Italians Protest New Austerity Measures
Tens of thousands of Italians took to the streets Tuesday during a day-long strike against the government’s latest austerity measures, causing flights, trains, and buses to be canceled and government offices to close. While the government has been facing criticism for its €45 billion austerity package, it has been trying to revise it. However, though the government has thrown out or toned down some of its measures, on Tuesday it announced new additions, including a tax hike and a revised wealth tax.
The latest austerity measures would add a 3% “supertax” for anyone earning €300,000 or more per year, a 2% tax on cash transfers home by immigrants, many from developing countries, raising the women’s retirement age to 65, and cutting government spending. Added to the bill today was a sales tax increase of 1%, from 20% to 21%.
With one of the largest economies in the euro zone, Italy’s endless revisions to austerity measures and the public disapproval of its citizens are worrying its European neighbors. Tuesday’s general strike, called by Italy’s largest union federation, the CGIL, is thought to have had millions of participants. While the latest austerity bill does include CGIL’s request that the government crack down on tax evaders, it does now promise continuing job protection, and actually includes a new clause that will make it easier to dismiss workers, which CGIL union leader Susanna Camusso called “irresponsible”, as it “put all of the burden on public sector workers,” many of whom were strikers today.
Parliament is expected to vote its latest austerity bill into law this week. Parliament has been hastily drawing up its austerity over the last month as the insistence of the European Central Bank. The bill will be put to a vote of confidence — a common technique for ensuring the passage of controversial measures.
Meanwhile, the gap between German and Italian bond rates is expanding, and stocks in Milan fell more than 3% today on concerns over the austerity plan. German Chancellor Angela Merkel has compared Italy’s current situation to that of Greece in past months. Prime Minister Silvio Berlusconi’s popularity rating has sunk to an all-time low over the past month, as the country took some of the focus off Spain’s difficulties, though they may soon return to the fore as people begin to protest a new constitutional amendment that would require the government to ensure that budgets are balanced.