The Def arrives in Parliament and passes the voting test with full sails. A blind vote. The box is half empty and what is missing is precisely what matters most: how much and how the government can spend, the programmatic part. The other half, the trend side, should be a snapshot of the current situation, but the photo is retouched, the picture comes out distorted. It forecasts growth reduced to 1% from the previous 1.2%, to be “prudent”. But only the Italian government believes it. The forecasts, outside the MEF, are significantly lower, around 0.6%. The deficit ceiling has gone from the 5.3% forecast by Nadef to the 7.45% now ascertained. The debt grows instead of falling but according to Fitch’s accounts, thanks to the Superbonus disaster, it risks soaring up to the peak of 142% and beyond.
MINISTER GIORGETTI, visibly tried, defends the choice not to indicate destinations and route: «It is a realistic Def, compliant with the realism of the European Commission. We have undefined rules and waiting is better than uncertainty.” The main culprit for such a difficult situation, for Giorgetti, is the usual Superbonus, the “abnormal monster” that “has destroyed public finances this year and in the years to come”. Not that he’s wrong. But he should explain it to the members of the majority who continue to want avalanche of exemptions. An idea to avoid the collapse is proposed by Fi, with an amendment: to spread the tax credits over 10 instead of 4 years. The only alternative would be to eliminate the bonus before the deadline set for the end of next year. A step that no one in the majority wants to risk.
But even if the box is blank for the moment, the programmatic item will have to be filled in and trouble will begin for the government. The prime minister does not want to give up on the extension of the tax wedge and the Irpef cut: 15 billion in spending. Everything else is uncertain. The items that in the Def go under the formula unchanged policies cost 20 billion which are not there and will not be there because the Stability Pact is back in force and is about to bite. It is estimated to cost an additional 13 billion per year.
THE MOMENT OF TRUTH that Giorgetti “expects” will arrive soon, on 19 June, when the Commission will notify, together with the already very certain infringement procedure for excessive deficit, the “return trajectory” on deficit and debt. On that basis, the government and the Commission will negotiate the recovery plan, which should be for 4 years but can be extended to 7. Italy will ask for the extension and the Commission will grant it but we will have to see at what price. From that moment, whether we admit it or not, Italy will begin a rather long path of austerity.
THE REAL REASON why the majority decided not to vote for the Stability Pact, even though it had been agreed with the Italian government, is this: no one wants to take on the responsibility of openly approving rules that will weigh first on the State but then and directly on those who live in that State . There will be no alternative to cutting social spending and the more or less hidden introduction of new taxes. Giorgetti, embittered, defends the choice to conclude that agreement, which was effectively rejected by the MEPs of the majority and his own party: «It’s a compromise. It is not the proposal that I have been pursuing for a year and a half. But it is a step forward compared to the rules that would have come back into force.” But then he goes further: «It is not an LSD, Debt and Subsidy Laxity pact. For me the model is what made this country great: Sacrifice, Investment, Work.” But the majority of him didn’t feel like signing a formula that translates as Rigor and Austerity.
Romano Prodi almost agrees with the minister: «It is a compromise and abstention is not a drama». But “the step forward is not that big.” The Pact was stupid and remains stupid.
