Brussels cracks down on Rome over deficit
The European Commission has also rejected a slightly modified draft of Italy's 2019 budget on the grounds that it violates EU rules, and is initiating an Excessive Deficit Procedure against the country. For Rome this could mean fines of up to 3.4 billion euros. Some commentators praise Brussels for its firm stance. Others say both sides will end up losing.
Deter copycats
A lenient stance towards Rome would be precisely the wrong approach, stresses Die Welt:
“Other countries - and no doubt France too - would conclude that the rules of the Stability Pact are really more like recommendations. That's what happened at the start of the millennium when Gerhard Schröder and Jacques Chirac softened the pact - which led to the euro crisis a few years later. Sticking to principles and not budging an inch, on the other hand, offers a chance. The chance to finally consolidate greater adherence to the rules in the monetary union. The very clear signal from Brussels to this effect is therefore gratifying.”
EU struggling to survive
Lucia Annunziata, chief editor of Huffington Post Italia, tries to explain the reasons behind Brussels' unrelenting stance:
“The long Brexit farewell has formed the nucleus of the collapse of the British political system; and the elections in Germany saw Merkel, whose farewell was expected to be prolonged, lose her power almost at a single blow. ... In short, today's Europe is far more in crisis than it was in June [when the Italian government came to power]. And because the EU is fighting for its survival it has given up the magnanimous, bureaucratic zig-zagging that had so far enabled it to manage all the struggles of the member states or at least coexist with them. But now that Europe sees its very existence at stake and is besieged by all kinds of fears, it has drawn out its knife.”
Italy's government losing support
The Italian government can't count on the citizens' support, Naftemporiki points out:
“Populist governments are also fast losing popular support once they are in power. The fascination with the 'revolution', with the confrontation with the 'enemy' ends once people start feeling its consequences. Regardless of what the investors say, in less than a year the Italians will see whether Salvini's formula increases their income or has actually worsened their lot. For the Italian government the first round has begun. It has called on consumers to put their money in so-called 'patriotic investments' [government and bank bonds]. But the consumers have ignored it.”
Italy gets the fight it was looking for
Italy is deliberately picking a fight, NRC Handelsblad comments:
“According to the leaders of the coalition parties, Europe's rules don't work in Italy. As proof they point to the fact that growth in Italy has been lower than in the rest of the Eurozone for years, and that poverty levels have steadily risen since the crisis. The Italian government is now focusing on other priorities - and it has every right to, according to Di Maio and Salvini. ... More pressure from the financial markets would force Italy to accept Europe's rules. But failing that, the confrontation will continue.”
Rules aren't carved in stone
Both Brussels and Rome should relent a little, urges Jean-Marc Vittori, editor in chief of Les Echos:
“The Eurozone's budget rules are dumb, as former Italian prime minister and EU Commission president Romano Prodi once said. Imposing sanctions for breaking rules is absurd because it means imposing a huge penalty on a country whose budget deficit is already large to begin with. Italy's draft budget leaves much to be desired, since it includes no sweeping measures for reviving the economy even though Italy has continuously brought up the rear in growth terms ever since the Eurozone was established. It's still possible to pass rules, reinvent the Stability and Growth Pact and promote aid, solidarity and investments, rather than encouraging states to close themselves off. ... But it could soon be too late.”
Sooner or later the government will have to cede
The Italian deputy prime minister Salvini first scoffed at the warning from Brussels. "A letter from the EU? I'm also waiting for one from Father Christmas," he told reporters on Wednesday. La Stampa's Brussels correspondent Marco Zatterin counters:
“Salvini himself should be writing the letter to Father Christmas, together with Di Maio and Conte. They could ask for the wisdom to entertain at least some doubts about the expansion potential [of the Italian economy]. ... They could ask for a recipe that would dispel the suspicions about the country's unreliability and restore calm on the markets. They could ask for the foresight to conduct serious negotiations with their European partners, which sooner or later they will be forced to do anyway.”
Eurozone on the waiting bench
The collateral damage from the confrontation between Rome and Brussels is already foreseeable, the Tages-Anzeiger remarks:
“All the plans to deepen and consolidate the Eurozone will now be put on ice. The northern Europeans won't agree to a European savings guarantee or the strengthening of the euro bailout fund for ailing banks with a coalition like the current one in Rome. Who wants to assume liability for a government that deliberately ignores agreed rules? This is bad news, because the next recession, the next financial crisis, is no doubt on the way.”