Dear sirs, Yesterday I had the privilege of attending a conference on the re-launching of the Italian economy. Great steps have been taken since Monti was wisely appointed a year ago this week as caretaker of this country. The spread on Italian debt over German debt has shrunk from over 550 bps to less than 350 bps.
Monti has asked Italians to make great sacrifices in these trying times, imposing new taxes and eliminating certain benefits which had become "entitlements" more than anything else; they benefited the few who had connections.
He even cut provinces by nearly 40 percent, including his natal city of Varese. There were no sacred cows in his plan which has been scrupulously followed by his expert team of technical Ministers. Liberalization laws have been implemented and we can already see improvements, from the price of gasoline, to the creation of new pharmacies and notaries.
In order for the spread to come down to a more reasonable level (150 bps), further steps must be taken by the members of Parliament: yes you, Deputies and Senators.
You are in now doubt aware that your level of support among Italian voters is similar to that of Badoglio in 1943-1944! It is even worse than the depths of the end of the First Republic. The only consolation you have is that it cannot go any lower. There is an easy solution which would go a great way in eventually giving you the opportunity to build up your image.
One of the main gripes of Italians is the outrageous expenditure of your infrastructure. At the event, a few politicians (none of them members of Government) had the audacity/bad taste to enter with a retinue of assistants, bag carriers, etc. I counted at least ten. Further, their entrance, rather than being discrete, was such that it interrupted the event and the speech of very prestigious industrialists who actually had interesting things to say.
My proposal or challenge is the following: show Italians the good example and cut your salary by 50 percent until you are able to balance Italy's budget. While you are at it, vote to rescind, even retroactively agreed contracts, all forms of pensions to the actual politicians who served until now, including you. I am not talking about the staff, just the Deputies and Senators.
You will quickly realize that this savings is just a drop in the bucket when one considers all the profligacy you have been so good at executing.
I can guarantee you that once you implement these two simple items, you will have singlehandedly helped Mr. Monti bring the spread down to levels that more properly reflect Italy's standing in the world economy.
Furthermore, the FTSEMIB index, which currently stands at the same level as a year ago, will blast off as foreign investors will finally see that even recalcitrant Italian politicians are getting their act together.
One of the issues that you have always pushed for is Foreign Direct Investment (FDI) . Italy ranks as one of the countries with the lowest FDI as a percentage of GDP. This will change quickly as foreign institutions will start piling in, just like they did in the early 60s.
As with all open letters, it will in all likelihood fall on deaf hears and blind eyes. More than a few of you don't even speak or understand English.
My hope is that the more enlightened members of Parliament translate this to you and explain to the rest that this is the only way to the salvation of this country where I have lived as a guest for the last 28 years. I love this country! Do you love it too?