Maastricht is in Holland and is full of flowers. A bit like San Remo, with the difference that San Remo is famous for the Festival, Maastricht for parameters. Nothing strange. Cities have always linked to something. If it means "the olives of Gaeta", "the pasta of Gragnano", "the Parma ham", then "the parameters of Maastricht" are also valid. City you go, specialties you find.
While olives, pasta and ham are understandable to all, we can however support with a good approximation that the Maastricht parameters are a more indigestible matter.
It was almost the '94. While the war in Europe was returning after 50 years, EU member states were preparing the red carpet for a new currency. Everything was done quietly, with discretion, in the typical style of economic policy maneuvers, in particular those of Monetary Policy, often triggered by interventions unknown to most.
The Maastricht parameters signed with the agreements, roughly summarizing, can be summarized as follows:
maximum deficit 3% of GDP maximum public debt 60% of GDP inflation 1,5% maximum compared to the most virtuous countries
In situations of euphoria it often happens that you forget your condition. So from the boat Europe, in an atmosphere of intoxication, when everyone jumped into the sea, some forgot they could not swim.
In the collective happiness, Italy, for example, forgot to boast a record public debt, exceeding 110% of GDP. It was more or less like diving into the sea with a backpack of cement on his shoulders.
The thing can leave indifferent but it is worth remembering that a state can make money only in three ways:
printing money with taxes with public debt
Entering new currency, as the Economic Policy manuals explain, was a classic of the times of Philip II. The hyperinflation that resulted from American gold, however, has left its mark on Spain for the next four centuries. Even assuming that in certain circumstances it is technically useful, in any case a Central Bank would be needed. Today, however, the Bank of Italy maintains the sole function of control, having delegated the Monetary Policy instruments, branch of the Economic one, to the European Central Bank, based in Frankfurt, Germany.
Second method to make cash is taxes, old allies of all the treasurers since the days of the caves. The negative repercussions of a fiscal tightening on aggregate demand (on GDP) are however intuitive: removing money from the pockets of citizens reduces consumption and in the medium term burns the benefits it produces. Taxes also have political contraindications, being an unpopular and inflexible lever. It does not take a genius to understand that all tax breaks tend to take place away from election campaigns ...
The third instrument, dear to the old Italy system, is precisely the public debt. Through BOT and CCT placed in avalanches thanks to generous interest rates, for decades a cash system has been created based on the advance of cash: citizens were spared, the State had liquidity. A sort of constant reference to the future, giving a good idea of having a stratospheric and cumulative debt.
With this in mind, signing the Maastricht agreements and the related parameters was how to deliver the portfolio (in Frankfurt) before shopping. The only systems to have liquidity have become the tax burden, the (s) sale of public assets and the cutting of expenses.
Here it is explained that while the olives of Gaeta, the pasta of Gragnano and the Parma ham like them all, the Maastricht parameters have started to be on the zebedeis to many.
The synthesis that fully reflects the Italian situation, obviously extends to all those countries with non-virtuous accounts which, like Greece, have always been based on public spending to feed their aggregate demand. Here is the creation of two parallel economies:
on the one hand the States with the accounts more or less in order, able to cope with the new system of monetary integration with the same schemes as before; on the other, countries with a high public debt and accustomed to a mostly public economy, suddenly forced to revolutionize their economic policy.
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Greece in this disaster also had the handicap of not being a structured economy, especially in the manufacturing sector, which elsewhere guarantees liquidity flows with exports. To remain in the euro area, even Portugal, Spain and Cyprus have the same problem.
Italy vice versa is part of the G8 and has so far been able to postpone the disaster thanks to the volume of its commercial numbers and a decidedly different weight compared to the cousins of Southern Europe. But the bill has arrived.
Understanding whether it is the fault of Frankfurt or bad management of public money is a sensitive issue.
However, it is worth reflecting on the genius of having unified different systems on the financial, economic, trade union and not least political level. In terms of economic policy, we are talking about liberal-economy systems alongside countries with traditional welfare. In terms of weight, we are talking about industrial superpowers with aggressive economies placed on the same level of semi-agricultural systems based on debt; in terms of work, we are talking about markets with different wages unified from one day to the next.
We should explain whether integrating Europe from above with these criticalities has been more useful than looking calmly at the common points from below. Rather than unifying monetary and financial systems, perhaps a reflection on the common roots of peoples would have helped more. Maybe lengthening the time of integration, but ensuring its tightness.
Assuming that the Greek crisis re-enters, there will be other questions that will question us about the effective usefulness of such a congenital Union. Just think about Serbia and Albania, candidates for entry in the coming years. The unresolved problems of the Balkans will come back and one wonders if interest rates and rhetoric will be enough to restore millennial wounds.
The dignity and well-being of a people is not said to go through numbers, finance or a common currency. It is not enough to eliminate borders to ensure coexistence between men.
All this in Maastricht, among flea markets full of flowers, is of little interest. In the meantime, retirees and ordinary people are queuing up at ATMs in the south. If this is Union ...
Giampiero Venturi
