Presenting the 2024 budget, Giorgia Meloni avoided questions: We would like to ask why, when explaining the economic program of the government, it speaks of “extra income”, instead of explaining that most of the measures taken are budget deficit, that is, debt. . But what we would like to believe in the Prime Minister’s slip of the tongue seems to be a clear political will to distort the facts. Just read the details of the financial maneuver. We did this together with the famous macroeconomic analyst Mario Seminerio, who has always been devoted to highlighting the distortions and effects of economic policies. And according to Seminerio, this initiative by the Meloni government is a “ticking time bomb” triggered in the state budget.

Economist Mario Seminerio: “An irrational maneuver, the result of propaganda, poorly written. Judging by the spread index, the market is not punishing Italy, but worse may come.”

The reason is simple: the budget law presented by the Government is based on 14 billion euros of money that Italy does not have but that the State owes. An “IOU” offered to foreign investors and Italian savers to finance structural measures (it is worth remembering the recently concluded BTP valuation operation). “Among other issues, when talking about the scope, Minister of Economy Giancarlo Giorgetti announced that the fund for reducing the tax burden will be used for this year’s Irpef reduction. One-time scope for structural reforms”.

The problem is exactly this: the government approved the fashionable cuts to avoid immediate damage to Italians’ wallets, but improvised funds were used to ensure that the tax wedge was reduced, and the issue was carried over to next year’s fiscal measure.

“It’s a propaganda maneuver where some memes and some postcards are good for social media use,” explains Seminerio.

Remember the slogan that Fratelli d’Italia has been promoting for a year now: “The more you hire, the less you pay” and crystallized in the new Superbonus for companies. It has nothing to do with creating bonuses, but in the 2024 budget, the reduction of contributions to companies is taken to an extreme, leading to a real distortion. But let’s go in order.

130% Super Bonus

The maneuver allows a company to reduce the cost of hiring by up to 130 percent if it increases its headcount through permanent hires in 2024, especially in disadvantaged categories.

• 120% for all permanent hires;
• 130% for mothers with at least two minor children, women who have not been in a regular paid job for at least six months, people under 30, people receiving former citizenship income and people with disabilities.

Giorgia Meloni claims to have introduced the principle of “the more you hire, the less you pay”, but the measure included in the Government program also introduces a distortion. Let’s see carefully: According to Meloni, the higher the ratio of employees to turnover, the less the tax debt to the state. However, the same claim starts from a contradiction and an outdated assumption.

In fact, Superbonus tends to favor companies that are already in a position to hire and therefore give money to “already rich” or profitable companies; On the contrary, it does not create an incentive for companies entering a spiral of stagnation.

The government forgets research and development

As Seminerio explains to us, “But the real problem is the logic behind this counter-cyclical stimulus, which highlights the full propaganda scope of the entire maneuver.” This incentive, which is asymmetrical as mentioned and dictated by pure propaganda motivation in the service of social media memes, is financed by the ACE deduction, a benefit launched in 2011 to encourage the strengthening of the capital structure of companies. Therefore, recapitalization of the Italian production system is not recommended; instead, given companies’ high debt ratio, providing money to profitable companies could have been useful to encourage the system to hire workers rather than encouraging automation and productivity; This is a real production disease. Italian system.

Because Italians’ salaries are very low

Underlining how the financial crisis goes hand in hand with the demographic crisis in a country like ours, Seminerio comments, “The government had very little money and eventually squandered financial resources.” And if Meloni’s government has made a commitment to help families, prenatal measures abroad have also proven ineffective against demographic decline. “We could use the few resources available to encourage automation and productivity growth, as seen in the examples of Japan and South Korea, which found themselves facing a demographic winter very similar to that of Italy, but whose economies were nothing short of crisis,” Seminerio argues.

So, in an Italy with public accounts similar to a South American country, we began to emulate the Scandinavian welfare system. We can be sure of this: This measure of the government will definitely be included in the graphs where the Prime Minister will show permanent employment increase in a few terms. What he won’t want to show is this graph, which is certainly more difficult than a slide from Palazzo Chigi but documents from Eurostat data how Italians are working less.