Italian Coalition Takes Shape: Platform Includes Parallel Currency

Authored by Mike Shedlock via MishTalk,

Five Star and Lega want another three days to conclude talks. Neither Di Maio nor Salvini would be Prime Minister.

A reader informed me yesterday that Five Star was pro-Europe and not Eurosceptic.

Compared to what?

Certainly Five Star leader Luigi Di Maio is a far cry from former Five Star leader, Beppe Grillo. But some of that change in positioning was little more than political expediency to win votes.

The platform now in the works includes a parallel currency, reduced immigration, and flat taxes.

Eurointelligence Comments

This is what real coalition negotiations look like. The leaders meet and set the agenda for sub-committees to talk about specific policy issues. That process will start in Italy tomorrow, when the deputy leaders of the two parties come together, but some of the outlines have already been drawn up by the leaders themselves.

What do we know so far? Five Star and Lega are very different political parties, but they have enough in common for a radical legislative agenda. The two sides seem to be inching towards a neutral prime minister, in other words neither Di Maio nor Salvini. The name mentioned by Italian newspapers this morning is that of Giampiero Massolo, a career diplomat who seems to be acceptable to both parties. Massolo will clearly only be the frontman. Power will rest with Di Maio and Salvini.

It will be interesting to see how the two sides will legislate together on issues that might affect Silvio Berlusconi personally. We don’t think he accepted to step aside and let Salvini run the show himself without any clandestine conditions. Any undertaking Salvini might have given him would be difficult for Five Star politically, though.

Corriere della Sera lists the following as the main legislative priorities. If implemented it would be the biggest shake-up of the Italian economic system in modern times.

Platform Provisions

  • The end of the pension reforms under Mario Monti; Five Star is softer on this point than Lega, but together the two parties can be expected to agree fundamental changes.

  • A flat tax on companies and people - in other words a massive tax reduction.

  • A study on the so-called minibot. This is a parallel currency based on future tax receipts, similar to the plans proposed by Yanis Varoufakis in Greece. The minibot was in the Lega’s election manifesto. Five Star is far less radical on the eurozone, having dropped the idea of a referendum, but also seeks changes that are incompatible with the the EU fiscal rules. A parallel currency stands a much greater chance of success in Italy, and it would go some way to solving the government’s fiscal dilemmas. The open question is whether it would constitute a slippery slope towards euro exit.

  • And a citizens’ income, which is Five Star’s big idea, to be implemented next year.

EU's Worst Nightmare

The Express describes the EU's Worst Nightmare as Eurosceptics Join Forces.

One of the first things the two parties are likely to agree on will be to scrap a 2011 pension reform which raised the retirement age and required further hikes over time. Economists say repealing the law would cost 20 billion euros ($24 billion) a year, but opponents say it is unfair on ordinary Italians.

Both parties also want to renegotiate the EU's fiscal rules to allow Italy to spend more. 5-Star has rowed back on a pledge to hold a referendum on Italy's membership of the eurozone, but the League still calls the euro a "flawed currency" and wants to exit it as soon as is politically feasible.

Setting up a possible institutional clash in Italy, President Mattarella made clear on Thursday that he did not want to see any confrontation with Brussels.

"To think that one can go-it-alone in Europe is knowingly deceptive in front of public opinion," Mattarella said in a pointedly pro-European speech at a conference on the state of the European Union in the central town of Fiesole.

Major Changes

President Mattarella can make all the pro-Europe noises he wants, but other than force new elections which would likely give Five Star and Lega a bigger majority, there is little he can do.

Major changes are coming but there is no way to pay for them.

Flat taxes and a tax reduction are good ideas. A guaranteed income is a bad idea, but it's on the way.

Both parties are staunchly anti-immigration.

A parallel currency is indeed a stepping stone to a break from the Eurozone.

Flashback March 1

I do not believe anyone else suggested this outcome: Italy Election March 4: Consider a Surprise M5S + NL Alliance.

In March, many thought I was crazy.

Comments

King of Ruperts Land Pinto Currency Sat, 05/12/2018 - 16:19 Permalink

Precious metal denominated parallel currency might be a way to wean ourselves from worthless fiat.

Gresham's law would not apply if the parallel currency had no fixed exchange ratio to the older fiat.

Example: The old paper federal reserve dollar and the new silver US Treasury dollar, with no fixed exchange ratio. If I was a unionized MacDonald's employee, I would support a new contract to get paid in the new US silver dollar.

In reply to by Pinto Currency

rmopf2010 ParkAveFlasher Sat, 05/12/2018 - 12:46 Permalink

We might be seeing the experiment that will shift the western countries policies for the future.

The "pensionists/retirees" are every western country finances nightmare, because it was promised to them, pensions and benefits that nowadays are totally irrealistic, because they live 20~30years after retirement.

When social security was made people lived 5~10years after retirement.

Let's focus on Italy:

0-14 years: 13.5% (men 4,056,156/women 3,814,070)
15-64 years: 66.3% (men 19,530,696/women 18,981,084)
65 years and over: 20.2% (men 4,903,762/women 6,840,444) (2010 est.)
https://en.wikipedia.org/wiki/Demographics_of_Italy
 

Pension expenditure as a percentage of GDP in Italy from 2009 to 2015: 17%

https://www.statista.com/statistics/654719/pension-expenditure-as-a-per…

 

Public spending on pensions will continue to increase in the coming years. According to the Ministry of Economy, in 2016 social security benefits will cost €261.65 billion and will continue to increase to €264.92 billion in 2017 and €279.37 billion in 2019.

http://www.italy24.ilsole24ore.com/art/public-finance/2016-07-14/public…

  1. In 2016 global "social expenditure" in Italy was €535 billion.
    1. Here we can see that 20% of the population gets half the social expenditures
  2. M5S is promissing basic income of 780€/month per citizen which will cost €560 billion per year

 

The solution will give every pensioner basic income, so it's leveled, the old man have an income so they don't starve to death, and the young unemployed will get some income to get started their lives and the economy.

In reply to by ParkAveFlasher

TheGardener RumpleShitzkin Sat, 05/12/2018 - 12:05 Permalink

I"n March, many thought I was crazy."

Great reporting Tyler. I am usually fully on board with most of your projections but at that time I was just praying for wishful thinking to come true .

Will hold you in even higher esteem for reading my beloved Italians right through an election.

But as you report it, it seems just a logical and natural trend, in retrospect many will

get on board with your original assessment .

 According to Nietzsche understatements are a sly way of overstatements.

According to Italians , our world is a philosophical construct as it seems and not all is lost.

 

In reply to by RumpleShitzkin

TheGardener Aliens-R-Us Sat, 05/12/2018 - 12:25 Permalink

/sarc on your Mussolini comment and my single little upvote. Yet Mussolini was a former communist/socialist , member of such parties in Swiss exile (((where Lenin once hided before being shipped by rail through Germany with full malignant support and content))) and imprisoned and expelled in Austria . Full copies of various autobiographies at hand if full quotes desired.

Mussolini ordered the trains to arrive on time while Hitler built the Autobahn in competition to the Reichsbahn who had an estimated time of arrival at target Bahnhofs of less than almost military 40 seconds "over target". 

In reply to by Aliens-R-Us

Oldguy05 Sat, 05/12/2018 - 11:36 Permalink

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There ya go!

 

 

mendigo Sat, 05/12/2018 - 11:48 Permalink

We are all vassal states:

Coordinated central banks

Wto

Wb/Imf

Global banking

Now us as stasi to world stepping on necks of those who dont play along.

Us/China rock/hard place

Expendable Container Sat, 05/12/2018 - 12:08 Permalink

I agree with J S Bach, a ZH commenter. We, of sane minds, must FIGHT for the future of our children!

A good way to do that (one of many necessary methods) is to pass on this Excellent interview as it saves years of researching outside the fakestream media:

The Andrew Carrington Hitchcock Show (651) Dr. Peter Hammond –

“THE REAL STORY BEHIND THE MULTICULTURAL AGENDA”

http://eurofolkradio.com/2018/05/08/the-andrew-carrington-hitchcock-sho…

EuroFolkRadio’s Andrew Carrington Hitchcock interviews Dr. Peter Hammond, for a show entitled, “The Real Story Behind The Multicultural Agenda.”

We discussed: how multiculturalism is actually demographic engineering; the birth control agenda for the White Race; the goal of a one world government and a one world religion; the heresy of the Rapture Doctrine which is designed to encourage pacifism amongst Christians; the Jewess Barbara Lerner Spectre’s admission that it is primarily Jews who are behind the multicultural agenda; Karl Marx’s admission that Communism destroys truth; how the six pointed star on the Israeli flag is a satanic symbol that represents 666; how the entertainment industry has been stirring up hatred against the White Race; how Frederick Engels claimed his friend Karl Marx was pure evil possessed by 10,000 demons; how Prophet Muhammad married his third wife Aisha when she was six years old and consummated the marriage when she was nine years old, which may explain why some Muslims have absolutely no qualms of grooming and raping children in the UK; how Hindu girls have been married as young as four years old both before and since the fall of White Christian rule over India; how Fidel Castro is actually Canadian Prime Minister Jacques Trudeau’s father; Harvard Professor Noel Ignatiev’s repeated calls for the genocide of the White Race; how the way in which the White Race are being persecuted in South Africa is a testing ground for how Whites are going to be treated in White countries throughout the world; and many other topics.

Ace006 Sat, 05/12/2018 - 12:08 Permalink

REDUCED immigration?  How about NO immigration?  How abut massive EXPULSION?  Jeez, the West is going to sink under the waves of timidity, self doubt, and suicidal PC.  After decades of the scourge of open borders and leftist immigration "compassion" and cultural subversion all they can think of is "reducing" immigration.  HMOG. 

Same in the U.S., of course.  None of us can find our ass with both hands.

Shibboleth Sat, 05/12/2018 - 12:49 Permalink

You know what a parallel currency means? It means war. That’s what happened to nazi- Germany. The socalled allies didn’t give a fuck about the jews and the endlösung. 

yvhmer Shibboleth Sat, 05/12/2018 - 13:12 Permalink

A parallel currency as in Swiss Franc and WIR . Or like in Albania, where the Euro also is a currency in which payments can be done. Or the Sardex.  

There are many places in which a parallel currency works wonders bother economic downturns,  as well as in economic good times. 

Prof.Wilhelm Hankel ( German ) has and is still crusading to have every country in the EU back on it's own currency, parallel to the Euro . 

At least the austerity can be softened and turn the wheels of economic life. Clearly, Italians have now a real chance of implementing it. I do hope they will stick with it and do it right. No Greek tragedy for them, it seems. 

 

In reply to by Shibboleth

Rubicon727 Sat, 05/12/2018 - 14:16 Permalink

"A reader informed me yesterday that Five Star was pro-Europe and not Eurosceptic."

Shedlock- the fact that you just learned this well known fact amongst educated/well informed Italian, then it strongly suggests you know very little about Italian politics in the face of the EU & Germany's power. 

Some in Italy determined this abrupt change months and months ago meaning 5 Stars was bought off.

Secondly, you portray both 5 Stars and the Northern Leaguers as the only active players in a potential political coalition.

What you don't understand is the power of the EU/Germany AND the US. The Italian president was, not long ago bought off by these three noted powers. Just a few days ago, a US Ambassador visited Matteralla insuring that either a "techno govt" be installed or something similar to satisfy these 3 powers. OR ELSE.

Lastly, the only way motive introducing "a basket of currencies" into this arrangement would be from the direct command of the German Elite. THAT notion could only be slightly plausible because the German's are going to be financially hit by the Trump/Financial Elites with the withdrawal of the IRan deal and US sanctions. A basket of currencies would help alleviate German's manifest need to remain a leading export nation. 

Most of America doesn't have a clue that German exporting power has greatly expanded in the world, done largely by its stranglehold on EU nations and its trade with China/elsewhere. 

Cosmicserpent Sat, 05/12/2018 - 17:00 Permalink

This should be good for a further spike in the dollar.  If they announced dropping the Euro entirely, these politicians may find they have a compulsion for self defenestration or suicidal tendencies to death by nail gun.

The only way for southern European countries to get out from under the Rothschild banking guild is to adopt sovereign currencies.

fiddy pence ha… Sun, 05/13/2018 - 03:11 Permalink

The parallel currency is an electronic ledger for use

between the government and the people.

It means that the government can free itself

from its daily reliance on the ECB for liquidity.

it still equals a Euro, but it can be used instead

of the Euro, at some point.

Anyway, just dumping the Euro would have been rough

sailing for two years, but this pax germania is causing

the same thing, and it's long-term.