Berlusconi on Very Shaky Political Ground
Meanwhile, Democratic Party leader Pier Luigi Bersani has just labeled the so called “easy-dismissals” proposals contained in the Italian “letter of intents” to Brussels as an “unacceptable threat,” while his colleague Dario Franceschini has called into question the very feasibility of such measures.
Another extremely pressing issue that Berlusconi must face has of course to do with Italian public debt, now close to $1,933 billion USD, which equals 119% of Italy’s GDP. That is why EU President Herman Van Rompuy has recently asked for a “major effort on the part of the Italian authorities” in order to bring the sovereign debt down as much as possible. However, this seems to be at odds with Italy’s desperate need for swift economic growth: some economists are in fact skeptics about austerity measures and the most recent monthly economic outlook from Banca di Siena (founded in 1472) reads that “the heavy austerity measures are choking economic growth” and that the fears of a double-dip recession are once again en vogue.
More in general, while the gossip of alleged sexual scandals revolves heavily around the figure of Berlusconi, opposition leaders are starting to think about the possibility of early elections. According to Pierfrancesco Casini of the Union of Christian and Centre Democrats, the next week will be crucial in order to understand whether or not Italians will have to vote for a new government sooner than they expected. In case of further political chaos, early elections will probably take place in April 2012. Instead, if the present cabinet somehow manages to endure political and economic turmoil, there will be no elections at least until April 2013; but at that point Berlusconi’s third cabinet would have already accomplished its quinquennial mandate.
This grand finale, however, will depend more upon the fate of the global economy than on the outcome of domestic political issues. Actually, Silvio Berlusconi has recently appeared particularly confident of the fact that Italy is on the road to recovery. But even though the present economic situation must be read in the context of the global financial crisis and that tension in financial markets has been (at least partially) a consequence of multiple speculative attacks on sovereign debts, politicians in Brussels are still seriously concerned that Italy will bite the dust of insolvency next.
Ultimately, regardless of the fact that the ratio between national debt and GDP in Italy has been growing less than in other countries since 2008, and that the fraction of deficit/GDP is lower here (4.6%) than in other European countries such as France (7/7.1%) and Spain (9,2/9,3%), Berlusconi’s shoes, more than ever before, are walking on very shaky ground these days.
If you think it’s bad for Italy — you ain’t seen nothing yet.
Consider: In 2010, there were 61 million Italians. Fully 27 percent were 60 years of age or older; 20 percent were 65 or older; 6 percent were 80 or older.
Now, fast forward to 2050.
Between 2010 and mid-century, 6 million Italians will disappear. In 2050, Italy will be a nation of 55 million, whose median age will have risen from 43 today to 53. And the life expectancy of all Italians will rise from today’s 82 years to close to 86.
The average Italian may enjoy four more years of life, but he or she will also require four more years of social security and health care provided by the taxpaying public. And that taxpaying public is also going to shrink.
By 2050, the percentage of Italians over 60 will have risen from 27 to nearly 42 percent. The percentage 65 and over will have risen from 20 to 35 percent, and the share over 80 will have more than doubled from the present 6 percent of the population to 14 percent.
By 2050, one in three Italians will be 65 or over, and one in seven will be 80 or over. That is a lot of old-timers for working Italians, whose numbers and share of the population will have been dramatically reduced, to support.
Moreover, the percentage of Italian women in the childbearing ages of 15 to 44 will have fallen from today’s 40 percent to 29 percent, guaranteeing a continuous decline in the Italian population for the rest of the century.
There is not a single year between 1980 and 2050 where Italy’s birth rate even approaches the replacement level of 2.1 children per woman. By mid-century, Italy will have been below zero population growth for 70 years. This is a nation slowly taking its leave of this world.
To the south, the exploding Muslim populations of the Maghreb and the Middle East appear ready to come and help out.
The moral of the Italian story being you can vote for whatever you want to and you can vote not to pay for it “right now” but if what you vote for isn’t sustainable it doesn’t make any difference.
The Northern League, Berlusconi’s most influential coalition partners have for years harboured a wish to split Italy into two nations, the prosperous industrialised north and the oilve oil producing south. Northern League voters don’t see why they should pay high taxes to prop up the loss making olive oil farming co-operatives of the south.
Watch for developments as Italy consideres austerity measures.
This article is remarkably “fair and balanced” — especially considering the controversial subject matter.
All the same, I think the author could have raised the issue of why Berlusconi did not implement labor market reforms in his 2nd government (2001-2006), when the economic conditions were more favorable. (His 1st government was of course too short lived.) If he had acted then, the crisis would be more bearable now.
No 1, Demographic – The number you present are sound, nevertheless I find your analysis to be too Malthusian. Remember you’re still dealing with predictions. Apart from that, consider that the the sons and daughters of the immigrants that are entering into this country legally nowadays will be regarded as Italian citizens tomorrow. As per the Italian race (if something like that ever existed) – I am afraid it is long gone already.
Ian Thorpe, even though what you say isn’t necessarily wrong I have to remind you that – officially – the Lega Nord does not advocates for secessionism but for federalism.
Snorri the issue with layoffs has always been a no-go area for the entire Italian left (which makes up roughly for 50% of the votes here). You simply do not talk about dismissals in Italy. I know it’s hard to imagine: different cultures. That is why Berlusconi did not even start thinking about reforming the job market back in 2001.
“the issue with layoffs has always been a no-go area for the entire Italian left (which makes up roughly for 50% of the votes here).”
…but not for Berlusconi’s roughly 50% of the votes.
“That is why Berlusconi did not even start thinking about reforming the job market back in 2001.”
If he had started thinking about something else in 2001, that would be ok, but since he did not start thinking about anything (afaik) and then lost the next election anyway, he might as well have started thinking about labor market reform: the worst that could have happened was losing the next election by a bigger margin.
“You simply do not talk about dismissals in Italy. I know it’s hard to imagine: different cultures.”
I am fairly familiar with Italian culture since I grew up there and still keep in touch. One of my Italian friends is a lawyer specializing in labor legislation (though he does not talk about work with me, mercifully).