The new right-wing Italian government

 in front of the European crisis

 

The rightwing alliance will take over the leadership of the Italian government by the end of October with Giorgia Meloni at the top. The premiership candidate has been moving with concern so far. It must govern a country that is heading towards economic stagnation while prices have increased to an extent unknown in recent years, unemployment and the difficulties of weaker areas such as the South are increasing. And where it is no coincidence that the of the 5 stars movement has reported an unforeseen great success.

Which line will the new right-wing coalition - Meloni's Fratelli 'Italia, Savlini's Lega and Berlusconi’s Forza Italia - choose, confronted with the crisis it will inherit?

The traditional right program offers no solution. It will be useless to take a position against immigration, if not to testify to a position that ignores the disastrous problems of migrants. The immigration from Nigeria or Ghana. to cite by way of example two countries characterized by an unsustainable economic and social condition, they will continue to attempt the passage through the Sahara and then Libya, becoming prey to gangs that strip them of the few resources they have kept. Not welcome them, and possibly try to facilitate their passage to other European countries? To send them back - where?

The program of the right-wing parties announces, among other things, various (and bizarre) measures such as the reduction of taxes for richer people. In other words, reduce public revenue while national income tends to go to zero and total revenue falls automatically. It will be said that the government will propose to implement the program by diluting it, in the course of the legislature, if circumstances allow it or, more realistically, it will be necessary to abandon it.

But it's not just about the difficulties of living up to an ordinary right-wing agenda. The new government will find itself in the middle of the conflict with Russia. Brothers of Italy have already chosen a course of action by siding with the United States. The choice is not accidental. The American consensus is a guarantee for a government led by the far right that is unprecedented in Italian post-war history. The American guarantee is an important condition. Meloni has cleverly cultivated it by clearly siding on the American line in the ongoing conflict in Ukraine.

Problems remain unresolved and worsening. The United States is scarcely or not at all interested, in the economic and social crisis involving European countries. These are subject to an unprecedented increase in prices that affects not only oil derivatives but the entire industrial system. Zero growth is a problem for any government. For those, as in the Italian case, who in the past decade have been victims of the recession interspersed with phases of modest growth, the right-wing government will have to face a condition aggravated by the energy crisis for the families and the industrial asset.

The crisis obliges the search for remedies. Great Britain and Germany have proposed to intervene in different ways. It is interesting to mention the contents of the interventions together with the possible outcomes.

 

 

 

The Chancellor of the Exchequer of the new British Conservative government has decreed an increase in public spending of 45 billion pounds to support demand. Rising government spending carries the risk of further devaluation of the pound already close to par with the dollar. To stem the consequences of the increase in public debt, the Central Bank put the government 60 billion pounds. Subsequently, the manoeuvre, which favoured the richest part of the population, was corrected to encourage the increase in spending by less well-off families.

 

 

Substantially different was the choice of the German government which decided to invest 200 billion euros from the public budget to compensate for the increase in the price of fuel, support household income, favoring the recovery of consumption, investments and exports. A measure that moves in the opposite direction to the line of the European Commission against the increase in public spending.

 

The European Commission sees in the German example a model in contrast with the austerity line of the Union which imposes control and tendentially the reduction of public spending. First of all because the maneuver took place without being presented to the Commission, then for the fear that the example could be replicated in other countries and, in particular, in Italy, the third largest country in the eurozone.

 

In the last decade, the Italian center-left governments have followed European rules by passing from one government to another - seven different governments in a decade - with the result of alternating phases of low growth with recessive phases, the result of which has been the contraction of the national income, currently lower than that recorded fifteen years ago in 2007.

The new right-wing government finds itself in the alternative of abiding by the rules imposed by Brussels or violating them with a growth in public spending tending to support national growth but necessarily destined to increase public debt.

In essence, the new right-wing government is faced with a growth problem accompanied by the urgency of inflation which has reached 9 percent, a level unprecedented in recent decades. It can take a line more or less similar to the British and German ones. But, in this case, the country does not escape the conflict with Brussels.

 

There are many reasons why Italy should follow the German line in contrast with the policy of the European Commission. A reasonable choice mired to avoid the collapse of consumption to the detriment of the large majority of families, and the collapse in investments.

 

 

 

The ongoing war has enormous consequences. The energy loss that weighs on families and businesses tends to drastically reduce the growth.

 

The direction the new government will take for this fundamental aspect remains uncertain. The only certainty is that the continuation of the policy followed in the past in compliance with European rules can only aggravate the crisis that has seen the alternation of governments in the last decade with no way out.

A radical change would be needed following the example of countries inside and outside the European Union. But this opens a conflict with the Brussel authorities. The new right-wing government may lead to a clash with Brussels politics or the continuation of the failed policies of the past decade. The future remains uncertain.