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Italians don't need to change



Italy is in trouble because ruthless governments used low Euro interest rates and excellent Eurozone (until recently) credit rating for piling up a mountain of public debts which created inflation due to debt-financed excessive demand. To satisfy this demand, merchandise imports rose sky-high.

My woolen winter coat carries two labels: one says "Vincenzo d'Italia", the other says "Made in China." A good coat, for that matter.

In fact, decades of lira inflation have created an inflation-addiction which has become part of the Italian national character, as it were. This inflation-mindedness was carried forward into the Euro era as if the Euro was only a new label for the lira.

Italians feel something is missing in their life if they can't take their car to the mechanic once a month and have two rounds of price and rate increases (stangata) a year: usually one in January and one after returning from the summer break (Ferragosto).

Unless Mario Monti can break with the Italian propensity to inflate, the country will continue piling up public debts until it drops out of the Euro community. Already now, Italy has lost most of its competitivity due to inflated production costs. Already, tomato preserves and garlic are imported from China. Next, chestnuts will be coming from Korea and parmesan cheese from Argentina. Manual labor is increasingly performed by Bangladeshi, Filipinas, Romanian academics (harvesting tomatoes), Arabs.and other extracomunitari.

Like in Greece, the bubble of this opulent life style is bursting because Monti pricked it with a needle. It is not the Italians that need to change. They are fine as they are. All they need to do is make sure that the governments of the past and their protagonists never return.

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—— T.C. Sempronius