Union Process | The paper

Investigation of a country affected by inflation, where employment increases but the purchasing power of families decreases. Also due to the mistakes of a trade union agenda that believes that it is political redistribution rather than productivity that makes wages grow. May Day deserves more

It is a particular May Day: on the one hand the unions take to the streets for a “mobilization” against the loss of the purchasing power of wages and the insufficient government policies, on the other Giorgia Meloni who has chosen Workers’ Day for a ” work decree” which cuts the tax wedge on the lowest incomes, those most affected by inflation. The government, quickly remedying the majority’s mess on the failure to approve the Def in the Chamber, puts all the new resources freed up by the budget slip on income from work; the union protests because it is not enough. In the middle there is a very complicated economic situation, although the latest data on growth (+0.5 per cent in the first quarter, with an acquired change for 2023 of +0.8 per cent) show a somewhat unexpected dynamism : an energy crisis that has eased but continues; inflation that persists and is shifting from supply to demand, or from the energy component to the underlying one; a monetary policy of raising interest rates to bring inflation back towards the 2 per cent target; a very high public debt, well above 140 per cent, which will slowly decline as a result of the increase in interest expenditure; the return of European fiscal rules after the suspension due first to the pandemic and then to the energy crisis. All of this narrows the budgetary margins with which the government – ​​any government – ​​can intervene. And this, however, the union, in particular the CGIL and the UIL, does not seem to take into consideration. The proposals of the union led by Maurizio Landini they are a long shopping list: cut the tax wedge by 5 points; recovery of fiscal drag through indexing of deductions; increased public spending on health, education and non-self-sufficiency; renewal of public employment contracts; increase in pension expenditure by introducing Quota 41. The total bill amounts to a few tens of billions of euros which do not have coverage. The government should find them in a macroeconomic framework in which – in accordance with European rules – it must pursue a fiscal adjustment of around 20 billion. A confrontation, even a harsh one, between the government and the trade unions on this basis is impossible, because it does not start from a principle of reality.