Yet again, we have a financial crisis in Europe. After the bailouts in Greece and Portugal we are told that Italy, once described as “too big to fail”, is once again on the verge of bankruptcy and the rest of the EU will be forced to ride in to rescue it,
Apparently the financial press has it in for the Italians. We have been seeing similar prophecies of pending doom since 2016. The argument being that Italy is being slowly destroyed by the Euro, as its essential lack of competitiveness cannot be offset by manipulation of the lire, as previously. There is now a revival of talk about inventing a parallel currency to keep the country afloat, even though this idea has been dismissed by the European Commission
Yet that same financial press seems less able, or at least less willing, to explain the positive indicators of the Italian economy: falls in bankruptcies, seemingly low inflation, a widening trade surplus and the best unemployment figures for five years
So maybe it isn’t all doom and gloom after all: the national airline Alitalia may be going bankrupt, but plenty of big carriers want to buy it, which they wouldn’t if it had no commercial potential within Italy.
Ups and Downs
So what is going on here? Time and again economies have fallen and then risen again. We have also been told again and again that the Eurozone will be toppled by one country, and that the Euro will destroy newly entering countries, even as far back as Spain’s entry in 1986. But if you mention the name “Italy” everyone automatically assumes the worst, whilst at the same time enjoying their Italian wine, driving their Italian cars, eating their Italian food washing their clothes in Italian made washing machines.
Is there some inherent trait in the Italians which makes them financially incompetent, in stark contrast to their forebears in decadent and sleazy Ancient Rome? It is not so much a moral issue but apparently one which we can beg the question as if there is something structurally weak in the Eurozone which affects Italy alone?
This latest “financial crisis which could destroy Europe” is just like the others: a political stunt designed to protect vested interests which no one would actually vote for if they raised their ugly heads.