Rushing to keep Italy from being sucked further into a broader European debt crisis, the Parliament gave final approval on Friday to a package of austerity measures meant to cut the nation’s budget deficit by ¤70 billion ($99 billion) over three years.
The lower house voted 316 to 284 for the measures, in what politicians called the fastest approval of a budget bill in modern Italian history. The upper house approved the bill on Thursday. Prime Minister Silvio Berlusconi, who won two confidence votes on the measures, had vowed to push the bill through this week because of worries in the financial markets that Italy would become the next euro nation to suffer a sovereign debt crisis like those in Greece, Portugal and Ireland. The bill was originally supposed to be debated later in the summer. Italy’s high debt and low growth have placed the country in an uncomfortable international spotlight. The rates the country had to pay to borrow rose this week to the highest levels in three years. The leading index of Italian stocks slid almost 1 per cent on Friday, part of a sour day on European markets generally.
The center-left opposition voted against the measures, but did not present the kind of obstructionist amendments that are often used to block a bill’s passage in debates over budgets. On Friday, opposition leaders amplified their calls for Berlusconi to step down, saying he was no longer able to run the country.
Addressing Parliament on Friday, the opposition leader Pier Luigi Bersani called the budget bill “disastrous” and “homicidal,” saying it unfairly made Italians pay for the Berlusconi government’s “misguided” economic policies. “How much did it cost us to have a prime minister who lost international credibility?” Bersani asked.
He added that the austerity measures would not protect Italy from market attacks. “Our bond spreads are widening again today, showing that this plan won’t shield us from the crisis,” Bersani added, referring to signs that investors’ confidence in Italy was still shaky. Other troubled nations in the euro zone have also struggled to satisfy the credit markets, most notably Greece. The European Union decided Friday to hold an emergency summit meeting the following Thursday to try to break a deadlock over a second bailout plan for Greece.
The Italian austerity package aims to eliminate the country’s budget deficit by 2014. The deficit is now 4.6 per cent of gross domestic product, below the average for the euro zone. The package includes 40 billion euros ($57 billion) in spending cuts. It also increases taxes, including those on gasoline and some trading accounts; introduces a co-payment for some health care services; raises the retirement age; and cuts some high-level pensions.
©2011 The New York
Times News Service
