EU fiddles as Rome burns

As talks continue to form a eurosceptic government in Italy, delusional Eurocrats plan ever deeper integration in Brussels. Britons looking on, can be grateful they will soon no longer be party to this fiasco

Rome burns?
Tim Hedges
On 19 March 2018 10:49

The recent election in Italy has produced two winners: that is to say two groups which, coming from behind unexpectedly, overturned the status quo. One is a coalition group - the centre right now led by Matteo Salvini of the League, and the other is the 5-Star movement, led by Luigi di Maio, the largest single party.

Naturally both claim victory. The thing is, the law does not provide for which should be consulted first to form a government. President Mattarella decides on the basis of who he believes can form a majority in both houses of parliament. It is then put to the test with a confidence vote.

The first deadline is 23rd March when the parties try to get their candidates elected as Speaker in each of the two houses. It seems likely that di Maio and Salvini can organise one speakership each and many people will conclude that this is a sign that they can form a government between them.

But the two newcomers are very different, particularly in their flagship policies. Di Maio, who controls the poor south, wants a form of unemployment benefit, which doesn’t exist in Italy: at present, firms pay a little into a fund which gives the redundant employees a small sum, but when the company is in trouble it often stops paying in. Di Maio would make the benefit a permanent obligation of the State, as it is in Britain. It would cost tens of billions.

Salvini, by contrast, who controls the prosperous north, wants a flat rate of tax. This would, obviously, benefit higher earners but many economists believe it would increase the numbers actually paying the tax, something Italy sorely needs. It would also cost tens of billions.

There remain a large number of secondary policies but these can probably be sorted out. Coalition would possibly mean the end of 5.Star’s plan to legalise the brothels, though. In the post-war period when brothels were legal, they were officially graded as to excellence of the girls, surroundings and so on. So there’s a job for someone, though the European Commission would probably get involved somehow.

In an unrelated matter, Vittorio Sgarbi, a well known journalist working for Silvio Berlusconi’s Il Giornale paper, has claimed that Di Maio is secretly gay and named his ‘boyfriend’ (a publicity aide). This came after the vote but might still weaken Di Maio. Italy is not California.

Meanwhile, in a galaxy far away (Brussels) the teams of Mr Macron and a rather diluted Mrs Merkel are drawing up proposals for the new Eurozone. This will include deposit insurance, whereby in the event of your bank in, let’s say Italy, going under, your money is guaranteed not by Italy but by the whole of the eurozone.

Two problems here. Firstly people are getting a bit fed up with new ideas being proposed and agreed by the two biggest players and the smaller countries being expected to follow. Spain, for example, has recently refused to attend a meeting with four Balkan countries to talk about them joining.

The second problem is that one or both of Italy’s new parties is likely to blow open the budget deficit ceiling of 3%. If a high spending Italian government had to be propped up, either through its banks or the purchase of its debt, Mrs Merkel would be a laughing stock in her own country.

But still they go on, talking about further integration as Rome burns.

Tim Hedges, The Commentator's Italy Correspondent, had a career in corporate finance before moving to Rome where he works as a freelancewriter, novelist, and farmer. You can read more of his articles about Italy here


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