This savings tax

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This savings tax


Thirty years ago the Governor of the Bank of Italy sounded the alarm over the insidious “savings tax” levied by‘inflation. Ignazio Visco did it last Saturday during the annual Forex conference, the traditional annual meeting of the number one in via Nazionale with bankers and financial operators.

Paolo Baffi and Carlo Azeglio Ciampi took turns on the same stage – then less publicized than today – when at the turn of the 70s and 80s annual inflation remained in double digits for twelve long years, exceeding 21% in 1980. It was Ciampi in particular – future Prime Minister and President of the Republic – who never missed an opportunity to denounce an unacceptable form of destruction of household savings in the rise in prices. And it is not surprising that Ciampi was the real “father” of Italy’s entry into the euro: without delay, since 1999, and after a long process of restructuring the entire economic system.

The surge in inflation in recent months is largely the result of a geopolitical maneuver by Vladimir Putin’s Russia, which artificially raised the price of gas. However, the general price spike also depends to a non-marginal extent on the Covid effect. Two years of restrictions have undermined all trade chains supplying companies with raw materials and intermediate goods and consumer markets with finished products. It is not certain that the first cause – so close to the oil shock that triggered the hyperinflation of half a century ago – is more relevant than the second: namely the overcoming of the Ukrainian crisis and normalization ( trend but not certain) of energy prices bring inflationary dynamics back to its “ordinary” terms (for example, the 2% per year assigned to the ECB as the limit for the euro zone). Nor should we neglect the indirect interest of States in seeing their public debts reduced: in conflict with the holders of private savings.

The energy market itself, however, is in itself a symbol of deep, non-cyclical problems. Gas seems partly irreplaceable – for those who produce it and those who consume it – like oil in the 1970s. In fact, everything (starting with fossil fuels) is replaceable and everything is replaced, at least in part. Nuclear has never replaced oil or coal, but a still limited crisis was enough to push the European Union to look into its possible reuse in a “green” key. Decades of stories and strategies in the field of clean and renewable energy have been thrown into crisis in the space of a few weeks: but the work, scientific, technological and diplomatic conveyed by COP26 on climate change is not likely to be to be annihilated. It is much more likely that the transition to eco-sustainability will continue: much like – between the 70s and 80s – a country-system like Italy “emerged” with manufacturing 2.0 compared to big industry traditional. And it is this country – “self-made in Italy” – which followed Ciampi by signing the most effective anti-inflationary policy: joining the euro.

Visco wanted to remind us: inflation is a serious danger (especially for family savings) that we are fighting with serious weapons.

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