Generational Dynamics World View

[John J. Xenakis]

*** 9-Aug-18 World View -- Italy threatens EU with immigration fight to get budget concessions

This morning's key headlines from GenerationalDynamics.com

• Italy threatens EU with immigration fight to get budget concessions
  
• Spain becomes the major destination for migrants from Africa
  

****
**** Italy threatens EU with immigration fight to get budget concessions
****


Migrants disembark at a beach in Tarifa, southern Spain, after crossing the Strait of Gibraltar (Spiegel)

Readers may recall that when Italy held nationwide elections in March,
the elections failed to produce a majority party. Two particularly
bitter rivals were the left-wing Five Star Movement (M5S) that got 32%
of the vote, and the right-wing La Lega (The League) that got 17% of
the vote.

Incredibly, these two parties got together and formed a governing
coalition. They're far apart on many issues, but they do share
similar attitudes on three issues: a nationalistic anti-euro attitude,
a xenophobic anti-immigrant attitude, and a complete lack of fiscal
discipline. Much to everyone's surprise, they formed a governing
coalition based on these three principles.

This new governing coalition announced a list of policy proposals,
including a completely
delusional list of economic proposals.

Italian debt stands at around €2.3 trillion ($2.7 trillion), or
133% of gross domestic product (GDP), the worst in Europe. The new
government does have a way of reducing the debt: spend a lot more
money, and drastically reduce taxes. (As I wrote at the time, I wish
I could tell you that this is a joke, but it isn't.)

Specifically, the government would like to do the following
right away:

• Sharply cut taxes to a flat tax of 15-20%.
  
• Give everyone a guaranteed free basic income of €780 ($922)
  per month.
  
• Increase pension benefits by substantially reducing the retirement
  age.

As wonderful as these proposals are, they have a serious problem:
Implementing them would violate EU rules by pushing Italy's annual
deficit above 3% of GDP.

Italy's deputy prime minister and M5S leader Luigi Di Maio has a
solution: The EU should change the rules, so that Italy can
spend as much as it wants on these social problems. According
to Di Maio:

<QUOTE>"It is possible to introduce both this measure and a
flat tax and to respect European Union deficit limits, because
this is a structural reform for Italy. The European Union must
listen to us in this phase when we want to protect citizens facing
a social emergency."<END QUOTE>

He added that his request to change the EU deficit limit rules
comes with a threat:

<QUOTE>"We want to discuss these reforms with the European
Union to obtain the margin for maneuver that will allow us to
implement those measures. That means doing the same as we did on
immigration. There shouldn’t be a clash with the EU, but a frank
discussion."<END QUOTE>

In the case of immigration, the "frank discussion" was accompanied by
an order closing all Italian ports to immigrant rescue ships. This
forced the EU government in Brussels to adopt new rules for
immigrants, giving Italy at least a portion of what it was demanding.
Interior Minister Matteo Salvini, leader of La Lega, claimed that his
government had gotten 70% of what it wanted from the EU.

So Di Maio is demanding that the EU change its deficit rules, or Italy
will "do the same as we did on immigration." What that means
remains to be seen.

It should be noted that Di Maio's delusional plans and demands are not
being met with unanimous agreement even within Italy's government.
Prime minister Giuseppe Conte is insisting on a "realistic" budget,
and that the new measures will be introduced gradually. Bloomberg and Reuters and Bloomberg and Guardian (London)


****
**** Spain becomes the major destination for migrants from Africa
****

At first, the major route for migrants into Europe was through Turkey
into Greece. When the EU closed the so-called "Balkan route" for
migrants, and then signed the EU-Turkey migrant deal in 2016, the
number of migrants reaching Greece fell sharply.

Then the major route moved westward, with migrants crossing the
Mediterranean Sea from Libya to Africa. However, in 2017
Italy paid money to Libyan warlords and the Libyan government to
prevent migrants from crossing.

So the preferred route to Europe has moved westward again. The number
of migrants crossing the Mediterranean from Africa to Europe has
fallen drastically from previous years, but now the major route is to
cross the strait between Morocco and Spain.

So far in 2018, 27,614 migrants arrived in Spain, 18,475 arrived in
Italy, and 16,142 arrived in Greece. Der Spiegel and El País and Euro News and Guardian (London)

Related Articles

• European markets in turmoil over Italy's unbridled spending proposals (23-May-2018)
  
  
• Bank run worsens Italy's banking crisis (28-Dec-2016)
  
  
• Italy's migration policy opens up battle lines within the EU (17-Jun-2018)
  
  
• Spain's offer to take in Aquarius migrants is rejected as dangerous to migrants (12-Jun-2018)
  
  
• EU migrant crisis moves to Italy as Austria begins closing border (13-Apr-2016)
  
  
• France, Italy have bitter feud over migrants as quota system collapses (16-Jun-2015)
  

KEYS: Generational Dynamics, Italy,
Five-Star Movement, M5S, Luigi Di Maio,
La Lega, The (Northern) League, Matteo Salvini.
Giuseppe Conte, Turkey, Greece, Balkan Route,
Libya, Spain, Morocco, Gibraltar

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John J. Xenakis
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