| Brussels Raises Red Flag on French Deficit, Hollande Blames Hidden Taxes of Sarkozy; France in Deep Trouble Already Posted: 12 May 2012 10:14 PM PDT French president-elect François Hollande has launched a preemptive attack blaming outgoing president Nicolas Sarkozy for the huge budget deficit of France. Given Hollande wants to tax millionaires 75%, I find it quite ironic that Hollande blames the problem on "hidden taxes" of Sarkozy. Please consider Brussels raises alert over French deficit Brussels has raised a red flag on France's budget deficit next year, in a warning over a €24bn fiscal shortfall that threatens to develop into a confrontation with Paris over austerity.
François Hollande, the French Socialist president-elect who has warned against over-reliance on austerity, said he had "anticipated" the deterioration in public finances and blamed "hidden taxes" left behind by the outgoing president Nicolas Sarkozy.
European Commission forecasts unveiled on Friday suggest France is expected to meet its deficit target of 4.5 per cent of gross domestic product in 2012, but its shortfall next year will be 4.2 per cent – well short of the 3 per cent EU target. Closing the 1.2 per cent gap would require savings or new taxes amounting to about €24bn.
France was one of 13 countries in the 17-strong eurozone that Brussels said it expected to miss their deficit targets for 2013, with the total deficit for the single currency bloc slipping by 1 per cent of overall output.
Spain fell badly short, nursing an expected 6.3 per cent deficit next year – some 3.3 per cent wide of its target.
Olli Rehn, the EU commissioner responsible for economic affairs, said he was "waiting for the French authorities to decide which measures will be introduced for 2013".
Mr Hollande, who campaigned for growth initiatives alongside austerity measures, will find it harder to hit the target if the EU growth forecasts for France prove correct. Brussels forecasts growth at 1.3 per cent next year, weaker than the 1.7 per cent expected by the incoming Hollande administration.
Tax-raising measures account for 40 per cent of Mr Hollande's deficit-reduction programme, and 60 per cent spending cuts, but the Socialist president-elect has been vague about where the cuts will fall. Hollande in Deep Trouble Already Note that Hollande does not have the decency or the courage to name his budget cuts. Moreover, I can guarantee cuts will be bigger and/or the tax hikes greater than he has announced because growth estimates in France are wildly optimistic. Specifically, the idea that France is going to grow 1.7% next year is preposterous. I am willing to bet France will not grow at all. If so, expect still more austerity measures or tax hikes, with protests spreading to France as they did in Greece, Spain, and Italy. The result will be as happened in Greece. Voters will start backing any candidate willing to tell Brussels and the Troika to go to hell. Marine Le Pen is one such candidate on the right. She is in favor of exiting the eurozone. Expect to see counterparts on the left willing to say the same thing as politics splinters in country after country. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com
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| Tax Collection Violence in Italy: Mail Bombs in Rome, Police Clashes in Naples, Molotov Cocktails in Livorno Posted: 12 May 2012 08:09 AM PDT Violent protests against the hated Equitalia, the Italian tax collection agency, are making headlines in several cities in the past few days. In Rome mail bombings have been ongoing since December. Via Google Translate, this time in Italian, please consider a trio of articles. Equitalia, six months of mail bombs MILAN - Equitalia once again in the crosshairs. After the envelope with gunpowder delivered Friday to the see of Rome, in Via Giuseppe Grezar, last night, two Molotov cocktails were thrown against the door of the agency's headquarters in Livorno. This is the latest in a long series of parcel bombs and suspicious envelopes arrived in recent months in various offices of the Italian society of recovery.
THE FIRST PACKS-BOMB - The first package bomb delivered to Equitalia comes in via Millevoi, in Rome, December 9 last year. The bomb explodes in the hands of the director general, Mark Cockaigne, that is wounded in the hand and eye. On 12 December a large firecracker exploded outside the headquarters of the agency Equitalia in Naples. The explosion causes damage of the lower part of the gate valve iron input current Southern.
On 15 December an envelope, containing gunpowder and a primer, is caught in the seat of Equitalia Flaminio in Rome on the Tiber. On 20 December an envelope containing white powder with no sender is delivered to the site via Equitalia Millevoi. On 22 December, two envelopes containing suspicious powder is delivered to the Stock Exchange in the square in Milan and the Business of Equitalia in Via San Gregorio. On 4 January an anonymous caller warns of a bomb the headquarters of Perugia Equitalia. After the appropriate checks reveals a false alarm.
January 5 at Leghorn a threatening letter and a 7.65 caliber bullet is sent to the Director of the office of Equitalia of Livorno. The same day at Caserta a parcel containing gunpowder and intended to Equitalia of Caserta is intercepted by the Post Office, insospettitesi the lack of sender. Inside is also found a threatening letter. On January 9, an envelope containing suspicious powder and addressed to Equitalia is intercepted in the post office of Ischia and a second envelope with gunpowder and a piece of rope as a wick reaches the site of the Tiber Equitalia Flaminio in Rome.
Less than ten days later, on January 26, two envelopes are delivered, within an hour, in two different offices of the agency in Milan: the first at the headquarters of Via San Gregorio, the second on a Dell 'Innovation.
'N PAY THE CONSEQUENCES "- On 14 March, another envelope with suspicious powder was intercepted in Cosenza. The letter, sent to the registered capital of Calabria, contains electric wires with a triggering mechanism. To alert the police post is a postal sorting center of Cosenza, who became suspicious after seeing out of the envelope of gray dust. The letter also contains a sheet with a sentence written in large letters: "you'll pay the consequences." On April 27, false alarm for the two coffee cans connected with electric wire found outside the headquarters of Equitalia in Ivrea, near Turin. The bomb squad of policemen arrived to reclaim the land has not found any trigger.
On May 9, a bomb in the headquarters in Genoa by way of Equitalia Casaccie. The building was evacuated as a precaution, the accesses to the site are blocked by police.
Friday at 11.30, an envelope containing gunpowder was delivered to the Roman Equitalia, on Via Giuseppe Grezar. A first analysis was gunpowder inside but no ignition. The attorney on the case of Rome opened a file. Last night, finally, an attack with blows of Molotov cocktails has occurred against the headquarters of Equitalia of Livorno. Unknown assailants threw two Molotov cocktails against the door tax collection agency on the ground floor by way of Independence, in the city center. The fire caused damage outside the building. Investigates the incident Digos. Livorno, Molotov against Equitalia 4 Molotov cocktails (two did not ignite) and a bomb against Equitalia.
A Molotov cocktail first, then after a second, the noise of people fleeing the fire that illuminates and Independence Street in the center of Livorno, where the headquarters of Equitalia. It is' an attempt, Digos confirms that from 4.30 am on Saturday doing assessments, together with the Scientific, the entrance of the palace collection agency. The police found abandoned on the road three more bombs and other unexploded bomb paper two Molotov cocktails. But most worrying of rudimentary primers were found that probably should be used to cause a fire that could spread to the rest of the building where there are also apartments.
The damage of the attack fortunately are mild because the alarm was triggered almost immediately.
A letter from someone describing himself as a desperate "maverick" believed to be harassed by the "demon of the tax," which "does not distinguish between poor and billionaires" and are not aware of having violated the rules to be beyond the law. Clashes outside the headquarters of Equitalia in Naples NAPLES - The demonstration outside the offices of Equitalia leads to violence. The police charged the demonstrators, one hundred, the "Network against Neapolitan Equitalia" who manned the headquarters of South Course in Naples. "Network" made up of temporary committees, community centers, networks, trade unions and student base.
Firecrackers - Against the offices of the headquarters of the collecting society were thrown eggs filled with red paint and two firecrackers exploded. Then, bottles and stones have gone against the agents of the mobile unit deployed outside the offices. Police responded to the pressure of the demonstrators charging for at least 4 times and throwing tear gas. Expect the protests to become more frequent and more violent. Protests in Greece started much the same way. Mario Monti, the technocrat appointed to save Italy has lost support. Reuters reports local vote result dims reform prospects May 9, 2012 12:18pm EDT
The results of last weekend's local elections in Italy are likely to weaken Prime Minister Mario Monti and make it harder for him to push through unpopular reforms to shield the country from a worsening euro zone debt crisis.
The vote to elect mayors in more than 900 towns and cities saw heavy losses for the centre-right PDL, the largest party backing Monti's technocrat government, and a surge in support for a protest movement that wants Italy to leave the euro.
Former Prime Minister Silvio Berlusconi was quoted in Italian media as saying his PDL would no longer "lie down" before Monti after the party suffered a rout at the polls on Sunday and Monday, losing control of dozens of cities.
The centre-left PD, which also lost votes but is likely to boost its number of mayors in run-off ballots thanks to the implosion of the PDL, said Monti must now take more account of its positions, which are increasingly hostile to austerity.
Monti said on Tuesday that he did not believe the vote would affect his government, but many analysts disagree.
"The impression is that Monti is more isolated. Having been the shield of the parties, he now risks becoming their target," said political commentator Massimo Franco in the daily Corriere della Sera.
The only winner at the vote was the 5 Star Movement led by Beppe Grillo, a shaggy-haired comedian who wants Italy to quit the euro and default on its debt and whose caustic invective against the established parties has gained increasing resonance in the wake of a spate of corruption scandals. Monti is not going to remain in control for long, assuming of course he is still in control in the first place. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com
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| Will Greece Snatch Defeat From the Jaws of Victory? Posted: 11 May 2012 11:54 PM PDT Inquiring minds scoff at the preposterous Financial Times headline a 'Glimmer of hope' for Greek coalition The "Glimmer of Hope" that Financial Times writer Kerin Hope speaks of is the possibility of a coalition that last until 2014 before new elections. I strongly disagree. I believe another coalition whose sole purpose is to keep Greece in the eurozone will result in more years of useless torture. Here are a few snips from the Financial Times. Greek conservative leader Antonis Samaras said on Friday there were still hopes a government could be formed after Sunday's inconclusive election to avoid a repeat poll.
"We are fighting to form a government and there are still hopes this can done," Mr Samaras told his parliamentary group, adding that he welcomed the proposal of a small, moderate leftist party for a national unity government.
Earlier, he met Socialist leader Evangelos Venizelos, who has been given a three-day mandate to try to form a government.
Mr Venizelos on Thursday launched a last-ditch attempt to form a coalition government and avert a fresh general election next month that could push the country closer to exiting the euro.
He said he was not optimistic, but "discerned a glimmer of hope" in discussions with Fotis Kouvelis, leader of the small leftwing party Democratic Left, who appeared to have softened his previous opposition to co-operating with the socialists and conservatives in government.
Such a three-way coalition could "just possibly" survive until the European parliament elections in mid-2014, "when the country should be on the road to recovery", said one Pasok lawmaker, referring to forecasts by the EU and International Monetary Fund for modest growth that year. Venizelos is a Liar For starters Venizelos is a liar. He said he had no interest in forming a government pieced together with barely a majority. So what changed his mind, and what may change the mind of Fotis Kouvelis? The answer is easy to explain in form of post-election polls that show soaring support for the Syriza party led by Alexis Tsipras. Before looking at recent polls, note that Syriza's demands are enough to spread fear into the hearts of every pro-euro clown. Tsipras' Five Point Proposal Please consider Tsipras lays out five points of coalition talks - The immediate cancellation of all impending measures that will impoverish Greeks further, such as cuts to pensions and salaries.
- The immediate cancellation of all impending measures that undermine fundamental workers' rights, such as the abolition of collective labor agreements.
- The immediate abolition of a law granting MPs immunity from prosecution, reform of the electoral law and a general overhaul of the political system.
- An investigation into Greek banks, and the immediate publication of the audit performed on the Greek banking sector by BlackRock.
- The setting up of an international auditing committee to investigate the causes of Greece's public deficit, with a moratorium on all debt servicing until the findings of the audit are published.
However, it's not the proposals that are scary to the Troika and eurocrats, but rather Syriza's poll results two days after the election as disclosed in Athens News show that Tsipras has a chance in carrying those proposal out. - Syriza - 27.7 (128 seats)
- New Democracy - 20.3 (57 seats)
- Pasok - 12.6 (36 seats)
- Independent Greeks - 10.2 (29 seats)
- KKE 7 (20 seats)
- Golden Dawn 5.7 (16 seats)
- Democratic Left 4.9 (14 seats)
Svriza's totals rise every day. By the time elections are held, any coalition might put them in the majority. It's conceivable Syriza would not even need a coalition. This explains the all-out push by eurocrats and Troika-sponsored clowns to stop another election. Thus, the "Glimmer of Hope" that Financial Times writer Kerin Hope speaks of is more like a "Glimmer of Despair". In general, I have no use for socialists. However, if they serve to bring about the exit of Greece from the eurozone they will have done Greece and Europe a huge favor. The sooner the breakup the better. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com
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