The Demise of Italy and the Rise of Chaos
8 ottobre 2013by Roberto Orsi
Future historians will probably regard Italy as the perfect showcase of a country which has managed to sink from the position of a prosperous, leading industrial nation just two decades ago to a condition of unchallenged economic desertification, total demographic mismanagement, rampant "thirdworldisation", plummeting cultural production and a complete political-constitutional chaos.
In a previous post on this very blog, the dire situation of Italy's economy has been briefly sketched. A few months later, the scenario of a serious disruption of the Italian state's finances is building up, with tax revenues contracting 7% in July, a deficit/GDP ratio projected again well over the 3% mandatory threshold and public debt well over 130% of GDP. It will get worse. The government knows perfectly well that the situation is unsustainable, but for the moment it is only capable to resorting to an extremely short-sighted VAT rate increase (to a staggering 22%), which will depress consumption even more, and to vague proclaims about the necessity of shifting the tax burden way from wages and companies to financial rents, although the chances of this to be implemented are essentially negligible.