In August 1983, Bettino Craxi became Italy’s first Socialist prime minister — but it didn’t herald a triumph for socialism, or even for his Partito Socialista Italiano. Craxi is today most infamous for destroying that hundred-year-old party in a corruption scandal that resulted in him fleeing to Tunisia to avoid jail time. He also played a decisive role in the rise of his ally Silvio Berlusconi, whom he licensed to build a private TV empire that soon conquered Italian public life. But for labor, Craxi’s most important legacy was his role in dismantling the scala mobile (“escalator”) —  a mechanism that topped up workers’ wages in line with inflation.

On Valentine’s Day 1984, Craxi announced what he called a divorce: a four-point reduction in the index. It led to a protracted battle culminating in a June 1985 referendum, instigated by the opposition Italian Communist Party (PCI). This posed defining questions in a country with proud traditions of organized labor. Was it true that double-digit inflation — then also visible across all major economies — owed to workers’ pay being too high? Who should pay the short-term costs of “modernization” — and who should decide who would pay?

The main resistance came from the PCI’s supporters in the CGIL union. It staged a million-strong protest in Rome on March 24, 1984, with Communist leader Enrico Berlinguer brandishing a copy of party daily l’Unità headlined “ECCOCI” — Here We Are.” This campaign was a show of the party’s still-vast mobilizing strength but also its limits; in the referendum, the PCI-led “no” side took 46 percent, failing to repeal the measure. But the struggle also highlighted the tensions among different categories of employed workers — and the difficulty in rallying a majority based on wage demands alone.