Italy unveils austerity budget

Source: Financial Post

Dec. 4 – Italian Prime Minister Mario Monti announced 30 billion euros ($40 billion) of austerity and growth measures as he seeks to cut the euro-region’s second-biggest debt and prevent a breakup of the euro.

Monti’s Cabinet in Rome passed the measures a day earlier than planned as the new prime minister rushed to reassure investors he is serious about taming a debt of almost 1.9 trillion euros. The premier will present the package, which includes a tax on luxury goods, resurrects a property levy on first homes, and forces many workers to delay retirement, to both houses of parliament tomorrow.

“The huge public debt of Italy isn’t the fault of Europe, it’s the fault of Italians because in the past we didn’t pay enough attention to the well being of the young and the future adults of Italy,” Monti said at a press conference in Rome today after his Cabinet passed the package.

Monti, sworn in on Nov. 16 after Silvio Berlusconi resigned, is under pressure to move quickly as a selloff of the country’s bonds sent borrowing costs surging last month past the 7 percent threshold that led Greece, Ireland and Portugal to seek aid. Italy is seen as too big to bail out with 450 billion euros of bonds maturing in the next three years, more than the current size of the EU’s rescue fund.

Read more: http://business.financialpost.com/2011/12/04/italy-unveils-austerity-budget/

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Monti Unveils Austerity Plans.

ROME—Italy's new government unveiled austerity measures that this week could form the first part of a wider European deal leaders and markets hope could be a turning point in the battle to save the euro.

Italian Prime Minister Mario Monti, in his first test since taking office two weeks ago, outlined a three-year plan made up of €30 billion ($40.2 billion) in spending cuts, tax increases, pension overhauls and growth-boosting measures.

The Italian austerity package will likely be followed by Franco-German proposals on Monday to create a new regime for budget policies in the euro zone, which European leaders could adopt at a summit on Dec. 8-9.

Leaders hope a deal could pave the way for massive European Central Bank intervention in government bond markets aimed at stopping the exodus of private capital and reversing the rise of countries' borrowing costs to ruinous levels.

http://online.wsj.com/article/SB10001424052970204770404577078562944299248.html

Italy crisis: Mario Monti announces austerity plan.

Italy's new government has adopted a package of emergency austerity measures aimed at fending off bankruptcy and saving the euro from collapse.

Taxes on the assets of the wealthy will go up, as will pension ages. There will be a major drive to tackle tax evasion.

Prime Minister Mario Monti said the measures were necessary to "save Italy", and announced he would give up his own salary as part of the effort.

The plans must still be approved by the Italian parliament.

http://www.bbc.co.uk/news/world-europe-16024316

Italy's welfare minister Elsa Fornero was reduced to tears at a news conference on Sunday as she outlined tough reforms to pensions contained in the government's plan to regain control of strained public finances and help solve Europe's debt crisis.

Under the austerity plan unveiled on Sunday, Italy will raise the minimum pension age for women and men to 66 by 2018, and will scrap annual inflation adjustments for many pensions.

"We had to... and it cost us a lot psychologically... ask for a..." Fornero said, but was unable to complete her sentence as she wiped tears from her eyes.

Prime Minister Mario Monti finished the sentence for her, speaking the word "sacrifice" that she'd been unable say.

http://www.reuters.com/article/2011/12/04/us-italy-tears-idUSTRE7B30WU20111204

Perhaps it's starting to happen, but there's a long way to go...

Is part of the package. Depending on their dedication to this effort, it could allow Italy not to make the cuts as deep as they otherwise would be. The plan looks to have decent balance so it should soothe the markets somewhat.

I find this heartbreaking. Occupy everywhere!

I originally created it for our own nation because of the debt crisis and the subsequent downgrading of our credit rating, but I think this montage applies equally to Italy - and, for that matter, Greece:

http://www.mixcloud.com/derby378/music-for-governments-to-default-by/

I have a feeling my trip will be very interesting.