Matt O’Brien, (2018), “Italy’s game of chicken with Europe is getting serious again”, Washington Post, 22 Οκτωβρίου
For a long time, Italy has been Europe’s hidden crisis. Now, though, it’s becoming much more open.
The problem is simple enough: Its economy has forgotten how to grow. Indeed, even if you cast things in the most favorable light possible by adjusting for its shrinking working-age population, Italy’s economy is still roughly the same size today as it was in 2003. Which, together with the legacy of all the red ink it ran up in the 1980s, means that it’s had to run persistent primary budget surpluses just to keep its debt burden from spiraling up even more.
This combination of nonexistent growth and all-too-real austerity seemed like it would inevitably lead to a political backlash, which, right on cue, it did earlier this year. The vaguely left-wing Five Star Movement captured the country’s poverty-stricken South with its plan for a basic income for the needy, while the stridently right-wing party the League won in the more prosperous North with its promise to cut taxes and kick out immigrants. Together, then, they’ve formed a government of onetime outsiders whose slightly less restrictive budget looks like at least a minor repudiation of Europe’s reigning fiscal orthodoxy.
Σχετικές Αναρτήσεις
- Fergal O’ Brien, (2018), «The Long and Winding Road to Italy’s Budget», Bloomberg Europe, 13 Οκτωβρίου
- Lucrezia Reichlin, (2018), «Fiscal Freedom in the Eurozone?», Project Syndicate, 1 Οκτωβρίου