A Day of Peril for the E.U.: Threats Emerge From the U.S. and Within

The battles are likely to come not just on economic grounds, but on key European policies on migration and sanctions against Moscow.

President Sergio Mattarella of Italy had earlier vetoed an anti-euro economist, Paolo Savona, as finance minister, raising the chilling prospect of new elections that would have effectively been a referendum on membership in the euro.

In the end, the two populist party leaders named another finance minister, but pointedly made Mr. Savona the new Europe minister instead. There, he will have cabinet rank and get to annoy other European ministers in Brussels meetings — including, presumably, the country’s own pro-European foreign minister, Enzo Moavero Milanesi.

A Day of Peril for the E.U.: Threats Emerge From the U.S. and Within
A Day of Peril for the E.U.: Threats Emerge From the U.S. and Within

The new finance minister is Giovanni Tria, a little-known economics professor who in recent opinion pieces has denounced Germany’s trade surplus as an indicator of the failure of the euro.

And, of course, the fundamentals of Italy’s economic situation have not changed — a cumulative debt of over 130 percent of gross domestic product, low growth, high unemployment, and banks with mounds of nonperforming loans.

Even if the new government keeps Italy in the euro, it promises to reverse a rise in the retirement age and sharply increase government spending and the fiscal deficit, which could create another credit crisis.

The cost of the two parties’ respective electoral promises — most notably, a flat tax and a form of guaranteed income — would amount to at least 6 percent of gross domestic product, the economist Silvia Merler told Politico.

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