A-Infos (en) Italy, FAI, Umanita Nova #8-26 - Governing is harmful. ISTAT reveals the government's failure (ca, de, it, pt, tr)[machine translation]

Giorgia Meloni's crown as prime minister is fraught with thorns. The 
referendum, the product of a reform specifically advocated by Forza 
Italia and reluctantly accepted to hold together a fraying majority, 
wasn't enough. Now ISTAT has also joined in certifying the government's 
failure of its financial policy. --- On March 2, the Central Institute 
of Statistics released data on the performance of the Italian economy in 
2025: gross domestic product (GDP) at market prices stood at EUR2,942 
billion, an increase of EUR73.84 billion compared to 2024, or a growth 
rate of 2.57%. This means that the deficit (or deficit in elegant form) 
of the Italian state budget for 2025, as a percentage of gross domestic 
product, will stand at 3.1%, one decimal point above the 3% threshold 
that would have allowed the Italian government to escape the excessive 
deficit procedure.

The European Commission can initiate an excessive deficit procedure 
(EDP) against a Union government that fails to comply with at least one 
of the two rules of the Stability and Growth Pact (SGP): the first is 
not exceeding the deficit threshold of 3% of GDP; the second is not 
having a public debt level exceeding 60% of GDP and not decreasing at a 
satisfactory rate, equal to one-twentieth per year. The Commission 
reactivated the budget rules after the pandemic, initiating a procedure 
in June 2024 for Italy (2023 deficit at 7.4%) and six other states.

The excuse advanced by Economy Minister Giorgetti is that it was a 
last-minute reversal of the superbonus. The issue of the superbonus was 
well known to this government and its Economy Minister, who in fact 
decided to concentrate the resulting burdens in a single year, 2023, in 
order to achieve two goals: to shift the responsibility for this 
"foolish" operation onto previous governments and to present themselves 
with their accounts in order in subsequent years, thus quickly escaping 
the infringement proceedings. To now use the last-minute reversal excuse 
means either that the accounts prepared in 2023 were inaccurate, or that 
the progress of payments for the 2025 superbonus was insufficiently 
monitored; in either case, the responsibility would fall on the Economy 
Minister-who has always given the impression of being aware of the 
situation and capable of keeping the accounts in order-and on the Prime 
Minister who appointed him.

I prefer to believe that the overrun is the result of electoral bribes 
and handouts, distributed indiscriminately in the regions where the 2025 
elections were held, with the aim of somehow halting the decline in 
votes for the governing majority parties.

If this applies to the government's financial policy, when it comes to 
economic policy, it's worse than going out at night. The real cause of 
the government's collapse in exiting the infringement procedure lies in 
the insufficient GDP growth, which stood at 0.5% compared to the 
previous year, while the government (still led by Giorgetti, alas) had 
already estimated a conservative 0.7%.

The decision to abolish the super bonus and the resulting burden of 
costs may have been a clever political move to consolidate a certain 
temporary consensus around the government, but it has proven disastrous 
from an economic standpoint.

According to the same data released by ISTAT, the superbonus years (2022 
and 2023) saw an increase in fixed investments compared to the previous 
year, of 7.36% and 10.11% respectively, with an increase in industrial 
production (including construction) of 3.38% in 2022 and 2.01% in 2023; 
GDP consequently increased by 4.82% and 0.92% in 2023 (the first year in 
which the Meloni government was in office for the full twelve months). 
In 2024, fixed investment will collapse, decreasing by 3.06% compared to 
2023, before rebounding by a modest 3.47% in 2025. This has an impact on 
industrial production, which will grow by 0.50% in 2024 and 0.77% in 
2025, and on GDP, which will grow by 0.78% and 0.55%, respectively. In 
other words, fixed investment drives industrial production and, 
consequently, gross domestic product; if fixed investment declines, 
given that the PNRR's contribution has proven insufficient to compensate 
for the cancellation of the superbonus, industrial production will not 
grow and GDP will stagnate.

Private investment should be both the cause and effect of capital 
accumulation: in Italy, it has always been insufficient, and today more 
than ever, given the growing commitment it requires due to the size of 
production units and the resulting decline in the profit rate, the 
engine of accumulation.

The government also realized this: confident in the successful 
conclusion of the excessive deficit infringement procedure in April, the 
government decided in December 2025 to reserve EUR15 billion from the 
ReArm Europe fund, with the aim of boosting investment through military 
spending. This is not a far-fetched idea: in 2025, gross fixed 
investment increased by less than EUR15 billion compared to the previous 
year. An additional EUR15 billion investment would double that increase, 
with a clear boost to industrial production and gross domestic product. 
However, this would be a temporary improvement, because, once invested 
in military infrastructure, the capital and tangible assets involved 
would be removed from the economic sphere.

If the EUR15 billion were invested in a public project, such as the 
Strait of Messina Bridge, once built, the project would continue to 
contribute to the gross domestic product through its use, for example, 
through highway tolls, reduced transportation times, and so on. If, 
however, they were spent on one or more aircraft carriers, for example, 
once built and after enriching the sharks of the defense industry and 
the investment funds associated with them, they would exit the economic 
sphere and cease to produce economic benefits because they are not used. 
If they were then used, if their use value were consumed, their use 
would consume far more gross domestic product than would be created by 
fuel consumption and the replenishment of weapons and ammunition stocks. 
This consumption of gross domestic product is the economic description 
of the destruction and carnage caused by the use value of weapons and 
military infrastructure.

These considerations, of course, are not endorsed by the government. 
Even less so in the minds of Confindustria, anguished by the threat of 
losing EUR15 billion due to the failure to exit the infringement 
procedure. Therefore, it's likely that a small hand within the European 
accounting body that will certify ISTAT's work will correct that 3.1, 
allowing Italy to participate in the banquet of the European rearmament 
plan without addressing the limitations of its production and its 
inability to meet the needs of the population.

Il Puzzone, Giorgia Meloni's inspiration, used to say that "governing 
isn't difficult, it's useless." I say that "governing isn't difficult, 
it's harmful...for us."

Tiziano Antonelli

https://umanitanova.org/governare-e-dannoso-listat-rivela-il-fallimento-dellesecutivo/
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