“I will speak to you in the subversive language of truth,” Mr. Letta told lawmakers in his debut speech to the lower house of Parliament after the swearing-in of his cabinet on Sunday. Without measures that stimulate growth, he said, “Italy will be lost.”
He conceded that Italy, the European Union’s third-largest economy, must address the debts that had made the country one of the first to stumble in the euro zone economic crisis. But the most urgent priority, he said, is to reverse the downward spiral in what he called one of the “most complex and painful seasons” in Italy’s history.
The new prime minister’s rare coalition government has at least temporarily ended the political gridlock that has consumed Italy since an indecisive election in February. After Mr. Letta’s speech, he easily won a confidence vote, supported by political forces that are ordinarily at war with each other. He is expected to win a second vote on Tuesday in the Senate.
Mr. Letta said the effort to revive Europe’s economy lay in greater European integration, moving beyond a common currency and toward a political and banking union. “Europe can return to being a motor of sustainable development only if it finally opens,” he said. “The destiny of the entire continent is closely intertwined.”
His first trip, scheduled for Tuesday, will be to Berlin, Brussels and Paris, he said, “to give a sign that ours is a Europeanist government” and to confirm that Italy would continue with its budget commitments.
He said the fiscal rigor of the kind enforced by the government of his predecessor, Mario Monti, was an indispensable precondition to growth. But he also said fiscal rigor alone would “kill Italy” in the long run.
Mr. Letta is part of a growing European effort to question the austerity policies championed by Germany as the medicine to deal with the economic malaise in Europe, where unemployment has surpassed Great Depression levels in some places in the south and recession is creeping toward the once-resilient economies in the north.
Mr. Letta’s government is almost entirely composed of politicians from his party, the center-left Democratic Party, and from the center-right People of Liberty. They are united by a common cause: heading off economic disaster while toning down the antagonistic tenor that has dominated Italian politics for the last 20 years.
More than a decade of stagnation and protracted recession had taken a toll on citizens, Mr. Letta said. In some cases it had created a “personal vulnerability” and “lack of hope that risks turning into anger and conflict,” he said, citing an attack on Sunday in which an unemployed Italian man shot two military police officers in front of the prime minister’s office. The gunman later told investigators that he had aimed to kill politicians.
The new government was formed out of necessity after national elections in February effectively split Parliament into three factions. More than a quarter of the vote went to the anti-establishment Five Star Movement, which campaigned to overthrow the existing political class, depicted as overprivileged, overpaid and out of touch with the hardships faced by many citizens. A record number of voters abstained from the polls.
Demonstrating that the popular discontent had not been ignored, Mr. Letta said one of his government’s first orders of business would be to abolish the stipend that ministers receive on top of their salary as members of Parliament.
He pledged a series of tax cuts for small and medium businesses, and a delay in the increase of the value-added tax, a form of consumption tax, which had been set to take effect this summer.
The June payment of an unpopular housing tax would be canceled, he said, to give Parliament time to work out a reform of the tax that would “give oxygen to families,” especially those in greatest need.
Though several political parties campaigned to abolish the housing tax, it became the signature issue for the People of Liberty and its leader, former Prime Minister Silvio Berlusconi, to support Mr. Letta.
Article source: http://www.nytimes.com/2013/04/30/world/europe/enrico-letta-italys-new-premier-puts-stimulus-first.html?partner=rss&emc=rss
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