We have to defend national interests. Quite right. But what exactly they are is a question that many are asking. To try to understand this and clarify it, we met Francesco Pontelli, economist, business consultant and economic journalist.
Italy has been in debt up to its neck for decades and it is always in check by the international community and banks on any initiative that could indicate economic and political freedom. Can it ever regain some autonomy in this sense?
At the end of the years' 70 Alberto Ronchey, a journalist for Corriere della Sera, asked Ugo La Malfa, secretary of the Republican Party, what he thought was the future of the country. The secretary replied that a nation that has access to debt to finance current spending has no future.
After thirty-nine years from that prophecy, which gave him the definition of "Cassandra," all the knots came to the comb. The 2008 crisis is compounding. For nearly forty years, all governments have come to full-fledged hands to finance public spending on public debt by dragging it to the current 2239 billions. Aware of how secure that no one would have called them to respond to those little-shared political-economic choices and the negative consequences for the Italian population.
From the 2011, year of entry of the Monti Government, to date the debt has increased by more than 50 billion a year with an increase rate of 4 times higher than the GDP growth (Gross Domestic Product). To this must be added the overall values of all the financial maneuvers that the three governments that have followed have launched up to 2016: the value reaches the figure of about 400 billion. Among other things, it is equal to the amount indicated, fatality, by the International Monetary Fund (IMF) to reduce the public debt and bring it to a level close to 110% on GDP.
Still according to the last few years, the choices of the last three governments have been in my opinion not adequate as we have witnessed an absolutely unique economic phase, conditioned by the action of Quantitative Easing which has brought interest rates to zero. if not negative. Instead the Monti, Letta, Renzi and Gentiloni governments have continued to increase public spending up to the current 828 billion, drawing heavily on a greater public debt, convinced, like the previous governments of the First and Second Republic, that no one will come to ask them to respond to these economic policy choices.
It should also be remembered that this higher public spending is entirely devoted to financing the bureaucracy and certainly not the infrastructure costs as well as demonstrates the difficulty with which the current government is trying to get 3,4 billions to redress the deficit as a reference to the European Union.
This is the current picture after forty years of some sort of economic vision. Clearly, anyone argues that leaving this situation alone is the only solution, it proves to be anchored to an economic vision that does not take into account past experiences and which persists in stubbornly not wanting to see the reality of the facts. This financial situation highlights the crisis of management rather than a system and is linked to the human resources - hence the political and executive class - that have generated it. Most parties now believe that public spending is the first vehicle to gain electoral consensus and keep the current political class at the power of the government.
To this state of affairs is added the absolute lack of an industrial policy. In the last thirty years, the entire Italian academic-political and economic world had fallen in love with the New Economy now transformed into App / economy and Sharing / economy. However, both with minimal employment repercussions and in any case, as the statistics show, 75% of these companies go bankrupt within three years or are acquired by the big IT giants.
What should you do?
Return to an industrial policy that increases GDP through an Italian and European regulatory framework that protects Italian labor and products in the world as a cultural expression of industrial and professional know-how.
It is the only option. As truly tuned to the real market expectations. Just think how last year Bloomberg Investment published the data of a market research from which emerged as the '82% of American consumers was available to pay even 30% more than the Chinese product provided that expression of Made in the USA.
Such a regulatory framework can offer greater competitiveness and protection of investment in Made in Italy and, at the same time, support, including regulatory, remuneration and hence domestic demand for goods that have been falling for too many years.
In Italy only through a policy of industrial product protection, linked to a decrease in current spending on investment spending, a scenario can now be created for the next 20 years to allow Italy to exit the current corner in which the debt has relegated it.
Compared to the 2007 we are still about 11 points below the GDP and with the current growth rate it will take from 13 to 15 years to reach pre-crisis level.
What are the economic interests of the Italian System?
This question presupposes that those who manage our country do so to ensure the best prospects for economic growth to the country itself and not for personal interests, shop or party.
Unfortunately, the history of the last forty years has shown us that they were privileged to short-term immediate interests through the use of debt and increased public spending that financed it, rather than creating prospects for future growth. In order to ensure a well-paid job opportunity growth, as the market demanded, it always requires and will require Made in Italy products, naturally understood as the synthesis of cultural, professional and productive value.
At present, the interests of our country can only be a balance between economic growth, debt and public spending because they are now too unbalanced to the last two factors that in this case represent real anti-competitive factors. Thus, in a re-established general view of common well-being, having already lost that unique opportunity in the world that was the reduction in interest rates on public debt that would have allowed a sharp reduction in the debt itself, one must always leave the assumption that only an economic growth structure represents the best conditions to be followed by cultural and social growth.
In other words, in the last thirty years it has been thought that social and cultural growth could be detached from economic progress. On the other hand, I am convinced that greater wealth gives citizens the possibility of free choice and, consequently, creates the conditions for social and cultural growth that presupposes greater shared well-being.
Is there anyone who follows this policy, maybe here near us?
Of course, this is the policy that is following Switzerland, Slovenia, Croatia and France. They are setting favorable conditions for the reallocation of our Italian SMEs (Small Medium Enterprises), which are considered a source of well-being. It is precisely those companies that here come to us in the background, in terms of legislation and legislation, because too often the economic visions are oriented towards the big companies.
You see, the regulatory recognition of the specificity of Italian productions represents the initial condition for developing our country economically. Therefore, exactly the opposite of what happened with the CETA (commercial agreement between Europe and Canada) which legally recognizes only the specificity of 18% of our PDO and DOC.
Which countries could guarantee greater interests to our country? And how?
In a barrier-free world and with the globalized market it is difficult to identify which countries, more than others, can secure economic development in our country. It should be remembered, however, that western markets, such as Europe, the United States and Canada, are now basically saturated markets. In the sense that growth rates may be in favor of this or that company, but the total sales of certain sectors are basically stable.
Excuse me, but are the developing countries saturated too?
No, developing countries can ensure significant growth rates over the next few years, but they may have financial benefits for the companies they export. The higher the growth rate of these countries, the smaller the ability to immediately absorb Made-in-Italy products that represent the highest in the range. So, in this case, growth prospects go into the medium and long term. Obviously, sanctions should be abolished in Russia.
Would greater openness to Russia be desirable?
Russia is certainly a commercial partner and an energy provider. Our industrial system needs both. Of course, this will ensure that there is a double link to this market: export oriented strategy and energy strategy.
All this obviously does not exempt our country from trying to diversify the sources of energy supply as much as possible, in order to balance any political upheavals that could lead to an unexpected political imbalance.
As for our exports, for example, Russia is a key trading partner, especially in the shoe industry, as evidenced by the crisis in the Marche region linked to sanctions notes. In principle, therefore, I consider Russia a country of great importance for our economic growth.
Summarizing: abolition of sanctions against Russia and immediate recovery of trade flows, because Russia is a key partner for the economy as an outlet market. Our energy strategy must be balanced with other suppliers in order not to be too dependent on a single supplier.
How do you see the Italian energy scenario?
I think that compared to only four years ago, the world energy scenario has changed with the entry into the world of oil production in the United States of America. The US energy autonomy, which will be reached in the current year or in the 2018, represents the fundamental justification for a certain isolationism common to both the politics of Trump and that of Clinton. The responsibility for managing crisis areas is discharged on the European allies. Proof of this is the recent request of the new US project to a greater financial commitment by the European allies for the maintenance of the NATO Alliance.
In this renewed context and with the possibility that the United States can take on the role of the world's leading producer of oil, Italy has chosen to support Iran's reintegration into world trade by abolishing sanctions (such as the EU) while they are instead maintained by the USA.
The political motivations that justify supporting the Iranian population increasingly projected towards a democracy remain valid. At the same time, however, our energy supply policy remains problematic, which specifically discourages the policy of a trading partner such as the United States for a state like Iran that does not ensure stability. Italy, as a trading partner, however, needs absolute stability.
Can the Italian defense and military system help the economy?
Every area of the Republic can contribute to the achievement of economic and political growth goals. In this sense, our Armed Forces are engaged in various peace-keeping operations in multiple world scenarios. They have always been able to appreciate and obtain excellent results even in the simple terms of consideration by local people. After all, our divisions represent through their professionalism the first expression that populations have to appreciate "our specificity". So, the precious action of Italian military forces lay the foundation for later to be appreciated the Made in Italy, a not only commercial but also cultural expression in the broadest sense of the term.
