European crisis no laughing matter

The economic and political landscape in Europe is developing some disturbing fault lines.

The long-suffering Italian public must be wondering when a stable government will be formed to oversee the process of guiding their nation out of the mire of its sovereign debt crisis.

Italy does not have a long tradition of single party majority government, with a succession of volatile coalition governments that have struggled to serve full terms, and 39 Prime Ministers elected since World War II (some serving more than once). Instability has become the hallmark.

One of the longest serving Prime Ministers, Silvio Berlusconi served from 1994-95, 2001-06 and 2008-11 and it took a series of scandals in his personal and professional life for Berlusconi to be replaced by Mario Monti in late 2011.

Monti was described as a "technocrat" who would use his authority to drive through the reforms that the paralysed Berlusconi government was unable to achieve.

In practical terms, this largely meant agreeing to the austerity measures demanded by the European Union and in particular the German government of Angela Merkel.

Similar measures have been deeply unpopular in Italy, Greece, Spain, Portugal and other parts of the Europe Union.

Opponents of the measures argue that austerity increases unemployment and depresses economic activity.

Conversely, proponents of austerity argue that unsustainable levels of government debt will not be cured by even more debt and that radical steps are required.

Italians are facing the deepest recession in decades, with unemployment of more than 11%.

The spectre of more austerity threw a cloud over the recent elections, where inconclusive results have plunged the nation into a political crisis.

Berlusconi failed to achieve the necessary votes to return to the Prime Ministership, yet no other candidate appears likely to be able to form government.