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Thread: Coming soon to the USA ? Italy's Austerity Measures Risks 'Social Explosion'

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    Default Coming soon to the USA ? Italy's Austerity Measures Risks 'Social Explosion'

    from

    (snip)"(Reuters) - Italy risks a "social explosion" over the government's austerity measures and unions plan more protests against them, the head of the country's largest labor federation CGIL said on Wednesday.

    CGIL leader Susanna Camusso told Reuters that Prime Minister Mario Monti's government was "deeply conditioned" by its need for support from the party of his predecessor, Silvio Berlusconi, and its austerity plan spared the rich and demanded excessive sacrifices from ordinary Italians.

    "We see every risk of a social explosion," Camusso said in an interview, warning that anger was rising over a pension reform she said was unnecessary, measures that cut already weak purchasing power and a worsening labor market.

    The left-wing CGIL and the two smaller and more centrist unions, CISL and UIL, are holding a series of strikes this week to protest against the 33 billion euro plan that aims to shore up public finances and combat Italy's debt crisis.

    Camusso, the first woman leader in the CGIL's 105-year history, acknowledged that Monti had made some concessions to union demands by reducing cuts to low pensions and slightly easing a housing tax, but this did not go far enough.

    "It would be absolutely excessive to say we are satisfied; the solutions are insufficient," she said, announcing that the CGIL and its partner unions would hold a national street demonstration just before Christmas.

    More than half of the CGIL's 6 million members are pensioners.

    Speaking in her office in central Rome, 56-year-old Camusso tried to strike a balance between accepting the need for tough measures to solve the debt crisis and an insistence that the steps adopted were unfair.

    "We are flexible in the face of the emergency but we are not willing to accept everything," she said. "You can't ride roughshod over people.""(snip)


    Of course this article didn't specifically mention what the specific impact of these austerity measures would be ...


    from

    (snip)"Prime Minister Mario Monti has unveiled a €30 billion (NZ$51.6b) package of austerity measures, raising taxes and increasing the pension age in a drive to shore up Italy's strained finances and stave off a crisis that threatens to overwhelm the euro zone.

    Packed into a single emergency decree which comes into effect before formal parliamentary approval, the measures followed growing pressure for sweeping measures to restore confidence in the euro zone's third-largest economy.

    Monti said the package, divided between €20b of budget measures over 2012-14 and a further €10b in measures to boost growth, was painful but necessary.

    "We have had to share the sacrifices, but we have made great efforts to share them fairly," he told a news conference, in which he said he had renounced his own salary as prime minister and economy minister.

    In a mark of the emotional impact of the cuts, Welfare Minister Elsa Fornero broke down in tears as she announced an end to inflation indexing on all but the lowest pension bands, a move that will mean an effective income cut for many pensioners.(snip)

    (snip)"With yields on Italian 10 year bonds near 7 per cent and almost €160b euros of bonds needing to be refinanced by the end of April, the worry is that market confidence has been so badly damaged that outside help will be needed.

    Ad Feedback Deputy Economy Minister Vittorio Grilli said around €12-13b of the €30b package would come from spending cuts with the rest coming from tax increases.

    As well as an end to inflation indexing for many pensioners, the measures will see the minimum pension age for both men and women raised in stages to 66 by 2018 with incentives to keep workers in employment until 70.

    A new property tax, which head of Italy's local government association Graziano Delrio said would raise some €10-11b, will account for the bulk of the new revenues.

    A two-percentage-point increase in value added tax could also be introduced from September next year, while there would also be new taxes on luxury goods like yachts and some gas-guzzling cars.

    As part of a crackdown on tax evasion, cash transactions of more than €1000 will be banned, and there were also measures to liberalise business opening hours and open up pharmacies and the transport sector to more competition.

    The package also cut a number of local government functions in a bid to reduce the cost of administration.

    Monti left for a later date the vexed question of reforming of contracts that hinder companies from laying off workers, a measure seen as key to overhauling the labour market, but which is bitterly opposed by unions."(snip)

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    Default Re: Coming soon to the USA ? Italy's Austerity Measures Risks 'Social Explosion'

    ^^^Is it possible to just post the article without your inference about it "Coming to the USA"?

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    Default Re: Coming soon to the USA ? Italy's Austerity Measures Risks 'Social Explosion'

    ^^^ yes, but that would require that existing US gov't debt was less than 100% of GDP ( it isn't ), that would require that US gov't deficit spending in excess of tax revenues was shrinking ( it isn't ), that would require that future year US gov't spending 'commitments' for retiree and other benefits were growing slower than the rate of growth of the country's economy in general ( they're not ) ...

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    Default Re: Coming soon to the USA ? Italy's Austerity Measures Risks 'Social Explosion'

    Presently, the world's economy is on life support. Government spending varies from country to country, but government spending amounts to a huge percentage of world GDP. Until the economy mends that will have to continue. If we take out the support of government spending, a world wide recession will take place. The other problem though is in the US, much of Europe and Japan, there is no credible plan to reduce government spending once the economy does improve. Without a plan, and that's what S&P's downgrades have been about, recovery will take longer because investors and business are reluctant to invest and take risks.

    I will avoid the political, but I will say that the US especially needs to bring about sound regulation to the financial services industry. What we have is a system of crony capitalists on Wall Street who get wealthy by designing financial products that don't make commerce more likely. What the do is get rich by feeding at the government trough. That has to end. When the US economy worked best was when people got rich by making things or selling things that people wanted. Make things better, make them smarter, make them cheaper, make them faster, whatever. We have to get back to that model. In short, we need to make money by moving molecules, not electrons.

    Z

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    Default Re: Coming soon to the USA ? Italy's Austerity Measures Risks 'Social Explosion'

    Quote Originally Posted by Melonie View Post
    ^^^ yes, but that would require that existing US gov't debt was less than 100% of GDP ( it isn't ), that would require that US gov't deficit spending in excess of tax revenues was shrinking ( it isn't ), that would require that future year US gov't spending 'commitments' for retiree and other benefits were growing slower than the rate of growth of the country's economy in general ( they're not ) ...
    There are way too many variables to make these kinds of generalizations and Italy and the USA are apples and oranges for a wide range of reasons. You've been posting this kind of reactionary stuff for so many years now- do you remember when you posted about the food riots that were supposedly "Coming to the USA" in a few month- over 2 years ago?, or how oil was going to go to $200 per barrel?.

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    Default Re: Coming soon to the USA ? Italy's Austerity Measures Risks 'Social Explosion'

    do you remember when you posted about the food riots that were supposedly "Coming to the USA" in a few month- over 2 years ago
    In terms of a fact check, I posted about food riots in other countries ( which did happen ). And I, like many others, failed to conceive of the possibility that 16% of the US population in general, and 25% of US children, would become 'permanently' dependent on food stamps. While the 'politics ban' precludes a whole lot of additional discussion, it can be safely said that the 'costs' of SNAP and other social welfare programs which serve to prevent potential riots have not actually been paid for. Like Italy these 'costs' have been financed by increasing levels of gov't debt. And like Italy, the global financial community will eventually force a reduction in the amount of new US gov't debt they're willing to buy and hold, which will eventually force austerity measures to be enacted in the US.


    how oil was going to go to $200 per barrel?.
    Admittedly, from the perspective of 2 years ago, a near total lack of an economic recovery thus a greatly reduced worldwide demand for oil were inconceivable. From

    (snip)"Industry analysts, including Trilby Lundberg and AAA officials, attribute falling gas prices to declining demand due to the nation’s persistent unemployment. With fewer Americans working, demand for gasoline for commuting purposes has been shrinking.

    As a result, a $4.19 a barrel increase in crude oil prices over the past week alone pushed the price to more than $100 a barrel and cut into the profits of gasoline refiners and retailers.

    Now analysts are watching to see if the situation changes based on economic statistics released last week. The U.S. Labor Department announced payrolls gained 120,000 workers and unemployment rate fell to 8.6 percent, the lowest rate in two years.

    AAA spokeswoman Jessica Brady said it is unlikely there will be an immediate surge in gasoline consumption.

    “U.S. stockpiles of oil increased almost 4 million barrels during the last week of November; a sign demand is still relatively weak,” Brady said. “Gas prices may stabilize this week as we see whether or not oil prices continue to rise beyond $100 a barrel or if prices retreat."(snip)

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    Default Re: Coming soon to the USA ? Italy's Austerity Measures Risks 'Social Explosion'

    Quote Originally Posted by zofia View Post
    presently, the world's economy is on life support. Government spending varies from country to country, but government spending amounts to a huge percentage of world gdp. Until the economy mends that will have to continue. If we take out the support of government spending, a world wide recession will take place.

    I will say that the us especially needs to bring about sound regulation to the financial services industry. What we have is a system of crony capitalists on wall street who get wealthy by designing financial products that don't make commerce more likely. What the do is get rich by feeding at the government trough.
    Z

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    The country has been looted.

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