European crisis no laughing matter

The person who has emerged from the electoral carnage to hold the greatest leverage in the post-election period is comedian and TV star Beppe Grillo, well known for his anti-establishment views.

Grillo leads the Five Star Movement which attracted about 25% of the primary vote and vaulted his party into political prominence.

It was estimated that his final campaign rally in Rome attracted 800,000 people.

While it appears unlikely that Grillo's party of protest, as the single largest party in the lower house, will support either of the competing coalitions to form government, it raises the prospect of further elections with no guarantee of a break to the deadlock.

This situation could easily be dismissed as business as usual for Italian politics, if the stakes were not so high.

There are concerns that the political instability could spread from Italy to other parts of Europe, including Germany.

The rise of protest parties such as the Five Star Movement could encourage other parties to adopt similar stances in other European nations.

At a recent political rally of the German Social Democratic Party, a candidate for Chancellor, Peer Steinbrueck pointed to the political situation in Italy as a challenge for all of Europe.

Nervous German politicians have observed the rise of the protest party SYRIZA in Greece which advocates the tearing up of any agreements for austerity measures imposed by the European Union.

The fear of European leaders more generally is that protest parties will steadily increase in popularity to the point of forming government, leading to the risk of radical responses and the abandonment of any budgetary restraints.

Austerity will be last year's story. If the measures advocated by these protest parties are taken to taken to their ultimate conclusion, there would be a default in some countries on the sovereign debt incurred by former governments.

The Eurozone would be in crisis, as nations faced the spiraling costs of borrowing, leading to economic collapse.