Haggling over budget in Rome
Italy's new government is due to present its budget plan to the European Commission today, Thursday. In his draft budget independent finance minister Giovanni Tria aims for a deficit that doesn't exceed 1.8 percent of the country's GDP. The ruling parties, however, want the deficit target to be raised to 2.4 percent in order to push through their election promises. Italy's press is sceptical.
Italy heading for disaster
By making further concessions to Economy Minister Tria the League and the Five Star Movement are gambling with the nation's future, columnist Antonio Polito complains in Corriere della Sera:
“The demand for the deficit limit to be raised to 2.4 percent is a battle cry against Brussels, which can hardly accept such a high deficit. But above all it's an attempt to get the economy minister over a barrel and force him to submit in the hope that he won't collapse and resign. If he does resign Italy would face a perfect storm on the markets, and it's by no means sure that the government would survive it. A real paradox in which the fate of the government but also of Italy as a whole is at stake.”
Deficit must not be increased to win votes
Alessandro Sallusti, editor-in-chief of Il Giornale, has no objections to a higher deficit but wonders how it would be financed and who would benefit:
“The Five Star Movement is pushing for a higher deficit according to the model championed by French President Emmanuel Macron, who has announced a manoeuvre involving a deficit of 2.8 percent. 'If Macron can do it so can we,' said Five-Star leader Luigi Di Maio. But he's forgetting two key factors. First, Italy's debt is one and a half times that of France. Second, Macron has proposed a drastic cut in public spending to compensate for a drastic cut in taxes (25 billion euros) in order to promote growth. This is the opposite of what Five Star wants to do. Its formula is recessive and the reverse of the French one: raising taxes to finance the manna falling from the welfare state sky.”