Debt and its Nature

The Eight O'Clock News has warned us all and reassured us all (this News is Prime Minister Berlusconi's personal News, you should understand):

we are going to have tens of billions of euros cut off public expenditure debt to meet the requirements of the eurozone but, mysteriously, there will be no reductions in services and pay-outs, or tax rises.

So that's all right then.  

Of course there is the slack of tax evasion continuing to be taken up - as it has been for the last few years, during which we have all learned to be punctilious in keeping our bits of paper and handing them over to the accountant regularly (no-one in Italy is without an accountant, it's not the avoiding so much as the claiming and allowances that are so easy to lose track of); but equally, we have all now agreed that  we don't want to be unable to show our innocence of ducking and diving.  The ending of mass evasion alone is yielding most of what is needed - as Mr Berlusconi,  himself a member of the masses, at least in his heart, knows.  And then there is the rectitude of so many Italians who don't do debt:  not  personal debt on credit cards and for, or from, silly behaviour.  They do private debt, very private debt  over generations and extended family; but that sort of debt is really private and, as it glues society together,  behaves differently and exists under wholly different rules from just the rules of economics.

So despite the ill-mannered acronyms and expressed derision of Anglo-Saxon journalists and financial commentators, Italy only  has public debt, which can be readily covered if the government insists, which Dr Tremonti and Dr Draghi do, without much embarrassment and certainly without any of the bad behaviour displayed in Greece recently.  And without the discomfort of the English and Americans who have covered themselves in all and every kind of debt.  So we were probably told the truth this evening.  But then, though perfectly capable if lying serves,  the Prime Minister isn't a liar by nature, whatever else he may be.

And the bank at the bottom of the hill is ready and willing to lend - to the credit-worthy.