money to sustain federal government operations must be ended before the American dollar can no longer be accepted as the world’s reserve currency.

There will be scope for lateral ‘win-win’ bi-partisan co-operation if there is a Mitt Romney and Newt Gingrich Republican presidential ticket. These candidates for the Republican Party nomination appreciate the profound threat that the GFC poses to the American and international financial systems and to social stability. They also have a technical capacity to formulate policies that can help save the world from the GFC.

But, because there is still abundant scope between now and election day in November 2012 for economic catastrophe, a possible Romney-Gingrich ticket would have to advance their ideas and policies during the course of the campaign as a basis for synthesis with the Obama administration’s proposed solutions.

It may seem bizarre for a presidential race to be used as a platform to canvass different ideas of presidential candidates to be advanced and then enacted by Congress on a bi-partisan basis, but then, the current context is one which is in keeping with the Chinese saying: ‘May you live in interesting times.

If President Obama and Vice-President Joe Biden are opposed by a Romney-Gingrich Republican presidential ticket, the dynamics will be in place for the scope will be there for an intense interchange of ideas and passage of consequent legislation to save the United States and the world from economic catastrophe. The respective blue and red lines of the Democrat and Republican parties are now so entrenched that lateral synthesis between the two presidential candidates will ensure a still close 2012 vote.

Paradoxically, if either ticket (assuming that there is a Romney-Gingrich presidential Republican ticket) decisively wins in 2012, it will be an indication of socio-economic disaster. If President Obama wins re-election by a large margin, then it will be an indication that the Republican majority in the House of Representatives has blocked the administration’s policies which, since the raising of the debt ceiling, have been promising due to their focus of appreciating the importance of capital formation in relation to employment growth.

The American people will punish a Congress that does not engage positively (which does not necessarily mean that the President’s proposals should be automatically accepted at the initial stage) with lateral and considered (if not brilliant) ideas and solutions that President Obama will probably advance in the course of the campaign for congressional approval.

Alternatively, if there is a Republican landslide in the 2012 elections, it will be due to an economic catastrophe (such as in Europe) occurring between now and next year’s vote. If this is to occur, I would not wish the job of American president on my worst enemy.

It Is Not All Doom and Gloom

In the context of the contemporary doom and gloom, it is often overlooked that there have been real bright spots such as the Bush and Obama administrations providing (with congressional approval) financial aid which helped contain unemployment and underemployment respectively to 10% and 9%. As bad as the current employment situation is, it could have been much worse had if financial aid had not been provided to corporations such as General Motors (GM) to fend of bankruptcy and maintain an employment generating capacity to bolster the American economy.

With regard to American GM, this corporation is now solvent and stronger than it was before the GFC. This car manufacturer is still a crucial contributor to employment in the United States, to associated industries and in facilitating foreign trade. For all the managerial and employee talent that GM had, they could not have successfully adapted without the provision of capital which was provided by emergency loans (that were re-paid) from the state.

GM’s success did not lead to a state takeover of a vital component of private American industry or the commencement of a social credit paradigm in American public policy. However, a crucial precedent was set that showed that the American state can and should step in as an emergency step not to supplant capitalism but rather to support it. The current challenge for American capitalism is that current gaps in American banks and financial institutions require capital formation to avoid a financial cataclysm that has threatened the world since the GFC in 2008.

Creative Destruction: Without Secure Employment, There Can Be No Social Stability

Hopefully, there will be temporary support from the American state to help ensure that the miracle that is American capitalism will not only survive but continue to provide crucial support to the global economy. The GFC provides the opportunity-for the Obama administration and the American Congress (in dealing with this crisis) to help establish a set of values that can help adapt to technological induced socio-economic change.

How the GFC is addressed can determine whether the effect of ‘creative destruction’ that technological change has on employment will be negative or positive on labour employment. Creative destruction was originally a Marxist concept which envisaged technological innovation creating a crisis for capitalism by destroying jobs. A counter perspective on creative destruction was advanced by the Austro-American political theorist, Joseph Schumpeter (1883 to 1950). He maintained that technological advance created new industries and employment opportunities which would compensate for jobs temporarily that were lost.

Presently, new technology is reducing employment more rapidly than it can be replaced with no jobs and industries. This phenomena is due to the rapid rate of technological change rather than the inherent injustices of the capitalist system. However, the GFC is yet to be adequately addressed so that there is scope for the negative Marxist version to prevail. This could occur if capital (i.e. the private sector) is dominated by big corporations which will utilize technological changes to minimize the use of labour (i.e. employment) as a cost impost.

Indeed, by ensuring that technological changes do not facilitate new employment growth opportunities the GFC could be used by some leaders in industry around the world to help ensure that creative destruction does have negative ramifications. Having a post-GFC banking sector that mainly supports big business is one way of consolidating a transition to low employment regimes around the world.

A major problem with the above negative outcome is that technology can now be used for social media to organise and sustain demonstrations and social unrest for the sake of challenging the capitalist system. Already this is happening, with ‘left wing’’ social movements attacking and scapegoating the banks. In actual fact, re-capitalizing and instituting new effective prudential safeguards for banks so that they will lend to spur economic and employment growth at a micro level is a key strategy to overcome the GFC by ensuring that creative destruction will have a positive impact.

Scope for positive creative destruction can be created if internet technology is used to create new trade and investment, wealth and employment opportunities. Due to technological advances, international transfers of money are now almost instantaneous. Therefore capital can be expeditiously and strategically transferred - to create new wealth and employment opportunities* for as many people as possible therefore counteracting the Luddite threat of recent technological advances.

(*Technology can now also be used to facilitate needed bank capitalization).

President Obama in campaigning for president in 2008 implicitly promised to utilize existing talent to help make a better world. Utilization of existing talent can be achieved by President Obama and/or the American Congress striking a balance between capitalization, prudential security and transparency for the domestic American banking sector to overcome the profound threat posed by the GFC. Accomplishments in American banking reform could be used as a framework approach of ensuring that technological induced creative destruction has positive wealth and employment ramifications.

(In a foreign policy context, the United States under President Obama and Secretary of State Hillary Clinton have being making the world better by supporting struggles for freedom and democracy).

Historical Greatness: Helping Those Who Need Assistance

Political greatness is something which should not be consciously sought due to the potential pitfalls for egocentricity as opposed to achieving a higher purpose. An historical figure who validated this perspective was Sir Winston Churchill (1875 to 1965). He was someone who was ridiculed because he stuck to his beliefs no matter how unpopular and derided they were. His becoming prime minister in May 1940 was a belated admission that he had been correct but, with the impending Fall of France, it seemed that it was too late. Churchillian greatness was manifested in the context of persisting when one was not necessarily in a position to prevail.

Due to a combination of Churchill’s inspirational leadership and Hitler’s ineptitude, Britain held out against capitulation. For all that, Britain could not have reversed the disaster of the 1940 Fall of France had it not been President Roosevelt’s support for Churchill in ensuring that Germany was defeated before Japan. There are criticisms that can be made of President Roosevelt in trusting Stalin over Churchill due to his fear of an Allied victory reviving European imperialism.

However, President Roosevelt still demonstrated greatness by initiating the Lend Lease programme before the United States entered the war at the end of 1941. This programme provided a beleaguered Britain with needed arms and equipment despite there being strong domestic isolationist opposition to President Roosevelt’s policy. In this context, President Roosevelt demonstrated another aspect of historical greatness: utilizing existing power to help a nation (or a cause) when there is no immediate dividend for your own country in doing so.

Post Qaddafi Libya: Precarious but Promising

The Obama administration’s assistance to the Libyan freedom fighters was an example of historical greatness because help was provided to a heroic people who could not have prevailed without external assistance due to Qaddafi’s initially superior military position. The assistance that the United States, EU/ NATO nations and some members of the Arab League provided to the Libyan people is what should have occurred in 1991 when the Iraqi people rose up against Saddam Hussein.

The prudent policy approach of the Obama administration in Libya of assisting without directly intervening is continuing. The United States, for example, is helping Libya’s transitional government recover funds that the Qaddafi regime embezzled and banked abroad. This policy action is also noteworthy because America is helping provide help to a nation when there is not an immediate dividend in doing so.

This does not mean that all requests from Libya’s interim government should be acceded to without individual nations, such as the United States, taking into account their domestic/foreign policy requirements and actual capacity to help. Furthermore, nations that are prepared to assist Libya have a right to set criteria, such that their assistance is conducive to promoting democracy and human rights.

Foreign countries, in relation to considering requests from Libya’s transitional government, will naturally need to evaluate ‘the situation on the ground’. The contemporary context in Libya is precarious but promising. A promising aspect of the Libyan situation is that the nation’s interim leaders are rational. The strategic brilliance with which the freedom fighters successfully fought against Qaddafi indicates that there are smart people associated with the new provisional government. Furthermore, the overwhelming majority of Libyans desire free and democratic elections in the immediate future.

The precarious aspect of the Libyan situation is that there is considerable scope for anarchy due to the widespread availability of arms and the existence of armed gangs. The formation of a new professional army and the disarming of armed gangs is a priority for Libya’s transitional government. The skill with which the rebellion against the Qaddafi regime was brilliantly conducted (such as in Tripoli, where clans that were aligned with the regime judiciously defected to ensure the capital’s liberation) indicates that there is potential to forge a professional Libyan armed force capable of maintaining law and order.

Different ideological, clan or regional demographics will need to be taken into account to forge a new Libyan army. The Dominican Republic precedent of 1965-1966 illustrated that a provisional government can successfully form a new armed force reflective of different political interests to maintain order for and after the holding of democratic elections. The post-1966 Dominican armed forces became professional because political differences that were originally reflective in the composition of the officer corps were thrashed out in the context of the Dominican Republic developing a competitive party system.

The parlaying of political differences into electoral competition will hopefully commence with elections to a constituent assembly to draw up a new Libyan constitution. Unless democratic elections for a constituent assembly are held, the Libyan Revolution will not consolidate. It should not be the role of provisional governments to draw up new constitutions because they are bound to be reflective of the orientation and biases of those in power. Let the multitude of ideas and expectations of the Libyan people be parlayed into electoral politics, commencing with elections to a constituent assembly.

A missed historical opportunity illustrating the importance of constituent assemblies in transiting nations to democracy was apparent in Russia in 1917. Russia, (the term ‘Russia’ then encompassed nations such as the Ukraine and Georgia) was confronted with a vast array of problems following the fall of the Romanov dynasty in March that year. The Provisional Government’s ill-considered ban on the monarchist Octoberist Party participating in the November 1917 constituent assembly elections and Lenin’s closure of the assembly in January 1918 aborted Russia’s then potential to become a truly great nation.

Had there been a democratically elected Russian constituent assembly, then the potential could have been there of utilizing existing problems as opportunities by drawing up a widely accepted democratic constitution. The positive ramifications of a Russian democracy for the world can be negatively and comparatively measured by the alternate reality and disaster of Russia becoming a Marxist-Leninist dictatorship.

The emergence of a true Libyan democracy would have major historical ramifications because a precedent will be set of having democratically elected governments in an oil rich nation. A major reason why the Arab world has been beset by dictatorship is that the concentration of oil has helped elites to selfishly accrue wealth for themselves and finance security forces to repress their people.

In the Libyan context, Qaddafi (despite his pretensions to being an innovative leader and political theorist) was the epitome of a resource dependant rent seeking dictator. The revolution against Qaddafi was precipitated by his regime’s over-dependence on oil, its siphoning off of oil revenue and falling oil prices. The real potential is now there for Libya to actually be a ‘cutting edge’ nation as an oil rich democracy.

Why Tunisia Will Continue to Be the Beacon of Arab Democracy

With regard to Libya and the ‘Arab Spring’ in general, there has been a disconcerting tendency on the part of the western media to be wary of the spread of Arab democracy on the basis that newly elected governments will be ‘Islamist’ dictatorships. An overwhelmingly Islamic nation such as Libya will invariably adopt a post-Qaddafi constitution which recognises Islam as the official religion. There is also a better than even chance that a future elected Libyan government will be an avowedly Islamic one. It should therefore be appreciated in the west that Islam and democracy are compatible as recent events in Tunisia promisingly indicate.

The Islamist Nahda Party won a plurality of the vote (40%) in Tunisia in the October 24th 2011 constituent assembly elections. That the Nahda Party came first was not only due to the Muslim faith of Tunisians who voted for this party but also because of the Nahda Party’s leader Hamadi Jebali courage in opposing the former dictator, Zine Ben Ali (who ruled Tunisia as president from November 1987 to March 2011).

As hazardous as it is to make predictions, it can be anticipated that the Nahda Party will lead a future Tunisian government as the equivalent of a European type Christian Democratic Party.

A brief overview of Tunisian history indicates that this North African nation a is secular orientated nation in that is opposed to religious leaders assuming political domination. Tunisia as a French protectorate from 1881 to 1956 was exposed to western ideas and culture. Paradoxically, western influence on Tunisia was transmitted through the legacy of the nationalist leader Habib Bourguiba (1903 to 2000).

Bourguiba was a university graduate who had studied in France and founded the Neo-Destour (Constitutional) Party in 1934. Because France ruled Tunisia as a protectorate through the traditional royal structures of the Hussainid dynasty, Tunisian nationalism was manifested in advocacy of modern constitutional governance such as parliamentary rule so that de facto independence could initially be gained. The Destour Party was inspired by the middle class based Wafd (Delegation) Party that was founded in Egypt in 1919. Similar to the Wafd Party, the Destour Party advocated full independence in keeping with the ideals of the new League of Nations.

The Neo-Destour Party established branches outside the capital Tunis where the dominant faction of the Destour Party was based. Even though Bourguiba was imprisoned in the 1930s and then exiled by the French, the Neo-Destour Party’s extensive branch structure ensured that his popular support base remained intact. Presciently, Bourguiba (who was transferred by the Vichy French to Italian custody) refused to collaborate with the Axis as he was always certain of an Allied victory in the Second World War.

Faced with the prospect of an Algerian type of insurrection in Tunisia in 1955, the French released Bourguiba* and granted Tunisian independence in April 1956. The prestige and power of Bourguiba and his Neo-Destour Party were such that in the April 1956 constituent assembly elections, the only opposition that ran were the Communist Party and independents with the latter only inning a small number of seats.

(Bourguiba had been re-arrested in 1952 following his return to his homeland in 1949).

Shrewdly, Bourguiba had formed an electoral front with the nation’s union confederation and with merchant guilds so that there would not be a basis for party formation outside the Neo-Destour Party at the time of the 1956 elections. Bourguiba’s skill at co-option was such that powerful Tunisian monarchists also ran with the Neo-Destour Party in the 1956 elections so that it subsequently came as shock to the royal family in July 1957 when the constituent assembly at Bourguiba’s insistence declared Tunisia a republic!

Members of the Hussainid royal family who wished to maintain their royal status were banished to the relatively remote north eastern town of Manouba where the royal court was allowed to continue. The Tunisian monarchy effectively came to an end when King Muhammad VIII, 1881 to 1962, (who was a skilled locksmith and who as Bey under the French between 1943 and 1956 had consistently supported Bourguiba, often serving as liaison between him and the colonial authorities), abandoned his court to return to Tunis as a low profile private citizen.

The abolition of the Tunisian monarchy severely undermined the prospects for democratic constitutional monarchy in the Arab world. This is because the dominant ruling party was one that had come to power through democratic elections and whose right to govern was not impeded by there being either an overly powerful royal family (the Hussainid royal family believed that there would be a constitutional democratic monarchy under Bourguiba) or an interfering foreign power. The abolition of the monarchy helped clear the way for Bourguiba to establish a de jure one party state.

The establishment of a one-party state in Tunisia was the equivalent of the Wafd Party in Egypt or the moderate nationalist Istiqlal (Independence) Party in Morocco establishing a party dictatorship. The Neo-Destour Party (which successively reconfigured to eventually become the Constitutional Democratic Rally in 1988) was a party with a coherent branch structure which helped Bourguiba to maintain a pulse on the popular mood.

Tunisia’s ruling party contrasted with the Baathist regimes in Iraq and Syria where marginalized elements of society, through connections to the military, seized power to establish brutal dictatorships that were avowedly dedicated to pan-Arab unity. Even as the Tunisian regime became increasingly authoritarian and the egocentric Bourguiba (who was declared ‘president for life’ by the National Assembly in 1975) more detached from reality, the Neo-Destour Party still retained a degree of legitimacy that state sponsored parties such as Nasser’s Arab Socialist Party (ASU) did not have.

For all his faults, Bourguiba always fostered a private sector as a driver of employment and maintained cordial relations with France and the United States while often serving as a bridge between the west and radical left-wing Arab governments. Tunisia also established close commercial and political contacts with European Mediterranean countries such as Italy.

Had Bourguiba really wanted to be a unique Arab leader, he could have utilized the Neo-Destour Party as a dominant ruling party (instead of establishing a one party state) thereby creating the scope for later political liberalization through opposition parties later winning more parliamentary seats. Instead, he established a regime that eventually resembled-a dime-a dozen type Arab dictatorship.

It was as a near absolute dictator that Bourguiba in the 1970s attempted to mollify and ultimately exploit Qaddafi by canvassing unity with neighbouring Libya. The bizarre upshot of this political dalliance was that the Italian military intelligence established links with the Bourguiba regime which help lead to his deposition in November 1987.

For reasons that are still unclear, Qaddafi was tipped off by Italian military intelligence of a plot against him which enabled the dictator to survive a nearly successful military coup attempt in August 1975. Tentative links between Libya and Tunisia in the 1970s and the role of Italian military intelligence in rescuing Qaddafi led the increasingly repressive Bourguiba regime to rely on this foreign military service for assistance to maintain its position against a growing Islamic movement which, by the 1980s, had been thoroughly crushed.

Bourguiba’s success in crushing Islamic opposition (which had gained strength due to the regime’s corruption) rebounded on him when his prime minister, Zine Ben Ali replaced him as president in November 1987. Although the deposition was ostensibly constitutional, (the president was deposed on the basis of his being able to discharge his duties due to senility), Zine Ben Ali was able to seize power because he was a senior officer in Tunisia’s security forces who had served as interior minister from April 1986 to October 1987 and then as prime minister for less than a month until he became president.

Zine Ben Ali seized power with the support of the Italian military intelligence with the apparent connivance of former Italian prime minister (1983 to 1987) and PSI leader, Bettino Craxi. The Ben Ali government was a seeming improvement on the Bourguiba regime because it broadened the scope for political pluralism by permitting opposition parties. Tunisia’s secular inclined majority (approximately 60% of the population) might have accepted Ben Ali’s semi-authoritarianism as a bulwark against Islamism had it not been for his regime’s corruption.

Links between Tunisia’s elite and Craxi were also reflective of the corruption of the Neo-Destour regime. The granting of asylum by Tunisia to the disgraced Craxi in 1994, despite vehement protests from officials of the Italian state, was reflective of the close links between Ben Ali’s regime and Italian supporters of the former prime minister. (Craxi died in Tunisia in 2000 from diabetes). The links between Tunisia’s elite and Craxi were also reflective of the corruption of the Neo-Destour regime. The Ben Ali regime lacked the requisite capacity to crush anti-corruption demonstrations in March 2011 because they were undertaken by its secular base.

The genuine progress that Tunisia has taken toward democracy was reflected by the succeeding interim government allowing the Nahda Party to re-establish itself in Tunisia to compete in the October 2011 constituent assembly elections in which it won a clear plurality. *Nahda Party leader (and new prime minister) Hamadi Jebali is a committed democrat who has recently formed a coalition government with secular parties and supported the election of Mustapha Ben Jafar of the social democratic Democratic Forum for Labour and Liberties as head of the constituent assembly.

These developments augers well for Tunisia to become a democracy and therefore show the way for future ruling Islamist parties in the Arab world to rule democratically. But then again, despite being ruled since independence by two authoritarian regimes Tunisia has had a long standing appreciation of democracy due to the independence struggle been intertwined with the fight for democratic constitutional rule.

Morocco’s ‘Bazaar’ Transition to Democracy

Another Arab nation that also received independence from France* in 1956 was Morocco. By in contrast to Tunisia which could have continued as a democracy, Morocco was in essence a dictatorship when independence was granted but its elite has survived by adopting democratic procedures which are now laying the groundwork for constitutional democratic monarchy in the Arab world.

Another similarity between Morocco and Tunisia at the time that they received independences was that there was a Moroccan equivalent of Tunisia’s Neo-Destour Party, the Istiqlal Party. However, the Moroccan equivalent of a Bourguiba was the Sultan, and after 1957, the King, Mohammed V! His Majesty reigned from 1927 to 1961. During the Second World War, His Majesty refused to sign an anti-Semitic decree and in the 1940s and 1950s courageously advocated Moroccan independence. Even though His Majesty was ‘deposed’ by the French between 1953 and 1955, the Franco regime in Spain continued to recognize Mohammed V as the legitimate sovereign. This recognition was more than token because Spain then occupied northern Morocco.

As with Tunisia, the French decided to avoid an Algerian type rebellion by coming to an accommodation with a pro-western ruler by granting independence. Accordingly, Mohammed V was allowed to return as Sultan in 1955 and full independence was granted to Morocco in February 1956 by France and Spain. Due to His Majesty’s popularity, the powerful Istiqlal Party did not then insist on elections being held, instead agreeing to serve in the cabinet.

The death of Mohammed V in February 1961 saw the ascension of his son as Hassan II. The new king was no way near as popular as his father and parliamentary elections were held in December 1963. Determined not to be swept away by the Istiqlal Party, Hassan II openly campaigned for royal court backed independents in rural areas. Most of these candidates legitimately won (in that there was no tampering with the ballot count) due to the strength of family networks and covert logistical and organisational support from the royal court and the security services.

Hassan II then ruled Morocco as a constitutional monarch who had the right to politically dominate the country through having legitimately won national elections. This balancing act became too much to maintain and the king after 1967 more or less relied upon the repressive skills of General Mohamed Oufkir as Interior Minister. Oufkir seemed to have consolidated his position as strongman when he crushed a near successful republican military coup in 1971.

But the power balance between Hassan II and Oufkir could not be maintained and in 1972 the latter lost his life after he attempted an abortive military coup. His Majesty survived the 1972 coup by feigning being dead so that he could surprise the traitors by unexpectantly rallying loyal troops. The break with General Oufkir (who lost his life during the coup attempt) helped Hassan II reconcile with many of his rural supporters who had previously been alienated from the corrupt Oufkir.

The king gained a degree of popularity amongst his rural base when His Majesty personally led 100,000 strong ‘Green March’ of 100,000 peasants on the Spanish (Western) Sahara in early November 1975. Since independence in 1956, Morocco had maintained cordial relations with the Franco regime despite Spain holding onto the tiny enclaves of Ceuta and Melilla in northern Morocco. Due to ties between Spain and Morocco, Hassan II and *Prince Juan Carlos of Spain through intermediaries arranged for the Moroccan occupation of the Western Sahara.

(*Prince Juan Carlos was then acting head of state and would formally become king on the 22nd of November 1975 two days after Franco’s death).

The Moroccan takeover of Western Sahara was an important victory for the more or less free world against the then Soviet bloc. Two years previously, the Algerian backed Popular Front for the ‘Liberation’ of Seguia el-Humra and Rio De Oro (Polisario Front) had launched a guerrilla war against Spanish administration of the Western Sahara. The Marxist Polisario Front* was also backed by Cuba which not only wanted to extend Soviet influence in the Maghreb (North West Africa) but to destabilize Spain in the immediate post-Franco period by supporting a debilitating colonial war of ‘liberation’.

(*Ironically, residents in the Western Sahara have more actual political rights as Moroccan citizens than what the Polisario Front’s Sahrawi Arab ‘Democratic Republic’ (SADR) as a government in exile has notionally conceded. The Algerian based SADR is still a one-party state that is vaguely committed to adopting multi-party system in the future).

Under the Madrid Accords of November 1975, Western Sahara was divided between Morocco and Mauritania, with the latter receiving the southern third of the territory. Under the Madrid Accords, Spanish investments in phosphate extraction were guaranteed but royalties to Morocco and Mauritania had to be paid. Capitulating to Algerian pressure in August 1979, Mauritania ceded its southern third of the Western Sahara to the Polisario Front. The subsequent Moroccan military success in overcoming the Polisario guerrillas in this part of the territory was the only instance during the Carter presidency (1977 to 1981) where ground that was taken by pro-Soviet forces was regained.

The Moroccan determination to hold onto Western Sahara was not only due to the desire to exploit the valuable phosphate reserves but also to establish an important barrier which prevented a then Soviet-Cuban aligned Algeria from overthrowing the Moroccan monarchy so that Algeria and Morocco could merge. Independent *Algeria’s determination to unite with Morocco was ironic because the bravery with which Algerians fought for independence from France between 1954 and 1962 prompted the French to grant independence to Morocco and Tunisia in 1956 to prevent the outbreak of rebellion in those two then protectorates.

(*Algerian independence would have been granted earlier and a horrific war avoided had it not been for the bloody mindedness of the Pied Noir (Black Foot) who were French settlers that regarded Algeria as part of metropolitan France. Even though the Pied Noir were instrumental in facilitating De Gaulle’s return to power in 1958, he defied them and nationalist army officers to grant Algeria independence in 1962. De Gaulle understandably felt little sense of obligation to former supporters of Marshal Petain who had tried to use him to establish an authoritarian military backed regime in France).

The three quasi-Marxist National Liberation Front (FLN) regimes that ruled Algeria between 1962 and 1992 wanted to unite with Morocco. This ambition was first manifested in 1963 when there was a brief border war between the two nations. (A lasting cease fire in the ‘Sand War’ was mediated by His Imperial Majesty Emperor Haile Selassie of Ethiopia in 1963).

The gravest Algerian threat to Moroccan independence was however internal through the support that the FLN regime in Algiers gave to Ben Barka (1920 to 1965?). Barka was the leader of the National Union of Popular Forces (UNFP) which was a Marxist party that had split from the Istiqlal Party in 1959. The charismatic Barka was backed by communist Cuba and was regarded as a future leader of a possibly pro-Soviet Algerian-Moroccan union. At the very least, Barka was the prime candidate to be president of a Moroccan republic.

The disappearance of Barka in October 1965 in the French capital caused a sensation in France which led to a temporary severance of diplomatic relations between Paris and Morocco. There is little doubt that Barka was murdered but the question remains as to who killed him? It was claimed by French military intelligence that General Oufkir not only instigated the kidnapping of Barka in Paris but personally killed him. This dark and murky chapter in Moroccan history not only removed a key threat to the Moroccan monarchy and nation but also marked the beginning of the ascendancy of General Oufkir which itself was to end in bloodshed in 1972 which Hassan II narrowly survived.

Hassan II’s regime survived after 1972 through a judicious mix of repression and liberalization. The popular Istiqlal Party was allowed to operate relatively freely in the cities so long as it did not challenge the regime’s base in the countryside. Even in the cities, the king established links with traders in the cities bazaars to maintain an urban base.

This base was needed from the early 1980s to the mid 1990s as austerity measures demanded by the International Monetary Fund (IMF) secured needed credit but precipitated sustained urban unrest. Due to the efficiency of the regime’s security services and chronic divisions within the Istiqlal Party and the UNFP that the king had cleverly instigated, the urban unrest never spiralled out of control. The failure of the secular opposition parties to harness social discontent should have precipitated a strong Islamist opposition movement.

That the above scenario did not occur was due to the close links that Morocco’s Alaouite dynasty (which claims to be directly descended from the Prophet Muhammad) has traditionally had with the nation’s religious establishment and practicing Muslims. These links not only helped prevent social unrest generating an Islamist opposition but have also served as a key popular support for the Moroccan monarchy which helps explains its endurance.

Ironically, the inability of the FLN to prevent or effectively handle the rise of political Islamism since 1988 has caused such internal discord that Algeria is now no longer a threat to Morocco. Libya after 1984 receded as a threat to Morocco when these two nations entered into a nominal but still inexplicable union. Why Colonel Qaddafi initiated this union is still unclear and it was not surprising that it was short lived. The undoubted beneficiary was Hassan II because Morocco gained needed financial aid from Libya and there was a temporary but valuable (from a Moroccan perspective) estrangement of Tripoli from Algeria and the Polisario Front.

Hassan II also demonstrated foreign policy skill in promoting peace in the Middle East. This was most vividly conveyed when then Israeli foreign minister, Shimon Peres (who is now Israeli president) publicly, if still relatively discreetly, visited the king in Rabat (the Moroccan capital) in May 1995. In this regard, the king was similar to former Egyptian president Hosni Muburak in that he was a shrewd wheeler and dealer in the Byzantine foreign policy of Middle East politics.

The Moroccan king in contrast to Muburak never took ‘his eye off the ball’ with regard to domestic politics and was singularly successful in sufficiently liberalizing to ensure the smooth succession of his son, Mohammed VI following His Majesty’s death in July 1999. Co-option of the opposition necessary for political liberalization was eventually achieved by Mohammed VI in February 2008 when His Majesty appointed Abderrahmane Youssoufi prime minister.

Youssoufi had been a moderate leader in the UNFP who was shrewd enough to know that a rapprochement with Hassan II was possible following the death of General Oufkir. This moderate leader’s supporters split from the UNFP in 1975 to form the Socialist Union of Popular Forces (USFP) which implicitly acknowledged the legitimacy of the monarchy and of the Moroccan state by participating in the 1993 parliamentary elections. Youssoufi’s appointment as prime minister was tempered by rural based monarchist parties (which were descended from former royal court backed independents) maintaining a parliamentary majority.

The above cited situation that existed under Youssoufi as prime minister between 1998 and 2002 continues under the current prime minister since 2007, Abbas El Fassi. He is a member of the Istiqlal Party which for years was an opposition party. Similar to the position that Youssoufi was in, El Fassi presided over a government in which the rural based monarchist based parties are coalition partners and have a majority in the parliament.

The monarchy’s successful co-option of a potential republican nationalist party, the Istiqlal Party, and of a party with Marxist Algerian FLN roots-the USFP-and maintaining the political allegiance of many, if not most Moroccan Muslims, are remarkable achievements. As a result Morocco has had an authoritarian government that has subtly and pre-emptively liberalized to gain probable majority acceptance that it is difficult to discern at what point the kingdom became (or is) a constitutional democracy.

Morocco will unambiguously become a democracy after elections are held on November the 25th 2011. Constitutional reforms were overwhelmingly approved in a referendum in July 2011 that clearly place executive power with the parliament. The pro-monarchy rural based parties have united into the Authenticity and Modernity Party (PAM) which in turn has coalesced into an eight party electoral alliance called the ‘Coalition for Democracy’. This coalition includes left-wing parties which one might think would not be aligned with the monarchist establishment.

The major rival of the Coalition for Democracy is a democratic Islamist party, the Justice and Development Party (PJD) which recently won the November 25th 2011 election. The PDJ’s election victory not only constitutes the consolidation of democracy but of Morocco’s constitutional monarchy.

The Iranian Republic: Quasi-Democratic Processes without Democracy

In contrast to Morocco, a strategic Middle East nation whose monarchy ignominiously failed to progress to a genuine democratic constitutional monarchy was Iran. The ramifications of this failure now pose a major threat to world peace due to the Iranian republic’s nuclear programme.

Iran’s nuclear programme is probably the most vexing foreign policy challenge that the Obama administration faces due to the real potential for mayhem that will exist if this republic develops a nuclear bomb. It is ironic that the governments and peoples of most Arab countries probably desire that Israel take military action to neutralize Iran’s nuclear weapons capability. Considering the grave domestic challenges that confront the United States, there is a very strong possibility that Israel will soon take stand alone military action. (Israel has already hacked into and disrupted the operation of the computers at the nuclear facilities).

The real and immediate challenges that confront the Obama administration in relation to Iran’s probable nuclear arms programme is to expeditiously assess whether the Iranian republic will quickly and genuinely pull back from its dangerous course of action. If the Tehran regime does not allow the International Atomic Agency Energy Agency (IAEA) to inspect Iran’s nuclear facilities, then the Obama administration will be compelled to support an Israeli military strike against the facilities.

Ascertaining Iranian intentions is a difficult undertaking for the United States. The Iranian republic previously strung Washington out between 1979 to 1981 during the American Embassy hostage’s crisis, thereby effectively styymying the United States’ capacity to effectively operate as a world power during this period. Similarly, American international power was briefly but still substantially undermined when the then Speaker of the Iranian parliament, Hashemi Rafsanjani, brazenly leaked negotiations between the Iranian Republic and the Reagan administration over secret arms sales to Tehran in October 1986.

As Rafsanjani had cynically intended, the ensuing scandal that emerged from the secret leaking of arms negotiations undermined the Reagan administration but not to the extent that Tehran hoped of there being another Watergate ‘scandal’ (sic). This was due to different domestic political dynamics in Washington in the 1980s as opposed to the 1970s.

Despite the domestic fallout from what became known as ‘Iran-Contra’, there was a relative lack of outrage in the United States when the USS Vincennes accidentally shot down Iran Air Flight 655 in July 1988 unfortunately killing 290 civilian passengers on the mistaken premise that this plane was an Iranian air force fighter. Even though the shoot down was a mistake, it was reflective of an American determination to stop the Iranian republic from winning the First Gulf War (1980 to 1988).

Due to the Iranian republic’s previous record of duplicity, discerning the Tehran regime’s policy intentions and the sincerity of their undertakings is fraught with uncertainty. But Israeli intentions are clear: with or without American concurrence, Israel will undertake military action against Iran if this republic develops a nuclear weapons capacity.

Tehran’s leaders should be aware that there is sufficient support amongst American public opinion to support pre-emptive Israeli military strike action against Iran developing a nuclear weapons capacity which will ensure that the United States will eventually support Israel. American support fro Israel will be forthcoming regardless of the United State’s current economic crisis (which is frustratingly self-inflicted due to the failure to raise revenue by temporarily increasing taxes and cutting wasteful spending to reduce the public debt to GDP ratio).

Strategists within Iran’s republican regime may categorize the United States as a ‘paper tiger’ still inflicted by aspects of the so-called ‘Vietnam syndrome’ which caused the ‘Fall of Saigon’ in 1975. This debacle can be directly traced to the American Congress helping divert military aid earmarked for South Vietnam to save Israel when Egypt and Syria launched the Yom Kipper War Israel in October 1973.

President Richard Nixon (‘RN’) was amazed that Indochina ‘doves’ such as Senator Frank Church of Idaho became ‘hawks’ with regard to ensuring that Israel received emergency military aid (which included a special air lift of military supplies) during the 1973 Yom Kipper War. It was a great tragedy that the American Congress, which thankfully rallied to support Israel in 1973, utilized this support as a pretext to deny sufficient military aid to the non-communist states of Indochina.

The Iranian regime might have believed that the United States is a ‘paper tiger’ that since the ‘Fall of Saigon’ in 1975 can be easily humiliated due to a lack of internal fortitude. That may have been true at the time of the hostage crisis between 1979 and 1981 but, had any of the American hostages been killed, then the United States would have launched a full-scale war against Iran and fought until complete victory was achieved. Such a war would have been undertaken regardless of the then existing strategic balance of power and despite the weakened position that the United States was in during the time of the Carter administration.

The United States is a nation that if pushed, will act on the injunction associated with the symbol of the coiled snake: ‘Don’t tread on me!’ This happens when American citizens are harmed or killed by foreign governments or when American territory is directly or indirectly attacked by another country. The American people know not to trust the Iranian republic with a nuclear weapons capacity that this will be the determinant that leads to the United State eventually taking sustained military action against an Iran seeking a nuclear arms capacity.

The relevant point that now needs to be appreciated is that, if Israel launches an attack against the Iranian republic’s nuclear armament capacity, American support (which could be military) will follow if required. President Obama will lose re-election in a landslide if his administration does not support Israeli military action against Iranian nuclear armament. Similarly, a Republican presidential candidate who does not support Israel over this issue will not win the party nomination.

If the Iranian republic does not allow the IAEA access to verify its claims that the nuclear programme is for peaceful purposes, then Israel will undertake military action. This will in turn precipitate a series of events in which the full might of American power against the Iranian republic will be unleashed as part of the course of supporting Israel out of a justified fear that Iranian nuclear weapons will be used against American allies or even the United States. In contrast to Iraq in 2003, where twelve years of sanctions had pulverized the population, there is a viable Iranian middle class that will be more than ready to fill the vacuum if American military action displaces the Tehran regime.

Hopefully, military action against Iran will be avoided. The Obama administration is taking the correct course by urging Iran to allow the IAEA inspection of its nuclear facilities to bolster the prospects for peaceful resolution in this acutely dangerous dispute. Indeed, there is no need for republican Iran to have a nuclear weapons programme because international conflict over this issue could divert the regime by gaining the overwhelming acceptance and legitimacy of its people by continuing with successful economic reform. In contrast to previous recent history, the Iranian republican consolidation will be based upon economic success as opposed to the nation’s military position.

Republican Iran consolidated as a regime during the Iran-Iraq War of 1980 to 1988. Iraq’s Saddam Hussein believed that because of trenchant opposition to Ayatollah Khomeini from former left –wing Islamist supporters had plunged Iran into turmoil, that an Iraqi victory was a certainty. Furthermore, Saddam believed that there was a good chance that the Iranian armed forces, which were then politically distant from the Khomeini regime, would in the wake of military defeat stage a military coup. In fact the opposite occurred.

The Iraqi invasion galvanized working class support for the republican regime which helped Iran fight the war for a further six years after Iraq had been forced out of Iranian territory in 1982. It is true that there was mutual suspicion between the military and the regime but the armed forces were professional in that they focused on prosecuting the war. As the war progressed, the Iranian military became not only more committed to the regime but eventually a key, if not the main, component in the power structure of the Iranian republic.

The original mainstay of the republican regime was the Revolutionary Guards. These guards started as a revolutionary militia which successfully suppressed popular unrest between 1979 and 1980. During the First Iran-Iraq War, the Revolutionary Guards expanded as a force on the war front so that they almost became as formidable a force as the regular army*. The continued prosecution of the war with Iraq became such a priority for the regime that there was an eventual alignment between the ruling clerical establishment and the regular armed forces.

(* A reason that was cited for the Shah, Mohammad Reza Pahlavi’s fall in 1979, was His Imperial Majesty’s penchant for buying expensive foreign armaments, such as the latest jet fighters. Whatever the validity of this criticism, the armed arsenal that the Shah bequeathed at the very least enabled republican Iran to hold off against a better armed Iraq).

Paradoxically, the war was sustained by the Ayatollah Khomeini being pragmatic by appointing Mir-Hossein Mousavi prime minister in 1981. Mousavi, a professional architect by profession, served as prime minister between 1981 and 1989 due to the staunch support of Ayatollah Khomeini. The Ayatollah protected Mousavi due to the prime minister’s success in very capably managing the Iranian economy which enabled Iran to continue to fight against Iraq.

It was due to the advice of another regime pragmatist, then Parliamentary Speaker Rafsanjani, that Ayatollah Khomeini agreed to a ceasefire in September 1988 to ensure the regime’s survival. Although Ayatollah Khomeini’s objective of conquering (or as he saw it ‘liberating’) Iraq from Baathist rule was not achieved, Iran still came out in a comparatively stronger position than Saddam’s regime.

Due to the challenges wrought by the 1980 to 1988 war, Iran often had to make a virtue out of necessity such that there were surprisingly positive legacies from the war. These included: the emergence of a strong non-oil service sector, becoming more innovative in industrial production techniques and the formation of a capable administrative caste of government bureaucrats. Mousavi’s genius as a self-trained economist also helped the Iranian banking sector to thrive despite persistent inflationary challenges. There were (and still are) problems of unemployment and poverty but the middle class in Iran is larger and wealthier than it was under the monarchy.

The unexpected capitalist progress under the Islamic republic was also surprisingly matched by the emergence of a formidable armed forces that now have tremendous political clout. A contributing factor to the Shah’s fall was that His Imperial Majesty from the early 1960s instituted a complex system of officer rotation that ensured his domination over the armed forces.

This elaborate system rebounded on His Imperial Majesty because the armed forces subsequently lacked the cohesion to resist the 1979 Revolution. Due to the de-politicalisation of the armed forces, only the Shah’s most senior officers were executed as most of the lower ranks of the armed forces grudgingly accepted the new regime. Due to their being no wholesale purge of the armed forces, most officers accepted the growth and the power of the Revolutionary Guards on the premise that they would not be displaced by them.

The contemporary symmetry between the regular armed forces and the Revolutionary Guards is derived from their both having considerable state backed investments in the Iranian economy. To maintain their privileged position in Iranian society, the armed forces/ Revolutionary Guards are now aligned with President Mahmoud Ahmadinejad.

Ahmadinejad was elected president of Iran in June 2005 due to the backing of the Ayatollah Ali Khamanei, who became Iran’s Supreme Leader following Khomeini’s death in early June 1989. The subtle but still clear endorsement of Ahmadinejad by Ayatollah Khamanei helped Ahmadinejad win strong working class support. Furthermore, the role of the Council of the Guardians *in engineering the nomination of the mis-trusted Rafsanjani (who was president from 1989 to 1997) as the reformist camp’s presidential candidate also considerably helped Ahmadinejad’s cause.

(*Under Iran’s 1979 constitution, candidates for electoral office, including president, are vetted by the twelve member Council of Guardians which is composed of six religious leaders appointed by the Ayatollah and six jurists appointed by the parliament, the Majalis).

The new president also owed his election to his support base with the Revolutionary Guards. As a result of this support, Ahmadinejad tended to be strongly anti-American and anti-Israel (if not outright anti-Semitic) to help create a justification for Iran having a very potent armed forces. The current dangerous situation with regard to Iran’s nuclear armaments programme is a direct result of the Ahmadinejad / Khamanei component of Iran’s ruling elite entering into an alliance with the armed forces to maintain their power.

Although the Iranian republic’s status as a democracy is questionable at the very least, there were democratic processes in place until the Iranian armed forces and Revolutionary Guards supported the rigging of Ahmadinejad’s June 2009 ‘re-election’. The Revolutionary Guards subsequent repression of wide scale demonstrations, combined with the counter-mobilization of Ahmadinejad supporters, ensured that the pro-reform ‘Green Movement’ was crushed (at least temporarily) by 2010.

Admittedly, the Ahmadinejad government since its 2009 ‘re-election’ has undertaken beneficial economic reform such as ending fuel subsidies in an oil rich nation. But the point is being reached where an economically competent government with a committed and substantial support base (albeit a minority one) is endangering its nation’s domestic and foreign interests with the nuclear programme. Israel understandably will not risk the development of nuclear weapons by the Iranian republic and a military confrontation will ensue which will very probably draw in the United States in due to its deep commitment to its long term ally.

Tehran denies that it is developing a nuclear weapons capability. That being the case, steps can be taken by the Iranian government to allow the IEAE to discreetly inspect the nuclear facilities and to commence a covert dismantling of the nuclear armament programme. The involvement of a trusted third party such as Turkey (which has a democratic pro-Iran Islamist government and a pro-American military) would be an ideal go-between to undertake the delicate mission of dismantling a programme that officially does not exist.

The Iranian republic is at a crossroads with respect to securing a positive and assured future. Iran since and due to unanticipated ramifications of the 1980 to 1988 Gulf War has substantially economically strengthened as a nation. The Islamic republic has therefore made more progress than that which the Shah valiantly attempted – that is, to utilize the nation’s oil wealth to generate strong industrial and service sectors of the economy with extensive infrastructures, such as an efficient transportation system.

These economic achievements of the Iranian republic could be consolidated by forging still stronger peaceful international trading relations to become a fully fledged First World economy with matching high rates of income per capita that are commensurate with an expanded GDP. Persisting with an unnecessary nuclear armament programme that will, at the very least, lead to international trade sanctions, and at worst, military conflict will be tragically counter productive.

The political ramifications of a discreet settlement of the nuclear armament issue would be potentially positive for the Iranian republic. History has shown that unbalanced political systems that hedge with regard to being democracies due to elites having close links to a bellicose military often implode because of the resultant internal contradictions. (1871-1918 Imperial Germany is a vivid case in point).

Republican Iran does (or did until 2009) have democratic processes which have compensated for considerable democratic gaps to the extent of pacifying public opinion. These processes (such as competitive elections between vetted candidates) often vitally contributed to rational public policy making in Iran. Consequently, the Iranian republic is better placed then most authoritarian or semi-authoritarian regimes (such as Egypt) to make a transition to a full democracy.

In contrast to Egypt’s Anwar Sadat’s experiment with constructed pluralism in the 1970s (by having factions/platforms within the ostensibly ruling ASU run against each other as a precursor to their becoming separate political parties), there is more scope in Iran for future party formation that gains public acceptance and legitimacy. Indeed, the leaders of the Iranian republic made a mistake (or perhaps it was intended) of dissolving the then ruling Islamic Republican Party (IRP) in 1987 and banning all political parties.

The *IRP had been Iran’s Dominant Ruling Party (DRP), i.e. a catch all party that had a de facto near monopoly on power. Due to growing factionalism within the IRP, this party, as previously mentioned, was dissolved in 1987 and a ban on all political parties was imposed. Had the IRP been able to naturally split after the end of the Gulf War in 1988 or following Ayatollah Khomeini’s death in 1989, there would have been more natural scope for regime backed parties to form and to compete against each other.

(*In 1981, the IRP was briefly declared to be Iran’s only permitted party).

Instead, the post-1987 ban on political parties paradoxically gave the Council of Guardians (which vetted candidates who now had to run as independents) more power by preventing the development of competing pro-Islamic Republic political parties. Fissures within the ruling elite were still manifested by limited electoral competition but the scope for genuine organic citizen determination of political processes was too compromised.

Despite the ban on formal political parties, the former Culture Minister, Mohammad Khatami won a landslide victory in the May 1997 elections, having run on a relatively liberal platform which appealed to women and young people. Khatami was backed by the informal Khordad movement but his subsequent power as president between 1997 and 2005 was to be mainly formal as opposed to actual. Disappointed expectations during the Khatami presidency led to massive popular unrest in July 1999 which was violently and effectively suppressed.

The utility for the political elite of the formal ban on political parties was evidenced in 2004 when the Guardians Council banned most pro-Khatami candidates from running in parliamentary elections, thereby helping to pave the way for Ahmadinejad’s election in 2005. As previously mentioned, the engineering of Rafsanjani as the avowed reformist presidential candidate in the 2005 elections was also crucial in ensuring Ahmadinejad’s victory.

(Indeed, it was somewhat unfair that Ahmadinejad’s supporters were allowed to form a formal party in 2003, the Alliance of Builder of Islamic Iran, while the reformists have not been allowed to by the Guardians Council. This discrepancy on the part of the Guardians Council was probably due to their wanting to ensure that Rafsanjani could be a front runner presidential candidate).

Permitting Mir-Hossein Mousavi’s 2009 presidential candidacy probably rebounded on the Revolutionary Guards and the armed forces because the mild mannered but respected former prime minister really won the election. Whether Mousavi is really committed to the reformist ‘Green Movement’ that he notionally inspires is an interesting point of analysis.

Presidential elections are scheduled for 2013. It is not beyond the realms of possibility that limited political reforms could be granted which would have major ramifications. These would include allowing the reformist camp to have a legally registered party as (Ahmadinejad does), instituting poll watching procedures to ensure clean elections and allowing a canvassing of contentious issues in the media such as the re-establishment of diplomatic relations with the United States.

Why Iran could be Religious Version of Turkey

Potential blocks with regard to future political reform would probably stem due to opposition from the Revolutionary Guards and the regular armed forces. However, it should not be forgotten that the Turkish military protects (to the point of staging outright military coups as occurred in 1960 and 1980) and has defended the secular institutions of the Turkish republic (proclaimed in 1923 by Kemal Ataturk), even though Turkey now as an elected Islamist government.

In a similar vein, the Iranian armed forces should allow political pluralism to the extent of allowing the election of governments that they do not really support. The constitutional structures of the Iranian republic are such that there is a range of institutions, such as courts, which can enforce the 1979 Constitution regardless of the orientation of the elected government.

It should not be forgotten that Anwar Sadat of Egypt despatched a high powered political delegation to Turkey in 1975 to study Turkish political institutions so that there could have been an eventual transition to a democratic system in his country. Had this Egyptian statesman not been assassinated in October 1981, Egypt might now be a democracy because he was planning to hold clean parliamentary elections in 1982 following Israel’s return of the Sinai Peninsula that year.

The best hope for political reconciliation in Iran is for procedures to be put in place to ensure that transparent elections are held in 2013 so that Mousavi has a fair chance of been elected president in 2013. As a stalwart of the Iranian republic, Mousavi could undertake the political reforms necessary*so that Iranians can partake in their nation’s political life without compromising the fundamental precepts of the 1979 Constitution.

(*Such as legalization of all political parties, or at the very least, a liberalization of registration requirements for political parties).

A transition to pluralism on the path to a pluralist Iranian republic would be of great benefit to the Middle East because the ramifications of the ‘Arab Spring’ will probably see Islamist parties being elected to government or at the very least joining coalition governments. Therefore the example that Turkey has set (and that the Iranian republic could also set) of Islamist parties operating in pluralist political systems would be of great political value to the Middle East.

Syria: Why Iran Should Stop Supporting a Secular Dictatorship

An anomaly of the Iranian republic not supporting pluralist democracy is Syria is that this effectively means that Iran is essentially a family military dictatorship that is ruling Syria under the ostensible auspices of the pan-Arab Baathist Party. If the regime were to fall (which is looking increasingly probable as more courageous soldiers defect to join with the people), then post-Assad Syria will have Islamist parties. Because religious based parties probably will initially have a Sunni-Shia dichotomy it does not make any strategic sense for the Iranian republic to alienate Syrian Shias, who among other communities are opposed to the avowedly secular Baathist regime.

Indeed it does not make any sense for supporters of the Syrian Baathist Party to continue to back Bashar Assad because he has lost the people’s trust due to his failure to take the chances that he had to liberalize his regime to gain democratic acceptance. The Iranian republic could help its cause both domestically and internationally by calling on *Bashar Assad to resign and leave the country.

(*The best option that Bashar could take would be to quickly leave for and take asylum in Algeria as some members of the Qaddafi family did. The Libyan Revolution is a cautionary tale to dictatorial regimes that miss their chances to exit and bequeath a future political base. Had Qaddafi been smarter, he could have made way for a provisional government headed by his son Saif or a temporary regime in which his family’s interests were represented until elections were held).

A post-Assad provisional government could have anti-Baath Shia representatives in it which would be inclined toward cordial relations with Iran. Such a development would not necessarily preclude a provisional government having Baathist Party officials so long as they are supportive of democratic elections taking place.

The international community’s support for Syrian democracy has been moving and impressive. This is particularly so with regard to the Arab League. Smart aleck commentators have made mention of the fact that most member states of the Arab League are dictatorships. This may be the case but political dynamics are changing in the Middle East for the better so that it is not unusual that Arab governments (even if authoritarian) are broadly supportive of the Syrian opposition. Morocco’s domestic transition to a full democracy is being bolstered by this kingdom’s support for the Syrian people.

Because their nation at the cross roads of the Middle East, Syrians have a reputation for being smart. A future democratic Syria or even one that grapples with the complexities of moving to a democracy would establish precedents for other countries in the region to broadly follow with regard to democratization. The impact of Syria on international affairs to date has been manifested by the negative skill with which the Assad regime has almost singularly frustrated the Middle East peace process. The benefits of having a democratic Syria supportive of the peace progress are therefore incalculable.

The Obama administration is fulling an important role by supporting the Syrian people’s struggle by liaising with the Turkish based Syrian National Council (SNC). This council is composed of a range of diverse Syrian opposition groups opposed to the Assad regime. The SNC seems to be focused on co-ordinating opposition within Syria, garnering international support for their cause and formulating a future provisional government that is broadly acceptable to the Syrian people.

The SNC could make discreet requests to countries such as the United States to enforce a no-fly zone over Syria. Such requests should be assessed by external countries according to their national interest and the inherent practicality of delivering on such requests. However, the Syrian situation seems to be developing in a way similar to Libya, that of external support being provided that is necessary and sufficient because it correlates with considered requests from the opposition.

A terrible future scenario for Syria would be similar to what happened in Iraq in 1991 where the Iraqi people could have freed themselves from Saddam had it not been for the conscious denial, at American instigation, of international air support (as distinct from troop support) for the different communities in Iraq that were then fighting for freedom. The current situation in Syria is one where foreign military air support is not required but should not be closed off as an option if the SNC requests it.

Kurdish Freedom can be Secured by Arab Democracy

Another aspect of the current situation in Syria that is eerily similar to Iraq in 1991 is the situation of the Kurdish minority. Kurdish history is replete with the theme of betrayal and abandonment as different foreign powers sold the Kurds out or played different Kurdish groups off against each other. The Assad regime was cynically adept at supporting Kurdish grievances for its own ends against Iraq and Turkey while suppressing the aspirations of Syria’s Kurdish minority.

The Baathist regime in Damascus between the late 1970s and mid 1990s supported the Workers Party of Kurdistan (PKK). The PKK was (and probably still is despite current denials) a Marxist political party which was of value to the Soviet Union in the 1980s when a PPK guerrilla war against Turkey was undertaken. The complexities of this armed conflict are too convoluted and distressing to cogently overview. It is fair to say that, if it had not been for the statesmanship of Jalal Talabani, the Kurds may yet again have been sold tragically short.

Talabani is the founder and leader of the Patriotic Union of Kurdistan (PUK) who out of necessity has been involved in labyrinthine politics involving wheeling and dealing between Kurdish factions and foreign nations to advance the Kurdish cause. His diplomatic skills were invaluable in saving the Kurdish people in Iraq from possible annihilation in 1991 by securing belated foreign support for the establishment of safe havens in northern Iraq.

Within these cramped safe havens, Talabani helped ensure that there was political compromise between the different Kurdish factions/political parties while also providing refuge and courtesy to Iraqi Arab refugees in territory that was still notionally part of Iraq. Talabani was wise enough to realize that the American led liberation of Iraq in 2003 provided the Kurds with the best opportunity of securing their rights by being integral to a future democratic Iraq. Kurdish support at Talabani’s instigation has been crucial to ensuring that genuine progress in Iraq has been made toward democracy to the extent that the Iraqi parliament elected him president in 2005.

Kurdish support in Syria for the opposition raises also questions concerning the future of Kurdish minorities in Iraq, Iran and Turkey. It should be said at the outset that whatever the quality of democracy is in these aforementioned countries, that none of them will make way to tolerate the establishment of an independent Kurdish state. President Talabani will hopefully be able to use his influence to ensure that Kurdish rights are respected throughout the region while fulfilling his obligations as Iraqi president to protect the sanctity of Iraq’s borders and those of bordering nations.

Democracy in Europe is Helping Hungary Overcome The 1920 Treaty of Trianon

The precedent that President Talabani is setting in Iraq will hopefully set a framework for Kurds in neighbouring countries to not only advance their rights as minorities but in doing so promote democracy in countries where they are domiciled to the point of exercising a strong political influence. The Hungarian people since 1989 have been very successful in utilizing the advent of democracy to address modern historic grievances.

The major focus of Hungarian dissatisfaction until the early 1990s were the ramifications of the Treaty of Trianon that was imposed on Hungary in June 1920. Even though Hungary only gained full independence in 1918, this nation was all but dismembered by the Trianon Treaty. Under this treaty over 70% of Hungarian territory was ceded to the successor states of *Austria, Czechoslovakia, Roumania and what was later named the Kingdom of Yugoslavia. These territorial losses saw Hungary lose over 60% of its population.

(*The cessation of Burgenland to Austria caused a degree of wryly black amusement in some Hungarian circles because this was the only instance of the Allies awarding a territory to a former enemy of theirs based upon the ethnic composition of the region).

A degree of Hungarian redress for the Trianon Treaty has come since 1989 due to the onset of real democracy in the successor states. (Austria which as a long standing post-war democracy that has treated its Hungarian citizens well). The most poignant, powerful and long lasting Hungarian blow against the Trianon Treaty came in December 1989 when demonstrations led by Hungarians in the Transylvanian city of Timisoara precipitated the downfall in Roumania of the hated Ceausescu dictatorship.

The anti-Ceausescu demonstrations in Timisoara occurred when the dreaded Securitate secret police arrive to arrest Rev. Tokes from his residence on the 15th of December. A picket to protect Rev. Tokes was formed not only by Hungarians but also by Roumanians. This defiant picket sparked a general uprising in Timisoara that was supported by the city’s mixed Hungarian and Roumanian communities. Ceausescu badly blundered when he called a central rally in the capital Bucharest on the 18th of December to generate and exploit anti-Hungarian sentiment.

To Ceausescu’s amazement, the crowd who had been dragooned to attend the rally screamed ‘Remember Timisoara!’ which then sparked a violent and widespread revolt against Europe’s most repressive dictatorship. An astounded Ceausescu* and his powerful wife Elena fled the capital and were later captured and executed after a hasty trial.

(* The circumstances surrounding Ceausescu’s fall were a form of poetic justice. In one of the main ghosted biographies that were written for the late dictator, he claimed that he had organised a rally against Carol II in May Day 1939. It was claimed in this fictional account that Ceausescu, as a young communist activist, arranged the infiltration of a hand picked crowd to heckle the king that His Majesty was so unsettled that he was compelled to leave in a huff.

Ironically, opponents within the Ceausescu entourage knowing of the false 1939 story suggested to the dictator that he call a rally in the centre of Bucharest to rally anti-Hungarian sentiment. Although there were defecting Securitate and Roumanian Communist Party (RCP) operatives in the crowd who helped provide the assembled people with the courage to break with Ceausescu, the intensity of their opposition was genuine).

A significant and touching aspect of the 1989 Roumanian Revolution was that a rank attempt to incite racial hatred was crucial in precipitating unity between Roumanians and Hungarians to bring down a detested regime. Indeed it is possible that, without Hungarian and Roumanian co-operation, there may well have been no revolution in 1989.

Due to the previous pervasiveness of the Ceausescu regime’s oppression and the gratitude that most Roumanians felt toward the RCP defectors who were instrumental in overthrowing Ceausescu, it was difficult for Roumania to promptly proceed to a strong pluralist party system that is crucial to democracy. The emergence of the Hungarian Democratic Union (HDU) in the June 1990 elections, as the principal opposition party, was therefore vital in ensuring that a democratic constitution was drawn up. This *republican constitution was overwhelmingly ratified in a referendum in December 1991.

(*In December 1947 a 26 years old King Michael of Roumania was forced at gunpoint to abdicate in December 1947 and depart for exile where His Majesty eventually settled in Switzerland with his wife, Queen Anne of Bourbon-Parma, to live in genteel poverty. Throughout his exile, the king remained aloof from émigré politics.

His Majesty’s main connection to Roumania was through his annual Christmas broadcasts which Radio Free Europe stopped in the 1970s when Ceausescu was the world’s ‘favourite communist’. These radio broadcasts were resumed in 1981 due to the support of the Reagan administration. The king gave great comfort to those who listened to His Majesty by saying in his radio broadcasts that the communist regime would eventually fall and that he subsequently return to Roumania.

The king first tried to return to Roumania in April 1990 after the fall of the Ceausescu regime but was forced back, which sparked demonstrations by mainly elderly Roumanians. His Majesty did return for a one day visit in April 1992 which the government of Ion Iliescu allowed to test the king’s popularity which they knew was growing due to increasing social unrest. After large crowds greeted their king, the Iliescu regime unsuccessfully tried to con His Majesty into running for president to split the opposition vote in the 1992 elections.

When the opposition did win the 1996 elections under Emil Constantinescu, the new government appointed the king ambassador to NATO where His Majesty lobbied for Roumania’s admission to the military alliance and to membership of the EU. In 2000, a deeply unpopular President Emil Constantinescu (who is monarchist sympathetic) declined to run for re-election and his Democratic Convention was annihilated at the polls. Former president Ion Iliescu probably would not have won the run-off in the 2000 elections against the ultra-nationalist Corneliu Vadin Tudor without King Michael’s reluctant but needed endorsement.

Due to the ruling Social Democratic Party’s (PSD) need to keep King Michael on side for the 2004 elections, His Majesty was allowed to permanently return to Roumania in 2001 with some of his former palaces being returned to the royal family. The king now has the official status as a former head of state and has done much to engage with his nation which His Majesty was once forced from. His Majesty has used his improved financial position due to the return of former properties to undertake substantial charity work. The effectiveness of the king’s charity work is such that, opinion polls indicate that while there is 15% support for a reinstated monarchy, over 65% of Roumanians believe that their royal family should have a recognised role in civic society).

The HDU’s impact in contributing to the drafting of Roumania’s 1991 republican constitution helped endow it with a liberal quality which has since helped hold the nation in good stead. The nation’s Hungarian minority have generally been enthusiastic supporters of Roumania joining the European Union (EU), which it did in 2007. The benefit of Roumania’s EU membership for its Hungarian citizens has been that their particular rights and identity have been protected and advanced within an international framework which in turn has helped bolster Roumania’s socio-economic well being and international prestige.

It should be pointed out that Roumania has defied the negative expectation that it could not make such strides in recovering from the disastrous Ceausescu legacy which persists with challenges of there being an underclass that is yet to adapt to a market economy. The reputation of the Constantinescu government (1996 to 2000) is retrospectively being rehabilitated due to an appreciation that this government’s austerity measures helped create an investment and capital base that is now assisting Roumania break with its communist past. The reforms of the Constantinescu government were also crucial in paving the way for Roumania’s entry into the EU.

The Nexus Between International Co-Operation and Domestic Democracy

It is not possible for former communist countries, such as Roumania, to expeditiously overcome all the problems that Marxist Leninist rule bequeathed. However, membership of international organisations such as the EU creates scope for Roumania to address seemingly intractable problems by accessing help on an international basis. The major challenge for all EU nations, particularly the smaller economies within the union, is to ensure that a balance between accessing international support, fulfilling membership requirements and protecting international sovereignty is achieved.

The Arab League is now showing great promise of one day becoming an international organisation in which the economic, cultural and political interests of Arab nations are advanced. This potential is reflected by the League’s support for the Syrian people. Hopefully, the Arab League will one day become as powerful as the contemporary EU by democracy endowing a common sense socio-economic and political purpose in the Middle East that transcends borders. The spread of democracy across the Middle East offers a capacity for minorities such as the Kurds to have their rights protected both domestically and in international forums.

Italy: The Need to Balance International Integration and The Domestic Interest

Post-war Italy was in a situation that future Arab democracies might be in with relation to a possibly revamped Arab League (or Arab Union) which Italy has faced with regard to its EU membership: how to achieve the balance between utilizing the benefits of membership of an international organisation without inadvertedly surrendering domestic sovereignty? This was not an acute challenge for Italy during the Cold War even though the Italian republic had Western Europe’s most powerful communist party.

Indeed, Italy’s political status as a blocked democracy helped keep the DC together as a catch all party and minor parties in coalition, or at least in support, of the ruling party. The June 1983 elections seemed to be the quintessential election result (even though early results indicated a PCI victory which led to celebrations by communists which were ebullient as they were premature) in which the DC garnered 32% of the vote (its traditional base was 30%) and the four centrist parties maintained their respective electoral bases of support. In this regard the 1983 election results vividly indicated the enduring strength of Pentapartito (five party coalition) pattern of government.

The surprising aspect of the 1983 elections was that the PRI defied its drift toward political oblivion by garnering over 5% of the vote. This upsurge in support was due to the prestige that the PRI had gained from their leader, Giovanni Spadolini, serving as prime minister in a DC dominated coalition government between 1981 and 1982. The MSI vote remained constant at 6.8%, which placed this party fourth after the DC, the PCI and the PSI.

A Pentapartito coalition government was formed but with the twist that it was headed by the PSI leader, Bettino Craxi. The PSI leader’s ascension to the prime ministership- a position which he would hold between August 1983 and April 1987, in which he presided over two governments-was due to support from the pragmatic (if not corrupt) wing of the DC led by Andreotti and Arnaldo Forlani.

This inter-party alliance, which was known by the acronym ‘CAR’ that denoted the first letters of the surnames of its three leaders (Craxi, Andreotti and Forlani). The CAR alliance was sufficiently cohesive, that unprecedented cabinet stability was seemingly achieved that had eluded the Italian republic since1953 after De Gasperi scorned the support of the monarchist PNM.

The real reason for the Craxi government’s relative longevity was the coherence of the long standing ties of the Andreotti/Forlani wing of the DC to the PSI, which in contrast to the other centrist coalition parties was bereft of factionalism due to Craxi’s domination of his party. Party corruption usually took the form of the payment of bribes to faction leaders. Bribes were often paid to party operatives at a local government level by contractors to secure tenders and/or gain authorization for building projects.

The dynamics of Italy being a blocked democracy, where the major opposition party was unelectable as an avowedly communist party, ensured the pervasive operation of corruption. Allusions to corruption were made in the press but were never followed through due to the entrenched nature of corruption. The operation of a strong central bank, a technically competent civil services, an excellent employers’ confederation (La Confidustria), a highly unionised workforce (over 60% union membership density), the benefits that Italy gained from being a member of the EU not only ensured that Italy surmounted the corrupt nature of the party system but that considerable economic advancement was still achieved.

Prior to the Craxi coalition, governments were brought down by losing parliamentary votes on key matters such as budget items which were undertaken by secret ballot. The real causes of such votes concerned issue of patronage and due to the confidential nature of parliamentary votes, inner party unity was always maintained because no-one could be certain of who had ‘ratted’. The Craxi government’s amazing success in lasting almost four years was due to the cohesiveness of the CAR parliamentary bloc vote which made it nearly impossible for the parties of the Pentapartito to form a new configuration.

Andreotti’s nemesis in the DC, Amintore Fanfani,* finally managed to bring the Craxi government down in 1987 so that elections were held in June that year. The election results were not that markedly different from those held four years earlier (although the PRI resumed its electoral decline). A succession of Pentapartito coalition governments were formed between 1987 and in 1989 Andreotti returned to the prime ministership to lead a nearly three year long government.

(*As previously mentioned, Fanfani notionally moved from the right of the DC to the party’s left-wing, while Andreotti led a continuing right wing faction as a pragmatic clientistic operation following ‘the opening to the left’ with the admission of the PSI to cabinet in the 1960s).

In a nearly two year interregnum (1987 to 1989), before the CAR alliance returned to power, DC General Secretary Ciriaco De Mita tried to block Andreotti’s return as prime minister. De Mita reluctantly accepted the prime ministership in 1988 because he knew that he that his ‘promotion’ to this would be compel him to give up the position of DC secretary which he considered to be more important than prime minister. This scenario that De Mita feared came to pass in February 1989 with none other than Forlani succeeding the prime minister as DC secretary. With Arnaldo Forlani in as DC it was relatively easy to re-configure the coalition in July 1989 and with Craxi’s support Andreotti became prime minister and held this position until the April 1992 elections.

The Italian republic may have found stability- because the CAR alliance had established a stable system for patronage politics- had it not been for the fall of the Berlin Wall in November 1989. The disintegration of the Soviet bloc caused a corresponding disintegration of a fundamental of Italy’s ‘blocked democracy’, the non-electability of the principal opposition party. The PCI had helped its own cause in July 1991 when this party successfully grappled with the issue that Italians had usually called ‘the thing’, i.e. the party’s name, by officially becoming the Democratic Party of the Left (PDS).

The CAR alliance might have continued its dominance had the DC vote not fallen marginally below its base of 30%. By 1992, the DC was really a conglomeration of nine parties such that the unity of the ruling catch all party was imperilled if its vote fell below the cumulative expected its 30% threshold. The 1992 elections were also noteworthy because the PDS not only failed to supplant a declining DC but its vote fell to 16%! This decline was due to the relative success of the new hardline Marxist breakaway party, Communist Party Re-foundation (PRC) which came fifth with 5.6% of the vote.

The 1992 election results were also a disappointment for the PSI which gained 13% of the vote due uncertainty concerning the PDS’s future. Although the Socialist’s voting base remained intact and they had come third, this party probably lost its best chance of becoming Italy’s second party with the prospect to later win power as an alternate social democratic opposition party. The prospect of the PSI and the PDS later merging was an impossibility due to Craxi’s detestation of the former PCI and their hatred of him.

1992- The Clean Hands Scandal Commences

But, after the 1992 elections, the long term prospects for the PSI became dire due to the outbreak of what became known as the Clean Hands Scandal (‘Mani Pulite’). This scandal in fact collectively referred to a myriad of scandals involving countless instances of corruption by party operatives across the party spectrum*. It was not uncommon for whole city and town councils to resign after having being exposed for corruption and a point was reached that, after 1993, Italy’s prisons were overflowing with criminally charged politicians.

(*The PDS and the MSI were generally exempt from the trauma of the Clean Hands scandal because they had usually been excluded from the politics of patronage.).

The immediate catalyst for the Clean Hands scandal was the Mafia assassinating the investigating magistrate Giovanni Falcone in May 1992. The national outrage that ensued provided another investigating magistrate, Antonio De Pietro, with the impetus to pursue his enquires that became known as the ‘Clean Hands’ scandal.

The assassination of Magistrate Falcone had the immediate political impact of ensuring that Arnaldo Forlani narrowly lost parliamentary election to the presidency in May 1992 because the public revulsion caused by the Falcone assassination resulted in a strong anti-politician sentiment. Consequently, the impeccably honest Christian Democrat, Oscar Luigi Scalfaro, was elected president. Had Forlani been elected president by the parliament thereby securing the continuance of the CAR alliance would have prevented judicial investigations and there would have been no revamping of the Italian party system.

President Oscar Scalfaro’s Courage Founds The Second Italian Republic

The election of Scalfaro as president did not automatically break the power of the CAR alliance as a close PSI ally of Craxi’s, Giuliano Amato(who was free from any taint of corruption) formed a succeeding Pentapartito coalition government in June 1992. However, Prime Minister Amato’s attempt to block further corruption investigations by submitting a decree to President Scalfaro depriving magistrates of their investigative powers led to such a massive public outcry that the prime minister resigned in April 1993.

President Scalfaro’s courageous refusal to sign the decree was crucial in ending nearly fifty years of corrupt rule by party politicians that had commenced with the CLN assuming power following the Allied liberation of Rome in June 1944. Had Victor Emanuel III demonstrated similar courage in 1922 by authorizing the state of emergency to prevent the so-called ‘March on Rome’ ,then Italy would have had the benefits of a democratic constitutional monarchy.

Italy may still have gained the benefits associated with a democratic constitutional monarchy of a stable party system and transparency in the exercise of power had Prime Minister De Gasperi ensured that a fairly conducted referendum on Italy’s constitutional status was conducted in June 1946. Umberto II’s subsequent action in leaving Italy to avoid a civil war also demonstrated that Italy had lost a head of state who would have defended the public good as President Scalfaro did in 1993 by refusing to sign a decree that protected the nation’s politicians from independent scrutiny.

Amato was succeeded prime minister by the former Governor of the Bank of Italy, Carlo Azeglio Ciampi as who formed a non-party technocratic government. The formation of the Ciampi government in April 1993 also marked the end of the rule by party politicians which had commenced when the executive of the Rome CLN assumed power with the liberation of Rome in June 1944. Although no new constitution was introduced, the appointment of the Ciampi government in effect constituted the foundation of Italy’s ‘Second Republic’.

The transition to a ‘Second Italian Republic’ was denoted by political party reconfiguration as opposed to adopting a new constitution. This process commenced in earnest when the DC was routed in local government elections in November and December 1993. The PDS did very well in these local government elections by entering into an alliance with the Greens Party, often providing popular mayoral candidates, most notably Francesco Rutelli, who was elected mayor of Rome.

The runner up in the race for mayor of Rome in 1993 was the MSI leader Gianfranco Fini who used his strong poll showing to transform his party into a ‘post-fascist’ conservative party. Almirante voluntarily retired as MSI leader following the June 1987 elections and helped ensure Fini’s election as his successor. Fini did not have the support of the MSI rank and file to repudiate fascism and he was obliged to make way in January 1990 for the RSI sentimentalist, Pino Rauti.

Rauti’s professed anti-capitalism and opposition to NATO grated with the MSI’s anti-communist middle class electoral base so the party’s vote plummeted in local government elections in Sicily in July 1991 and that he was obliged to make way for Fini’s return as party leader. Under Fini’s leadership, the MSI vote held up as opposed to making new electoral ground. The onset of the Clean Hands scandal helped the MSI nearly double its usual vote in the 1993 local government elections.

Competing Historical Traditions Subtly Revive

The improved showing of the MSI enabled Fini to call a Congress in Rome in January 1994 to form the National Alliance (AN) This conference was the most important attempt since Giolitti’s convening of a party congress in Rome in October 1922 to make the PLI into a secular centre right political party. The October 1922 PLI Congress precipitated anti-Giolitti ‘liberals’ into instigating the fascist ‘March on Rome’. By contrast the January 1994 AN foundation Congress marked the point at which Italian neo-fascism moved toward mainstream liberal-conservatism.

The AN acronym may have been adopted because it was similar to the Italian Nationalist Association (ANI) which was the nationalist conservative party that precipitated the 1922 fascist ‘March on Rome’ due to their connections with anti-Giolitti ‘liberals’. An association with the Italian nationalists emphasized the non-fascist roots of the *Mussolini regime which was subtle but sufficiently distinct to induce MSI stalwarts to move to post-fascism.

The name, the ‘Italian National Alliance’ may also have been adopted for the 1994 Congress to attract conservative anti-fascists because this had been the same name of a monarchist anti-fascist party that had operated in the late 1920s and early 1930s. The first National Alliance effectively came to an end in October 1931 after the poet, aviator and monarchist activist, the amazing Lauro de Bosis, was shot down as he was returning to France, having just dropped anti-Mussolini pamphlets over Rome. From Mussolini’s perspective, liberal monarchist dissidents were not to be tolerated because the PNF regime was too institutionally intertwined with the monarchy.

Contemporary monarchists did attend the 1994 Congress which consequently created the first opportunity for them to viably compete electorally since the demise of the DN in the 1979 elections. The formation of the new AN, was crucial to Silvio Berlusconi winning the March 1994 national elections. Berlusconi’s new party Forza Italia, FI, (which was formed in January 1994) entered into an electoral alliance in the South of Italy with the AN, while aligning with the Northern Leagues (LN) where that party was based (i.e. northern Italy).

Forza Italia’s respective geographic alliances with the AN and the LN were seemingly bizarre because of the stark differences between the respective electoral configuration. The AN, as a substantial continuation of the MSI, was strongly statist and staunchly opposed to any devolutionist reform, which it believed would imperil Italian national unity.

The LN, in vivid contrast to the AN, is effectively a Northern version of the Southern based UQ of the 1940s in that its leadership advocate a minimalist state philosophy to the point of being libertarian. The LN is different from the UQ in that it is not, and never has been an ephemeral electoral grouping manipulated by shadowy forces. The LN was (and is) technically a loose confederation of northern city based leagues. In reality, despite having coherent constituent regional bases, the LN follows the direction of its de facto national leader Umberto Bossi.

Bossi, who comes from the northern region of Lombardy, was first elected to the Italian Senate on a separatist platform in 1987. His attacks on northern taxpayer money going to the south and his implicit anti-migration stance appealed to many middle class northerners who had still voted for the DC or for the centrist parties in the 1987 elections due to the then DC-PCI dichotomy. The post-cold war 1992 national elections saw a surge in support for the LN with swathes of DC voters transferring their support to this electoral confederation.

Berlusconi, 1994: Old Wine in New Bottles

The party that the LN was aligned to in the 1994 elections, Forza Italia, was also an apparent electoral phenomenon. This party, which was named after the chant ‘Forza Italia’ (‘Go Italy’) that football fans invoke when barracking for the national football team (who wear blue, the traditional colour of the House of Savoy) was founded in December 1993 by Silvio Berlusconi. FI was initially based around ‘political clubs’ hastily assembled by Fininvest executives. Although FI substantially ran new politically inexperienced candidates in the March 1994 elections, this new party essentially owed its power to Berlusconi’s connections to the CAR alliance.

Berlusconi was originally a Milan building entrepreneur who established links with Craxi’s PSI in the 1960s. Craxi’s base in the PSI was initially in his home city of Milan which he used to become party leader of the Socialists in 1976 as a compromise choice among that party’s bickering old warhorses. As Craxi ruthlessly consolidated his ascendancy in the PSI, Berlusconi, with the Socialist Party leader’s backing, established the Fininvest media group in 1978.

The CAR ascendancy of the 1980s greatly assisted Berlusconi in transforming Fininvest into a media empire with exclusive control over television and radio stations, newspapers and publishing houses. The fall of the Amato government in April 1993 and the routing of the DC in local government elections seemingly marked the end of the power of the CAR alliance. But the legacy and power of this alliance continued in Berlusconi’s new Forza Italia party which won the March 1994 elections as the major constituent of the Pole of Freedoms (PdL) electoral alliance.

The PdL configuration in addition to the AN, FI and LN also included the Christian Democratic Centre (CCD) and the Union of the Centre (UCC). The CCD and the UCC constituted the respective right wings of the DC and the PLI. The formation of the CCD was politically significant because this undermined the People’s Party’s, (PPI) or Populari to substantially appropriate the CD’s electoral base.

The PPI’s prospects were also undermined by left-wing Christian Democrats who formed the Social Christians Party to run as part of the Alliance of Progressives (AP) which was the rival configuration to the PdL in the 1994 elections. The mainstay of the AP was the post-communist PDS followed by a range of left-wing parties including the Greens, the hardline PDS and incredibly enough the PSI, which had ostensibly repudiated Craxi.

The PdL won the 1994 elections because the FI substantially gained most of the former DC and PSI votes while also benefiting from the strong electoral showings of both the AN and the LN. By contrast, the AP blundered by alienating moderate voters (particularly former DC supporters) by having the PRC within the AP electoral alliance and naively expecting that the discredited *PSI would somehow substantially hold its voting base.

(*The PSI continues in Italy as the ‘New Italian Socialist Party’. This minor party is now aligned to the political right and is dominated by Italian monarchists).

The PPI, which ran in conjunction with the Segni Pact as the ‘Pact for Italy’ came third in the 1994 elections with 15% of the vote. This was a sufficiently strong electoral showing to send a message to the PDS that any future electoral configurations it might form (such as the AP which had garnered 33% of the vote) they would not be able to defeat the right (the PdL which garnered 46% of the vote), unless centre and centre-left Christian Democrats were included.

The first Berlusconi government (May 1994 to January 1995) was less than an auspicious success because the prime minister seemed to be utilizing his position to protect his corporate business interests. Such a perceived self-interest did not go down well with an electorate which were expecting a break from a recent corrupt past. The LN under Bossi refused to join the Berlusconi cabinet but supported the government by helping provide a parliamentary majority.

Sensing widespread public disillusionment with the Berlusconi government, the LN brought the government down at the end of 1994. A new technocratic government was formed in January 1995 which was headed by Lamberto Dini, who had been a senior official of the central bank, the Bank of Italy, in January 1995. The Dini cabinet provided Italy with needed competent and honest government until national elections were held in April 1996.

Fractured Stability: Italy Moves to a Two Political Configuration System

The PDS leadership, learning from the lessons of the 1994 election, dealt the PPI and a swag of micro centre and centre-left DC successor parties and secular centrist groupings into a new centre left configuration that was called the Olive Tree Alliance (L’Ulivo). To bolster L’Ulivo’s prospects for victory, the PRC was excluded from the alliance and Romano Prodi a, former Christian Democrat cabinet minister and chief executive of the IRI, was put up as the Olive Tree prime ministerial candidate.

The PdL went into the 1996 elections as the underdog due to the LN’s refusal to run with this electoral configuration, Berlusconi’s less than sterling previous time as prime minister and high public expectations of a Prodi prime ministership. Although the PdL (which was generally known as the ‘House of Freedoms’) lost the 1996 elections, it did better than expected, winning 37% of the vote, while the L’Ulivo won the elections with 41% of the vote.

The relative narrowness of the 1996 poll was probably due to the fact that it was the first election in Italian history where there was a viable left-right dichotomy. Such electoral divisions are common across the world where there are party divisions broadly based upon labour and capital. Two party systems are also based on a conservative- liberal philosophical dichotomy but these two philosophical opposites can coalesce into a party that is supportive of capital. The 1996 elections did not mark the point at which Italy adopted a two party system but rather showed that there was a move toward the *French party system of having two opposing configurations of parties.

(*The French party system is apparently moving from a two configuration model toward a two party system. The French Socialist Party, the PS, has effectively been a political party since Francois Mitterrand was elected party leader at the 1971 Epinay Congress. The PS has paradoxically consolidated its status as a party since the late French president’s retirement in 1995 by being able to continue on without him.

A consequence of the end of the Chirac – d’Estaing political rivalry is that a stable centre right wing party, the Union for a Popular Movement (UMP) has seemingly been consolidated. However, the UMP is still a hybrid, a political configuration such that it is perhaps premature to categorize France as having a two party system but it can be said that this nation now has the dynamics of one).

To bolster its chances of success the PdL refused to include Pino Rauti’s Tricolour Flame Party in its configuration. In a re-run of the 1973 MSI-DN convention, Fini convened an MSI-AN Congress in January 1995 to dissolve the MSI to thereby transforming the AN into a political party. As at the 1973 convention, Rauti opposed any repudiation of fascism but at the 1995 congress, most MSI delegates voted to enter a new ‘post-fascist’ conservative party.

Rauti subsequently formed the Tricolour Flame Party which garnered less than 2% of the vote at the 1996 polls thereby failing to win a single seat. Despite this party’s paltry vote, it was a determining factor in the PdL losing the April 1996 elections by decreasing this electoral configuration’s aggregate vote.

1996 to 2001, Olive Tree Rule: Setting the Scene for EU Integration

The Prodi government was effectively a coalition between the old Christian Democratic centre left/left and the post-communist PDS. For the former communists, it was the first occasion that they had been in cabinet since 1947 and the very first time that they were in a position of relative political dominance. The major objective of the Prodi government was to integrate Italy into the EU by having Italy join the Eurozone by 2002. Austerity measures were undertaken to meet Euro entry requirements. Even though these austerity measures caused a degree of mild social discontent, there was sufficient bi-partisan support to support Italy to achieve the objective of Eurozone entry.

The objective of Eurozone entry and integration into the EU remained the overriding objective of the ruling Olive Tree alliance despite internal divisions. Non-Italians who took a cursory interest in Italian politics during the 1996 to 2001 period may have thought that Italy was continuing with the usual pattern of political instability with frequent changes in government. In actual fact, the parliament running its full five year (1996 to 2001) term dominated by two electable distinct ideological blocs was crucial to Italy having future political stability.

The major problem with the Prodi government was internal because elements within the PDS wanted to establish their party as the dominant left party rather than establish a future centre-left party with a strong post-DC component. In October 1998, the parties of the PdL supported a no-confidence motion that was moved by the continuing communist PRC.

Although most PDS parliamentarians voted against the no-confidence motion in the secret ballot, they probably tacitly supported it so that a fellow party member could be prime minister. This scenario was plausible because the no-confidence motion was moved by Fausto Bertinotti who was in effect the leader of the pro-PDS faction within the PRC.

The Olive Tree candidate to be Prodi’s successor was Massimo D’ Alema and he received a one vote margin from the parliament to become the new prime minister. *D’ Alema was a member of the PDS and it is certain that members of the post-DC centre left and former centrist parties in the Olive Tree alliance (possibly including future ministers in the new government) voted against his confirmation in the secret parliamentary ballot.

(*D’ Alema was the first prime minister of a NATO and EU country of Western Europe to head a government who was a former communist).

It was still a positive development that D’ Alema won the confidence vote because it helped keep the centre-left (including post DC components) within the Olive Tree alliance so that PDS would eventually merge into a future democratic centre-left party. The probability of this scenario was also increased because there were already substantial numbers of Catholics who had joined the PDS at the discreet urging of Italian clergy. The prospects of such a consolidated future centre-left party were increased by Romano Prodi graciously supporting the D’Alema cabinet which governed for two years between October 1998 and April 2000.

The precarious political position of the D’ Alema government put pay to any notion that the PDS be bolstered to become the dominant centre-left party. To maintain unity within the Olive Tree alliance for the May 2001 elections, D’ Alema made way as prime minister for Giuliano Amato. It was incredible that Amato would again fulfil an important transitional role.

D’Amato (as mentioned previously) had first become prime minister in June 1992 as an honest PSI stalwart who had the backing of the CAR alliance. He had almost irredeemably tarnished his reputation in 1993 by supporting a presidential decree that would have shielded Italy’s politicians from investigation. *President Oscar Scalfaro’s incredibly courageous refusal in April 1993 to sign the decree resulted in Amato’s wise decision to consequently resign thereby ending nearly fifty years of corrupt party rule in 1944 with the CLN and consolidated with the rigging of th referendum to make Italy a republic in 1946.

The second D’ Amato government (April 2000 to May 2001) established the political dynamics for the Olive Tree alliance maintaining unity for the May 2001 elections. The transitionary prime minister had already taken honest non-Craxi supporters from the PSI into the PDS to enhance future prospects to create a future democratic centre- left party. The Olive Tree alliance moved to advance its immediate prospects for election victory by running Francesco Rutelli as its leader in the 2001 elections.

Rutelli had commenced his career with the libertarian *Radical Party, had later joined the Greens Party and was elected mayor of Rome in 1993 in an electoral alliance dominated by the PDS. Even though Rutelli held social policy positions that were not in keeping with the Catholic social teachings, there was an amicable rapprochement between him and elements of the Italian component of the Catholic Church in terms of ‘agreeing to disagree’ that both knew were bound to help create a future centre-left party.

(*The republican left wing of the PLI split away in 1957 to form the Radicals. This new twentieth century party claimed antecedence from the Radical Party which had been an anti-clerical parliamentary party in the nineteenth century with republican tendencies).

There was too much apparent division between the post-communist PDS and post-DC constituents within the Olive Tree alliance that the PdL narrowly won the May 2001 elections with 45% of the vote as opposed to their main aforementioned opponent with 43% of the vote. The post-DC and secular centrist components (including Rutelli) within the Olive Tree had strengthened its position within the alliance by forming a configuration within a configuration: Democracy is Freedom (‘La Margerita’). Although the Olive Tree alliance had lost the 2001 elections, this alliance had in effect become a two-party coalition thereby establishing the groundwork for a future full party merger.

The victorious PdL in contrast to the Olive Tree alliance did maintain the dynamics of a stable political party such that the Berlusconi achieved the incredible accomplishment of being the first Italian prime minister to serve an uninterrupted five parliamentary year term!! Despite this achievement, Italy was internationally derided as an odd, if not unstable, country. This was due to the clear conflict of interest between Berlusconi’s business empire, constant battle with the courts and the intense but still good natured rivalry between a discernable left and right which often staged public rallies.

Due to the political polarization that characterised the second Berlusconi government (2001 to 2006), the 2006 elections were again a closely poised affair characterised by amazing alliances between seemingly implausible allies. The four major components of the PdL (FI, AN, LN and the UDC-UCC) declined to merge into a single party but extended their alliance to include another four parties, two of which were avowedly neo-fascist, one being dominated by the Mussolini family and the other not.

Similarly, the main constituents of the Olive Tree alliance (the PDS and La Margherita) did not merge into a single party but formed an electoral alliance with nine other partes called, L’Unione. The constituent members of L’ Unione encompassed still more centre left micro parties (some of which had CD roots), communist and Greens parties as well as an anti-Mafia and a pensioner’s party. This expanded electoral configuration helped the broad left to keep up with the Berlusconi led right.

L’Unione ultimately had the edge over the PdL because it was led by the widely popular former prime minister, Romano Prodi. In a masterstroke, Prodi came up with the idea that party members of the Olive Tree alliance hold an American style primary to elect the prime ministerial candidate for 2006 elections. Although primaries are inappropriate in a parliamentary system because they undermine party branch democracy, this was then an excellent one-off idea because it would help forge a sense of common party that could later be used to form a future democratic centre- left party.

It was almost a foregone conclusion that Prodi was selected to be the Olive Tree leader for the 2006 elections. His professorial type persona so contrasted with Berlusconi’s seedy image that undecided voters went with L’Unione in the again closely contested election, with the PdL garnering 45% of the vote to the Berlusconi led right’s 42% of the vote. An unexpected determinant of victory in these elections was the vote of overseas Italians with postal votes from Australia being decisive.

The second Prodi government (2006 to 2008) was similar to the first such government and to the intervening Berlusconi government in that the major policy focus was on achieving economic and political integration into the EU. The major political problems of the second Prodi government were essentially similar to the first: the role of continuing communists (i.e. the PRC) in undermining a government led by a post DC centre left politician. The PRC manifested its hatred of Prodi over the deployment of Italian troops in Afghanistan which set the scene for the prime minister’s fall from power in January 2008, although he stayed on as caretaker prime minister until May that year.

The major positive domestic achievement of the Prodi government was the foundation of the Italian Democratic Party (PD) in October 2007. This new party was essentially a merger between the PDS and the parties of the Daisy alliance. The prospects for success for the new party were also enhanced by the PD entering into the anti-corruption party, Italy of Values (IvD) which was founded and led by the former crusading magistrate, Antonio Di Pietro.

Although the PD is factionalized (which Italian political party isn’t?) the democratic structures that the party has in place should ensure party unity and effectiveness. There are ideological divisions within the PD between the secular post-PDS and the post-DC factions but the institutionalized power of the rank and file within the PD deprive faction leaders of the capacity to break away to form new parties. It is a tragedy that only is now one of Italy’s two major parties is genuine social democratic party when opportunities were missed in 1922 and in 1946.

The advance of political moderation within the Italian polity was reflected in the results of the April 2008 elections when, for the first time since 1921, no extremist parties were elected to parliament. Avowedly communist and neo-fascist parties failed to win any seats as did the Greens (who stupidly ran with the continuing communists) because many of their members had wisely entered the PD. For the centre-left of the post-DC, the 2008 elections must have been very satisfactory because of the apparent demise of the hard left*.

(*Hopefully the government of Mario Monti, or another successor technocrat government, will successfully serve until scheduled parliamentary elections are held in 2013 so that extremist parties will not have an electoral base to re-enter parliament. The problem with Signor Monti serving as prime minister is that he is a technocrat who happens to be driven with a super sense of purpose to integrate Italy into the EU when that objective might not now be an appropriate priority in the context of the GFC.

Utilizing the GFC as the opportunity to consolidate Italy into the Eurozone should be measured against the criterion of whether this is conducive to facilitating capital formation for Italian banks so that they can spur urgently needed economic growth.

Former president (1999-2006) and technocratic prime minister (1993-1994) Carlo Ciampi, who is now a Senator for Life at ninety, is probably too old to lead another technocratic government. But hopefully Ciampi will be involved in advising the new government and helping bring in officials, who will prioritize capital formation as opposed to devising austerity measures that are socially unviable due to the GFC. As a former Governor of the Bank of Italy (1979 to 1993), in addition to the other cited positions that His Excellency has held, Ciampi has the requisite political and financial connections to help the Monti government (or another technocratic government) pursue a more lateral policy direction when further Italian integration with France and Germany via the EU may not be what is required in the critically important short- to-medium term).

European integration, since the French government adopted the Delors Plan in March 1983, has been orientated toward achieving economic integration via currency union and a central European bank. The viability of such European integration is practical to the extent that there is Franco-German co-operation. To date, the Benelux countries of Belgium, the Netherlands and Luxembourg have benefited from Franco-German backed economic integration. This has been due to the relative geographical proximity of Benelux countries to each other and to France and Germany, strong industrial capacity, an economically powerful banking sector and (with the exception of Luxembourg) seafaring and port access that is conducive to international trade.

The above cited sources of comparative trading and financial advantage to France, Germany and the Benelux countries are not necessarily transferable to other EU nations with reference to the overviewed combination. Therefore, while a consolidation of the Eurozone and an overriding European Central Bank may be laudable medium- to-long term objectives they should not be immediate priorities for other EU nations in the current context of the GFC.

That is not to say that a financially threatened nation such as Italy should not undertake austerity measures (i.e. spending cuts and tax increases) to cover existing debts but long term austerity is not viable for socio-economic reasons. Italy has a strong industrial base, a high rate of private savings and an excellent banking sector that, combined with financial support from the IMF and/or Japan, there is necessary scope for sufficient bank capitalization to save the Italian economy.

It would therefore be ill-advised for either Germany or France to now push European economic integration that will deny EU nations such as Italy the flexibility to raise (and later repay) the capital they need to facilitate and sustain needed economic activity, employment growth and international trade).

As satisfying as the demise of the continuing communists must have been to the new PD, they still lost the 2008 elections. This was despite the fact that the PD and the PdL garnered nearly the same vote, with both gaining an impressive 37% of the vote. Berlusconi had the advantage though because the LN ,by campaigning as a distinct party, garnered 8% of the vote by appealing to a particularist party base which might not have voted for the PdL per se. As a result of the LN winning the balance of power, Berlusconi was again able to form a new government.

The only really undetermined variable of the 2008 election was that a viable post-DC party (which also includes distinct secular elements), the Union of the Centre (UdC) which won a respectable 5.5% of the vote. The UdC is a seemingly orientated toward entering into an alliance with new party that Fini formed in 2010, the Future of Freedom (FLI).

The PdL itself made the paradigm shift toward becoming a political party when Berlusconi and Fini announced in February 2008 that their respective parties would form a joint election ticket (which was still known as the PdL) for the next elections, which they did. The process of party formation was seemingly completed in March 2009 when the PdL formally became the People of Liberty Party.

In contrast to the PD, the PdL is not a democratic party. This not surprising, because Berlusconi had previously been able to get away with running his FI party without a democratic structure due to his wealth, the logistical and human resource support of his Fininvest Corporation and because most party members adored him.

Paradoxically, the ‘post-fascist’ AN was more democratic than the FI which has actually benefited Berlusconi. This is due to most former AN members who went into the PdL being more supportive of Berlusconi than of Fini. This was because Fini is secular orientated and his stances on issues such as abortion have antagonised former AN Catholic members who are now in the PdL. It may seem strange that disillusioned Catholics are supportive of Berlusconi but this is primarily derived from their ingrained hostility toward Fini.

Fini is probably as politically brilliant as his late mentor Giorgio Almirante was and he has had displayed the same skill in leading a party that he is essentially ideologically at odds with in regard to party rank and file’s outlook and expectations. The AN leader-having previously taken his party from neo-fascism to post-fascism in 1995 and could have helped create a liberal-conservative party encompassing secular and Catholic tendencies. This could have occurred by Fini by filling the vacuum within the PdL that would have followed (and perhaps has occurred) after the mercurial Berlusconi inevitably exited from politics.

A New Fini Led Political Configuration?

Instead, Fini broke with the PdL in July 2010 to form the FLI. Perhaps the foundation of the FLI is part of Fini’s grand plan to create a new centre-right political party. The FLI is open to an alliance with: Bossi’s LN, (whom most former AN members in the south despise), the Movement for Autonomies (MPA), which is a Sicilian equivalent of the LN and the Alliance for Italy (API), which was founded and led by Fini’s former arch-rival, Francesco Rutelli. As previously mentioned, it also seems that secular elements within the UdC (which are descended from the defunct PLI) are orientated toward supporting a new Fini led electoral configuration.

The creation of a new secular Fini configuration may not be a positive political development because it is bound to be dominated by personal factions which will not subordinate their power to a rank and file based party (as the PD is) that is greater than the total sum of its parts. An exclusively secular based centre-right party in Italy cannot be a major competitor for power in Italy because an effective exclusion of Catholics would too greatly diminish its popular base.

It would be a political and social-economic advance for Italy if a centre-right party had a complementing Catholic component (as the PD does) to facilitate different ideas and approaches. Such internal differences can eventually be subordinated by a broad pluralist political dichotomy of capital versus labour within a democratic pluralist framework. Such a division can help drive ideas and political diversity so that national elites can downgrade the value of labour to help them selfishly gain control of resources according to a win-lose approach as is now being attempted in Australia.

Is Australia OK? – Not Really

Australia is a nation that, in the midst of the world’s precarious financial position, is downgrading the value of employment/ labour according to a win-lose rent-seeking approach. Incredibly, this transition is being undertaken at the worst possible time in the context of the GFC. The transition to Australia’s devastating rent-seeking future now depends upon the introduction of a carbon tax and the transition to a super profits tax regime for the mining sector that lopsidedly benefits the three big mining companies and inter-party political interests that support them.

Because of this tax’s very destructive impact the real objective of the two year carbon tax is to destroy a swathe of businesses and thus help pulverize the secondary sector of the economy so that there will be an overdependence on minerals exports. The necessary undermining of the secondary sector of the Australian economy will be facilitated by having the carbon tax run for the two years needed to transition to a rent -seeking economy and not beyond because Power interests such as conglomerate industrial unions and business corporations erroneously believe that, by their having representation on the boards, and/or input of funds into Sovereign Wealth Funds (SWFs), their economic and political power will be entrenched.

The 2008 GFC provided economic and political rent-seeking strategists with the pretext of engineering an over-dependence on the mining sector by squandering the nation’s budget surplus by unnecessary stimulus packages that supposedly averted mass unemployment but have in reality created the ground work for this terrible socio-economic blight. Probably no other nation in economic history has gone from having no public foreign debt to having a debt equalling 25% GDP in less than three years!

Serious questions have to be asked as to why the ALP is pursuing such a detrimental course of action. The rent-seeking elements within the ALP correctly believe that they can win an early federal election which will probably be called in September or October of 2012. The carbon tax will take effect in July 2012 and there will be a massive raft of financial compensation for millions of Australians in the form of tax concessions and direct rebates.

Such electoral bribes may win the ALP an election next year but the cost will eventually be too high and Labor’s electoral base will rightly take out colossal retribution against the party that is suppose to defend and advance their interests. The increased public foreign debt that will accrue from the electoral bribes will only compound Australia’s future economic woes as a rent-seeking nation.

Treasurer Wayne Swan will use the terrible economic situation that the carbon tax will plunge Australia into to press for the adoption of an extensive super profits tax regime from the mining sector and the subsequent adoption of SWFs. Swan has dispensed with the pretence that, having also taken the budget into deficit in record time, he can achieve his ludicrous promise of returning the budget to surplus in 2013.

In the 2012 campaign the federal Liberal leader Tony Abbott (whose continued role as opposition leader is crucial to the coalition supporting rent-seeking) in the 2012 campaign will accurately but disingenuously decry the carbon tax and denounce the compensation assistance as wasteful. This in turn will allow the ALP to run a scare campaign that substantial financial aid will be denied to Australian families if Abbott wins the election. Millions of economically vulnerable Australians will vote Labor due to the ALP scare campaign which will probably ensure that the government is returned or at the very least ensures that the ALP retains its voting base.

Even if Abbott ‘loses’ a second consecutive election for the coalition, he will have a base to continue as Liberal leader due to the apparent vehemence with which he will denounce the carbon tax. The opposition leader, having warned the people of the severe economic ill effects of the carbon tax and that the compensation package will effectively be a case of ‘robbing Peter to pay Paul’, will be more than well positioned to win the next federal election after 2012. The mega landslide that Abbott will eventually win against the ALP could be on a scale similar to the 1993 Canadian elections when the ruling Progressive Conservatives were reduced to two seats! Consequently, Abbott will be in a position to ideologically transform Australia to his specifications.

The disastrous ramifications of the carbon tax will hit the ALP so hard that this party will be confronted with a rout of 2011 New South Wales electoral proportions during the 2012 to 2015 term. In an attempt to ensure the ALP’s survival, the federal government with Abbot’s support will bring in ‘regionalization’ (sic) by which states will eventually be dismembered. This can be facilitated by constitutional recognition of local government-or even traitorous state governments (such a Barry of O’Farrell’s coalition government in New South Wales) ceding GST revenue to new regional local government bodies-that could alternatively be established by state legislation.

(The O’Farrell government is already showing signs of undermining the system for charging mining royalties in New South Wales).

ALP rent-seekers assume that, by proceeding to ‘regionalization’ (sic,) they can take refuge in new powerful local government authorities where factional party interests can more directly exercise concentrated power. It is true that ALP factions will be able to exercise more direct power at an enhanced local government level. But for the Labor Party to remain viable, it has to have trade union membership.

The continuance of trade unions will be threatened by a future Abbott government. The political theatre seen previously this year (2011) at the Liberal Party’s Federal Council when Abbot led it be known that he had voted for Liberal Party president, Alan Stockdale to provide him with a one vote winning margin was politically significant because it marked the re-entry onto the political scene of the defeated candidate Peter Reith.

Reith will never re-enter parliament and probably not hold elected office in the Liberal Party. Bu this does not concern Reith because he has a critical mass of supporters in the Liberal Party and in business and employer associations and academia that are now gaining a sense of co-ordination and critical direction from Reith’s effective return to political public life to pursue an anti-union/ anti-employee agenda.

These Reith- inspired industrial-political networks will have the necessary capacity to effectively advise an Abbot government on how to pursue de-unionising strategies. Considering decreased employment levels due to the legacy of a carbon tax and the disrepute that the ALP will be held in, particularly by their former voting base, it will be an accomplishable task by an Abbott government to destroy Australian unionism.

The Minchin Model: The Way of the Future?

The ideological settings and direction of a future Abbot government will not be primarily determined by Peter Reith but by former Liberal Party South Australian Senator Nick Minchin. He has always considered himself to be a ‘conservative’. It is true that there is probably no senior Liberal who has as developed an ideological outlook and sense of strategic capacity to achieve his objectives as Minchin but his ‘conservatism’ is of a win-lose category when it comes to employee rights.

The former senator may not be conversant with ‘voluntarism’ but an Abbott will bequeath an Australian version of this concept that conforms to Minchin’s ideological outlook. In the British context, voluntarism has referred to the utilization of shop-steward-led rank and file unionist activism. Voluntarism has also had a long standing American meaning as it has referred to individuals and communities enhancing the public good without government involvement.

It is probably the American version of voluntarism that might have inspired Minchin. But Minchin’s type of voluntarism entails a society in where there is not only minimal state involvement but an accompanying minimization of full time employment. It goes without saying that that there is no scope for unions if an Abbott government establishes a Minchin inspired ideological regime.

‘Voluntarism’ in a Liberal Party context has already been manifested by Minchin advocating a primary system of pre-selection under which party branches would be at best an optional extra. An absence of party branches-or a denial of their role to pre-select candidates and meaningfully contribute to the formulation of party policy-will lead to party oligarchy which will consolidate the power of rent-seeking elite.

The prerequisites for a Minchin model are already being set by the ALP. The ill-effects of a carbon tax in pulverizing businesses in the secondary sector of the economy will consolidate patterns of precarious employment. Ultimately, the power of capital under a Minchin paradigm will prevail in an economy where there are low levels of full-time employment.

‘Capital’ under a Minchin model will refer to the power of big corporations, as opposed to small and medium sized businesses. The carbon tax will have already done the job for rent-seeking Liberals in ensuring that capital defers to big business by having destroyed small to medium businesses over the two years of the tax’s anticipated operation. It will be big corporations that will be represented on SWFs along with industrial conglomerate unions (which will eventually be dispensed with from SWFs) and it will be through these funds that economic and political power in Australia will be determined.

The consolidation of Australia’s future rent-seeking elite will also be engineered by having economically vulnerable Australians politically activated to support Tea Party type parties: i.e. in avowedly social conservative political parties/organisations that by focusing on social issues divert supporters from protecting and advancing their economic and industrial interests.

The hatred that too many economically vulnerable Australians will have toward the ALP and the Greens due to the ill-effects of the carbon tax will help drive the so-called ‘True Believers/ Howard Battlers’ either to the coalition or to *Lasch type parties, such as the purported Democratic Labor Party (DLP). There is a distinct, social conservative voting base in Australia that can be harnessed by ‘conservative’ strategists to ensure that the ALP at the very least does not regain power for a very long time. This could mean that the ALP will eventually have to reconfigure into a new party and it is plausible that the hard left of the Labor Party could eventually split and merge with the Greens.

(*Christopher Lasch, 1932 to 1994, was an American political scientist who recognised the inherent social conservatism of the lower middle class and working class people. So-called ‘conservatives’ who appreciate Lasch’s insights have debased these insights by deliberately manipulating the voting of many economically vulnerable people to the detriment of their actual economic and industrial interests).

The operation of a Lasch political strategy has already been manifested by the activities of the ‘conservative’ Sydney based radio broadcaster Allan Jones. He was the keynote speaker of the anti-carbon tax rally/truck convoy in Canberra in August 2014. Although this rally was deemed by federal government ministers and the media to be a failure due to relatively low attendance, in fact this August rally was a complete success for the Minchin Liberals.

The relatively low numbers who took part in the August rally helped instil a sense of security in ALP parliamentarians to proceed with the carbon tax while helping establish a sufficient base for an avowedly socially conservative protest movement to expand after the carbon tax is passed. Frustratingly, Minchin Liberal backed organisations, such as the purportedly pro-state rights Samuel Griffith Society, will generate popular support over issues such as the maintenance of state mining royalties and protection of agricultural land from mining. However, anti-state premiers such as Barry O’Farrell will deliberately canvass such issues to both bolster pro-state organisations and to prepare the groundwork for rent-seeking.

Even without the Minchin Liberals effectively applying a Lasch strategy, the ALP is already helping to facilitate the Minchin model by adopting a carbon tax. Indeed, Minchin previously helped set the scene for the carbon tax when his climate change scepticism was utilized by him and his supporters to help depose Malcolm Turnbull as Liberal leader in late 2009. High powered political skill was displayed by the Minchin Liberals in deposing Mr. Turnbull. A manifestation of this skill was the way in which coalition front bencher Joe Hockey, a supposed supporter of the then opposition leader, split the Turnbull party room base to crucially ensure Abbott’s stunning victory.

As shameful as Malcolm Turnbull’s deposition was, (particularly because the opposition leader had secured prior party room approval to negotiate an ETS with the Rudd government), it was sinister that the Minchin Liberals colluded with the Greens to precipitate a change in Liberal Party leader. Although Minchin is a climate change sceptic, the Greens leader Bob Brown is a climate change cynic. This is reflected by the fact that, even after Mr. Turnbull was deposed, an ETS still could have been passed into law had the Greens supported the necessary legislation in the Senate. The passage of such legislation would have subsequently precluded the introduction of a carbon tax.

The Greens blocked the ETS legislation so that the current carbon tax law (which will take effect in July next year) could be passed. The profound political and economic change that the carbon tax will cause for Australia may substantially advance the power of the Greens but the socio-economic ramifications may latter rebound on them. The economic destruction that rent-seeking will bring will result in decisions being made that environmental treasures such as Kakadu National Park have to be mined out of economic necessity. But, then again, whoever said that the hard left of the Greens were ever genuine environmentalists?

If the hard left of the Australian Greens were really genuine environmentalists, then they would have supported an ETS similar to New Zealand’s which is genuinely giving the environment the benefit of the doubt. As a matter of economic and indeed environmental justice, it is wrong to tax producers who lack the capacity to lower their carbon emissions-which is what a carbon tax will do. An ETS is fairer and potentially more effective than a rent-seeking carbon tax because large emitters, who do not have the capacity to reduce their carbon emissions, can buy carbon credits from producers that achieve carbon reductions, thereby leading to a net decrease in carbon emissions.

But then, rent-seeking is inherently unfair because it is by definition concerned with gaining more pieces of the pie for existing stakeholders rather than growing the pie. Australia might have struck the balance necessary to insulate against rent-seeking had there been a synthesis between the positive aspects of the Costello legacy and the positive achievements of the Rudd-Gillard government.

The positive aspects of the Costello legacy were that Australia’s foreign debt was paid off, a new non-inflationary revenue stream was created via the GST and far-sighted prudential controls helped ensure that the service sector of the economy was strong. These positive accomplishments of the Howard-Costello era were counter-acted, to the point of negation, by its draconian anti-employee industrial relations agenda as manifested by the Work Choices (sic), 2006 Act and by then Prime Minister John Howard’s relentless anti-states agenda.

The election of the Rudd ALP federal government in October 2007 could have ushered in a golden age for Australia. An abundant surplus was bequeathed and there was a total absence of public foreign debt. The passage of the Rudd government’s Fair Work Australia legislation in 2009 re-introduced a pluralist industrial relations system along with the prospect of increased economic activity being engineered through union/employee involvement in enterprise bargaining.

But Australia’s golden age was not to be because the rent-seeking elements in the Liberal Party that had politically destroyed Howard have worked in collusion with similar elements in the ALP to coerce the Gillard government into ultimately pursuing a rent- seeking agenda. This is despite the acute dangers of rent-seeking to the Australian economy in the context of the GFC. The recent passage of the carbon tax through parliament is testament to the strength of such inter-party collusion in pursuit of gaining political and financial control of Australia’s mineral resources which will destroy the nation economically but politically help clear the way for the adoption of the Minchin model.

That the Minchin model will eventually apply to Australia is a virtual certainty due to the 2011 parliamentary passage of the carbon tax. As a result of the legislation, Prime Minister Gillard will be erroneously regarded in the future as a political leader who sold her nation out. If history was accurate, an overview of Julia Gillard’s leadership would indicate that her actions were positive when she was in control of circumstances. This was evident, when as deputy prime minister, Julia Gillard instigated the passage of the Fair Work Australia legislation in 2009 which re-established a pluralist industrial relations system after the coalition’s anti-employee Work Choices (sic) 2006 legislation. As education minister, Julia Gillard also left a positive mark by promoting transparency in school assessment thereby providing students in government with the leverage to receive quality teaching.

By contrast, Tony Abbott will be regarded as a maverick leader who eventually earned the people’s trust to win government by relentlessly resisting detrimental socio-economic policies such as the carbon tax. The reality that Abbott was crucial in compelling Prime Minister Gillard to adopt rent-seeking policies, such as the carbon tax, will probably never be apparent.

Tragically, Abbott will not only have secured the facilitation of detrimental policies that he avowedly opposed but will still reap the colossal political benefits of their application. Due to the ALP’s subsequently weakened position, a Prime Minister Abbott will have the requisite skill and capacity to remould Australia in accordance with the Minchin model.

A defining aspect of ‘voluntarism’ under the Minchin model will be that rank and file membership branch democracy will be at best an optional extra. Having crucially helped set the scene for the Minchin model by passing the carbon tax, the ALP is now contemplating to effectively dis-empower its membership at a branch level by moving to a plebiscitary/primary system. Such a transition might seem an advancement of party democracy but the reality will be that a minority of members will vote when mobilized to do so by factional heavy weights, thereby consolidating a transition to organisational oligarchy.

The down grading of ALP party branch democracy will help a new party oligarchy exercise power at a new regionalized tier of government as state governments are dismembered after the Labor Party wins re-election in 2012. For reasons that have already been outlined, the shift to ‘regionalization’ (sic) will also be conducive to political oligarchy and rent-seeking.

It is true that party democracy in the ALP is wanting but such inadequacy is symptomatic of a broader malaise- the lack of rank and file commitment to party branches. People have to be prepared to give up time and effort to participate in party branches. Why would citizens join ALP branches if member pre-selection rights (which are exercised in conjunction with central panels with union representation) are to be denied?

These issues of ALP structural reform will be vigorously debated at the Labor Party’s 2012 Conference (which could be moved forward to 2011). Whether more people will join ALP branches and participate are determinants that can not be engineered from above. But the ALP needs always to be there as a branch based party so that people can join the Labor Party if a Work Choices industrial type regime is inflicted on a long term basis. At the very least, the preservation of a branch structured Labor Party will provide a framework for later involvement in politics to resist rent-seeking.

The soon to be held ALP National Conference will debate the issue of uranium sales to India which could be the trigger to re-activate a Gillard-Rudd leadership struggle. The point that leaders of the ALP will hopefully appreciate is that since election to government in 2007, they have in one way or another been manipulated both inside and outside their party toward pursuing a rent-seeking agenda that will eventually clear the way for the adoption of an anti-labour Minchin model. Let the next ALP National Conference be the point at which the Labor Party breaks free from the confines of an external agenda being foisted on it instead of taking another step in consolidating rent seeking.

The Need for Positive Creative Destruction

‘Creative destruction’ is certainly in vouge because technological change is now destroying more jobs than it is creating. The socio-economic ramifications of this lag in the context of the GFC could inaugurate creative destruction that (in contrast to Schumpeter’s positive conceptualization) will actually be very destructive. The need for nations to have viable socio-economic and political systems that are aligned to societal needs and expectations is particularly acute in the context of the contemporary GFC.

Russia is the prime example of a nation that almost adapted to the need for change in 1917 but failed to do so with devastating consequences for the world. Similarly, Italy almost transitioned to a viable political and socio-economic regime in 1922 but was diverted by the rise of fascism. Ironically, whether Italy in 2011 continues to forge its own destiny might help determine if other countries such as the United States, Australia, Britain and Japan, if not the world can develop systems that provide a framework for effective re-adaptation in the context of the fundamental challenge of the GFC.

Dr. David Bennett is the Director of Social Action Pty Ltd.