I wanted to remake this awesome scenario by
, and so here it is!
Bits of the backstory are OC, the rest is taken from LoreC10's scenario
I didn't back up a proper story, so the scenario goes a little like this:
A: the Soviets intervene in southern Italy and the western Allies break out on northern Italy from France. The Soviets occupy a "zone" of Italy which resembles the furthest control by the Red Army just as in Germany. This becomes a communist regime just like the other Warsaw Pact nations. I don't know how this could happen, but let's keep it for the sake of the scenario.
B: a civil war breaks out just after the end of WW2 in Italy, just as it happened in OTL with Greece, in 1947 (communist north vs monarchist south, it is considered as the first proxy war of the Cold War). Communists supported by the USSR win in the south, they join Warsaw Pact, yadda yadda. This could be more likely.
bonus: the USA snags Corsica as a "reverse Cuba" in the final stages of WW2
After choosing one of these starting points, the Democratic Republic of Italy (Repubblica Democratica d'Italia) or DRI is officially set up and running in 1951. As a full-fledged member of the Warsaw Pact, it gest protection and recognition from the USSR. Ruggero Grieco, the country's first leader, starts asking Stalin for an official return of the Julian March to the DRI, stating that it would be a thorn in the side of the Federal Republic of Italy, FRI, up north. So, in return for this political change and "for the division of Italian people" (official reason), Grieco asks back the Adriatic lands taken from Yugoslavia after the war, to be part of the DRI: Stalin accepts.
End of June 1951: the terms of the agreements are communicated to other nations of the Warsaw Pact, everyone see it as a great thing. Excluding Tito, and Yugoslavia refuses to give up freshly conquered lands, so higher tensions grow between Yugoslavia and the USSR.
However, southern Italy is strategically too important for the global cold war which is taking shape, and the USSR increases pressure on Yugoslavia to convince Tito to give back what Grieco demanded.
November 1951: an agreement is reached between Stalin, Grieco and Tito: Yugoslavia will give up the Julian March, the DRI will grant the Slavic minority protection, and consequentially, Yugoslavia will annex Bulgaria as its 7th republic. Bulgaria is forced to accept. Finally on November 21st 1951 the Treaty of Belgrade is reached, and the territorial changes will be effective on January 1st 1952. With this treaty, Yugoslavia and the DRI will collaborate for mutual defense. NATO countries don't recognize the treaty, and tighten their alliance with the FRI.
In 1954 the European Community is founded, and the FRI is a founding member.
Meanwhile, southern Italy knows a very strict dictatorship which declares a ruthless war to Mafia and all the other organized crimes using methods, such as the death penalty for the guilts, that leads to high social tensions.
For the rest, the history of the Cold War is, apart for this important deviation, the same: a lot of threats but no action "thanks" to nuclear weapons. In Northern Italy peace and "armony" are restored, the Marshall plan and the EC lead to the economical "boom" of sixties, the boom begins in the same years and with the same dynamics of our timeline.
The DRI is employed in fighting Mafia, and this action takes all the period that runs from 1952 to the beginning of the 1970s, this temporal blink of around a decade, from (around) 1960 to (around) 1970, makes many people from southern Italy, especially ex-Mafia but not only, abandon the DRI, as emigration is allowed to everywhere. the favorite destinations are the Americas and northern Italy, A period of stagnation both in economical and demographic fields follows. Finally, mafia is defeated or mostly neutralized, many of the mafia people have emigrated, some of them are killed by the socialist regime, and a little part, having lost all their power, leave the criminal life and become normal citizens.
The way to the economical growth is now open. Together, alimentary and war industries lead the DRI to an economical boom in the second half of the 1970s. Population, decreased a lot, starts to increase again. People who are coming back from the Americas had a contact with liberal and democratic societies and, even though the government demands them, in exchange of permission of entry, not to mention those new ideas, it is inevitable that those ideas spread in southern Italy.
1989: the communist block is falling, the socialist regime is shaken by popular revolts. Lacking exterior support, the DRI falls in December 1991, as the barriers in the split cities of Rome and Gorizia are torn apart by the people, just like in Berlin. Talks with the FRI lead and finally on April 25 1992, symbolic date coinciding with the date of the liberation in WW2, the Treaty of Rome is signed, and Italy is reunited. The new state will be a federal parliamentary republic, on the German model; the regions of Lazio and Friuli-Venezia Giulia, as well as the cities of Rome and Gorizia, are reunited, great celebrations are organized in Rome, the new capital city, for the signature of the reunion of Italy.
1991-1992: Italy takes the Serbian side in the Balkan Wars and pushes to create a free, peaceful and democratic federal state in Yugoslavia. Albanian regions are given back to Albania in 2006 and Yugoslavia joins the EU in 2007 (Italy is already in, the reunification has the same effect of Germany as for the EC)
1995: Corsica is set free by the USA since there is no more point in having it after the fall of Communism, and joins the EU in 2004
Italy is now (alt. history) a well balanced state under economical and demographical point of view in the European Union, 2008 economical crisis hits it less then in our timeline (as much as today France).
well that was quite a bit of a journey