Last weekend’s Italian general election is a watershed event in the political development of Europe.

The point man for the European financial elite, Mario Monti, suffered a humiliating defeat and could not form a workable government with his ally, Pier Luigi Bersani of the Democratic Party. This is a major blow to the austerity policies of the European Union and the German government. Commentaries predict a new eruption of the euro crisis.

The problem for the ruling class is not so much Beppe Grillo and Silvio Berlusconi, who are now in a position to block any government decision in the Senate. While somewhat unpredictable, both men are bourgeois politicians who defend capitalism and are prepared to support brutal austerity measures. The problem is the opposition of the Italian people, who have decisively rejected a policy that brings them nothing but poverty and unemployment, while the financial elite enriches itself in a shameless fashion.

Italy is not the only country where such resistance is emerging. Across Europe, workers are exhibiting growing militancy, seeking to defend themselves against a social counterrevolution aimed at wiping out all of the social gains won over the previous 70 years. In Bulgaria, demonstrations against exorbitant electricity prices have brought down the government. In Greece and Spain, strikes and protests against the austerity measures of the European Union are assuming increasingly radical forms.

Over the past fifteen years, the European financial elite has mainly relied on the services of social democratic parties and the trade unions and their pseudo-left defenders to slash workers’ living standards and satisfy the financial markets’ hunger for profit.

Tony Blair in Britain, Gerhard Schröder in Germany and Lionel Jospin in France carried out austerity policies at the beginning of this period. After the 2008 financial crisis, José Zapatero in Spain, José Socrates in Portugal and George Papandreou in Greece continued and extended these policies. They carried out attacks against workers, pensioners and the unemployed that were unprecedented in Europe since the 1930s.

The trade unions collaborated in these social attacks, suppressing popular resistance and dissipating opposition by means of toothless protests. Pseudo-left groups criticized austerity measures in words, while in practice supporting the social democrats, and—in the case of Communist Refoundation in Italy and the Left Party in several German states—participating in their governments.

Social democratic leaders responsible for the social attacks were unseated due to the unpopularity of their policies. They handed over power to conservative governments that continued the social counterrevolution. When the latter faced mounting opposition, the social democrats returned to power to continue the same right-wing policies.

This was the game plan for the election in Italy last weekend, but it failed to come to fruition.

Monti ruled for thirteen months without any democratic legitimacy. Having been installed in power without the benefit of an election, he initiated unprecedented social attacks. He called early elections when polls predicted a clear majority for his own list and the social democratic camp led by Bersani. He hoped to achieve a stable parliamentary majority for his austerity policies.

The closer the election approached, however, the faster this majority melted away. The disastrous consequences of Monti’s policies became clearer by the day. The Italian economy is in a deep recession. It has become virtually impossible for young people to find a job. Pensioners are sinking into abject poverty. Low-income families are burdened by high taxes.

The bankruptcy of the official “left” enabled a right-wing demagogue such as Berlusconi and an unscrupulous pseudo-populist such as Grillo to profit from opposition to anti-working class austerity policies that were supported by and identified with the social democrats. But Berlusconi and Grillo have no answer to the social crisis. There are few illusions that Berlusconi is anything other than a right-winger, and time will soon dispel illusions that exist about Grillo.

The class struggle will increasingly assume more militant and open forms. European politicians have responded by publicly stating that they will not accept the electorate’s will as expressed in its vote against the austerity policies of the EU. The most blatant statement in this regard came from European Commission President Jose Manuel Barroso.

Commenting on the Italian election, he declared: “The mistake now would be to cave in to populism. We must now ask the question: Should we define our economic policy on the basis of short-term electoral considerations or by what is required to lead Europe on the path of sustainable growth? For me the answer is clear. We should… not yield to immediate party political considerations.”

In other words, the people can vote however they choose, but it will have no impact on state policy. We will stick to the social counterrevolution. Similar statements were made by other politicians and media commentators.

European ruling circles will react to Monti’s electoral disaster by increasingly turning to authoritarian methods of rule and the forcible suppression of resistance to their reactionary policies.

Workers and young people must prepare by drawing the lessons of the bankruptcy of the social democrats, the trade unions and their pseudo-left defenders, and organize themselves independently. The pseudo-left groups such as Communist Refoundation in Italy, the New Anti-capitalist Party in France, the Socialist Workers Party in Britain, SYRIZA in Greece and the International Socialist Organization in the US represent wealthy strata of the middle class whose income and social status are closely connected with the capitalist state. The more militant the resistance of the working class, the more they will move to the right.

The most urgent task now is to build a new revolutionary leadership of the working class to prepare for the coming struggles.

Social and democratic rights can be defended only by reorganizing society on a socialist basis. The major corporations and banks must be expropriated and placed under democratic control. Production must be organized according to the needs of society and not the greed for profit. At the heart of this perspective is the establishment of workers’ governments and the United Socialist States of Europe.