Spoiler: This post is a follow-up of a previous post and begins with the text and the graph of that post. That post showed that the Euro has had nothing to do with the poor developments of Italian exports. Instead, Italy has structural problems which date back a long time. A symptom of those problems is the low labour productivity and total factor productivity growth rates relative to the other countries who joined the Euro area at the same time as Italy, the EA12 countries.
If Matteo Salvini, the right-wing Italian politician, would have its way, Italy should leave the Euro. Why? Because he thinks that the Euro is the root of Italy’s problems. He has argued that if only Italy would not have to follow EU budget rules, Italy could spend its way out of its problems and return to the growth it had before the Global Financial Crisis (GFC).
People believing that the Euro is the problem, claim that it hurts Italy’s “competitiveness”. If that is correct, Italy’s problems began sometime after she joined the Euro area. If this is correct, we should see a negative effect on Italy’s exports after the introduction of the Euro. Let’ s have a look!
Spoiler: Hungary have benefitted enormously by joining the EU. Joining the EU meant that Hungarians were guaranteed civil rights that were unthinkable when Hungary was a communist country. The EU membership also meant that living standards increased to levels far higher than before. Hungary has also received more of EU funding than average of the ten countries that joined the EU in 2010. Despite this, Orbán has since he became prime minister, again 2010, set out on a path violating Hungarians’ civil rights, freedom of the press and rule of law. These are steps towards a more autocratic and corrupt society where elites are free to enrich themselves.
Spoiler: The number of democracies has fallen during the last decade. For the first time since 2002, there are now more autocracies than democracies in the world. The EU now has its first autocracy, Hungary.
The Polish government is following close in the path to autocracy. The governments in Hungary and Poland have systematically attacked the media’s and judiciary’s independence the last years. Without an independent media and judiciary, the regimes’ next step on the road to autocracy is to manipulate the elections.
The corona virus has made it necessary to implement measures restricting the freedom om movement and assembly. While these are justifiable measures which will be revoked in most countries, the Hungarian government wants to use the state of emergency powers in ways that violate civil rights also after the Corona crisis is over.
These developments are deeply worrying. Russia under Putin provides a horrifying example of how autocratic leaders abuse their powers at the expense of human rights.Continue reading