Friday, September 05, 2008

What is the point of the european union (part 2834)

From the Economist:

WHAT price patriotism? In the case of Alitalia, Italy’s long-crippled flag-carrier, the answer is about €5 billion ($7.3 billion)—or some €125 for every one of Italy’s 40m taxpayers. Even before the operation mounted by Silvio Berlusconi’s government to preserve the airline’s Italianita, €3 billion of public money had gone into it. The rescue, known as Operation Phoenix, will funnel Alitalia’s €1.2 billion debts and its least profitable bits into a “bad company” that is dumped on the Italian treasury. A report by the Bruno Leoni Institute, a liberal think-tank, concludes that “altogether, the cost to the state could reach almost €2 billion.” But press estimates have ranged a lot higher, and many details remain undecided.

[...]

All this should be of keen interest to the European Commission. However, one of Mr Berlusconi’s first moves was to secure the transport portfolio there for a supporter, Antonio Tajani. Some of Alitalia’s rivals may yet complain to Brussels. But even before Mr Colaninno had arrived to explain Operation Phoenix, Mr Tajani had praised it for “favouring the [free] market and the principle of competition.”

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