But even despite this the tax evasion rate is really low in rich areas, even if you take into account the rate given by official stats (which are probably fake since those who made the stats need tax evasion to appear high in order to justify the persecutions of entrepeneur), while is a little higher than EU average in poor areas where people either eat or pay taxes (and in Italy there are no food stamps no real welfare for the cronically unemployed).
Also we had hundreds of capable entrepeneurs who were brought to suicide by State persecution, with illegitimate request of money from various government body.
Also, another fun thing is that if you are persecuted by our equivalent of the IRS you can go to a special court, where the judges are people who used to work for the IRS equivalent or similar institutions designed to persecute business (not exagerating). Despite this the IRS equivalent still loses over 50% of the time [3] because it asks for money it shouldn't even in light of our anti-business laws. Just recently they have been found out while bringing fake documents in court [2].
But that's nothing but a hint of the terrible tax situation in Italy, so there you have it
[1] https://goo.gl/images/VjFqaB [2] http://www.ilgiornale.it/news/politica/altro-che-fisco-amico... [3] http://www.linkiesta.it/it/article/2012/03/20/contenziosi-co...
I would note that the EU's Vice President and head of foreign affairs is an Italian woman ... and former member of the Italian communist party.
But fun thing is that after ww2 many communists in Italy didn't really like economic central planning bcause it felt too fascist. So, they were communist but they didn't practice communism to the full extent. Italy also used to have classical liberals like Einaudi who even became president for many years, and kept politics in check. Sadly, I noticed that we are moving towards statist ideas more and more, with people expecting the State to solve everything and regulate all aspects of life. It's scary. Even people like Berlusconi or Salvini, while right wing, still have a lot of statism in them, even considering just what they appear to be.
I don’t know the exact causes: lack of focus on high margin activities (like, in the ‘90 the right was celebrating the small cottage industry in the North East, who was essentially competing with Eastern Europe and China... anyone’s guess how that ended?)
Or if it was staying in the Eurozone, as until ‘90 we were ok deficit-wise. But very uncompetitive so we took a load of debt just to stay in the Euro - and buy German goods for cheap - and not to become competitive.
In the meantime industrial production de-mobilized out of Europe and we’re just stuck with post-industrial parks and nothing to replace them with.
I’ve somewhere read that neo-liberal single market zones develop a trend where human (economic) potential remains constrained by the local macro-zone, hence migrations.
It’s becoming increasingly clear that post-ww2 economic development in Italy was exceptional: powered by the Marshall plan and the need to rebuild a country from scratch after being bombed back into the middle ages, the market boomed. Once that wave was over and public money ran out, the traditional approach came back in fashion and the country stalled.
Here's the broader problem: Italy's economy has not expanded since 1992 on an inflation adjusted basis. On a nominal basis it hasn't expanded since 2004. The population has expanded by about three million since 2004. The demographics have worsened in terms of an aging population, much like the rest of the developed world. That adds up to a painful scenario.
Italy's economic growth has been falling on a ten year averaged basis, since ~1960. That isn't super unusual, that's true of a lot of developed economies. The problem is, in the early 2000s it basically hit a zero growth flat-line, and has never picked up off of that. The significant economic contraction periods of 2008-2009, and 2012-2013, were never countered with bursts in post-recession growth as would be more typical. If you don't have a post-recession bounce of outsized growth, things tend to get super bad, super quick, as inevitably another recession will arrive and make the situation worse. Some meaningful growth is practically a requirement to a healthy society, in the sense that it pays for inevitable mistakes that are made politically and socially, including as it pertains to debt or policy mistakes. Without that, you have to operate at a level of perfection at all times.
At some point Italy has to figure out how to grow again. As a population ages, obviously, things only tend to get more expensive in terms of social welfare and having enough active workforce to pay for it all.
Ultimately there are two choices in that scenario: ration resources more tightly, reduce standards of living, and accept that as a new normal; or start growing again.
Wages seem to be awful there compared to the US and northern Europe, but it also appears that home prices are still really high.
Finally, from the few Italians I've spoken with - I've only been there once long ago - nobody is getting married and people live with their parents until their mid 30s, at least.
A lot of the educated Italians hit the road for jobs in Germany and elsewhere, meanwhile you're importing a lot of low skilled migrants from Africa.
Why are things so bad there?