From the outset of the legislature, the situation of political deadlock was obvious. PCI had, by all accounts, won its bet, winning an unprecedented share of the vote and depriving Craxi of any possible majority without its support. On the other hand, it did not have the means to impose its agenda on the other parties.
The most natural alliance, in such circumstances, would appear to be a PCI-PSI coalition. However, the old "brother parties", who had fought together during the Civil War and spearheaded together the reconstruction efforts, had never been more hostile to each other. Craxi was determined: his party had made significant gains in the election, and he was certain he would find the votes to convert his decree into law in this legislature. But for Berlinguer and his party, fully reinstating the Escalator was a precondition to any coalition agreement. Emboldened by their electoral triumph, the party was unwilling to make any compromises on the issue that was the centerpiece of their campaign. The personal animosity between Craxi and Berlinguer had also grown extremely strong, as the February decree was perceived as a treason.
Skillfully, Craxi publicly made several offers for government formation to PCI, all of which had as a condition support for converting the escalator decree into law. The offers remained fairly vague about the proposed pro-growth and pro-working class measures, but were generous in terms of cabinet positions for PCI members, and Craxi also offered to leave Prime Ministership in favor of some other PSI figure (with Cold War tensions heating up again, a PCI Prime Minister was unthinkable). However, the PCI remained compact in its opposition. Negotiations went upside down on June 11, when Berlinguer, aged 62, suddenly died of a cerebral hemorrhage soon after delivering a passionate speech. His dead plunged the "communist people" into sadness and dismay. Alessandro Natta was chosen a couple days later to replace him. Natta adopted the same uncompromising attitude, and negotiations were stalled throughout the summer.
Craxi, still holding on as acting PM throughout the crisis, decided once again to pursue his own goals. Despite the lack of a recognized government, he managed to convince the other parties to resume the legislative agenda, arguing about economic urgency. The parliament thus proceeded to convert the Escalator decree into law. With support from PSI, PDP, PLI, most of the Radicals and enough from DN, the cuts were made permanent by mid July. This only further infuriated the Communists and definitely doomed any possibility for an agreement - but it was already clear no government was going to come out of this legislature.
Soon after the passage of the law, President Pertini, who heavily disapproved of Craxi's bold and defiant attitude while lacking parliamentary legitimacy, dismissed him and once again appointed Giovanni Spadolini as a caretaker. He then proceeded to swiftly call for new elections, hoping to finally end the government crisis. The elections were to be held in September.
List of parties:Proletarian Democracy (DP) Still a far-left marxist party which denounces the PCI as traitors and accomplices of bourgeois forces. It has taken a major hit and been reduced to a minor force, but retains a vehemently radical rhetoric.
Italian Communist Party (PCI) The party has been brutally shaken by the sudden death of its charismatic leader Enrico Berlinguer. It has managed to find a new leader in Alessandro Natta, but has not yet clearly defined its new strategy for the upcoming years. Its rhetoric has somewhat radicalized, with Natta vehemently denouncing the PSI's treason of the working class.
Italian Socialist Party (PSI) Craxi's party is banking heavily on the voters' fatigue about political instability, and the need for a strong, decisive governance. Craxi is asking Italians to give him a strong mandate to reform the country, restore economic growth and preserve the social safety net. He is also stressing the need for an electoral reform and a few institutional changes, so to create durable stability, and promises that PSI will work in that direction with other parties.
Radical Party (PR) Still propounds its vehement message of change, progress and liberty, and denounces the increasing corruptness of political parties and the dominance of shady deals. It hopes to ride on public discontent over the parties' inability to find an agreement.
Progressive Democratic Party (PDP) Left without its old leader Aldo Moro, PDP has suffered a complete collapse and was reduced to a minor political force. Its presence in government negotiations has been marginal. Still, its new leader Spadolini has once again been called to lead the caretaker government, and the party hopes to benefit from its appeasing figure in times where government stability is much needed.
Italian Liberal Party (PLI) The PLI has been largely kept out of government negotiations, which mainly concerned the left side. The party is still led by Zanone and still has an economically liberal and pro-austerity message.
National Right (DN) Once again, the party of conservatives, nationalists and other hard-right-wingers. Its attitude toward economic policy is not clear, with a mixture of free-market ideology and populist leanings.