Can Matteo Renzi Fix Naples’ Destroyed Finances? The Population Of This Historic City Does Not Pay Its Taxes, With No Penalty Naples exemplifies the open illegality now considered "normal" in Italy. People do not pay their local taxes. Fines are not collected. The result is bankruptcy

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By Paolo von Schirach

February 21, 2014

WASHINGTON – Matteo Renzi, until yesterday Mayor of Florence, will be Italy’s next Prime Minister. He demanded the job on account of his election (via a primary contest) as leader of the Partito Democratico, the senior partner of yet another ruling coalition. He claims that he wants the job not because he wants power but because he believes that Italy needs a shock therapy: bold reforms, real transformations. In a word, he believes that Italy is on its way to terminal decline and therefore truly drastic measures are needed.

Italy’s deep crisis

I fully agree. Hard to underestimate the gravity of the Italian situation. There are just too many huge systemic problems: zero economic growth, high unemployment, (12%), no innovation, enormous public debt, inefficient public services, bad to poor education system, feisty labor unions, extraordinary levels of corruption and the cancer of organized crime.

If Matteo Renzi has a cure for all this, then he is a real genius. If he succeeds, he will go down in history as one of the leading statesmen of the entire Western World. But this will never happen. Without cynicism, I just do not see how he can accomplish much, given the depth and the gravity of Italy’s historic shortcomings.

Naples is bankrupt

Here is just one example. The city of Naples is one of the largest in Italy, and the 9th most populous urban area within the European Union. It has a population of one million, while its metropolitan area reaches four million. Now, here is what’s happening. The municipality of Naples is asking the Rome central government for extraordinary financial help measures. The city is bankrupt.

Half the citizens do not pay their taxes

Well, this is hardly a unique development. Let’s think for a moment about Detroit’s dramatic implosion. Once the shining jewel of US superior manufacturing prowess, totally bankrupt Detroit is now a virtual ghost town.

But what is special about Naples, as a report from an Italian national accounting office explains, is that its bankruptcy is in large part due to the fact that half the population does not pay any of its local taxes. Likewise, more than half of the fines and other payments due to the municipality go uncollected. What is worse, confronted with this openly illegal behavior practiced by hundreds of thousands of its citizens, the city of Naples does…well, nothing.

In all this, it is truly farcical that the city keeps booking as “receivables” huge amounts due to its treasury that go back 10 years or more. In other words, year after year, the city keeps creating fictitious budgets with fictitious assets, as it is clear that these sums will never be collected.

Not funny

Now, all this may look really funny. A real Commedia Italiana, an Italian Comedy. Look at that: the crafty Neapolitans manage to create schemes so that they manage to evade most of their taxes –and they get away with it! This is really clever! And so we can imagine these amiable, jolly characters who break the law, do not fulfill their obligations, while they go out to dinner, order pasta and pizza, drink good wine and sing beautiful songs.

Well, this is not funny at all. This is evidence of profound, possible irremediable, rot. If a municipal  government allows half of its citizens to openly break the law, apparently with no penalty, then we are in the darkest corners of the Third World. And do not forget that this flagrant illegality is laced with the local dominance of organized crime, (the powerful Neapolitan Camorra), that –with threats and real violence–exacts its own taxes from countless local businesses in exchange for “protection”.

Can Renzi fix Naples?

Well, mercifully Naples is not all of Italy; but it is a big chunk of it. If Matteo Renzi can fix the national disasters outlined above, and at the same time make the Neapolitans pay their local taxes, while defeating the Camorra, I shall conclude that he is blessed with unknown super natural powers.

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