Italy,Euro,Matteo Renzi,Unemployment

An ominous Italian recipe

December 19, 2016

Italy has just sworn in its fifth prime minister in five years, about par for a nation that has had, by one count, 65 governments in the 70 years since the end of the World War II. But the current situation in Italy is more serious than it was during most of those governmental changes, when the nation seemed to muddle through just fine. The pessimistic view of many analysts is that Italy's problems are insoluble, could spell doom for the Euro currency and even, in a worst-case scenario, trigger a global recession. To sum up Italy's current problems: Economic growth is anemic and will continue to be so according to forecasts by the International Monetary Fund. Unemployment hovers around 12 percent. Many of Italy's formerly vibrant industries are losing money and being propped up by banks that are on the verge of failure. These banks cannot lend to finance new ventures, so the economy stagnates. The government is now running a modest deficit, but over the past decade it has accumulated one of the largest debt burdens, relative to its income, of any European nation. So it has few practical weapons left to stimulate economic growth. Part of Italy's...

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