France and Germany often violate eurozone rules, while the poor in Italy pay the price
Sunday 16 December
The stalemate with European officials. Ministers flying to Brussels to negotiate a last-minute deal. Cries of betrayal at home. Dark warnings of economic calamity and social unrest.
No, it is not the Brexit serial in Westminster but the European crisis that everyone seems to have forgotten: the comparison between Brussels and Rome on the Italian budget.
In October, the Italian governing coalition, including the far-right League [sic] and the populist Five Star movement (M5S) they presented a draft budget with many of the parties' electoral promises such as citizenship income for the unemployed and the shelving of a previous proposal to increase the retirement age. The budget would have increased the Italian deficit to 2.4% of GDP, a higher rate than that foreseen by the previous government but lower than the European limit of 3%.
Nonetheless, in an unprecedented move, the European Commission rejected the budget for violating the tax rule. Rome's growth forecast, he insisted, is far too optimistic and the real deficit/GDP ratio would increase to 3%.
Italy was threatened with sanctions. Last week the government in Rome gave in by drawing up a more austere budget. Whether it is enough to appease the Commission remains to be seen.
Italy cuts the deficit target 2019 al 2.04% to avoid EU sanctions
Italy's real difficulty derives not so much from its annual deficit but from its debt [cumulative ?]. Which now amounts to €2.6 trillion (£2300 mld), about the 133% of GDP, behind only Greece, in the eurozone. If Italy were to default, Europe's fragile financial system could fall apart. So the Commission wants Rome to move forward to make ends meet and quickly.
In Great Britain, the Tories' pursuit of such a strategy has torn apart the social fabric of the nation. In Italy, where only a third of young people have a job, and beyond 5 millions of people live in “absolute poverty”, the impact could be devastating.
The budget stalemate is not just an economic issue but a political debate, which raises questions about democracy. Brussels is telling Rome: “We are not interested in the Italian vote. Democracy matters less than our fiscal rules”.
This is not only undemocratic but also politically dangerous. The current coalition in government is part of the product of the European response to the latest crisis of debt in Italy in 2001. The EU then demanded that the Italian parliament approve a package of highly austere measures, almost imposing 60 billion in cuts. Prime Minister Silvio Berlusconi had to resign to be replaced by an unelected technocrat, Mario Monti, who monitored the austerity program. It was then revealed that the EU had been struggling for months to replace Berlusconi with Monti.
Two years later, when the elections were held, popular anger both for the suspension of democratic procedures and for the consequences of the austerity led by Monti, they rejected Monti's party and gave the 5S movement a foretaste of their first electoral success. Five years later, the public anger that continued, it propelled the M5S and the anti-immigrant right. the League, in power in the elections last March. Today the League is the most popular party in Italy. The EU seems to have learned nothing from history.
The contrast between the European treatment of Italy and that of France is symptomatic. Until last year, France had violated the deficit rule every year, dal 2008. She was never sanctioned. The capitulation of President Emmanuel Macron in the face of the protests of the gilets jaunes, promising to raise the minimum wage and the tax exemption of increases in minimum pensions, made France's breach of the rule probable 3% next year. At the beginning of 2003, the European Court of Justice had ruled that the European Finance Ministers had been negligent in not penalizing France and Germany for violations of eurozone rules. Fifteen years later, European giants remain free to trample on the rules while smaller nations (and less small like Italy) must bear social penalties.
The Italian government has various hateful policies, in particular the brutal attack on migrants by the Minister of the Interior and leader of the League, Matteo Salvini. The policies of 5 place, although they are not so utopian, however, they are among the most progressive in the coalition. And so what is the reaction of the European Union? He accepts reactionary immigration policies but does not accept any package of economic measures to help the poor ?
In the 2013, having been kicked out of office by the Italian electorate, Monti, in a farewell speech at an EU summit he noted that “public support… for the European Union is declining dramatically”. To counter “the growing wave of populism and disaffection for the European Union”, he added, the EU must start “listening to people's concerns”. He didn't listen before, and don't listen now.
at Kenan Malic.
Source: https://www.theguardian.com/commentisfree/2018/dec/16/europes-merciless-treatment-of-italy-only-hardens-popular-resentment?CMP=share_btn_fb&fbclid=IwAR0_zYhrNT9GK8EgG-Ho-L2WZVXjIsTQ66TqcgtyDdMcG03JeNobD08RsWs
Translated by Nicoletta Forcheri il 14 December 2018
source: https://scenarieconomici.it/the-guardian-lo-spietato-trattamento-europeo-dellitalia-non-fa-che-rafforzare-il-risentimento-popolare/