The taboos to overcome for a real turning point

True, Italian public spending is mostly made up of pensions, health and salaries. Precisely for this reason courage is needed to face an overall spending reform that allows cutting in a non linear way into big items. Even health, because it is clear to everyone that imposing standard costs and services in those regions of medical malpractice means anything but hitting the fundamental rights to health services. Instead it means making more effective a national health service that already today is a flagship for how it is managed in some regions.

In the same way certain welfare costs or, on an entirely different subject, incentives to businesses cannot be considered taboos that cannot be violated. It is too well known that disability pensions (that are inefficient and ineffective) are a form of social shock absorber in the South of the country. How is it possible that even the government of professors cannot cut into this Italian paradox?
Then there is such confusion on incentives to businesses that even a simple quantification seems impossible. It is a system that grew by accumulation, from one crisis to the next, from one cycle to the other. A Government that intervenes, moving resources to measures that are really useful for growth maybe finding room for some savings would certainly do something useful, for everyone. From businesses that want to innovate and to stay on the market, doing their job (and there are many of these) first and foremost.
Also these further efforts, however, will risk being useless if the resources that are freed end up being absorbed in the spiral of high interest rates. This is why there is maybe one taboo that more than anything has to be faced: that of a strong and immediate reduction in the stock of public debt.

In twenty years of corrective budgets Italy burned hundreds of billions of euro. The result was that debt remained at its peaks (120 percent of GDP) and that the Country progressively became poorer. What is worse, as soon as interest rates started rising Italy found itself with its back against the wall.
We cannot afford another 20 years of this. The proposals are on the table: from the creation of a closed fund in which to channel State assets to the direct sale of public assets, from a strong tax on private wealth asking for a contribution from the high private savings of Italians (but weighing on tax evaders!) to more ingenious forms of securitizations of Italian public debt (a proposal on this was presented to Parliament in these days). All these possibilities have some advantages and some disadvantages. It would be useful that the high expertise of this government opened these files. Il Sole 24 Ore in the next few weeks will try to give is contribution to the consideration.

(translated by Yael Schrage)

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