The 5S-Lega Italian government is continuing the failed Renzi strategy of demanding the right to bend the fiscal rules without demanding a re-assessment of the fiscal rules – interviewed for AGI by Arcangelo Rociola

This is the English language (original) interview with Arcangelo Rociola, published on the AGI site in Italian, on the Italian government’s clash with Brussels over its budget deficit, the plans for a flat tax (that is not flat) and a universal income (that will never be universal), the 5S Movement’s claim to the mantle of the Italian Left, and my pronouncement that Mr Salvini has brought a Fascist Moment into Italy and into Europe.

The Italian government decided to take on Bruxelles deciding for a budget act that enlarges consistently the deficit/gdp ratio (2,4%). What is your opinion about it? Could it be enough to revitalize the Italian economy?

It won’t be enough to revitalize the Italian economy. For that to happen there has to be a major change at the level of the Eurozone, including a large scale investment program and a complete revision of the Fiscal Compact. What the government’s fiscal policy will do, besides igniting a confrontation with Brussels, is slightly to boost aggregate demand and (depending on how much of that deficit spending will be directed to poor families) arrest the decline in real average incomes.

The government is going to approve a budget act in which some of the previous austerity measures are going to be deleted (e.g. the pension reform), while a peculiar form of ‘basic income’ and a sort of flat-tax will be introduced. Some weeks ago you said the Italian economy isn’t supportable anymore. Are these the reforms the Italian economy needs in order to change the situation?

The Italian economy is sophisticated, export-oriented and potentially strong. What I did say, and I am repeating here, is that the Italian economy is not sustainable within the existing Eurozone architecture and economic policies (i.e. the fiscal compact, the policy on bank resolution and reductions in non-performing loans etc.). Turning now to the policies of the government, let us first be frank about the facts: There is no proposal for either a universal basic income or a flat tax. These terms are used for propaganda purposes and have no basis in the reality of what is being proposed. 5S is proposing a minimum guaranteed income (that already exists in most northern European countries) while the Lega is proposing not a flat tax but a major tax rate reduction for those paying the higher rate and the abolition of a medium rate. Are these ‘reforms’ what the Italian economy needs? While the minimum guaranteed income is necessary for many poor families, and will help to some extent boost the economy, the tax cuts for the rich will enhance inequality without doing much to boost spending significantly. In short, the new government’s policies will do some good, a little harm but not have a substantial impact on Italy’s problems within a Eurozone whose rules and policies are not allowing your country to breathe.

 Among Italian ministers many say their goal isn’t to undo the EU but to change it from the inside: from Euro to bureaucracy, but also migrants and sovereignty. Does your idea of change for the EU match with that of our government?

No, it does not. If the government wanted to help the EU change in a manner that is beneficial to Italians as well as to other Europeans, it would not be repeating Renzi’s ridiculous mistake. You will recall that Renzi too demanded that Italy be allowed to bend the rules of the Fiscal Compact without having the courage to call upon the EU Council, as the Italian Prime Minister had a right and an obligation, to convene in order to discuss a radical change of the Compact. This government is adopting Renzi’s spoilt-child strategy: Without proposing different rules, a new Compact, it is demanding that Italy is allowed to break the current rules.

As for migration and sovereignty, I am very much afraid that what Mr Salvini is doing – by treating flesh and blood fellow humans floating on the Mediterranean as bargaining chips against Brussels – is to promote strategic misanthropy as a legitimate negotiating tactic within Europe. This Italian government is, to put it bluntly, a clear and present danger for European civilisation.

In your latest book you write about what happened in Greece during the debt crisis describing Greece as an ‘evil experiment’ set up by Bruxelles. Do you see the same risk for Italy in the next years?

No, thankfully. While there are similarities, the differences are larger. Italy is too large to put into a troika-like program or to threaten with expulsion from the eurozone (since such a threat would end the eurozone itself).

Do you think that the Greek debt crisis is ended? Which lesson can we learn from it?

 Of course it has not. The Greek state, the Greek banks, most Greek families and companies are bankrupt. Everyone owes money that they can never repay. All the EU authorities have done is to suspend repayments, until 2032, while imposing austerity that will ensure negligible growth in the incomes that must rise substantially for the debts to be repaid. The reason this is tragic is that, meanwhile, the best and brightest leave the country – a loss of irreplaceable human capital. As for the lesson, it is simple and sad: The EU is nowhere near even having the discussion we must have on how to render our common currency area sustainable.

Are there any Italian political parties which are ideologically close to your Diem25? 

 There are millions of Italians that are close to DiEM25 ideologically and programmatically. We learn this every day, up and down Italy, in the many DiEM25 events across the country. There are also many parties and movements that we talk with – and who are, indeed, close to DiEM25 politically and ideologically. However, we also learn that the Italian people are sick and tired of small parties of the left ‘uniting’ without a comprehensive, a coherent program that makes sense to them. This is why DiEM25 is working to create authentic unity on the basis of a common paneuropean program, rather than a sad attempt to get elected without one.

According to many Italian columnist The 5 Star Movement is the “new left” in Italy, as the Democratic Party is facing a deep crisis. Do you agree with this view? 

 That 5S has captured many politically homeless leftwing voters, there is no doubt. But, unfortunately, 5S is using those votes to deliver power to Mr Salvini who is bringing a new fascist moment in Italy and in Europe. From this perspective, 5S will go down in history as a reactionary party.

Do you think that Europe will be different after the next European election? How do you imagine it? 

Europe is changing anyway, with or without us. Without us, left to the clueless establishment on the one hand and the racist nationalists on the other hand, Europe will fragment and become a reactionary, impotent Europe exactly as Donald Trump wants Europe to be. DiEM25 is active for the purpose of revitalising a humanist Europe that rejects both the austerian establishment and the xenophobic right.