Posted on 07/29/2013 5:50:44 AM PDT by Kaslin
This summer a private air plane has been flying over Italian beaches with a banner message Euro is Sucking Italian Blood
The article states "Italians have only one solutions to fight against this situation : leave Italy."
No End in Sight to Italy's Economic Decline
Der Spiegel says No End in Sight to Italy's Economic Decline
The Italian economy may be the third largest in the euro zone, but it is also plagued by inefficiency and continues to shrink. The country's political leadership has proven unable to implement badly needed reforms and the future looks grim.Structural Problems
Italy, despite being the third-largest economy in the euro zone after Germany and France, finds itself in dire straits, having been in decline for years. Its GDP has dropped by 7 percent since 2007. The last few years, says Gianni Toniolo, an economics professor in Rome, represent "the worst crisis in (the country's) history," even more devastating that the period between 1929 and 1934.
Some sectors have lost even more capacity, with the automobile industry having declined by 40 percent. According to Paolazzi, Italy is experiencing an "unprecedented process of deindustrialization."
But why?
Wages aren't the problem. They are 15 percent lower than Belgian and French wages and 30 percent lower than wages in Germany, according to a current Bank of Italy comparison. But according to Confindustria, the Italian economy faces a tax burden that is 20 percent higher than in Germany. And unit labor costs are about 30 percent higher than German levels, say central bank officials.
The CGIA research institute in Mestre, near Venice, found that one in two small businesses was only able to pay its employees in installments. Three out of five companies are forced to take out loans to pay their high tax bills.
In addition to the tax burden, a bloated bureaucracy obstructs almost all economic activity, an inefficient judiciary deters potential investors with trials that can last for decades. Italy has a relatively low education level and a poor infrastructure characterized by potholed streets, an energy supply prone to failure, constantly delayed trains and outmoded communication networks.
As a result, Italy continues to fall behind internationally as a place to invest. It is now 44th in the World Competitiveness Center (WCC) ranking, below the Philippines, Latvia, Russia and Peru, and only slightly above Spain and Portugal.
Populists like Berlusconi and the founder of the "Five Star" protest movement, Beppe Grillo, are not the only ones advocating the most radical of all solutions for Italy's problems. The country has "a lot of vitality and great potential," says US economist and policy advisor Allen Sinai, but it can only benefit from these strengths "by withdrawing from the euro."
Italian prime minister Enrico Letta pledged Wednesday to "fight relentlessly" against tax evasion in the recession-hit country, as the government pushed new growth measures through the lower house of parliament.Reflections on Italy's Shadow Economy
Letta blamed Italy's underground economy - which ranges from simple tax evasion to organised crime and accounts for some 25 percent of the overall economy according to most studies - for damaging competitiveness.
How do you say TRY CAPITALISM in Italo-skywriting?
Utter lie. The country's people have proven unable to elect honest men. These socialists elect thieves and then are shocked to find themselves robbed.
How do you say "more free stuff" in Italian?
TENTA IL CAPITALISMO
I am curious why you cut the sentence off?
Because in democracies and republics the people get the government they want, whether they vote or not. If the government hasn’t the will it is because the people haven’t the will.
I disagree.
As far as I can see, not one country in the Euro Zone has seriously contemplated leaving the Euro.
There is some populist and Hard Left opposition to the Euro, but beyond that, I'm not aware of any major political party in a “poor” or “distressed” country that wants out.
I think the strongest opposition to the Euro comes from taxpayers in the wealthy European countries who have been asked to “guarantee” the sovereign debt of Portugal, Ireland, Italy, Greece, Spain, and Cyprus.
In my opinion, the Euro would continue to function just fine even if some of those countries did default, although the wealthy countries would need to bail out their own domestic banks that held large amounts of PIIGS sovereign debt.
And one very good thing would happen after a default.....
Interest rates on sovereign PIIGS debt would be re-priced to reflect the real world risk.
My brother-in-law the economist refers to the way they do things in Italy as "the Italian Model." He speculates that it might take root here if taxes and regulations keep increasing.
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