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| Version 1 | Version 2 |
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| Italian Leader Offers Plan to Fix Economy | Italian Leader Offers Plan to Fix Economy |
| (6 months later) | |
| ROME — Prime Minister Matteo Renzi on Wednesday announced a $14 billion package of tax cuts and other measures intended to stimulate Italy’s stagnant economy, invest in public education and create jobs at a time of record unemployment, especially for young people. | |
| Mr. Renzi, who took power less than three weeks ago, is under pressure in Rome and Brussels to revive the economy and push through long-stalled political and economic changes. | Mr. Renzi, who took power less than three weeks ago, is under pressure in Rome and Brussels to revive the economy and push through long-stalled political and economic changes. |
| In a televised news conference, Mr. Renzi stood beside a large photograph of a grocery cart filled with food, a prop intended to demonstrate his promise to deliver tax cuts to workers who earn less than $2,100 a month. He said the government would also provide $3.6 billion in tax cuts to businesses, while also investing about $5 billion in renovating schools. | In a televised news conference, Mr. Renzi stood beside a large photograph of a grocery cart filled with food, a prop intended to demonstrate his promise to deliver tax cuts to workers who earn less than $2,100 a month. He said the government would also provide $3.6 billion in tax cuts to businesses, while also investing about $5 billion in renovating schools. |
| “It is the state that is tightening its belt here,” Mr. Renzi said. “We are not taxing anyone else.” | “It is the state that is tightening its belt here,” Mr. Renzi said. “We are not taxing anyone else.” |
| Over all, Italy’s economy contracted by 1.8 percent in 2013, and unemployment is above 12 percent. Record numbers of businesses have closed or gone bankrupt. | Over all, Italy’s economy contracted by 1.8 percent in 2013, and unemployment is above 12 percent. Record numbers of businesses have closed or gone bankrupt. |
| Italy’s economy is the Continent’s third-largest, and European officials have sharply criticized the failure of Italian politicians to address the country’s high public debt, lack of competitiveness, and administrative inefficiencies. Last week, Olli Rehn, the European commissioner for economic and monetary affairs, said the European Union was downgrading its outlook for the Italian economy and urged “decisive and urgent policy action and a strong commitment to reform.” | Italy’s economy is the Continent’s third-largest, and European officials have sharply criticized the failure of Italian politicians to address the country’s high public debt, lack of competitiveness, and administrative inefficiencies. Last week, Olli Rehn, the European commissioner for economic and monetary affairs, said the European Union was downgrading its outlook for the Italian economy and urged “decisive and urgent policy action and a strong commitment to reform.” |
| In Italy, where austerity policies are deeply unpopular, Mr. Renzi has been jousting with unions and business leaders over how best to improve the economy. Union leaders had threatened to strike if all of the tax cuts did not flow solely to workers, while industrial lobbyists said the only way to encourage new hiring was to reduce the labor taxes assessed on businesses. | In Italy, where austerity policies are deeply unpopular, Mr. Renzi has been jousting with unions and business leaders over how best to improve the economy. Union leaders had threatened to strike if all of the tax cuts did not flow solely to workers, while industrial lobbyists said the only way to encourage new hiring was to reduce the labor taxes assessed on businesses. |
| Hours before Mr. Renzi’s news conference, the lower house of Parliament passed an electoral overhaul that the new prime minister had promoted as a way to break the political gridlock in the country. Italy’s highest court has ruled that many of the country’s voting laws are unconstitutional. Mr. Renzi’s legislation — which he brokered with the opposition leader Silvio Berlusconi, the former prime minister — is designed to help bigger parties and larger coalitions win the majorities needed to govern. | Hours before Mr. Renzi’s news conference, the lower house of Parliament passed an electoral overhaul that the new prime minister had promoted as a way to break the political gridlock in the country. Italy’s highest court has ruled that many of the country’s voting laws are unconstitutional. Mr. Renzi’s legislation — which he brokered with the opposition leader Silvio Berlusconi, the former prime minister — is designed to help bigger parties and larger coalitions win the majorities needed to govern. |
| But the legislation must now go before the Senate, where its fate is uncertain. Mr. Renzi also wants to amend the Constitution to turn the Senate into a regional assembly with much reduced powers, though that legislation is expected to take a year or longer. | But the legislation must now go before the Senate, where its fate is uncertain. Mr. Renzi also wants to amend the Constitution to turn the Senate into a regional assembly with much reduced powers, though that legislation is expected to take a year or longer. |
| “We are all aware of the fact that we have to do everything we can,” said Alessia Mosca, a lawmaker in the lower house and a member of Mr. Renzi’s Democratic Party. “We have only this chance now.” | “We are all aware of the fact that we have to do everything we can,” said Alessia Mosca, a lawmaker in the lower house and a member of Mr. Renzi’s Democratic Party. “We have only this chance now.” |