Members of the Government and Parliament
the Italian representatives at the EU institutions
to representatives of political forces and the social partners
the Italian representatives at the EU institutions and the ESCB
And for your information, the President of the Republic

June 14, 2010

The most serious global economic crisis, and the related crisis in the euro area, not be solved through cuts wages, pensions, state social protection, education, research, culture and basic public services, either directly or indirectly by increasing the tax burden on labor and the most vulnerable social groups.
Rather, there is a serious danger that the implementation in Italy and in Europe the so-called "politics of sacrifice" further accentuate the profile of the crisis, resulting in a greater rate of growth of unemployment, delinquency and deaths of enterprises, and may at some point force some member countries to exit the European Monetary Union.
The key point to understand is that the current instability of the monetary union is not merely the product of accounting tricks or expenses easy. It actually is the result of a plot much deeper among the global economic crisis and a series of imbalances within the euro area, which are primarily derived dall'insostenibile profile of the liberal Union Treaty and the orientation of restrictive economic policies of member countries are characterized by a systematic surplus with other countries.
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The global crisis exploded in 2007-2008 is ongoing. Not being intervened on its structural causes, we are not in fact it never left. As has been widely recognized, this crisis sees one of its main explanations a widening of the gap between a growing global labor productivity and a stagnant or even declining consumption capacity of the workers themselves. For a long time, this gap has been offset by an exceptional growth of speculative financial values \u200b\u200band level of private that, starting from the United States, acted as a stimulus to global demand.
There are those who now looks forward to a resurgence of global growth based on a new boom in American finance. Downloading on public budgets a huge pile of bad private debt is hoped to give new impetus to finance and the related mechanism of accumulation. We believe that on this basis a credible global recovery is very difficult to achieve, and in any case it would be fragile and short-sighted. At the same time consider illusory to hope that in the absence of a thorough reform of the international monetary system, China will have to drive the global demand by withdrawing its business activities and accumulation of foreign reserves.
short, we are facing the tragic reality of a world economic system without a primary source of demand, without a "sponge" to absorb the production. The unresolved
global crisis is particularly felt in the European Monetary Union. The obvious weakness of the euro area comes from deep internal structural imbalances, whose main cause lies in the system of liberal economic policy of the Maastricht Treaty, to entrust to the alleged market mechanisms alone the balance between the various parts of the Union and restrictive and deflationary economic policy of countries in systematic trade surplus. Among these is particularly important Germany, long oriented to the containment relationship of wages to productivity, demand and imports, and the penetration of foreign markets in order to increase the market share of German companies in Europe. Through these policies systematic surplus countries do not contribute to the development of the euro but, paradoxically, move the coupling of the weakest countries. Germany, in particular, accumulate trade surpluses abroad, while Greece, Portugal, Spain and France the same tendency to borrow. Even Italy, despite a modest growth of national income, he finds himself from Germany to buy more than sell, growing debts accumulated in this way. The
full capital mobility in the euro area has greatly facilitated the emergence of imbalances in credit reports and debt between countries. For a long time, based on the assumption market efficiency, it was considered that the increase in debt ratios between the member countries should be considered a positive effect of increased financial integration in the euro area. But today it is quite clear that the alleged efficiency of financial markets is not reflected in the facts and that the accumulated imbalances are unsustainable.
These are the basic reasons why operators in the financial markets are betting on the explosion of the euro zone. They predict that the prolonged crisis of the tax revenue of states will decline and revenues of many companies and banks will be reduced further. In this way, it will be increasingly difficult ensure the repayment of debts, both public and private. Several countries could then be progressively pushed outside the euro zone, or may decide to break away it to try to escape the deflationary spiral. The risk of widespread insolvency and restructuring in the domestic currency debt is therefore the real challenge that moves the action of speculators. The turmoil in financial markets, therefore, focuses on a series of real contradictions. However, it is equally true that the expectations of speculators further fuel mistrust and therefore tend to self-realization. The operations bearish markets push up the differential between the rates dcinteresse and growth rates of income, and may make it suddenly insolvent debtors who previously were unable to repay loans. Financial institutions, which often operate in conditions non-competitive and far from symmetrical in terms of information and market power, can not only predict the future but also contribute to determining, in a pattern that has nothing to do with the so-called 'core' of orthodox economic theory and the alleged efficiency criteria described by its basic version.
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In such a scenario we is vain hope to counter speculation by mere loan agreements in exchange for the adoption of restrictive policies by the indebted countries. The loans in fact merely refer the issues without resolving them. And the policy of "austerity" further reduce demand, depressing incomes and therefore further deteriorate the ability to repay the loans by borrowers, public and private. The same, although significant breakthrough ECB's monetary policy, which stands ready to buy government securities on the secondary market, it is scaled by the announcement of wanting to "sterilize" these operations through maneuvers of opposite sign on the office or within the banking system.
Errors are undoubtedly attributable to the liberal and recessive recipes suggested by economists linked to patterns of analysis popular in past years, but do not seem able to grasp the salient aspects of the functioning of contemporary capitalism.
E 'well, however, clarify that the doggedness with which you pursue the policies of depression is not simply the result of misunderstandings generated by economic models whose logical consistency and empirical relevance has now been put seriously in question within the same academic community . The preference for the so-called "austerity" is also and especially the expression of social interests consolidated. For there is one who sees the current crisis an opportunity to accelerate the dismantling of the welfare state, the fragmentation of work and the restructuring and centralization of capital in Europe. The basic idea is that the money will come out winning crisis may revive the collection using inter alia less competition in the markets and a further weakening of work.
must understand that if you insist nell'assecondare these interests not only act against the workers, but also create the conditions for an uncontrolled centralization of capital for productive desertification in the South and the entire European macro-regions, for migrations increasingly difficult to manage, and ultimately for a huge debt deflation, comparable to that of the thirties.
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The Italian government has so far implemented a policy to facilitate this dangerous deflationary spin. And announced further narrow the budget associated with the persistent downward trend of employment protection, will only cause further fall income, after the heavy already made by Italy record in 2009. Keep in mind that the assumptions are highly questionable scientific basis of which it is believed that through such policies will improve the economic and budgetary situation and therefore there is safeguarded by a speculative attack. Rather, this way you risk the food crisis, defaults, and then speculation.
Neither one can say that the opposition has so far emerged a clear program of alternative economic policy. A greater awareness of the seriousness of the crisis and mistakes of the past is spreading, but voices were raised by some sectors of the opposition suggested that the positions are contradictory and even deteriorate, as is the the case of proposals to introduce more precarious employment contracts or to implement programs of massive privatization of public services. The same, frequent references to the so-called "structural reforms" are counterproductive where, instead of actually characterized by measures designed to combat waste and privileges of a few, are translated into proposals for further downsizing of the labor and social rights. What
warning for the future, it should be noted that in 1992 Italy was subjected to a speculative attack similar to those currently underway in Europe. At the time, Italian workers accepted a burdensome program of "austerity" based mainly on the compression of the cost of labor and social security spending. At the time, like today, it was said that the sacrifices were needed to defend the pound and national economy by speculation. However, shortly after the acceptance of that program, securities denominated in national currency suffered further attacks. Eventually, however, came from Italy European Monetary System and the pound suffered a massive devaluation. The workers and much of the community so they paid twice because of the policy of "austerity" and because of increased cost of imported goods.
should also be remembered that, with the overriding justification reduce the public debt relative to GDP in recent years has been implemented in our country a massive privatization program. Well, however modest effects on the public debt of that program are very largely vanished as a result of the crisis and the implications in terms of positioning the country in the international division of labor, economic development and social welfare are now considered by most authoritative scientific literature highly questionable.
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We believe therefore that the guidelines put in place so far should be abandoned, before it is too late.
should be considered the possibility that long not exist as a locomotive capable of ensuring a strong and stable recovery of world trade and development. To prevent an aggravation of the crisis and to avert the end of the project of European unification is then required a new vision and a change in the Broad Economic Policy Guidelines. Namely, that Europe should undertake a self path development of productive forces, the growth of welfare, environmental protection and land, of social equity.
order for a change of this magnitude could actually grow, you must first give breath to the democratic process, that you must have time. is why we propose to introduce a preliminary immediately clamping down on speculation. To this end, initiatives are under way to coordinate national and European level, but the measures you are putting in place are still weak and insufficient. Stop the speculation is certainly possible, but should clear up the ambiguities and political uncertainties. It is therefore necessary that the ECB is fully committed to purchase securities under attack, refusing to "sterilize" its interventions. It should also provide appropriate taxes designed to discourage financial transactions and foreign currency short- term and effective administrative controls on capital movements. If there were no conditions to work in concert, will be much better intervene immediately in this direction nationally, with the tools available, rather than move to delay or not act at all.
Historical experience shows that to effectively fight deflation must impose a floor to collapse of the wage bill, through a strengthening of collective bargaining, minimum wages, layoffs and constraints on new global rules to protect the work and process of unionization . Especially at this stage, thinking of entrusting the process of destruction and creation of jobs to market forces alone is analytically meaningless, as well as politically irresponsible.
In coordination with monetary policy, it must solicit the trade surplus countries, particularly Germany, to implement the appropriate maneuvers expansion of demand in order to initiate a virtuous process of rebalancing and deflation of the external balance of European Monetary Union member countries. The main trade surplus countries have a huge responsibility, about it. Rescue or destroy the Union will depend heavily on their decisions.
must establish a system of progressive taxation coordinated Europe, which will help to reverse the social and spatial inequalities that helped trigger the crisis. It should be a shift of tax burden from labor to capital gains and income from assets to income, taxpayers with withholding tax evaders, from poor areas to rich areas of the Union.
should significantly expand the federal budget of the Union and make possible the issuance of government bonds in Europe. The goal should be to coordinate fiscal policy and European monetary policy in order to prepare a development plan aimed at full employment and not only territorial balance of spending power, but also the ability production in Europe. The plan must follow a different logic from that, often inefficient and welfare, which has governed the European Development Fund. It must be based primarily on public production of public goods, the funding of public research infrastructure to counter the monopoly of intellectual property, environmental protection, spatial planning, sustainable mobility, the care of people. Are goods, these market failures create that relentlessly, beyond the narrow logic of capitalist private enterprise, yet are essential for the development of productive forces, for social equity, for the civil progress.
It must regulate and restrict the access of small and resource-saving social security for workers in the financial market. You need to restore the principle of separation between commercial banks, which lend themselves to quick, and financial companies operating in the medium to long term.
any strategies against dumping and "export recession" from countries outside EMU, we must contemplate a system of open market conditions, of capital and goods. The opening can be filled only if you implement convergent policies to improve labor standards and wages, and coordinate development policies.
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We are well aware of the distance that exists between our guidelines and the current, terrible involution of the framework of European economic policy.
However, we are of the opinion that today's economic policy guidelines soon could be unsustainable.
If there are no political conditions for the implementation of a development plan based on the objectives outlined, the risk that triggers a debt deflation and a consequent explosion in the euro area will be very high. The reason is that different countries may fall into a downward spiral, made up of short-sighted national policy of "austerity" and subsequent speculative pressures. At some point, these countries could be forcibly driven out of the monetary union, or may deliberately choose to break away from it to try to make autonomous economic policies for the defense of domestic markets, income and employment. If it really went, it should be clear that those would not necessarily on the main blow of the collapse of European unity.
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that event we suggest that there are more conditions to revive the spirit of European values \u200b\u200bby referring only to common ideals. The truth is that it is act in the most violent and decisive Europe as a political attack and the last bastions of the welfare state in Europe. Now more than ever, therefore, Europe to survive and re-launch should load way, a realistic prospect of coordinated development, economic, social and civic life.
For that, you immediately open a broad and frank debate on the motivations and responsibilities of the serious errors economic policy being made, the ensuing risk of aggravating the crisis and an explosion in the euro area and the urgency of a turning point in European economic policy.
Where appropriate pressure the Italian government and representatives of institutions are to perform in Europe not forthcoming to the crisis in the euro area will tend to intensify and the political forces and the authorities of our country could be called upon to make policy choices likely to return to Italy to support an independent perspective domestic markets, income and employment.