The slowness in the decisions of the European institutions. Or even more the loss of credibility, political rather than financial, of Italy which risks frustrating a heroic journey to remain hooked to the European train. “According to my calculations – explains Professor Alberto Quadrio Curzio, rector of Political Sciences at the Catholic University of Milan – between 2009 and 2014 Italy's sacrifices to achieve the goal of a balance and return to the deficit/GDP parameters will amount to 250 billions: a respectable figure”. Certainly, but not even such a demanding program seems capable of reassuring the markets. Indeed, at this point, even a convinced pro-European like Quadrio Curzio is forced to put the Eurobond project, on which he has worked for a long time, back in the drawer. "But it will be necessary to get him out as quickly as possible - he specifies - when conditions permit".
The first step, professor, consists in overcoming the obstacle of the limits to the bailout fund. The appointment is with the vote of the German Parliament. And then?
“My idea was that another step should have been taken some time ago to start the fund operational. From what emerges from the ECB Bulletin, 13 billion out of 220 have been used so far. Furthermore, the regulation that allows the fund to intervene on the government bond market, both primary and secondary, has not yet been drawn up. This slowness in making decisions and executing decided operations has left ample room for speculation which believes it can profitably bet on the prospect of a country's default”.
Are the decision-making mechanisms of the EU the prime culprit, then?
“It would not have been difficult to intervene successfully in Greece which represents 2,5% of the Union's GDP. Now, once the contagion has taken place, the situation has changed.
In your opinion, what is the mechanism that has triggered the attention towards Italy?
“I don't think a rating agency's negative outlook was the determining factor. I believe, if anything, that after the Euroland delays speculation decided it was time to shift attention to a bigger goal. The wobbles of internal politics from the end of July to the end of August did the rest".
Isn't it the fault of the maneuvers, then?
“I don't think the weakness of the announced measures has anything to do with it, which, after all, is not weak at all. According to my accounts, indeed, Italy has committed itself to sensational measures: between 2009 and 2014 between cuts and new levies, Italy will save 250 billion. A huge figure ”.
Will it be enough?
“A primary surplus of 6% is expected at the end of the cycle in the next DPEF. A great result as long as the interest on debt service does not rise to 10%. The credibility of the country will count for a lot”.
How much for credibility?
“I can say that, during the run-up to the euro, a colleague from Northern Europe, I don't remember whether Dutch or German, told me that at least half of the reduction in the spread between Italian and German rates was linked to the determination with which Romano Prodi and Carlo Azeglio Ciampi pursued that goal. Eurotax included. It is an illuminating example of the value that credibility can have”.
But this time a euro tax won't be enough...
"I agree. But here it goes beyond the field of economics”.
Will it help to knock on China?
“It can do a lot, even if we shouldn't delude ourselves that external help can replace our commitment. But, beyond financial aid, it can show us the example of a ruling class that knows how to set itself the goals that really count in today's and tomorrow's world. China has financial resources at its disposal, but also a strategy in raw materials and, unique in the world, a production chain that covers the entire industry, from the poorest technologies that they are careful not to abandon, to the hi-tech in which they are doing giant processes. But, above all, they have adequate vision. I recently listened to a speech by a Beijing deputy minister: our next goal, he said, is to lift 1 billion poor people out of poverty”.
