Italian Dreams Prime Minister Renzi indicated that, with a 0.7% growth, Italy is once again a locomotive

WASHINGTON – Hope springs eternal. Yes, but when Matteo Renzi, the Prime Minister of Italy, a country in slow but steady decomposition, expresses satisfaction about economic progress that does not exist on the basis of awful evidence, and nobody says anything, then the situation is in fact hopeless. 

Small is beautiful? 

Renzi just declared that Italy’s 0.7% projected rate of growth for 2015 proves that Italy is once again “a locomotive”. Got that? Less than 1% GDP a year a year gets you locomotive status. Never mind that the enviable 0.7% is a couple of notches lower than the still ultra tepid 0.9% that was predicted only a couple of months ago. In other words, the projections got worse, not better. In all this, please note that the Italian economy is not even back to its pre 2008 crisis levels.

High unemployment is actually good news 

To make it worse, the Italian media twists economic data in a desperate attempt to show that things are getting a lot better. And so we read in the daily La Repubblica that the unemployment rate is down to only 11.5 %. Yes, a triumph, because it used to be 13%.

Look, I appreciate that a little growth is better than no growth, and that 11.5% unemployment beats 13%. But to portray very slim gains, mostly due to easy money provided by the ECB, as some kind of decisive economic rise is ridiculous.

Even worse in the South 

Is this sorry-looking economy anybody’s idea of a locomotive? And yes, let’s not forget that while the overall unemployment is down to only 11.5%, Italy enjoys a truly catastrophic 40% youth unemployment rate. And this is the national average. In the South it gets up to 60%.

Some locomotive!


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