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Home , Adone Zoli, Antonio Segni, Bettino Craxi, Ciriaco De Mita, Giovanni Goria, Giovanni Leone

ITALY IN THE • Eurozone's third-largest economy • has the third largest public debt of the World in absolute terms and the eighth when it is GDP weighted • Italy presents the largest and most persistent development gap among its regional economies in the group of the advanced countries. • 1992-2007: – 8.3% decline of GDP per capita • Since the early 1990s, GDP growth in Italy has fallen behind not only the US, but also its European peers. Between 2000 and 2012, Italy was among the 10 worst performers in the world in terms of GDP per capita growth, with countries such as Haiti, Yemen and Zimbabwe

Export 2013 Import 2013 FEDERALIST IDEAS 1941 Ventoten manifesto

Altiero Spinelli , Ernesto Rossi, Eugenio Colorni (Giuseppe Mazzini, Carlo Cattaneo, Giuseppe Ferrari)

Altiero Spinelli

„The absolute of national states has given each the desire to dominate, since each one feels threatened by the strength of the others, and considers as its living space an increasingly vast territory wherein it will have the right of free movement and can ensure itself of the means of a practically autonomous existence. This desire to dominate cannot be placated except by the predominance of the strongest state.”

„All reasonable men recognize that it is impossible to maintain a balance of power among European states with militarist Germany enjoying equal conditions, nor can Germany be broken up into pieces once it is conquered.”

„In order to respond to our needs, the European revolution must be socialist, that is it must have as its goal the emancipation of the working classes and the realization for them of more humane living conditions.” CONSOLIDATION AFTER WW II. • Since the beginning of the EU integration process the Italian membership of the Community seems to have perceived between masses and elites as a kind of higher political good, or the Union as a “collective myth for Italian society”

• Large majority (>70%) believed membership of the EC was beneficiary for the country.

• The 1948 Italian Republican Constitution was a result of many political compromises. Italian society is pluralist and the Constitution reflects that.

• The Constitution designed weak institutions and strong parties, as it was believed that the system would work because of the strength and authority injected from outside the parties.

• Parliament procedures assign the gov. a marginal role in the parliamentary work, while maximizing opportunities for influence in the setting of the agenda

• Since the beginning of the Italian Republic, the mainstreams of foreign policy have been pro US, pro Europe values.

• Christian : not “old” “historical” but modern Christian universalism, cooperation of European democracies

Support for the EU is generally widespread, however it corresponds to a lack of confidence in the ITA institutional and political system

– comparative weakness of the PM – relative strength of the senate – PCI -> 1960s they followed Moscow “eurocommunism”

Alcide De Gasperi 1946-1953 (Christian Democrats) Giuseppa Pella 1953-1954 1954 1954-1955 1955-1957 1957-1958 Amintore Fanfani 1958-1959 Antonio Segni 1959-1960 Fenando Tambroni 1960 Amintore Fanfan 1960-1963 1963 1963-1968 Giovanni Leone 1968 1968-1970 1970-1972 1972-1973 Marian Rumor 1973-1974 Aldo Moro 1974-1976 Giulio Andreotti 1976-1979 1979-1980 Amaldo Forlani 1980-1981

Giovanni Spadiolini 1981-1982 ()

Amintore Fanfani 1982-1983 (CD) 1983-1987 (Italian ) Amintore Fanfani 1987 (CD) 1987-1988 (CD) 1988-1989 (CD) 1945-1953 Giulio Andreotti 1989-1992 (CD) 1992-1993 () Carlo Azeglia Ciampi 1993-1994 (Independent) Silvio Berusconi 1994-1995 () 1995-1996 (Independent)

Romano Prodi 1996-1998 () Massio D'Alema 1998-2000 (The Olive Tree) Giuliano Amato 2000-2001 (The Olive Tree)

Silvio Berusconi 2001-2006 (Forza Italia)

Romano Prodi 2006-2008 (The Olive Tree)

Silvio Berusconi 2008-2011 ()

Mario Monti 2011-2013 (Independent)

Enrico Letta 2013-2014 (Democratic Party) 2014-2016 (Democratic Party) 2016-

• ESCS membership was to offer security to the new-born Italian democracy (De Gasperi, and met regularly)

• national interest could be better defended within a policy of European identity

 ITA was included Bretton Woods 1946, IMF 1947  By accepting the Treaty of as a defeated country with no concession to nationalism, ITA could take part in the negotiations for the , founder of OEEC 1948),  founder of the NATO

• After De Gasperi’s death 1954, a “de-politicization’ of Italian foreign policy took place: proEurope and proUS values remained at the centre of ITA foreign policy, but with more technocrats (diplomats and bureaucrats) – politicians rather deal with domestic matters

• As a result gradually the EC became a non-issue in the Italian political arena

Italian economic prosperity of the 1960s

1958 EEC, EURATOM founder

Italy was a free market economy with a strong element of state control and state ownership. Many state-owned companies had operated efficiently and contributed to economic growth.

Comparatively, the Italian economy grew faster in the 1960s than any other European country.

• Relative macroeconomic stability

• down, (9.8%, 1.7 million)

• Private and state-owned enterprises took advantage of foreign assistance from the under the Marshall Plan and the launch of the European Economic Community (EEC) to restore the Italian economy.

• Despite skepticism about the European Common Market, Italy joined and profited from the progressive integration of Western European economies.

• By developing strong export-related industries, the industrial triangle of -- led the economic boom. Italian exports became attractive, and the growth of exports led to a strong internal demand for goods and services.

• Small and medium enterprises began establishing themselves and prospering in Northern Italy. These companies were the force behind economic growth as they exported machinery, engineering products, textiles, and clothing.

• Large private companies such as FIAT and state-owned companies such as and ENEL also contributed to economic growth. Meanwhile, remained impoverished, and its inhabitants migrated north in large numbers until the late 1970s.

ITALY as an EEC member

• Wealth growing, boom, foreign trade liberalisation (USA) • 1964-65 small recession • The high rates of economic growth that Italy had enjoyed in the 50s and slower but still healthy pace in the 60s have disappeared in the 70s. • The Italian economy has suffered low investment and growth, high rates of and balance of payments difficulties, and these difficulties have erupted into 2 severe crises in 1974 and 1976 that requires exceptional policy measures, external financial assistance • VAT introduced in 1973, 3 years after • Pro ESF, pro ERDF • After 1970: inflation up, 1972 5% -> 1980 21% • Industry restructured, role of small and medium size enterprises grew • The fourfold increase in the price of oil in late 1973/4 proved more damaging to Italy than the other major industrial countries.

• Trade deficit grew, upsurge in commodity prices struck Italy particularly because of the country’s heavy dependence on raw material import.

• Small recovery 1975, than the crisis exploded in Jan 1976, with the announcement of the “closing” of the foreign exchange market, in actuality the suspension of official quotations and central bank support.

• Italian gov. turned towards the IMF, Apr 1977, IMF granted SDR 450 million

• Bettino Craxi: Italy should grow up, big country vision, dynamic EU policy, Paris-Bonn+Roma triangle

1980s economic challenges

• The state began to withdraw from its role in the economy after a first round of privatization was carried out at the end of the (large state-owned enterprises such as the motor car manufacturing companies)

Acession of +Spain+

Mediterranean pack: move the gravitation centre of the EC to the south

“Green Europe” to “blue Europe”: CAP (instead of grain, cow, pig -> mediterranean products)

ITALY and the EU in the 90s

1992: collapse of the political system, corruption, fall of • soveregnists / nationalists: strong, wealthy state • pro integration parties • neo neutralists

Tangetopoli scandals: it is a term which was coined to describe pervasive corruption in the Italian political system exposed in the 1992-6 investigations, as well as the resulting scandal, which led to the collapse of the hitherto dominant party and its allies.

In the post Masstrich period public debates in ITA were not dominated as much by the ratification of the TEU as they were by other issues, such as

• the emergence of new political actors (Berusconi) • heated battle against organised crime • massive Albaninan • major attention in the media on Maastrich criterias

MAASTRICHT 29 October 1992 • large majority in the Italian Chamber of Deputies (467 present from 630 / 403 ok) without any debate involving the wider public • concept of European citizenship: social aim, democratic deficit, Article 11 effects on Italian law, national sovereignty,

ITLAY and the EU in the 90s

• strict financial disciplines (Italy was forced to undertake massive reforms to lower inflation, reduce the deficit, and lower interest rates) • the radical changes brought success in tackling the high deficit through cuts to the and measures to limit waste. • mainly shaped by so called technocratic actors, among them monetary experts (L. Dini, Ciampi) • sever economic policy: reductions in public expenditure, and special eurotax • 17/09/1992 Lyra leaves EMS/ERM • Devaluation by 40% to the DEM • 25 Nov 1996: back to ERM • 1994 deficit 9.6% GDP – eurotax 1996 • Debt 1994: 124.9%, 1997: 121,6% • Inflation was brought under control by means of restrictive monetary policies • the tax system was made more efficient

Italy succeeded in qualifying to participate in the EMU. By 2000, Italy enjoyed a healthy economy characterized by slow growth. Italy had the slowest growing economy of the 11 founding members of the EMU.

The implementation of Community Law obligations in the Italian legal framework

86/1989: Legge La Pergola 11/2005: Legge Buttiglione

• The Italian Constitution does not mention the EC. Article 11 of the Const. – foreseeing the possibility for the State to delegate powers to international organisations – was introduced with an eye on the UN, which Italy joined in 1955. • The EC was understood as classical international organizations, producing international law. Const. Court recognized the principle of EC law over national law in 1973, with limits, and finally in 1984. • The transposition of EC directives into national law takes place in Italy through the unusual means of the annual so called “Community Law” created with Law 86/1989 “Legge La Pergola”:

By 31 of March of each year, the gov. submits the Parliament a bill, including all EC norms in need of national implementing measures: the law allows different techniques to be chosen for direct and indirect implementation: a) modification of existing domestic legislation b) delegation of legislative powers to the gov c) authorization to the gov. to adopt regulations d) administrative acts

ERDF, COHESION POLICY

• Italy is the third largest beneficiary of the European Union’s Cohesion Policy after Poland and Spain. During the 2007–13 programming period, Italy will receive a total of almost €29 billion in European aid

• The ‘Convergence regions’, i.e. , Puglia, Calabria, and Basilicata, are the main beneficiaries of funds allocated by Cohesion Policy.

• The ‘Regional Competitiveness and Employment regions’ are diverse and include the regions of the north, which produce much higher GDP per capita than the EU average, and the regions of the south, which no longer come under the Convergence Objective but remain well below the European average in terms of GDP per capita (for example, , Molise and Abruzzo).

• BUT: The state of progress for the 2007-2013 EU budget programming period shows that Italy has used just 40% of its slice of EU regional funds. Many southern Italian regions lack even basic knowledge of EU structural and cohesion funds

Unemployment rate 2006 NUTS I.

Unemployment rate 2011

North West Aosta Valley, , ,

North East Emilia-Romagna, Friuli-Venezia Giulia, Trentino-Alto Adige/Südtirol,

Centre , , ,

South Abruzzo, Apulia, Basilicata, Calabria, Campania, Molise

Islands Sardinia, Sicily ITALY: THE REGIONS AND THE EU

 The first law dealing with the regions role in European affairs dates from 1987.  It recognized the regions right to directly enact regulations in their fields of competence.  In 1987 the “Fabbri law” gave the regions the right to directly enforce directives  Regions are allowed to set up offices in Brussels (but still limited), the 2000 Const Reform Article 117 granted regional participation in Italian EU policy making in areas of their own competencies.

• Although there were eight regions subject to the EU Structural Fund (areas where the per capita GDP was no more than 75% of the average European GDP) in the 1994-1999 period, the number decreased to four (Campania, Puglia, Calabria, and Sicilia Regions) as a result of the expansion of the EU to include eastern Europe.

• The purposes of the development of southern Italy are to enhance the competitive power of the south and enhance its production capability. To this end, traffic and transport infrastructures are required.

• Of the 12.3 billion to be invested pursuant to the 2007-2013 national strategic framework, 85% were allocated to the development of the south.

• The breakdown of the 12.3 billion euros is as follows: 2.87 billion euros from the EU Structural Fund, 3.11 billion euros from the country, 6.33 billion euros from the Fund for Underdeveloped Areas (FAS).

CONSTITUTIONAL REFORM

• Before the 2001 Constitutional Reform the Italian institutional framework was based on the hierarchical supremacy of the central government over regional authorities.

• In October 2001 the Italian Consitution was modified providing Italy with a federal framework.

• Article 5 enshrines both the principles of national unity and autonomy. The Constitution distinguishes the 5 special regions from the normal regions.

• Geographical, historical and ethnical differences are the basis on which Val d’Aosta, South Tyrol, Friuli, Sicily and Sardinia have been given special status and wider powers.

• Every Italian Region has a directly elected assembly, provided with legislative powers and an executive body. All regions have legislative and administrative powers.

ITALY: PUBLIC DEBT

• Italy has the third largest public debt of the World in absolute terms and the eighth when it is GDP weighted. In addition, Italy presents the largest and most persistent development gap among its regional economies in the group of the advanced countries.

• Public debt arises from a common pool problem where not all costs are internalized by the public expenditure beneficiaries, thus creating fiscal residuals so large that they pile up the national debt.

• Italy’s debt crisis is on a different level than the previous European crises, given that Italy is four times the size of Greece, Portugal and Ireland combined with a gross GDP of $2,1 trillion, making it the 8th largest economy in the world and the 3rd largest in the -zone after Germany and France.

• Italy holds the third-largest gold reserves in the world – not exactly a disadvantage in a situation when gold is at the highest levels in history. It enjoys a high living standard (according to UN integrative statistics among the top 5 in the world) with comparatively low private debt, and is technologically innovative. Yet it has been considered to be the most vulnerable of the national economies threatened by the because of its huge public debt, which reached 119% of GDP in 2011.

• Italy is characterized by having the second richest private wealth in Europe – that is, 130,200 Euro savings per capita, just behind France (136,800 Euro) and well ahead of Germany (94,500 Euro), with total overall worth estimated at 9,000 billion Euro ($13,000 billion, i.e. almost the amount of the total U.S. public debt). Private debt is well below $10,000 per household (in the U.S. it is $60,000); and the combination of private wealth and private liabilities puts Italy far ahead of the U.S. and most other Western countries in terms of per capita net savings (including real estate and landed property ownership, bank accounts, investment shareholderships and governmental bonds).

What can be done?