Italian unions threaten strike

Associated Press

ROME

The leader of Italy’s largest union is threatening a general strike against an austerity package that Premier Silvio Berlusconi’s government hastily pushed through to balance the budget by 2013 and avoid financial collapse.

The threat came amid mounting criticism Sunday of the $64.8 billion package passed Friday in response to demands by the European Central Bank.

Critics say the package — a mix of spending cuts, job cuts and tax increases, including a “solidarity tax” for high-earners — will strangle Italy’s stagnant economy, which is now expected to grow by only about 1 percent this year.

Other critics, including nine members of Berlusconi’s own coalition, say it unfairly targets the middle class and fails to tackle Italy’s massive tax evasion problem.

Susanna Camusso, leader of the CGIL labor union, criticized measures aimed at liberalizing Italy’s labor market and targeting its pension system, saying a strike is the only way to “change the inequity of this package.” She told the La Repubblica newspaper that union officials will meet Aug. 23 to set a strike date and invited other unions to join.

At least one other union, CISL, said it will not take part in the protest, although it said the package needed to be improved.

The new measures include $28.5 billion in cuts and tax increases for 2012 and $36.3 billion for 2013. They abolish some local government layers and gradually eliminate some 50,000 elected jobs — leading to fierce protests by local officials. Citizens face a 5 percent additional tax on income above $128,250 and a 10 percent additional tax on income above $213,750 for the next three years.

Both Berlusconi and his finance minister, Giulio Tremonti, have defended the government’s actions. Tremonti insisted the debt crisis could not have been predicted but said it could have been avoided with the creation of Eurobonds, a new joint bond backed by all 17 countries using the euro.