ITALY is now on a collision course with the EU. The European Commission has issued an ultimatum insisting that the country’s budget plan does not comply with its fiscal recommendations and must be ditched. It has given Italy three weeks to make amendments or else face huge fines.
The conflict has already led to big share falls. The EU Commission stressed that Italy’s public debt, at 131.2 per cent of domestic production, is the second largest in the European Union, so that more cuts are needed not less!
Italy’s Foreign Minister Enzo Moavero Milanesi however responded: ‘The last word on the budget matters must be left to to national parliaments.’ Italy’s governing parties have vowed to implement their campaign promises, including a minimum income for the unemployed.
The country now has been given three weeks to submit a new draft budget by arrogant Brussels. The Commission’s Vice-President for the euro, Valdis Dombrovskis, said Italy’s response to the Commission’s concerns was ‘not sufficient’ – and the euro’s rules were the same for everybody.
Italy is defiant: ‘This is the first Italian budget that the EU doesn’t like,’ wrote Deputy Prime Minister Luigi Di Maio on Facebook. ‘No surprise: This is the first Italian budget written in Rome and not in Brussels! His co-deputy PM Matteo Salvini added: ‘They’re not attacking a government but a people. These are things that will anger Italians even more.’
The new Italian coalition government has vowed to ‘end poverty’ by bringing in a minimum income for the unemployed. Other measures include tax cuts and scrapping extensions to the retirement age. The EU however says that it has little option but to take ‘firm measures to break Italy’s resistance’ if other states are to be discouraged from following its example.
Even before the Commission announced its rejection of the Italian budget on Tuesday, European shares fell to their lowest levels in nearly two years. Following the announcement, the Italy-Germany 10-year bond yield gap, widely used as a relative yardstick of Italy’s position on the markets, widened to a new high of 314 points.
Meanwhile, in Greece, a country shattered by EU austerity measures, the working class is fighting back. A nationwide 24-hour general strike has been called for the 14th of November by the Greek Federation of Public Sector Unions (ADEDY) and the Athens Trades Council to demand that the minimum wage rises from 450 to 650 euros a month.
The coalition government of Alexis Tsipras is in the middle of a huge economic and political crisis. The Athens stock exchange keeps on diving and the Greek banks are near collapse. Thanks to the EU diktat, there is mass poverty and unemployment.
According to Eurostat a staggering 35% of Greece’s population, some 3.8 million, live in poverty while the youth unemployment rate is over 50% if the tens of thousands of young people on ‘employment schemes’ are counted.
Eurostat also stated that Greece’s debt stands at 317 billion euros, 176% of the country’s GDP. The Italian workers are determined not to go the same way, and will not give way to the EU.
Meanwhile in Italy, the president of the Italian Budget Committee in the parliament, Claudio Borghi, has given his opinion of the future of the euro, and the EU. ‘The euro doesn’t work and it’s a fact. Today, we have to pay unacceptable and unforgivable taxes on the (bond yield) spread, which we owe to people who bet on “disagreements” between EU member-states. This is absurd. In this case, Europe cannot venture upon making the ECB the creditor of last resort, that is, to give it the opportunity to balance markets.
‘Today, in the event of a crisis, the ECB can decide not to help one country, but help another instead. Does this seem normal to you? Of course not, and that’s why markets are unstable. In this case, the entire system will collapse, with the euro falling apart.’
These revolutionary developments in Italy and Greece, along with the rising class struggles in France are making it perfectly clear that the UK workers were absolutely correct to vote to leave the EU. The working class in the UK must now take general strike action to force an immediate break with the EU and form an alliance with the workers of Italy, France, Greece and Germany to bring down the bosses’ and bankers’ EU and replace it with the Socialist United States of Europe!