Besides its large and growing public debt, Italy also suffers from political instability which is not lifting. Critics say that the people of Italy have decided to avoid reality, but the problem is deeper than that because Italian voters have been spoiled by unsustainable promises made by populist and socialist politicians. Italy desperately needs
• Serious structural reforms in the labor market,
• Liberalization of professions and sectors of the economy, and
• A tough control of government expenditures specifically including the pension and health care.
Since 1994, Italy’s average growth in yearly GDP has been substantially below that of Euroland. Italy’s labor costs continue rising due to old ...