Europe is called to "a massive investment of intelligence and financial resources" in the field of education, because "participation in the society of the future will require today's young people even greater capacities for discernment and adaptation. We must remind young people that the best way to find direction in the present is to design the future". Mario Draghi said this as he opened the forty-first edition of the Rimini meeting organized by Communion and Liberation.
THE SUBSIDIES END
“The pandemic threatens not only the economy, but also the fabric of society: it spreads uncertainty, paralyzes consumption and investment, damages employment – continued Draghi – In this scenario, subsidies are a first form of closeness to people most affected: they are used to survive, to restart. However, more must be given to young people: the subsidies will end and if nothing has been done in the meantime, the lack of professional qualifications will remain, which could sacrifice their freedom of choice and their future income. In the current circumstances, pragmatism is needed”.
WHAT WILL COME AFTER THE PANDEMIC
The former number one of the ECB then underlined that “we do not know when a vaccine will be discovered, nor what reality will be like then. Opinions are divided: according to some, everything will go back to the way it was before, according to others, we are facing the beginning of a great phase of change. The truth is probably in the middle. In some sectors there will be non-substantial changes, in others technologies will adapt rapidly, still others will grow and adapt to the change in demand imposed by the pandemic. But in some cases the return to the previous levels is at least unlikely”.
LEADERS ARE CALLED TO GREATER HONESTY AND WISDOM
For this reason, "economic policy is expected not to add uncertainty to that caused by the pandemic - Draghi said again - In the second quarter of 2020, the economy contracted at a rate comparable to that recorded by most of the main countries during the Second world War. There are fears of a destruction of human capital unprecedented since the time of the global conflict. Governments intervened: deficits and public debt grew as never before in peacetime. The direction of the response has been corrected. The rules have been suspended to make room for a pragmatism that takes into account the changed conditions. As Keynes said: When facts change, I change my mind. What do you do, sir? The recession was prevented from turning into a protracted depression. But the measures will not last forever. Leaders are called to greater honesty and wisdom. We must think about reforming the existing one without undermining principles such as membership of Europe and multilateralism. The future does not lie in a reality without points of reference, but in even profound reforms of the existing situation and we need to think about it immediately. We also need to be clear about the goals we set for ourselves”.
DEBT IS SUSTAINABLE ONLY IF IT IS GOOD
According to Draghi, “debt will remain high for a long time, but it will be sustainable if used for productive purposes, such as investments in human capital or research. That is, if it is perceived as a good debt. On the other hand, its sustainability will fail if it is perceived as bad debt, that is, unproductive. The perception of the quality of the contracted debt is as important as the level of interest rates, it produces effects on investments, employment and consumption. The debt created by the pandemic is unprecedented and will have to be paid by those who are young today. Depriving a young person of the future is one of the most serious forms of inequality".
EUROPE CAN EMERG STRONGER FROM THE CRISIS
The former number one of Bank of Italy and the ECB argues that “Europe can emerge from this crisis strengthened. The fund for the future generation it enriches the tools of community policy: the recognition of the role that the European budget can play and the start of common debt issues are important and can become the beginning of a plan that will lead to the creation of a community treasury ministry”.
Furthermore, “after decades of the intergovernmental method, the Commission has returned to the center of action and we hope that in the future the decision-making process will continue to be less difficult. This step forward must be cemented by the credibility of national policies. If it happens, it will no longer be possible to say that the changes imposed in the European institutions are temporary – concluded Draghi – This is an opportunity to design a common future: it is in the nature of the European project to evolve gradually”.
