So my first post on Italy's woes and future hopes had a few people asking the question; "what would you do?"
Let me be honest, I'm not sure where I would begin, as there is much to be fixed, but the general recipe of; slash the deficit; promote growth; weed out illegitimate crime all rank very highly!
Slash the deficit
In mainland europe, this is a case of increasing pensionable ages, reducing the public sector and affecting services hoping that the private sector steps in to sort out the mess it will cause. I'm not it's biggest fan but you have to do what is required to gain confidence in the markets as well as reducing the debt to banks and 10 year bonds (in Italy's case). It's not pretty but something has to be done. I would start with massive ministerial changes (reduce MP's, their wages and pensions, save roughly €58million).
Promote growth
This is where Italy can REALLY turn things around. The one thing Italy has over it's rival nations is the brand "MADE IN ITALY". As a marketeer you would give a right arm for a brand to turn up and evoke the emotion that this does. It represents; style, quality, crafted expertise, the best of the best. An FT report in January heralded the brilliance of the brand and I quote "They are forecast to rise a further 8 per cent in 2011 and 7 per cent in 2012, returning to pre-crisis levels in 2013, according to trade group SACE". Why would an economy not tap into this? Give tax incentives to businesses producing for the brand specifically for the export market, encourage employment incentives to get people working in these kinds of businesses. The tools are there to make Italy work, just no one seems to want to use them.
Diego Della Vale (a wealthy business owner) said “Many people want to live like us, they want to be us, they want to dress like us, and they are willing to spend money to do it.” LETS PROMOTE MADE IN ITALY!
Weed out illegitimate crime
Well, it costs the tax payer millions, it stagnates growth (by making employers pay protection money over staff) it controls the import and export markets and, well, kills people. I'm not sure how you deal with this. Maybe this is one element too great for Italy to fix, but if the market provided better opportunities for people to work and make a decent living doing that, rather than joining these institutions, maybe, just maybe we can begin to fix the issue.
A very brief and not plentiful solution I know, however I ask myself the question, why over the last three years have I had to hear about sex scandals and nothing of the above?
Maybe to some politicians it's easier to avoid the responsibility placed on themselves by the electorate, but hopefully we will have learnt.
We need to care more about those making the underwear, than the ministers trying to get into them.
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| Italy's hope lies in a label |
Let me be honest, I'm not sure where I would begin, as there is much to be fixed, but the general recipe of; slash the deficit; promote growth; weed out illegitimate crime all rank very highly!
Slash the deficit
In mainland europe, this is a case of increasing pensionable ages, reducing the public sector and affecting services hoping that the private sector steps in to sort out the mess it will cause. I'm not it's biggest fan but you have to do what is required to gain confidence in the markets as well as reducing the debt to banks and 10 year bonds (in Italy's case). It's not pretty but something has to be done. I would start with massive ministerial changes (reduce MP's, their wages and pensions, save roughly €58million).
Promote growth
This is where Italy can REALLY turn things around. The one thing Italy has over it's rival nations is the brand "MADE IN ITALY". As a marketeer you would give a right arm for a brand to turn up and evoke the emotion that this does. It represents; style, quality, crafted expertise, the best of the best. An FT report in January heralded the brilliance of the brand and I quote "They are forecast to rise a further 8 per cent in 2011 and 7 per cent in 2012, returning to pre-crisis levels in 2013, according to trade group SACE". Why would an economy not tap into this? Give tax incentives to businesses producing for the brand specifically for the export market, encourage employment incentives to get people working in these kinds of businesses. The tools are there to make Italy work, just no one seems to want to use them.
Diego Della Vale (a wealthy business owner) said “Many people want to live like us, they want to be us, they want to dress like us, and they are willing to spend money to do it.” LETS PROMOTE MADE IN ITALY!
Weed out illegitimate crime
Well, it costs the tax payer millions, it stagnates growth (by making employers pay protection money over staff) it controls the import and export markets and, well, kills people. I'm not sure how you deal with this. Maybe this is one element too great for Italy to fix, but if the market provided better opportunities for people to work and make a decent living doing that, rather than joining these institutions, maybe, just maybe we can begin to fix the issue.
A very brief and not plentiful solution I know, however I ask myself the question, why over the last three years have I had to hear about sex scandals and nothing of the above?
Maybe to some politicians it's easier to avoid the responsibility placed on themselves by the electorate, but hopefully we will have learnt.
We need to care more about those making the underwear, than the ministers trying to get into them.
2 comments → Italy's woes and future hopes...Part Two
I'll post a comment by someone who is a family friend based in the states. They obviously were missing my point, and somehow think I am a capitalist...
Well done!!!! You sound more like a Capitalist. Imagine suggesting that the private sector can lead the way out of Italy's debacle. What happened to your rabid support of Keynsean Economics and big government spending as the answer? We are going to halt that political ideology next November but I believe that the European mind set will prove more of a challenge especially with the younger generations that have been weaned and engrained with an entitlement attitude.
You are making great progress. Move back to Italy and enter politics. I can just see it now, Premier DiBlasio!! Why not?
My answer...
Well I may sound like a capitalist (which I know brings you so much joy) but I never said I wasn't against the free market, I was and am against a completely free market where mechanisms to control it, such as government and fiscal reforms are required to make it work. Ultimately if the Made In Italy brand is to work, everyone will need to pay their taxes to:
- Re-structure the infrastructure of the nation
- Pay anti-mafia police officers better wages
- Be able to pay for the tax incentives given to business
If it was all left to the "free market" then this wouldn't really happen, and don't bother arguing it, we have both studied enough to know that this is an economic reality, but there is nothing wrong with that. I personally don't believe we get anywhere without paying taxes because that pays for the services that are required.
And once again, I am not a Keynsian economist. You picked up on one thing I said in an email dated 2 years ago about me liking Keynes and his ideas and that somehow makes me his fervent fan. I also happen to like green tea, does that mean I want to embalm myself in it's lush aromatic aromas?????
I could never be a politician, because fact is, I'm 6'3 pale white and missing a finger. I'm not votable, and if I were voted into power, the mafia would have rid of me in a week with a car bomb or something of the nature of the Italian greats Borsellino and Falcone. (I advise you read a book about them, true heroes).
Actually, I will say this. The "European attitude" is a offensive to me as when I said "George Bush is an i***" to you. Most young Europeans, genuinely don't believe in the "entitlement" age. They believe that they study hard, and that they should have the same opportunities as everyone else to get by in life. Instead, for a lot of these people, myself included, an elite few get to share all the spoils, whilst people like me, who speak several languages and are adept at many different skills still get paid minimum wage and have to support themselves and families on it. Yes maybe that is entitlement, but an entitlement to FAIRNESS not hand outs.
Anyway, without causing any offence, I think I'll leave it there for today.
Not sure what you mean by "I am making progress", or rather I do know, only I don't think that's appropriate.
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