Is Italy’s economy sliding into abyss?
The Calculated Risk blog has a thoughtful and lengthy analysis of Italy’s economic situation, in which it assesses the current short-term outlook – which is negative on almost all fronts – and discusses whether Italy may this time not get out of this whole – quoting a phrase by former foreign minister Gianni de Michaelis who said the Italian economy was like the Titanic about to hit an iceberg. The case against a harmonised corporate tax base in the EU Sebastian Dullien and Daniela Schwarzer, writing in Eurozone Watch, come out firmly against plans by the coming French EU presidency to harmonise the tax base. This is generally seen as a second-best options, since harmonising tax rates is politically too difficult. Dullien and Schwarzer make the point that you get more, not less tax competition, when you harmonise the tax base, as cross-country differences become more transparent. Furthermore, this will severely constrict government’s ability to use fiscal policy during a downturn – whe
