Italian Austerity News

October 31st, 2011
in econ_news

maserati Econintersect:  Italy is the missing “I’ in the latest version of the acronym for countries in trouble in the EU (PIGS), which abbreviates Portugal, Ireland, Greece and Spain.  Until recently the acronym was PIIGS.  Italy has been kept out of the new acronym because it has agreed to embark on a severe new austerity program to bring sown government spending.  One of the most hard-fought concessions came last week when Italy agreed to raise its retirement age from 65 to 67.  This was a bitter measure for Italians to swallow.  Today (Monday, October 31) The Telegraph reports that the Italian government has made a significant purchase of new cars.

Follow up:

From The Telegraph :

Italy may be in the midst of a savage austerity drive but that has not stopped defence ministry officials ordering a fleet of armoured Maseratis to ferry themselves around Rome.

The delivery of the 19 top-of-the-range executive cars has raised eyebrows at a time when the country is meant to be shaving billions off its public spending.

Opposition MPs said it was it was an outrageous indulgence at a time when the defence ministry is supposed to be reducing its budget by €2.5bn (£2.2bn) [$3.5bn – GEI Ed.] over the next three years.

The matter was raised in parliament by Emanuele Fiano, an MP from the opposition Democratic Party. "At a time when millions of Italians are being affected by a very serious economic crisis, is there good reason for the defence minister to feel it necessary to add 19 armoured Maseratis to the ministry's car park?" he said.

Italian officials are notorious for their attachment to what are known colloquially as "auto blu" - vast fleets of dark blue and black limousines which carve through traffic with flashing lights and police outriders.

According to Defense Minister Ignazio La Russa, the cars had been paid for with money out of the 2008-2009 budget, well before the government started making cuts.

According to The Telegraph the model of car bought (Quattroporte) starts at around £80,000 ($127,000).  The 19 cars purchased by the government are far from the bottom of the line and are armored, which is far from inexpensive.  Econintersect doesn't have exact prices, but it is likely that the special order is worth high single digit millions of dollars.

maserati

Source:  The Telegraph









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