Laying Siege to Their Fathers
Is Italy’s Left doomed to die a slow death?
April 24, 2000
Italy’s political left is still a powerful force in Italy — even as its influence in the rest of Europe has waned. Now it even has, in Guiliano Amato, a leader who rose to prominence on the left. But in recent years, even Mr. Amato — a former leader of the Socialist Party — has come to the realization that Italy’s left is doomed to die a slow death.
Among the many signs of demise, the country’s public pension system is in particularly bad shape, with the unfunded portions alone equaling 60% of current GDP. Worse still, more than half of the members of Italy’s labor unions — the major source of political power for the left — are not workers, but pensioners!
Of course, nothing is harder in a democracy than trying to take away benefits that people became accustomed to long ago. Never mind that Italy’s luxurious pension policy is a direct result of the Cold War and concerns about Euro-communism. Throughout the post-war era, it seemed as if Italy’s working class was always on the verge of being consumed by the communist threat.
In order to cure the masses from the Soviet virus, Italian politicians bribed them into loving the capitalist West. They did this by granting workers pension benefits that were so generous, they essentially took the place of any dreams of a communist wonderland.
Little surprise then that Mr. Amato’s reform efforts, since his first go-round as Prime Minister, were given an icy reception by Italy’s labor unions. But the thoughtful and gutsy politician found a way to stop the boisterous union leaders in their tracks. When his proposals to scale back pension benefits were challenged, his response was:
“In the 1950s and 1960s, we took bread out of our mouths to give to our children. Now, those children who have been out of the work force for so long identify themselves with those who propose abolishing the unions. Rightly or wrongly, these young people believe unions only represent the generation of their fathers.”
In other words, the overly generous non-wage benefits granted to current employees have made companies extremely reluctant to take on new workers. No group realizes this more so than the youngest entrants into the job market. As a result, corporations are desperately trying to reduce their payrolls, by devising early retirement programs and the like.
As would be expected, unions are fighting hard against cutbacks of any kind. They have branded Mr. Amato’s past proposals as outright and completely reckless abandonment of the welfare state. But under current circumstances, of course, the high price of Italian labor will not fall — and the young will remain unemployed and restless.
This is what gives Mr. Amato’s dark, but honest vision of a looming generational warfare between fathers and sons such an eerie undertone — and hints that his new job will not be an easy one.