''At 2.3 trillion euros, Italy has the largest debt load of any country
in the entire European Union, and it is paired with the lowest rate of
economic growth. Every third Italian under the age of 25 is unemployed.
Banks in the country are struggling under the weight of a huge number of
bad loans. In contrast to other eurozone countries that have
experienced crisis, Italy never experienced an economic boom in the
initial years of the currency union. Per-capita income has stagnated for
20 years. And yet Italy has still managed to adhere to strict EU
deficit rules in recent years. From the Italian perspective, however,
the benefits of doing so have been nonexistent. Against that background,
the implosion of the country's political system can hardly come as a
surprise.
No Simple Answer
Germany will not be able to isolate itself from the problems in
Italy. If the crisis devolves further, a critical question will have to
be asked: What is Germany prepared to do to keep Italy in the currency
union? The explosiveness of this question is hard to overestimate. And
unfortunately, it is already clear that there is no simple answer.
Italy needs more growth to be able to pay down its mountain of
debt, and it also needs more social equality, especially between the
rich north and the struggling south. The question as to how to achieve
those goals, however..''
No comments:
Post a Comment