"...few would have expected that Portugal, of all places, would be where a socialist party would enter government for the first time, but this misunderstands a number of factors, first among them the moderate influences on Portuguese socialism, and Iberian socialism more generally, due to the Proudhonist tradition of Spanish (and, by proxy, Portuguese), radicalism.
With the exception of Russia, Spain and Portugal had spent much of the 19th century regarded (if not outright dismissed, as in Napoleon's huffy comment that "Africa begins at the Pyrenees") [1] as Europe's impoverished, autocratic backwaters, countries that had peaked at the height of the Age of Discovery and, particularly in the wake of the collapse of their colonial empires, broken polities running on fumes economically and fueled by nostalgia, kept gripped tight by the firm hand of the Church and landed aristocracy. Both had been gripped by violent wars between political liberals and conservatives, with Spain's dance with personalism and instability concluding with the Glorious Revolution of 1868 led by moderate and progressive nobles and military officers who imposed a constitutional democracy with clearly delineated powers and invited in a new royal family, the German Hohenzollerns, to sustain it. While this experiment in Spanish democracy had been highly imperfect and indeed faced many of the same institutional problems that the Bourbons before had, particularly in rural areas, it nonetheless had delivered an internal stability that Spain had not experienced in decades.
Portugal, conversely, had never suffered from quite the decadal debacles of Spain and reformed more gradually under the Braganzas, but by the end of the 19th century was regarded as one of Europe's financial basket cases, frequently suffering defaults on her British-held debt and unable to maintain her vast and expensive African empire, and with the country increasingly run by two tired, revolving parties of the liberal and traditionalist right, resembling a closed oligarchy which became associated with not just the Church and nobility but the entire concept of monarchy itself. As such, the 1912 revolutions had nearly struck in Portugal, and the 1916 debt default had led to the King's abdication and the seizure of her African territories by Britain and Germany, an act that served to destabilize European politics and helped lead to the Central European War.
What both countries shared was a relatively small industrial base (much more so an issue in Portugal than in Spain) and a radical tradition that had been fundamentally anarchist as early as the 1870s and had always associated republicanism as an end to itself, particularly the appeal of anticlerical opposition to the Church's foundational role in a monarchical system. As such, bourgeoise radicalism for educated, urban middle classes sustained itself much more so than working class agitation, which was far more limited, and often steered by these bourgeoise radical progressives, who themselves rejected socialism as gauche. The revolution would not come from the labor movement in a place like Portugal, in other words, but rather from the literati. This posed a problem for middle class figures who found all these ideas fine in theory but started to balk once the extent to which their fellow republicans sought to reorder an already-fragile state became apparent, and also for the Socialist Party of Portugal, a relatively small though quickly growing outfit which was already badly split between its moderate faction and its syndicalist faction, particularly after the 1907 death of its longtime leader and co-founder, Azedo Gneco. [2]
Luis II, the Portuguese King, was determined to make significant changes to Portugal, and not just in light of his narrow personal interests of the survival of the monarchy. [3] Luis had been educated in Portugal, but he was thoroughly Anglophile in a way others in his family were not, in part out of genuine personal affinity for the country and in part thanks to his British wife, herself a granddaughter of Queen Victoria. Though the marriage had been initially negotiated, it had been sealed out of true affection, and Luis was an honest, loyal husband to his wife, whom he doted on especially with the knowledge that formal, conservative Lisbon was not always to her liking. Queen Patricia's influence was clear - she encouraged him to pursue his interests in painting, geography and writing - but she had become unpopular with the Portuguese street after the "British betrayal" in which Austral-Africa was lost.
Luis was thus on a mission to restore the prestige of the monarchy, and also undo the tremendous cultural, economic and political stagnation of Portugal that had begun under his grandfather and namesake and continued under his father. As Britain was a country of great stability and wealth, and a successful constitutional monarchy, Luis looked to London as an example, and even though he knew that he would fall well shy of the United Kingdom, if he merely arrived at something approximating Hohenzollern Spain, he would have a successful reign. As such, when he called elections for June of 1918, they were the first elections called of his reign and thought to potentially be the first genuinely open elections in Portugal's history, with the Renovator and Progressist parties having all but collapsed.
In many ways, this was a dangerous gamble on the part of Luis, for the largest party in the country, by far, was the Republican. The "Crime of 1916," as Portuguese referred to the Malcolm-Jagow Agreement to split up Austral-Africa, had reenergized what had before 1912 been a flagging group losing popular support (or at least not gaining any). [4] Republican paramilitaries operated largely undeterred across much of the Lisbon area, in particular the Carbonaria, led by the secretive Manuel Buica and which had nearly successfully assassinated the king two years earlier in the wake of Malcolm-Jagow. Figures of the radical anticlerical left such as Afonso Costa gave long, stemwinding speeches across the country where they advocated for the abdication of the King and the imposition of a Republic; even fairly conservative figures such as Antonio Jose de Almeida had joined the call, as had opportunist figures such as the retired general Sidonio Pais, whose ideological orientation was often hard to entirely deduce. The Republicans were, crucially, not an illegal party - in his efforts to pursue a genuine settlement on the questions facing Portugal and give the 1918 elections a legitimacy that the old duopolistic oligarchy had not and could never, Luis would leave no group banned from the polls, a decision that suggested, at least to Republican leaders, that Luis would abdicate in the event they were to triumph. The stakes, in other words, could not have been higher for Portugal, and only brewing crises in the Belgian Congo and Hungary distracted Europe from the potential of the first successful republican revolution - this one by way of democratic elections rather than popular armed revolt - since the French Second Republic in 1848.
The problem for the Portuguese Republicans, however, was that their support was a kilometer wide, but only a meter deep. Their leaders were intellectuals and academics, composed of disillusioned career politicians, journalists, lawyers and artists, people clearly more comfortable in Lisbon's tony cafes near the Praca do Comercio than in the small, close-knit villages of rural Portugal. It was a party of literati in the Western European country with the lowest literacy rate, a party that relied on lodges of freemasonry to organize rather than the town square or the Church parish. In its near-total rejection of traditional Portuguese culture in a highly conservative and traditionalist country, the Republican Party - especially figures such as Costa - essentially declared to much of the population that they intended to rule them as they saw fit, not govern with the consent of the masses.
In contrast, the small Portuguese Socialist Party did anything but. As outlined in previous chapters, one of the central questions of socialism in the 1910s was a simple one with a deceptively complex answer: "Who is socialism for?" For Portugal's socialist leader Manuel Luis Figueiredo, that answer was simple: it was for the material benefit of the working class. For many of Europe's particularly radical socialists and syndicalists, revolution was the end itself; for the more moderate brand of democratic socialism that emerged in the Iberian Peninsula, the revolution was one means, perhaps a necessary one, but the end result of tangible material impact for organized labor was always to retain her primacy. Costa, Pais, and others campaigned largely in boroughs where they were already likely to do well, preaching to the masses in promising the intoxicating rush of revolution and reorder; Figueiredo, by contrast, kept his focus on Lisbon's canneries, Porto's port distilling houses, and textile mills, organizing workers of small but dedicated labor unions into "electoral cadres" and doing the hard work of electoralism with an eye towards influencing the final result.
The 1918 elections were thus muddled, returning no decisive result other than a fundamental shift in Portugal's electoral landscape and heralding, at least for a moment, a Portugal that could actually function as a true democracy. The Republicans were the largest party, winning over a third of the seats in the Parliament, but the Costa faction was notably weaker than the Pais faction. The second-largest party was, in a surprise, the Catholic Center, a party of lay organizations and moderate-to-conservative voters in the north, especially Porto, as well as the rural interior, led by the reformist law professor Antonio Lino Neto, and after those two groups followed Figueiredo's Socialists and the rumps of the Progressists and Renovators. The old oligarchic parties pledged to support Lino Neto, and so it was he who looked likeliest to form a government, but even then he lacked the full support of the Parliament; it was then that Figueiredo was surprised to receive a summons to the Lisbon Palace, where he was called into an audience with the King.
Luis was alarmed by the relative success of the Republicans, though heartened they had shot themselves in the feet and that the syndicalists of Manuel Ribeiro had rejected electoral democracy entirely and thus made themselves for the time being irrelevant. The meeting was thus part of his efforts to extrapolate exactly how tolerant of monarchy Figueiredo was, and if he was somebody who could support a Lino Neto government. [5] The choice for Figueiredo here was monumental: if he collaborated with Lino Neto, he endorsed the perpetuation of the monarchy rather than supporting a Republican regime that would quickly seek to abolish it, but with Pais and his nationalist, positivist conservative ethos ascendant amongst Republicans alongside the anticlerical zeal of Costa, he was unsure that the material benefits he hoped to deliver his constituents who had just fought to give their small trade unions a seat at the table would be realized.
"Who is socialism for?" In that moment, Figueiredo came to the conclusion that it was as much for the subjects of a monarchy as it was for the citizens of a republic, and more confident that Lino Neto would pursue a course similar to paternalist Catholic statist regimes like France or Austria, he told Luis that for a price, such as Cabinet ministries, a veto on policy and political nominations, and the further legalization of trade unionism and their incorporation into the daily life of Portugal, he would not just support but "participate with enthusiasm" a Lino Neto government. Luis thought the demand high, but he was not willing to test Figueiredo's openness to joining a government led by Pais or, worse, Costa.
With that, in June of 1918, Europe's first "Blue-Red" government (or "purple regime") was formed, a transactional bond between conservatives and social democrats in opposition to liberals and radicals. Like most Blue-Red governments, it would not be harmonious, and it would not last long, but Portugal was the first innovator in such a Cabinet, and the success of a targeted, disciplined and cabined social democratic campaign that could co-exist with monarchy did not go unnoticed elsewhere in Europe, particularly in Germany and Spain..."
- Socialism and Europe
[1] Or Naples, if you ask certain people in Northern Italy
[2] You can see shades of this dynamic iOTL - it was not the largely irrelevant socialists who drove Portuguese Revolution or who ran the First Republic, and in Spain, the PSOE (as well as Ferrer's anarchists!) were usually more moderate than many of the bourgeois figures and factions in the Second Republic.
[3] Or himself, considering how things ended for him in OTL 1908!
[4] Joao Franco never getting into power and a successful Pink Map buys the Braganzas way more time and prestige, basically.
[5] Lino Neto was himself ambivalent about monarchy, iOTL arousing some controversy with conservatives when he declined to advocate or agitate explicitly for his return, though it was the anticlerical Republicans who really detested him.