By Barry Moody
ROME (Reuters) - Five years after he won one of Italy's biggest postwar election victories, Silvio Berlusconi is dragging his own party towards destruction by a mixture of indecision and refusal to withdraw gracefully.
The man who triumphantly dominated Italian politics for 17-years before he was humiliatingly driven from power a year ago, is in steep decline, beset on all sides by problems ranging from his business empire to his scandal-plagued personal life.
Anyone reading newspaper headlines about the flamboyant 76-year-old billionaire could be excused for feeling dizzy.
His flip flops from one position to another, sometimes in the space of a day, have torpedoed attempts by his hapless protégé Angelino Alfano to revive their People of Freedom (PDL) party, and frustrated his supporters as they struggle to reduce the scale of almost certain defeat in an election next spring.
"He wants to go back, then forward, then back again," said exasperated PDL moderate Franco Frattini who was foreign minister under Berlusconi. "This indecision is a problem for the party".
"You would be better off talking to a psychologist than a political scientist," said Professor James Walston of the American University of Rome. "It is about what you do with a wealthy old man who refuses to step down. It's a personal problem. This is like Dallas without the guns," he told Reuters.
Berlusconi's party seems close to splitting into two or three groups from a pro-European centre to radical right wing, undermining any chance the centre-right might have of clawing back credibility after their support dropped to less than half the 37 percent they won in a huge election victory in 2008.
Berlusconi has repeatedly hesitated about whether he will stand as leader in the election, whether the PDL should hold polls to select a candidate and whether he wants to dump the party he created in 2007 and launch a new one.
He has also confusingly veered from proposing Monti lead a new administration to threatening to bring down his government.
"He created the PDL and now he has enough remaining power to destroy it because he has been so hesitant in deciding what to do. Probably he has already destroyed it," Professor Gianfranco Pasquino of Johns Hopkins University in Bologna told Reuters.
"At this point the centre-right is fundamentally doomed."
Berlusconi, weakened by scandals including revelations of alleged "bunga bunga" sex parties with aspiring starlets and call girls at his palatial homes, stood down last November as Italy tottered on the brink of a Greek-style debt crisis.
He was replaced by respected technocrat Mario Monti who has restored investors' faith in Italy and averted catastrophe in the euro zone debt crisis.
For many months after, a pale and shaken Berlusconi left office to the jeers of baying crowds, he remained in the background as Monti imposed tough austerity measures to cut Italy's debt. The PDL, in a grand cross-party alliance, gave essential parliamentary support for these measures.
Then after weeks of rumors and false starts, Berlusconi stepped back into the limelight in September, attacking Monti and vowing to repeal a key housing tax.
Since then it has become customary to open the paper and find that the media magnate has changed his mind yet again. In the past few weeks he has gone from inviting Monti to head a grouping of moderates in a new government to threatening to "pull the plug" on him and excoriating his economic policies.
In a scathing front page editorial in Italy's top paper, the Corriere della Sera, on Friday, respected commentator Sergio Romano said Berlusconi was creating a vacuum in Italy's centre right, which he united under his charismatic leadership in 1994.
"Instead of striving for the survival of his creature, he seems to have no other polar star than himself," Romano said.
The spectacle of the PDL tearing itself apart contrasts sharply with the resurgence of Italy's centre-left, whose polls this month to select a candidate for the elections it looks certain to win have garnered powerful positive publicity.
Even the centre-left is worried about the centre-right chaos, which it says unbalances the mainstream political system and opens the door to a dangerous challenge from the populist 5-Star Movement, led by Genoese comic Beppe Grillo, which has overtaken the PDL to run second in opinion polls.
FEAR OF ANTI-ESTABLISHMENT FORCES
Lapo Pistelli, a senior official in the centre-left Democratic Party (PD) told Reuters they feared ending up as the only mainstream party, surrounded by populist forces ranging from the right wing of the crumbling PDL to Grillo's movement.
"What is needed is a contest between the centre-right and centre-left. We are apprehensive about what is happening in the centre right," PD deputy leader Enrico Letta told Reuters.
"The increased vote for Grillo is a result of the collapse of the PDL," he said.
Frattini, who wants to bring back Monti after the election, says many PDL voters are among the nearly 50 percent of Italians who say they will abstain or are undecided on how to vote.
"We lost half our votes. They are remaining at home because they do not see what they want to vote for," he said.
Berlusconi threatened to dump the Monti government in October, immediately after he was convicted of tax fraud. A verdict is expected in January in the sensational "Rubygate" trial in which he is charged with paying an underage prostitute and abusing his office to get her freed from arrest.
Earlier this month five women who attended his parties for aspiring showgirls told a court he was still giving them thousands of euros a month.
Also this month, Berlusconi's Mediaset broadcaster posted its first quarterly loss, hit by recession and competition from Rupert Murdoch's Sky Italia.
Berlusconi had been expected on Thursday to announce Forza Italia 2.0, a relaunch of his original political party, but the decision about what will happen to the PDL has again been put off, until next week.
Pollsters SWG said on Friday such a new party would poll around 9 percent, compared with 14.3 percent for the existing PDL and 30 percent for the centre-left PD. [ID:nL5E8MU7OP]
"Nobody can understand where we are and where we are going...the troops have abandoned the trenches," said a despondent Frattini.