26 May 2006

The speech of the President of the Confindustria

I would like to summarise the points made by the President of the employers association Confindustria, Luca Cordero di Montezemolo, who was speaking at Confindustria's annual general meeting and to add my comments.

Luca Cordero di Montezemolo’s main points were:
- contain expenditure
- no increase in fiscal pressure
- equilibrium in public financing
- discussions between economic and social players for development
- greater autonomy for companies
- reduction of the tax wedge {taxes paid by employer for each employee}
- keep the Biagi Law but adding in social sweeteners
- development of big engineering works even in the face of local opposition
- deficit of infrastructure in the north and the issue of the North
- encouragement of bank mergers
- privatisation and liberalisation
- fight against tax evasion
- no to the spoils system
- constitutional reforms aimed at modernising the organisation and the operation of public institutions

It’s easy to share many of these aspirations, in particular those relating to the spoils system, limits on public expenditure, the fight against tax evasion, reduction of the tax wedge, and encouragement of bank mergers.
It’s possible to share others only partly, like the development of big engineering works, considered necessary “a priori” without any evaluation in a complex picture of the needs of the country and of the economic possibilities; keeping the Biagi Law without adding in strong correctives arising from principles of solidarity; the privatisation of companies without precise guarantees for citizens at the level of services and employment, so as not to repeat the errors of the past.

Other aspects are absent from the speech of the President of Confindustria. One of these is the Mezzogiorno {the South of Italy}. Without a revival in the South, through the construction of infrastructure, and the return to the rule of law, Italy cannot develop. Furthermore, there seemed to be a lack of self criticism in the speech. Companies cannot totally exclude themselves as responsible for the current difficult economic situation. I refer in particular to the modest investments in terms of innovation and research and to the scarcity of integration between the system of industry and the universities.

Posted by Antonio Di Pietro in Economy