Angheria
Dedicated to my bright and beautiful daughter, who today is celebrating her Birthday 750 km. from home.
Angheria
Or why Italians have a tormented view of rule of law...and you would too in their place, or “will”, if your country is sliding in the same direction.
”Angheria” in today's Italian language means “prevarication”, but it was originally a technical term, meaning the days of compulsory labor that farmers had to personally provide to their feudal Lord. It is indeed the name of a form of taxation.
I am a lucky man. I have a family I adore, and a slew of acutely stimulating friends and acquaintances strewn across the world. Yet, “stimulating” means varied, opinions differ, and there are some individuals I value most because, on some issues, we are more unlike than like.
But I was strangely put out when a good friend of mine, a person I REALLY look up to, lamented that “after the COVID scare, Italians are reverting to their usual self and disrespecting rules. Soon it will be mere chaos”; I thought, “Really?? it's basically ALWAYS been that way in my adult life, and for good reasons”.
I remember more than two decades ago, I had been invited to an economic venue, and had the good fortune to be seated at dinner next to the main speaker. He told us in no uncertain terms that yes, Italian laws and regulations were dysfunctional, but luckily a combination of sketchy enforcement and creative interpretation on both sides allowed the “Bella Italia” to survive, even thrive in patches, because compliance was in some way tempered by a sparse but persistent application of common sense that denied enforcement via some form of arbitrary use of the rulebook. Those who usually went absolutely bonkers were foreigners investing in country: many did not survive the culture shock of coming from a “rule of law” system to what they saw a “whatever floats your boat” country, especially since the EUR had just been introduced and those were the Spring days of “one currency, one Continent, one law”, “free movement of people and capital”, and other weird ideas.
And it was even at the time quite difficult to convey the Method to the Madness. The system described is in fact a two way street: yes, citizens look like a bunch of Barbarians lacking civic conscience, but on the other hand if you are a civil servant or politician you don't get mobs with pitchforks, tar and feathers clamoring for your untimely demise any time you write down into law something that would make Boldrick, of “Blackadder” fame, issue a press communique distancing himself from being in any shape or form associated with what you put to paper.
Of course, there is a catch. Like sand in a gearbox, this kind of
arrangement has brought on the Italian disease: a chronic inability of the country to grow and to live within its means. The amount of time Italian
citizen lose in inane compliance with senseless regulation is
absolutely shocking to anyone not born or raised here. For an example
out of many, the month of June has over 130 fiscal obligations
pending1, and that's just the tip of the iceberg.
Before someone thinks this is a “taxes are much too high” rant, consider this:
Italy has been one of the first countries to enact “Split payment” of VAT, even in the face of EU analysis that indicate that the measure is largely ineffective for its avowed purpose of cutting VAT fraud. But since it DOES cut government cash outlays in a way that's not recognized in the official statistics as public debt...here we are. 2.
Italy has adopted the improperly named “Electronic invoicing” across all domestic transactions, in the face of an EU directive that is limited to Business – to – Government deals. It is in fact a compulsory interposition of tax authorities, with all the attendant “single point of failure” and privacy problems, adopted outside Italy only in Portugal3. The original intent was to allow EU companies and governments to have a single economic area and to encourage simple “EU compliant” public-procurement to foster intra EU competition, a thing which Italy consistently fights against, successfully, and with the full knowledge and help by EU authorities.
To put it shortly, there is hardly any additional administrative cost or procedure imposed on private companies or enterprising individuals that the Italian government doesn't like. For those who follow Italy more closely, one of Europe's requests before granting the funds coming from the Next Generation EU program is a number of reforms. One of the resulting decrees is tentatively called “Decreto semplificazioni” [“deregulation decree”]. Yet, early indication is that what the government means by that is that it will relax what the public administration must comply with during procurement: no deregulation for the peasants, I am afraid.
But enough of finance, or other such things. COVID did an ENORMOUS service to Italian society at large since it “democratized” this nonchalant attitude by extending to lay citizen the same offhand and disparaging treatment Italy has customarily accorded to private economic actors. So, for the benefit of non natives (and of natives that did not delve into what was happening to them), I will do some real-life examples, some also older than COVID.
Phones, for examples. They have become such a part of us that some banks refuse to accept anything else as validation of remote transactions or as access control. However, my bad temper about them goes way back... when the most you could do was downloading ringtones. Because, even then, abuses occurred, and my wife, my daughter, and my niece all fell for them. Not for any particular reason, bar one.
The system was simple. Under the guise of offering people a free sample, unscrupulous companies lulled people into accepting to pay a monthly fee off the phone card credit or a per ringtone fee which rapidly exhausted the credit on the phone. Wait a minute, exhausted the CREDIT ON THE PHONE?
Yep, for months Joe Q. Public discussed many measures against such practices, except one, which was my personal question. I cannot access the credit on someone else's phone unless I have access to the mobile provider accounting system. That can be done in either of two ways: Legally, by entering a contract with said mobile access provider as a company offering “value added services”, or by hacking. It wasn't the second, obviously, but never, during the whole saga, did I hear someone ask: “Excuse me, why is is that the authority who granted a license to the mobile phone company (i.e., the state as the “owner“ of the frequencies) did not write a clause in the concession saying that the company obtaining the license would be banned from providing payment services to value added service providers, whose payment should be negotiated directly with the final client?"
That was one of the many times when another shattered piece of my trust in the rule of law evaporated, like an Hobbit's sword in the Lord of the Rings. Because unless I postulated that all the head offices at various multinational mobile phone companies were dunces, the explanation was rather bad smelling.
Fast forward to today, and the situation is materially better.... not. Introduction of GDPR (privacy protection law) has spawned consumer protection measures, like one called “registro delle opposizioni4”.
It is a noble effort: any mobile phone owner can register by following a simple procedure, compiling the PDF form you can find here: http://www.registrodelleopposizioni.it/sites/default/files/Mod.RO-ABBONATO_email.pdf
Of course, you have to phone a number, get a reference code, after having asked to be put into a PUBLIC reference database (which of course, causes no privacy risk whatsoever, no one is interested in getting a free “Name – email -cellphone number” user authenticated database), in order to be OUT in another list that should guarantee that you will receive no sales call by cold callers etc.
Yet, I can't help but wonder: why not change the default setting and have people who want to be bothered to actively ask to be released from protection?
Oh one more thing that happens frequently, and just to make a public apology to those who phone my cellphone number : If I don't have that number in my address book, I will hang up and call back. That's the safest way to avoid getting entangled with cold callers, lots of public databases of obnoxious numbers. Yet... many times, I call back, and a soothing voice says “The number you dialed doesn't exist”. Obviously, my reaction is mixed.
Reaction 1: “If I ever had a married mistress, I want a phone company that provides me with that service: having a randomly assigned untraceable number that you can kill at will and change into another “non existing” number? How great is that???”
reaction 2: “how on earth this is even allowed??? Cold callers in Italy must be licensed (after all their goal is to get you to agree to a contract with a third party company which is aware of the arrangement and whose initial selling commission is their gross income). What kept the government from enacting a law that any cold caller must have a single identifiable outgoing number, or a public list of numbers??”
To add insult to injury, and just to reassure "dem forringers" that not all Italians are stupid: I receive many calls allegedly from fixed lines based in prefixes that at a passing glace look like an incoming cellphone call (in Italy that's a string of three number starting with "3"), mostly at VERY interesting times of day, like 14.00, 18.00.... you can't tell “I am at lunch” etc, and it might seem like a social call, or God forbid, someone who wants to tell you something untoward happened. The benevolent side effects of having one offspring home and the other abroad, I don't have to hold my breath. Wrong prefix, there's no country identifier in front.
As to “Angheria”... the example of a modern one is in trash collection
accounting. In my city , the rate of trash recycling is quite high,
in the region of 40%. That comes with strings attached, of course:
trash separation at home, more truck runs, etc. But there is one
thing more: I NEVER saw any attempt at accounting for the hours
of forced labor imposed on families to have to separate/ dispose
different refuse, make multiple trips to the various garbage bins,
etc. I particularly urge the fans of “minimum wage per hour” to
endure the drudgery to use that number to come to a nice round figure
to add to the direct payments authorities exact for trash collection,
since this kind of hidden taxes are the new normal: compulsory
courses and other non cash taxation forms are a material part of the
total factor productivity gap Italy suffers toward other countries,
but Italians don't realize that because they are lulled into thinking
that most of it comes from European directives that are applied
equally anywhere in Europe. They don't know the amount of "gold plating", the EU
approved exemptions, the lack of analysis of impact of new rules that
allows a whole ruling class to thrive, and a country to buckle under the weight. This is what happens when at last, you successfully erased from people's mind that they are paying the COST of things, not the PRICE.
Bah, time to take a trip to downtown. Let's take a public transport bus, shall we? As long as we wear our mask, no one will bother us. And I mean literally.
Hear this. My city always laments a significant loss of revenue from non paying passengers on the public transport. Hence, controls were never interrupted by COVID... but they were changed thus: checking personnel would stay off the bus at stops, and check tickets of the passengers coming OFF the bus (this is where I count down from ten, in real life: 10...9...8...7...6...5...4...3...2...1)
Ok, if your reaction included some tart expletives, congratulations! You make me feel less lonely! In fact a system like that does NOT target offenders, it targets the elderly lady who was forgetful today, or lost her ticket: the pro loafer and I look out, see the prim transport police, and stay on the bus one more stops. A slightly longer walk is just what the doctor ordered to soothe my belly ache. In fact, as I am a keen follower of things like “superfreakanomics” tests of humanity, I use that as a kind of information tool. The “woke”, alert, altruistic rational human agent would have to do the following, in no particular order (apart from buying a ticket, but I have a yearly pass):
refuse to produce the ticket off the bus on lack of jurisdiction grounds;
report the incident to public administration accountants for the obvious waste of resources involved;
ask for the transport company's head and have it replaced with someone more respectful of logic, if not of individual intelligence.
Yet, If I tried, I fully expect to lose convincingly on the third point.... because my fellow citizens meekly get off the bus, produce the ticket, and even pay the fine: I saw a poor elderly lady pay once. Me? Once, being worse than my usually obnoxious self, I looked at one of these overbearing inflated public personnel and asked him “You KNOW that this makes no sense, don't you?”
Oh, one deviation into my field of work and study: I would LOVE to
plant a bunch of economists both on the bus coming off it, and another looking
at the scene from the outside. It would make for a very interesting
thought experiment.Heck, we might even try journalists.
Yet, what transpires in the end is that I look at my brethren and see a people defeated. Italian happiness and culture will never be lost, thank God: on top of the traditional Italian resourcefulness, more than five million Italian citizens now live abroad, and the number grows from net emigration.
What I find personally worrying, tough, is not as much what is transpiring now. I am in any case not immune from the disease, I flee many more battles than I enter, and I fight very few even of those5.
What worries me is that through a combination of emigration and suppression, we are losing in my opinion much of our ability to engineer an economic recovery. The generation which gave us “La Dolce Vita” is long gone, and the present flock is faced with almost insurmountable obstacles that make me think that even those ancestors, in today's data set, would have much slimmer chances of thriving.
So, the lack of debate on these two aspects drives me bonkers, especially since a country with our debt ( no one who reads me should be surprised if I say that 160% Debt/GDP is the lower limit of my estimate of TRUE government financial exposure) should never put any citizen in the awkward position to look at his country's default chances and go check if going belly up would not be such a bad idea after all. True, my professional description entails going deeper than most in scenarios which any “normal person” would consider unlikely, on top of unpalatable, but again, I see no part of the Italian intellectual debate asking “what was that made us so great in the middle of last century? Is it worth it to explore avenues different than the globalized consensus were are following?”.
Just to be clear: I don't have the answers to those questions. I would just breathe a bit easier if I saw them openly discussed somewhere, both domestically and in the EU.
There is another consideration that piques my interests. Most of the Italian quirks have been agreed, some overtly some tacitly, with the relevant EU authorities. What if other countries are Larvae and Italy is the lone butterfly?
2“The study found no strong evidence that the benefits of split payment would outweigh its costs. The main identified effects were that a wider scope of split payment would potentially provide a larger decrease of the VAT gap and hence have a positive impact on the Member States’ budgets, but would also significantly increase the related administrative costs for businesses, especially when applied on broad scale” https://ec.europa.eu/taxation_customs/sites/default/files/split_payment_report2017_en.pdf
5One of the wittiest pen ever in Italy, Leo Longanesi, is quoted as saying that the Italian Flag should carry the motto “Tengo Famiglia” (I have a family) meaning no one should be so intrepid to attract the wrath of authorities. https://it.wikipedia.org/wiki/Leo_Longanesi
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