State of the union: The Italian Republic turns 150 this month but this is a nation at odds with itself

This month the Italian Republic will be 150 years old – youthful, as countries go. But as the birthday approaches, it seems to be generating more ambivalence, or even hostility, than joyful anticipation.

The avuncular head of state, President Giorgio Napolitano, has called on all Italians to join the party. But elsewhere there is apathy, or worse; the province of Bolzano near the Austrian border, led by the Teutonically named governor Luis Durnwalder, has already said "nein" and announced its intention to snub the festivities.

Opposing him, Italy's defence minister, Ignazio La Russa, is ordering his countrymen to put on their party hats. There are even plans to close schools and offices on the big day, 17 March. La Russa, a bruiser with a voice like the possessed child in The Exorcist, was part of the old neo-fascist National Alliance party and probably expects a nationwide show of patriotism – even though it doesn't exist.

Across the cabinet table from him is the government's Northern League coalition partner, which would rather build a wall between the north and south of the country than celebrate the day Italy was unified.

And if you stop people in the streets, from Naples to Milan, and ask what they think, the chances are they'll reply: "A birthday for what?" with a curl of their lips. "The north and the south are too different"; "Italy isn't really a country".

Well, officially, it is – since 1861, when north and south joined together after Durnwalder's ancestors had been kicked out with some help from Napoleon. In the late 1700s liberal ideas fermenting in Great Britain and France began to find their way over the Alps. These helped stir revolutionary activism across the Italian peninsula, which was still smarting after being carved up by various powers after the Napoleonic wars.

By the late 1850s the Kingdom of Sardinia (which also included a large part of north-west Italy), had persuaded Napoleon to help it expel the Austrians. And within a few years, the Hapsburgs, who had previously lorded it over much of what we now know as Italy, were f clinging on by their fingertips, with just the north-east pocket of Venice to their name.

The key stumbling block to a united Italy remained the Kingdom of Naples – or the "Kingdom of the Two Sicilies" – which held sway over the entire southern half of the peninsula. Enter Italian independence fighter Giuseppe Garibaldi who took an army south to conquer first Sicily then Naples in 1860.

With both halves of the country joined up, the following year, on 18 February 1861, Victor Emmanuel II of the Kingdom of Sardinia assembled the first Italian parliament in the north-west city of Turin. MPs returned the favour by declaring Emmanuel King of Italy on 17March. Ten days later Rome was named the capital, even though it was still officially the Papal state. Within 10 years, however, both it and Venice had become part of Italy.

Just months after the 17 March "birthday" Camillo Benso, conte di Cavour, who was Emmanuel II's prime minister and the chief architect of unification, was said to have made the valedictory utterance on his deathbed: "Italy is made. All is safe."

But although the Austrians are long gone, the comment of the prominent 19th-century Austrian diplomat Klemens von Metternich that Italy was "little more than a geographic expression" resonates strongly today. And 150 years later, in 2011, with ex-communists such as Napolitano, neo-fascists like La Russa, and a rowdy, separatist rabble like the Northern League in positions of influence, you get some idea of how tribal this nation still is.

True, the most powerful person in Italy isn't big on ideology – apart from the pursuit of money, partying hard and infamy. Silvio Berlusconi is the western world's only true autocrat. His ruling Il Popolo della Libertà, or PdL party is about as democratically accountable as the AC Milan football club – which Berlusconi also owns. To the dismay of at least half of Italy, Il Cavaliere, as he is often known, has already joined the list of quintessentially Italian things, pre-and post unification, alongside the Colosseum, Leonardo da Vinci, pizza Margherita and of course, the Mafia.

For nearly two decades he's been able to paper over the cracks and keep Italians on-side by feeding them a diet of trash TV while appealing to their baser (and already finely developed) instincts for dodging taxes and disregarding civic responsibility. He certainly hasn't managed to alter the provincial outlook, or engender a spirit of patriotism or national cooperation. Silvio Berlusconi currently dominates Italy, but these tendencies were around long before he arrived on the scene.

The flip-side to Italians' slyness and frugality is the resourcefulness that has helped Italy avoid the worst of the financial crisis, despite a huge national debt and sluggish growth. Millions manage to muddle through hard times by living with their families and relying on hand-outs from parents who've stuck to the national tradition of saving money.

And despite all the bureaucracy and corruption, the natives' creativity and design flair provides the Italian economy with its market-leading, high-end clothes, furniture, cars and textiles. Ferrari, Dolce & Gabbana and Alessi are desired around the world. As such, Italy can, unlike poor old Britain, claim to be a major economy that manufactures things people, particularly people in big emerging markets, actually want to buy.

But... but... the all-pervasive corruption is a hideous drain on Italy, both financially and psychologically. The Mafia has helped keep the south of the country economically hamstrung and reliant on handouts from Rome. This has fuelled the resentment that has seen the separatist Northern League surge in the polls.

That's not to say the north of Italy is innocent. Bankers and well-known businessmen in Milan make millions by laundering the mobsters' millions, and northern companies pay the clans to dump their toxic waste on the cheap in the south of the country. And it's not just high-level turpitude. When I first moved to Italy, a Milanese friend told me that "the Mafia isn't about men in dark glasses and sharp suits in Palermo; it's the old lady in the post office, who always goes straight to the front of the queue because she knows the assistant behind the counter".

Italians know they're shafting each other – and many of them don't like it. Modern Italy's founding father Cavour, who noted that "the man who trusts men will make fewer mistakes than he who distrusts them" saw the value of trust and honesty. But it's not obvious whom they could look to – or vote for – to change things. With a left wing that hasn't forgotten communism and a political centre still contaminated by the social conservatism of the Vatican, political inspiration is in short supply.

Despite their outgoing nature and general lack of cynicism, it's striking how pessimistic many Italians are, and the low regard in which they now hold their own country, largely as a result of the rackets and nepotism. You'll even hear Italians use the phrase "fatto all'Italiana" or "done the Italian way", meaning done badly or on the cheap: vernacular that hardly suggests a country at ease with itself.

Most people (usually the young ones) are amazed when they learn I'm from London. "But why are you here?" is the standard – and instant response – from people unaware that London might be the centre of the universe, but only for those young enough and rich enough. I try to explain that, apart from the Italian food and weather, it's nice to feel you can totter home slightly drunk on Friday night without being attacked by gangs of girls called Jade.

And of course in many ways Italy remains a marvellous place, blessed with great weather, the best cuisine in the world, an astonishing variety of beautiful landscapes, a peerless artistic and cultural heritage and a relatively secure and stable society. They should be happy. But with sufficient exposure people can take anything for granted.

Nonetheless, these attributes are responsible for making Italy what it really is today: the dream holiday or retirement destination for Europe's middle classes. For young Italians without the right family connections the prospects are grim. The latest figures show that one young Italian in five has no job and no place in training or education; the country is among the worst in Europe in this regard. And thanks to antediluvian labour laws that have provided many full-time workers with jobs for life, employers have responded by hiring people on precarious, penny-pinching short-term contracts.

Is it any wonder then that so many young Italians, the mummy's boys – and girls – stay on with parents until they're in their 30s or 40s? Not surprisingly a brain drain is in full flow, with the best and brightest Italian youth leaving in search of more meritocratic terrain.

Italy has some of world's oldest and most famous universities in Bologna, Modena and Padua, but not one made the world's top 200 in the Times Higher Education 2010 rankings. It seems Italy can't compete with colleges in Taiwan, Korea or Egypt, let alone those in the US or the UK. It's no mystery why. Professors routinely hand out academic posts to relatives and friends instead of people who deserve them. Some departments, particularly in southern Italy, resemble family fiefdoms.

The worry is that before too long all that will be left of Italy will be a theme park – beautiful, tourist-ridden, old and increasingly irrelevant. As a concerned political scientist at Rome's private LUISS university told me last week, the fear was that Venice, the glorious but dying Adriatic lagoon city, "will become a symbol of the whole nation."

Last month, opposition leader Pier Luigi Bersani of the Democratic Party, said that failure to celebrate the 150th anniversary "in a united and convincing way" would be an awful sign and "one that could weaken the country". At heart Italians are a social bunch, and some, young ones included, will grab 17 March as an opportunity for a party, even if it's not clear what they're celebrating.

But as at least part of the country prepares to mark its birthday, Bersani and the whole political class might consider whether Italy's most pressing problem isn't the differences between north and south or the strong local ties from Bolzano to Palermo that give regions their distinct personalities, but rather that this ostensibly young country already feels so strangely and disconcertingly old.

Little Italy: A history

1861 Proclamation of the Kingdom of Italy

1871 Rome becomes the capital of Italy

1911 Italy gains control of Libya, after conflict with the Ottoman Empire

1915 Italy joins the First World War, fighting with the Allies

1922 Mussolini forms fascist government

1936 Alliance forged with Nazi Germany

1943 The Allies invade Sicily; King Victor Emmanuel III imprisons Mussolini. Armistice signed

1963 The Italian Socialist Party joins Christian Democrat-led coalition; Aldo Moro is Prime Minister

1994 Freedom Alliance coalition wins the election – but collapses by year's end

2001 Silvio Berlusconi, leading a centre-right coalition, wins the election

2011 Berlusconi is ordered to stand trial for abuse of power and sexual misdemeanours