We could have a finlandized Italy, moving towards the Unaligned Countries after 1956.
Makes sense.
However, I think that civil liberties will suffer quite a lot in the Red Forties and Fifties: even if Christian Democrats are somewhat appeased, the Gedda wing (Civic Committees) is likely to team up with the far right to fight back "Bolshevism", and we'll probably see some heavy hand there, maybe under the guise of "anti-fascist epuration", using the post-war laws. Rome city council elections could be a definite hot point, if the Pope goes on with his idea of a christian-liberal-monarchist-fascist coalition against commies, De Gasperi resists him and a split in the DC occurs.
Hmm, again sounds very similar to Mexico under the PRI - but the PRI did allow the right-wing party the PAN to operate (and the PAN is similar to DC) - in a few cases the PAN were the "loyal opposition".
If the right wing of the DC is banned along with the rising MSI and monarchist groups to "defend democracy against reactionary forces", what will the DC do ? Accept Togliatti's pleas and support the government, effectively leading to a Czechoslovak, Eastern German, Polish or Yugoslav situation as our Agrarian Party, or staying in the opposition and menacing civil disorder to defend parliamentary democracy, thus probably making again Italy a dominant-party State (with the People's Front in charge) up to the end of the Cold War ?
In the latter case, could an alt-Mani pulite investigation also occur, since I could probably assume that something like Tangentopoli would still happen - especially if the merged PSI/PCI becomes entrenched into society and rely on the Mafia and similar organizations to survive.
There's also the question of the small parties - the Liberals and the Republicans. The question with them is how they would fare under this new system.