[cedivad]

10th largest? Last I checked we were the 7th and that was just a few years back. Go back another couple of decades and for a brief moment we held 4th place just after Germany. I believe this decline explains most of what you are seeing.

[isostatic]

In 1999 Italy was 7th, in 2017 it was 9th (world bank placing)

India and Brazil overtook it thanks to massive growth. That's not a problem for Italy directly. The US has changed from 29% of the world economy to 24% over the same period.

Relative numbers are slightly more concerning though.

Since 1999, Italy's gone from 3.8% of the economy to 2.3%, a much larger drop than the U.S.

In 1999 Italy's GDP was 56% that of Germany. In 2017 it was 52%. France moves 81% to 75% US moved from 13% to 10%

Italy was 96% larger than Spain in 1999, now it's only 48%. It was 81% larger than Canada, now it's only 17%.

[danmaz74]

Let's not forget that the 5th place we briefly held was financed by the enormous unproductive deficit spending which is the root cause of our last 20 years of almost-no-growth. That was just growth on drugs, spending the future earnings of young and not-yet-born Italians to satisfy the greediness of voters at that time.

[RobertoG]

"[..] spending the future earnings of young and not-yet-born Italians to satisfy the greediness of voters at that time."

If the Italy of the year 3000 is a wasteland without buildings or industries, never mind how much money have you saved, the not-yet-born Italians will be in problem.

If the Italy of the year 3000 is a highly developed country, with futuristic robots and star trek replicators, they will just have a good life.

Sometimes, with all this chat about debt and earnings we forget what is really important.

Do you want the future Italians have a good life? Invest in infrastructure, technology and knowledge and don't do the opposite trying to "save" not-yet-born people money. That should be obvious.

[tormeh]

Consumption is not investment. That's not to say consumption is bad or unnecessary, but they're not the same. Nobody's talking about increased investment, it's all consumption. Italy's government is not criticised for an investment push it can't afford, but rather unsustainable increases in welfare spending.

Anyway, whenever the Italian government invests, it seems to be into money-pit clusterfucks like Alitalia, so I wouldn't be too enthusiastic about Italian governmental investment. How hard could it possibly be to let that monster die and use the money on something useful?

Before the Italian government can invest properly it needs functioning politics and bureaucracy, which are the real problems anyway. Like in Greece, they're just so hard to fix it's not even an option people talk about. It's always magical solution X or Y ("policy"), never how to fix politics or improve the bureaucracy.

[danmaz74]

It's not about saving. It's about using your resources wisely. The opposite of what this government is going to do.

[lapnitnelav]

Yeah but how do you explain the decline?

Do the systemic problems that have always existed getting worse? New ones?

[cedivad]

I don't know what I'm talking about but I cannot resist the urge to tell you what I think. As a bit of a background I've been living outside of Italy for many years now, I was there last week for the first time in 8 months. I can think of several reason:

- Italy used to handle Europe's low end manufacturing, like textiles, thanks to our relatively inexpensive wages and nice location. This all disappeared in the last 15 years with production moving to Asia, you can say we got outcompeted at our own game. Here is one example of one such factories in ruin (https://it.wikipedia.org/wiki/File:Valdagno_Marzotto.jpg) I saw last week. That thing is massive.

- You heard this before, but taxation is huge. It's one of the reasons I left and it is especially depressing given the next to nothing we have to show for it. We do have a corrupted political class we can't seem to get rid of. I didn't really follow but it seems that in the process of replacing it we ended up with a worst evil, that is populism. I guess stealing a bit from everyone for your own profit is a thing, stealing from future generations for feel-better political manoeuvres is even worse.

- The huge divide from north to south. It's a long story, but if you ask the north they will tell you the south is spending all their taxes, if you ask the south they will tell you the north conquered them and stole all of their wealth 200 years ago. The region I'm from, Veneto, used to be one of the wealthiest in Europe until very recently. The big majority of our taxation ended up being redistributed in the south, again, with nothing to show for it thanks to corrupted politicians, mafia and I will add, a general disinterest in improving one's condition due to the very nice weather and the very little you have to do in life to live comfortably in the south. Which I hope doesn't sparkle any debate, it's something I believe you can observe in the whole of Europe taking a train from Sicily to Norway.

- English. We don't speak it. If we do it's just a notch above barely. With the internet and international commerce that is holding us back more than you would expect. I wish we had cartoons and movies with no dubbing on national TV.

On the positive side, one Indian friend of mine jokingly told me his parents still buy textile machines from Italian companies, which is a nice example of the kind of industries that managed to survive in Italy to this day.

[Theodores]

Regarding manufacturing, I think that the expansion of the E.U. has been where Italy's jobs have been going.

I have worked with a few Italian companies over the years and been disappointed to find that the premium products are not really Italian. You can have very expensive shoes that have 'Made in Italy' written on them but then you find out that the uppers are made on the other side of the Adriatic in the former Yugoslavia. These uppers then get glued on to the soles in Italy to get the coveted label.

Other luxury leather goods have fallen to the same fate. This is a bit of a con for the consumer as they can spend up to $2000 on a handbag, which is okay if you really are paying for craftsmen in Milan to make an exclusive product, not so okay if the hard work is done elsewhere with cheap labour.

Cars are also an area of concern to me. The Fiat cars that people actually buy, e.g. the '500', are made in places such as Poland. These are not 'cheap cars for the masses', they are designer luxury goods with allegedly Italian style. This is not good for people who are loyal to the brand.

There are some aspects of business culture that do not help. I wish the whole Northern Hemisphere closed factories during August so everyone can have a holiday. However, in Anglo-whitey-world that does not happen. So if you are trying to source product for Autumn/Winter and need to get orders in then it can be a struggle working with Italian suppliers. You might as well order from competitors in the Far East that do not have these problems (and also do a better job of sizing shoes to people's feet, not the 'last' that the shoes are made on).

Money is also difficult in Italy. In ecommerce when you need to get payment providers working it feels like going back to 1970's Britain, when banks had special opening hours and everything had to be done in a branch rather than online or over the phone.

The consequence of all of the above is very bad for Italy in export markets. You can't get legit Italian product and even if you can then paying has these extra hurdles that make things extremely difficult.

[meguest]

The Fiat 500 is a cheap car for the masses. It competes with the Ford Fiesta, Renault Clio and other B class hatchbacks. A Fiat 500 can be had from £10,900 to £15,000 in the U.K. while the Ford Fiesta starts at just over £13,000 and can be optioned up to £20,000.

The Abarth 595 is also competitive with B class hot hatches such as the Fiesta ST, Polo GTI, Renault Clio Sport, etc.

[Theodores]

The 500 is 'A class', the 500L is the 'B class'. The 500L is the one made in Serbia, again not brilliant for keeping Italian people gainfully employed on the production line. There are people selling the cars and fixing them in Italy so there is some economic utility there, however, manufacturing matters, just ask Donald Trump.

The 500 is designed with the female buyer in mind. The colours and retro-styling suits this audience and makes it a 'designer' car. If it looked like a Dacia Sandero and was priced accordingly then it would be a 'cheap car for the masses'.

[ed_balls]

> Cars are also an area of concern to me.

Or maybe Fiat should build a better quality cars? Lancia was a go to car for many governments, but BMW, Audi and Mercedes outcompeted them.

[rjsw]

Same thing has been happening with outdoor footwear, brands that used to be made in Montebelluna are now made elsewhere in the EU.

[so_tired]

> you can observe in the whole of Europe taking a train from Sicily to Norway.

This is a wonderful meme!!!! True or not..

For what's it worth, I think governance is even more important that work ethics.

Italy is rich enough, and with 70 years of peace time, can probably work 3-4 days a week and be fine.