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Italian President fiddles while Rome burns, vetoes Coalition nominees

His reasoning was that he didn’t fancy the political perspective that they represented

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Italy’s president, Sergio Mattarella, refused to give consent to the designated Prime Minister’s picks for high office.

His reasoning was that he didn’t fancy the political perspective that they represented, namely that of the Finance Minister nominee proposed by Giuseppe Conte, who has withdrawn his role as the designated Prime Minister.

Conte was designated by a coalition of the 5 Star Movement and the League, two Italian political parties on opposing sides of the political aisle, after months of back and forthing.

Yesterday, Matarella vetoed Conte’s nominees, saying that he feared that they could endanger Italy’s participation in the EU.

RT reports:

Italian President Sergio Mattarella has used a shady pretext to turn down a Euro-skeptic coalition pick for economy minister, as he seeks to mold a cabinet after own political views, an MP from the coalition told RT.

Manlio Di Stefano, an MP from the anti-establishment Five-Star Movement (M5S), which has teamed up with Lega Nord in a parliament, argued that it was Mattarella’s fault that Sunday did not bring a much-desired end to the two-month long post-election stalemate. Mattarella on Sunday rejected the candidacy of former industry minister and a distinguished economist, Paolo Savona, who was suggested by the coalition to fill the post of the minister of economy.

“I asked for a figure, who would mean not risking an exit from the euro,” Mattarella explained, citing Savona’s Euro-sceptic remarks.

Stefano argued that Mattarella has gone well beyond his powers by rejecting Savona’s candidacy based on his political views.

“You can be a problem if you have a trial, you can be a problem if you’ve been found guilty for something, but not because you have some good ideas, or, any idea in a political sense. There is a constitution defending political ideas and opinions,” Stefano said.

Mattarella’s claims that Savona is a danger to Italy’s stay in the eurozone lack any ground, Stefano argued, since Savona’s current stance is that Italy can assert its place in European economics without necessarily abandoning the euro.

“The incredible point is that Savona was the first telling us that Italy has to stay in the EU and Eurozone, but it has to be stronger institutionally to bring some points at home,” Stefano said.

Given that, Mattarella’s reasoning seems tailored to serve his own political agenda, the M5S member said.

After the coalition’s bid to form a new government failed, Mattarella summoned Carlo Cottarelli, a former senior official at the International Monetary Fund (IMF), to his office. It is believed that Mattarella will ask Cottarellli to head the government.

“The incredible thing is that President Mattarella has not only stopped this government, but is trying to force the government that is the expression of his own will,” Stefano said.

In case Mattarella makes Cottarelli PM-designate, the latter “will not have any chance to create the government,” the MP said. “We will never support the kind of a different government than us,” he stressed.

Arguing that Mattarella has broken all the rules of an established European democracy, Stefano described his conduct as “something without any historic record until today.”

Mattarella’s objection to the economy minister candidacy earlier drew the ire of MS5 leader Luigi Di Maio, who called the president’s decision “incomprehensible” and called for his impeachment.

Matarella’s actions have brought some fundamental questions to the fore as he did not mask the fact that he vetoed Savona’s nomination on the basis that he did not approve of Savona’s political opinions, something that is supposed to be protected under Italy’s constitution.

In fact, Matarella seems intent on position his own candidates, having sent the Parliament’s picks down the drain, potentially leading to new elections, during which interim, his political agenda continues to realize implementation.

He precisely wants to preserve cooperation with the EU and continue the course of action that his administration has followed to date.

France24 reports:

Efforts to form a coalition government collapsed on Sunday after the Italian president rejected a eurosceptic pick for the key economy ministry, triggering a possible constitutional crisis and opening the prospect of fresh elections.

The leaders of the two parties trying to field a government, the far-right League and anti-establishment 5-Star Movement, accused President Sergio Mattarella of abusing his authority and working under the orders of European powers.

5-Star leader Luigi Di Maio, whose party won the most seats at an inconclusive March 4 vote, demanded that parliament impeach Mattarella, raising the spectre of political turmoil in the euro zone’s third biggest economy.

Financial markets tumbled last week on fears the mooted coalition would unleash a spending splurge and increase Italy’s already huge debt mountain, which is equivalent to more than 1.3 times the nation’s domestic output.

Looking to allay investor concerns, Mattarella vetoed on Sunday the choice of 81-year-old economist Paolo Savona, a vocal critic of the single currency, to the pivotal economy post.

Prime Minister-designate Giuseppe Conte promptly abandoned his efforts to form a government.

In a sombre, televised speech, Mattarella said he had accepted all the suggested ministers bar Savona.

“I asked for that ministry an authoritative political figure from the coalition parties who was not seen as the supporter of a line that could provoke Italy’s exit from the euro,” he said.

Shortly afterwards, he summoned former International Monetary Fund (IMF) senior official Carlo Cottarelli for a Monday morning meeting — an indication he may be considering asking him to head a government of unelected technocrats.

Voter anger

Cottarelli would be a calming choice for the financial markets, but any technocrat administration would likely only be a short-term solution because the majority of parliamentarians have said they would not support such a government.

If he failed to win parliamentary backing, Cottarelli would stay in office in a caretaker capacity ahead of elections that would most likely be held in September or October.

Polls have suggested that the League, which won 17 percent of the vote in March, would see its support surge in any early ballot, while support for 5-Star remained strong.

Mainstream centre-left and centre-right parties were seen losing further ground in the face of voter anger over the sluggish economy.

League leader Matteo Salvini responded furiously to Mattarella’s refusal to rubberstamp Savona.

“If there’s not the OK of Berlin, Paris or Brussels, in Italy a government cannot be formed. It’s a folly, and I ask the Italian people to stay close to us because I want to bring democracy back to this country,” Salvini told reporters.

News of Mattarella’s veto sent a shockwave through Italy.

The leader of the nationalist Brothers of Italy party, which had an electoral pact with the League, said the head of state should be impeached, accusing him of abusing his position.

“We will ask parliament to charge Mattarella with high-treason because he has acted under foreign pressure,” Brothers of Italy chief Giorgia Meloni said on La7 television channel.

The 5-Star’s Di Maio also demanded impeachment under article 90 of the constitution. Under that clause, parliament can demand a president leave office if a simple majority of lawmakers votes in favour. The constitutional court would then be called to decide whether to impeach or not.

“After tonight, it’s truly difficult to believe in the institutions and the laws of the state,” Di Maio said.

Experience

On Friday, the closely watched gap between the Italian and German 10-year bond yields, seen as a measure of political risk in the euro zone, was at its widest in four years at 215 basis points.

After markets had closed on Friday, Moody’s said it may downgrade the country’s sovereign debt rating because of the risk that the would-be government would weaken public finances and roll back a 2011 pension reform.

Facing Mattarella’s veto, Savona tried on Sunday to allay concerns about his views in his first public statement on the matter.

“I want a different Europe, stronger, but more equal,” Savona said in a statement.

He also said his position on debt was the same as that forged by the potential coalition allies in their programme – which says it will be reduced not through austerity or tax cuts, but through targeted investments and policies that boost economic growth.

Savona has had high-level experience at the Bank of Italy, in government as industry minister in 1993-94, and with employers’ lobby Confindustria. But his critical stance on the euro has been the focus of concern.

In Sunday’s statement Savona did not mention his opinions on the euro, but more than 70 slides outlining a “plan B” for Italy’s exit from the euro, co-authored by Savona in 2015 with a dozen others, circulated on social media.

On Monday, Mattarelli is set to meet with Carlo Cottarelli over whether he will be willing to take the post, likely to be offered him by Matarelli.

Insodoing, Mattarelli will be installing someone to fill the slot without the backing of the Italian people or that of the Parliament, to serve as a technocrat during the interim space until elections can be held in autumn.

Cottarelli, as an occasional television analyst, has harshly criticized the policies represented by M5S and Lega’s coalition, indicative that his role will be to construct obstacles in the implementation of their agenda, should they eventually accommodate the Italian government.

Not the least is the fact that he represents precisely what the coalition stands united against.

AFP reports:

Carlo Cottarelli, a former International Monetary Fund director, will face an uphill battle should, as expected, he is tasked with forming a technocrat government for Italy in the midst of a deep political crisis and populist rage at the financial “elite”.

Cottarelli, 64, will meet with President Sergio Mattarella after talks between the head of state and populist parties on the cusp of forming a new government fell apart over the inclusion of eurosceptic Paolo Savona as economy minister.

Cottarelli’s likely appointment as prime minister has already attracted the wrath of the anti-establishment Five Star Movement and nationalist League, which have denounced a “premeditated” strike from Mattarella and European “lobbies” against their proposed coalition government.

The chances of the economist gaining approval for any technocrat government are slim, as Five Star and the League boil with anger at their own coalition stumbling on the home straight.

League leader Matteo Salvini said that Cottarella was a “Mister Nobody” who “represents financial institutions”, while the head of Five Star Luigi Di Maio laughed off his chances of ever gaining the endorsement of a parliament in which his and Salvini’s parties command a majority.

“They’ve replaced a government with a majority with one that won’t obtain one,” said Di Maio to supporters at a rally near Rome.

Cottarelli first joined the IMF in 1988, following six years in the Bank of Italy’s Monetary and Financial Sector Division.

He was director of the IMF’s fiscal affairs department from 2008 to 2013 and became known as “Mr Scissors” for making cuts to public spending in Italy while charged with the revision of public spending by Enrico Letta’s short-lived centre-left government.

Looking back on his time under Letta, Cottarelli lamented the resistance of bureaucrats in Rome to help him carry out his role, claiming that “often I wasn’t even given the documents I asked for”.

In 2014 Letta’s successor, Matteo Renzi, nominated him as the IMF’s executive director for Italy, Greece and Malta before leaving the institution in October 2017.

Since then Cottarelli has worked as director of the Public Accounts Observatory at the Catholic University of Milan, and as a TV pundit he has offered a string of warnings about the economic cost of the Five Star and League’s joint government programme, which includes huge tax cuts and a ramping up of welfare spending.

Mattarella is treating this situation as if the fate of Italy’s participation in the Euro is at stake. He sees the situation in Italy from the top down, rather than the way the Italian people view it: from a bottom up.

At the ground level, Italy’s economy is fundamentally malfunctioning, and Cottarelli sees the situation from the perspective of Italy’s creditors.

The people and the government, at this moment, do not perceive a common ground. Political gains are to be made, governmental stakes are to be uprooted, and relationships shaken up. The outcome of Monday’s meeting will further show how this situation will pan out.

 

 

 

 

 

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French opposition rejects Macron’s concessions to Yellow Vests, some demand ‘citizen revolution’

Mélenchon: “I believe that Act 5 of the citizen revolution in our country will be a moment of great mobilization.”

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Macron’s concessions to the Yellow Vests has failed to appease protesters and opposition politicians, such as Jean-Luc Mélenchon, who called for “citizen’s revolution” to continue until a fair distribution of wealth is achieved.

Immediately after French President Macron declared a “social and economic state of emergency” in response to large-scale protests by members of the Yellow Vest movement, promising a range of concessions to address their grievances, left-wing opposition politician Mélenchon called on the grassroots campaign to continue their revolution next Saturday.

I believe that Act 5 of the citizen revolution in our country will be a moment of great mobilization.

Macron’s promise of a €100 minimum wage increase, tax-free overtime pay and end-of-year bonuses, Mélenchon argued, will not affect any “considerable part” of the French population. Yet the leader of La France Insoumise stressed that the “decision” to rise up rests with “those who are in action.”

“We expect a real redistribution of wealth,” Benoît Hamon, a former presidential candidate and the founder of the Mouvement Génération, told BFM TV, accusing Macron’s package of measures that benefit the rich.

The Socialist Party’s first secretary, Olivier Faure, also slammed Macron’s financial concessions to struggling workers, noting that his general “course has not changed.”

Although welcoming certain tax measures, Marine Le Pen, president of the National Rally (previously National Front), accused the president’s “model” of governance based on “wild globalization, financialization of the economy, unfair competition,” of failing to address the social and cultural consequences of the Yellow Vest movement.

Macron’s speech was a “great comedy,”according to Debout la France chairman, Nicolas Dupont-Aignan, who accused the French President of “hypocrisy.”

Yet many found Melanchon’s calls to rise up against the government unreasonable, accusing the 67-year-old opposition politician of being an “opportunist” and “populist,” who is trying to hijack the social protest movement for his own gain.

Furthermore, some 54 percent of French believe the Yellow Vests achieved their goals and want rallies to stop, OpinionWay survey showed. While half of the survey respondents considered Macron’s anti-crisis measures unconvincing, another 49 percent found the president to be successful in addressing the demands of the protesters. Some 68 percent of those polled following Macron’s speech on Monday especially welcomed the increase in the minimum wage, while 78 percent favored tax cuts.

The Yellow Vest protests against pension cuts and fuel tax hikes last month were organized and kept strong via social media, without help from France’s powerful labor unions or official political parties. Some noted that such a mass mobilization of all levels of society managed to achieve unprecedented concessions from the government, which the unions failed to negotiate over the last three decades.

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Soros Mimics Hitler’s Bankers: Will Burden Europeans With Debt To ‘Save’ Them

George Soros is dissatisfied with the current EU refugee policy because it is still based on quotas.

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Via GEFIRA:


After the Second World War, many economists racked their brains to answer the question of how Hitler managed to finance his armament, boost the economy and reduce unemployment.

Today his trick is well known. The economic miracle of Führer’s time became possible thanks to the so-called Mefo promissory notes.

The notes were the idea of the then President of the Reichsbank, Hjalmar Schacht, and served not only to finance the armament of the Wehrmacht for the Second World War, but also to create state jobs, which would otherwise not have been possible through the normal use of the money and capital markets, i.e. the annual increase in savings in Germany.

The Reich thus financed the armaments industry by accepting notes issued by the dummy company Metallurgische Forschungsgesellschaft GmbH (hence the name Mefo) rather than paying them in cash. The creation of money was in full swing from 1934 to 1938 – the total amount of notes issued at that time was 12 billion marks. The Reichsbank declared to the German banks that it was prepared to rediscount the Mefo notes, thus enabling the banks to discount them.

Because of their five-year term, the redemption of notes had to begin in 1939 at the latest. This threatened with enormous inflation. Since Schacht saw this as a threat to the Reichsmark, he expressed his doubts about the Reich Minister of Finance. But it did not help, and Schacht was quickly replaced by Economics Minister Walther Funk, who declared that the Reich would not redeem the Mefo notes, but would give Reich bonds to the Reichsbank in exchange. At the time of Funk, the autonomous Reichsbank statute was abolished, the Reichsbank was nationalized, and inflation exploded in such a way that Mefo notes with a circulation of 60 billion Reichsmark burdened the budget in post-war Germany.

George Soros also proposes such a money flurry in the style of Schacht and Funk.

Soros is dissatisfied with the current EU refugee policy because it is still based on quotas. He calls on the EU heads of state and governments to effectively deal with the migrant crisis through money flooding, which he calls “surge funding”.

“This would help to keep the influx of refugees at a level that Europe can absorb.”

Can absorb? Soros would be satisfied with the reception of 300,000 to 500,000 migrants per year. However, he is aware that the costs of his ethnic exchange plan are not financially feasible. In addition to the already enormous costs caused by migrants already in Europe, such a large number of new arrivals would add billions each year.

Soros calculates it at 30 billion euros a year, but argues that it would be worth it because “there is a real threat that the refugee crisis could cause the collapse of Europe’s Schengen system of open internal borders among twenty-six European states,” which would cost the EU between 47 and 100 billion euros in GDP losses.

Soros thus sees the financing of migrants and also of non-European countries that primarily receive migrants (which he also advocates) as a win-win relationship. He calls for the introduction of a new tax for the refugee crisis in the member states, including a financial transaction tax, an increase in VAT and the establishment of refugee funds. Soros knows, however, that such measures would not be accepted in the EU countries, so he proposes a different solution, which does not require a vote in the sovereign countries.

The new EU debt should be made by the EU taking advantage of its largely unused AAA credit status and issuing long-term bonds, which would boost the European economy. The funds could come from the European Stability Mechanism and the EU balance of payments support institution.

 “Both also have very similar institutional structures, and they are both backed entirely by the EU budget—and therefore do not require national guarantees or national parliamentary approval.“

In this way, the ESM and the BoPA (Balance of Payments Assistance Facility) would become the new Mefo’s that could issue bills of exchange, perhaps even cheques for Turks, Soros NGOs. Soros calculates that both institutions have a credit capacity of 60 billion, which should only increase as Portugal, Ireland and Greece repay each year the loans they received during the euro crisis. According to Soros, the old debts should be used to finance the new ones in such a way that it officially does not burden the budget in any of the EU Member States. The financial institutions that are to carry out this debt fraud must extend (indeed – cancel) their status, as the leader of the refugees expressed such a wish in his speech.

That Soros is striving to replace the indigenous European population with new arrivals from Africa and Asia is clear to anyone who observes its activities in Europe. The question is: what does he want to do this for and who is the real ruler, behind him, the real leader?

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The French People Feel Screwed

For the first time in his presidency, Macron is in trouble and Europe and America are looking on.

The Duran

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Authored by David Brown via The Gatestone Institute:


On December 4, French Prime Minister Édouard Phillipe told deputies of the ruling party, “La République en Marche”, that a proposed fuel tax rise, which had led to the largest protests France has seen in decades, would be suspended.

The protesters, called Gilets-Jaunes — “Yellow Vests,” because of the vests drivers are obliged by the government to carry in their vehicles in the event of a roadside breakdown — say that the fuel tax was the last straw from a president who took office with a promise to help the economically left-behind but instead has favoured the rich.

Even by French standards, the protests of the “Yellow Vests” during the weekend of December 1 were startling. Burning cars and vast plumes of grey smoke seemed to engulf the Arc De Triomphe as if Paris were at war. Comparisons were drawn with the Bread Wars of the 17th Century and the spirit of the Revolution of the 18th Century.

For more than two weeks, the “Yellow Vests” disrupted France. They paralyzed highways and forced roads to close — causing shortages across the country – and blocked fuel stations from Lille in the North to Marseilles in the South.

During protests in France’s capital, Paris, the “Yellow Vests” were soon joined by a more violent element, who began torching cars, smashing windows and looting stores. 133 were injured, 412 were arrested and more than 10,000 tear gas and stun grenades were fired.

One elderly lady was killed when she was struck by a stray grenade as she tried to shutter her windows against the melee.

There was talk of imposing a State of Emergency.

The “Yellow Vests” present the most significant opposition French President Emmanuel Macron has faced since coming to office in May 2017. Unlike previous protests in France, which have divided public opinion, these have widespread support – 72% according to a Harris Interactive Poll published December 1st.

Fuel tax rises — announced in November before being retracted on December — were intended to help bring down France’s carbon emissions by curbing the use of cars. Macron makes no secret of his wish to be seen as a global leader for environmental reform.

He forgets that back at home, among the people who elected him, fuel prices really matter to those outside big cities, where four-fifths of commuters drive to work and a third of them cover more than 30km each week.

The increases have incensed people in smaller communities, where they have already seen speed limits reduced to please the Greens and cuts to the local transport services.

These additional costs-of-living increases come at an extremely bad time for ordinary French people working outside of Paris. Lower-middle class families are not poor enough to receive welfare benefits but have seen their income flat-line whilst cost-of-living and taxes have risen.

An analysis by the Institut des Politiques Publiques think-tank shows that benefits cuts and tax changes in 2018 and 2019 will leave pensioners and the bottom fifth of households worse off, while the abolition of the wealth tax means that by far the biggest gains will go to the top 1%

This is tough to swallow. Macron is seen as being out of touch with ordinary people and is unlikely to escape his new title, “the President of the Rich.”

“People have this feeling that the Paris technocrats are doing complicated things to screw them,” said Charles Wyplosz, an economics professor at the Graduate Institute of International and Development Studies in Geneva.

It is probably not as complex as that. The French people feel screwed.

As employment and growth are slowing, Macron, for the first time in his presidency, is under serious pressure. Unemployment is at 9%; his efforts to reform Europe are stalling, and his approval rating has plummeted to just 23% according to a recent opinion poll by IFOP.

Images of Macron at the Arc De Triomphe daubed in graffiti calling for him to step down, or worse, have done little to bolster his image abroad.

So far, Macron had said he would not bow to street protests. To underline his point, in September 2017, he called protestors against French labour-market reform “slackers”.

The political U-Turn on the fuel tax is a turning point for the Macron presidency. The question is : What next, both for Macron and the “Yellow Vests”?

Macron most likely needs to plough ahead with his reform agenda, and doubtless knows he has the support of a solid majority in the National Assembly to do so. France is crippled by debt (nearly 100% of GDP) and its grossly bloated public sector. There are 5.2 million civil servants in France, and their number has increased by 36% since 1983. These represent 22% of the workforce compared to an OCDE average of 15%.

Tax-expert Jean-Philippe Delsol says France has 1.5 million too many “fonctionnaires [officials]. When you consider that public spending in France now accounts for 57 per cent of gross domestic product. Soon the system will no longer function as there will be less and less people working to support more and more people working less”.

Macron’s mistake, in addition to a seeming inclination for arrogance, is not to have made national economic reform his absolute priority right from his initial grace period after his election. Lower public expenses would have made it possible to lower taxes, hence creating what economists call a virtuous circle. Instead, he waited.

Now, at a time when he is deeply unpopular and social unrest is in full sway he is looking to make further reforms in unemployment benefits, scaling them back by reducing the payments and the length of time beneficiaries can receive the money. The “President of the Rich” strikes again.

There is talk that he may also re-introduce the wealth tax to try to placate the protestors.

Macron’s presidential term lasts until May 13, 2022. Understandably, Macron will be focused on the elections to the European Parliament expected to be held May 23-26, 2019. Headlines have signalled that Marine Le Pen and the National Rally (formally National Front) are ahead in the polls at 20%, compared to Macron’s En Marche at 19%.

The shift is understandable, given the divide between the countryside, where Le Pen has solid support, and the cities, where Macron’s centre-left prevail.

In contrast, the “Yellow Vests” have galvanised support after standing up for the “impotent ordinary”, and seem much buoyed by the solidarity they have been shown by both fire fighters and the police. There are images online of police removing their helmets and firefighters turning their backs on political authority to show their support for the protestors.

Whilst Macron’s political opposition may be fragmented, this new breed of coherent public opposition is something new. Leaderless, unstructured and organised online, the “Yellow Vests” have gained support from the left and right, yet resisted subjugation by either.

Being leaderless makes them difficult to negotiate withor to reason with in private. The “Yellow Vests” seem acutely aware of this strength, given their firm rebuttal of overtures for peace talks from the Macron government.

Enjoying huge support from the public and with reforms to the social welfare system on the horizon, the “Yellow Vests” are not going away.

For the first time in his Presidency, Macron is in trouble and Europe and America are looking on.

After Macron rebuked nationalism during his speech at the armistice ceremony, Trump was quick to remind the French President of his low approval rating and unemployment rate near 10%. A stinging broadside from Trump on twitter suggests that Macron may well be relegated to Trump’s list of global “Losers“:

“Emmanuel Macron suggests building its own army to protect Europe against the U.S., China and Russia. But it was Germany in World Wars One & Two – How did that work out for France? They were starting to learn German in Paris before the U.S. came along. Pay for NATO or not!”

The “impotent ordinary” in the United Kingdom, who might feel betrayed over Brexit, and the nationalists in Germany, who have suffered under Merkel , are no doubt staring in wonder at the “Yellow Vests”, wishing for the same moxie.

The historian Thomas Carlyle, chronicler of the French Revolution, said the French were unrivaled practitioners in the “art of insurrection”, and characterised the French mob as the “liveliest phenomena of our world”.

Mobs in other countries, by comparison, he argued were “dull masses” lacking audacity and inventiveness. The blazing yellow vests of the French protest movement , however, have made Macron appear increasingly dull and weak too.

David Brown is based in the United Kingdom.

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