The Spanish general election on 20 December delivered the most fragmented parliament since the country’s transition to democracy, with the People’s party and the Socialist party suffering unprecedented losses to two new political forces on the centre and on the left – Ciudadanos and Podemos. While this had been widely expected, what was not what was that neither of the two ideologically compatible combinations of ‘traditional’ and ‘new’ political parties – PP and Ciudadanos, or PSOE and Podemos – would on their own have the numbers for a parliamentary majority. The country faces unprecedented political uncertainty that is ultimately in the hands of the PSOE to resolve.

With a formal national governing coalition still highly unlikely given Spain’s political culture, two distinct minority scenarios emerge as the most probable. The PSOE could acquiesce to the formation of a centre-right minority government, by abstaining with Ciudadanos in the investiture vote to elect a PP prime minister. Alternatively, the PSOE might attempt to lead a fractious leftwing alliance with Podemos as well as a number of smaller nationalist parties. Failure to reach agreement with the right or the left will lead to early elections in the spring, which would polarise the electorate, squeezing the PSOE and likely delivering an equally inconclusive result.

At a time of increasing political fragmentation and volatility among the electorate, the PSOE faces a version of the same dilemma that many of its centre-left counterparts elsewhere in Europe have had to resolve: whether to accept a government led by its traditional rivals on the centre-right, as in Germany, or attempt an unprecedented alliance with parties further to its left, as in neighbouring Portugal. But with an additional layer of complexity; Spain is a relatively new democracy that has not yet achieved a consensus about what sort of country it wants to be, and its politics operate not just on a traditional left-right axis, but also on an additional centralism/independence dimension, ranging from parties that seek to limit the level of autonomy of Spanish regions, to others whose raison d’etre and outmost priority is independence for their corner of Spain.

A leftwing alliance, while perhaps finding common ground on social and economic policies, would face insurmountable differences about the conception of the Spanish state. It would include Podemos, a party that is not only snapping at the PSOE’s heels, but also supports holding an independence referendum in Catalonia and elsewhere, as well as parties interested first and foremost in secession, both positions that are anathema to most Socialist voters and party officials. There is also little to suggest that Podemos would be interested in propping up a PSOE government, and is not instead trying to sabotage such a deal by setting red lines that the PSOE cannot meet in order to force them to prop-up the centre-right, bringing the party closer to its objective of replacing the PSOE as the main force on the left. Any type of compromise with its historic political rival the PP, even if it falls well short of a formal coalition, would be highly problematic and be seen as a betrayal by a significant section of the Socialist electorate; the PSOE will be well aware of the fate that befell its allies in Greece. The PSOE, a party now at the centre of this new political environment, is firmly stuck between a rock and a hard place.