EU CHIEFS MUST MEND ITS BRIDGES

They say August is a wicked month and I’m sure if you live in Genoa in Italy it must feel that way.  However, I have to say that the collapse of that bridge, horrendous as it was, has a much wider significance.  Matteo Salvini, Italy’s Interior Minister who is also Deputy Prime Minister, has suggested that Brussels is partially to blame on the basis that EU constraints have limited the government’s ability to spend money on critical infrastructure like the bridge.  Mark my words, this tragedy presents the populist Salvini with an opportunity to open up an assault on what he sees is an EU that is dominated by Germany.

There are other factors at play here and they are not good.  Italy’s finances are in a somewhat precarious state.  The Chairman of the Italian Budget Committee, Claudio Borghi, predicts that the Italian bond market will spin out of control if the European Central Bank stops buying Italian sovereign debt.  A crunch is predicted in the autumn.  It is hard to know where this is all going, but it is ominous that Matteo Salvini thinks Italy cannot govern itself within an EU cage and that “ the euro is a crime against humanity”.

All of this does put Brexit in perspective and it is a sobering reminder that all is not well in the European garden.  Sometimes I think people forget that Brexit could have been avoided.  There was no question the whole issue was grossly mishandled by the British Prime Minister, David Cameron, but equally Brussels were deaf to the British cries for reform.  I worry that in the current negotiations with the British, the EU, through its chief negotiator, is being too inflexible.  It is not in our country’s interest to see the UK crash out of the EU because of an inappropriate approach to the negotiations by the chief negotiator, Barnier.  Ultimately he should be answerable to his political masters.  One only hopes that our own government are more on top of this than they are on the housing and health crises.

The collapse of that bridge could be the beginning of a chain of events that could lead to a financial crisis and the restructuring of Europe.  Who would be our friends then ?  In 2010 the UK lent us €3.2 billion.  What if something like that happened again.  Now that would be a turn for the books.