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Europe, Italy

If we continue with austerity we will hit the point of no return

By Giorgio Cremaschi

If a patient is given an aspirin at the point that he becomes ill and a fever takes hold, the drug may work. But if you wait without giving him anything, just recommending a strict diet, and the fever grows and the disease becomes chronic and complicated, then an aspirin no longer works and can even hurt the weakened body.

The great budget flexibility on public investment about which Italy’s prime minister Enrico Letta has been happily tweeting, is too little too late, too much aspirin to be administered to sick man Italy.

If you look beyond the smoke and mirrors you can see that, at best the EU, which from September will script our public budgets in compliance with the fiscal compact and attached budgetary commitments, will only grant temporary relief from the constraints of a balanced budget. Provided of course that Italy has already committed, via new cuts in public spending, to bring the budget back to balance.

At this draconian price, which means closing more hospitals in order to finance roads and rail projects, perhaps some ten billion euros in total can be invested, over a number of years, in the nation’s infrastructure, according to recent government indications.

Now this figure, staggered over time, must be measured against a loss of production and income of at least €150 billion here and now; a labour market with an unemployment rate of 12.2%, higher than the EU average; and a public debt that has risen to more than 2 trillion euros on account of austerity policies, that’s a debt that costs us 60 to 80 billion per year in interest only.

If these investments had been launched five years ago and they were accompanied by expansionary economic policies and measures promoting social justice, they might have delivered a result.

But the patient with pneumonia was left in the icy water and has long refused any medicine explaining that he first had to gain strength …

While Letta chirps, a furniture manufacturer Natuzzi, one of the multinationals we were told would regenerate the country, has fired 1,700 people, 60% of the workforce, and relocated abroad. UNESCO condemns us because Pompeii, a UNESCO World Heritage site, is going down the drain due to lack of funds. And the mayor of Florence, the Blairite would-be leader of the Democratic Party, wants to finance the city’s administration by renting Pontevecchio out for private dinners by executives of Ferrari. And didn’t Greece ask to use the Parthenon as collateral, having already sold its islands?

The tale that they will hear is that these promised investments in Europe are not in themselves worth much, but they inspire confidence, which should lead to a new influx of private capital into our country.

Lies. While Letta tweeted, the Stock Exchange suffered a new fall because markets, lets be clear, not only do not believe in a recovery in the second half of the year, but predict a worsening of the crisis, starting with the weakest countries led by Greece and Portugal that have suffered austerity for the longest.

If we continue with these austerity policies the economic and social situation of the country will hit the point of no return.

So let’s not accept assertions that this is the only possible recipe. This is clearly the only wrong one.

When a disease is worsening the first thing to do is remove the sick from the harmful environment and halt incorrect cures. But this is the only thing that Italian and European leaders are not doing – instead they continue undeterred to administer the policies of austerity, despite the fact that they are hurting in Europe and are negatively infecting the whole world.

By now, the rulers responsible for this disaster should be hunted down, as a doctor who is manifestly incompetent and guilty. And they should be asked to pay damages.


Translated/edited by Revolting Europe

About revoltingeurope

Writer on Europe's Left, trade union and social movements @tomgilltweets or @revoltingeurope


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