Centerfield

The Italians Look for the Exit

Italy's Berlusconi says euro strangling economy

Berlusconi said the [tax] cuts were needed to revive a lethargic economy, but stressed the strength of the euro currency was also weighing heavily and called on his EU partners to revise the Maastricht Treaty on which the stability pact is based.

"The blessed introduction of the single European currency has thus far produced the exact opposite result of what the euro was created for -- an asphyxiated economy and hobbled growth under the burden of 'stupid' ties," Berlusconi wrote.

"In Europe there is an extremely strong drive to review aspects of the rigid ties of the Maastricht Treaty, those perverse factors that have increased the value of our currency above what is necessary and artificially penalised the competitiveness of our industries and our services," he added.

Berlusconi has broken ranks with Chirac and Schroeder and is saying in public what the French and the Germans are loathe to admit--that the tight money policies of the EU combined with the social welfare state of some member nations are strangling the European economies, and that reform is desperately needed. The Euro has brought intra-European economic "stability," but at the cost of zero economic growth and high unemployment. The result is that some nations are effectively subsidizing the socialist welfare structures of wealthier nations, all are paying with endemic borderline recession, and Italy wants out.