Wednesday, July 18, 2012

Is Sicily Bankrupt???

Yes! At least that was the story that made national headlines in Italy today, in newspapers like La Repubblica. The simple fact is that the Sicilian Region's government has a deficit bigger than a sink hole - literally billions of euros - and no ready source to tax, rob, coerce or beg for revenue. As it is, most of Sicily's public sector actually survives on "national" funding; it has been so since the 1940s. If Sicily were a country (it hasn't been since establishment of the Two Sicilies in 1816), it would be another Greece, facing a crisis very similar to that nation's troubles.

The national "central" government (in Rome) is reluctant to bail out Sicily without attaching at least a few strings to any "emergency" funds. Until now, a few Italian towns have faced default but never an entire political "region." Not that Prime Minister Mario Monti would permit a literal default, but he is talking about sending a special "commissioner" (super-manager) to audit the books and administer any bailout funds from Rome. The special commissioner would temporarily replace the Regional President, who has tendered his resignation effective by October. Figures vary, but the shortfall (the deficit) is estimated by disinterested economists at some 21 billion euros while the people running the Region claim a less credible 5 billion.

For now, the Prime Minister is sending Sicily a hundred million euros in "emergency" funds. That doesn't change the fact that the island - which after Naples was the wealthiest region of the newly-unified "Italy" in 1861 - is an economic "charity case."

Last week, newspapers reported that the European Union is also talking about more closely overseeing EU "development" money sent to "under-developed" Sicily. Amidst the endemic, chronic public corruption, payoff scandals and thousands of jobs-for-friends (Palermo province alone has more public-sector employees than the entire Lombardy region, which includes Milan), both these moves point to a single ideal: Accountability.

For now, it's just a question of the Regional Assembly's offices cutting back on the air conditioning and perks.

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