Edoardo Secchi is an entrepreneur, investor, economic advisor, president of Italy-France Group and founder of Club Italy-France.
Brexit, the election of Trump in the United States, the League in Italy, the yellow vests in France, all these phenomena are the example of this refusal of the system which continues to worsen and which risks turning into revolt with violent and unforeseeable consequences. This major crisis is fueled by the power of international finance, the excessive deregulation of the labor market, the constant reduction of social protections in favor of the privatization of fundamental rights and a certain weakness of the world political class. From now on, globalization has taken hold in the European Union. It triggered a dumping effectsocial, which proceeds to a leveling of society to the bottom. On the one hand, we are experiencing competition from below from countries in Africa or Asia. On the other hand, we are facing ruthless competition from certain member countries of the European Union.
If the global financial elite who own the vast majority of wealth is safe, the middle class sees its purchasing power and its expectations of evolution decrease each year.To this must be added the fiscal dumping still exercised by some countries of the Union: these real tax havens manage to attract not only companies, but also foreign investment. Previously, we could have talked about sharing wealth, today we are talking about sharing poverty. If the global financial elite who own the vast majority of wealth is safe, the middle class sees its purchasing power and its expectations of evolution decrease each year. In Europe, there are more than 100 million people at risk of social exclusion and poverty. For a continent that wanted to differentiate itself from ultra-liberal American policies, this is certainly a failure. To this failure, we must add the bankruptcy of multicultural society, because regardless of their origin: we are welcoming new poor who are added to the already existing poor. A country that cannot offer a better future to its citizens, how can it offer it to thousands of foreigners - who do not have the same culture, the same level of education, or the same values - a decent future?
The real economy is losing ground to the underground economy and crime
This model of capitalism has been well described by financier Warren Buffet: "There is class warfare, okay, but it is my class, the rich class, that makes war, and we win." It triggered a process that is now irreversible: Mexicanization. If we look closely, the country that resembles this economic and social system more is Mexico for the presence of this mixture of formal, informal and criminal economy.
The first social structure is made up of the real economy, that is to say all the high added value industries which represent the excellence of each country. This entity lives, works and develops in a monitored and protected environment. This structure leaves more and more room for the informal economy, which feeds on a general spirit of "tolerance": undeclared work in the majority of cases allows unoccupied people to get by without giving in to the delinquency in order to avoid social tensions. This structure, which has always existed, is developing more and more because of the deterioration of social conditions. Even though the underground economy no longer allows survival, the third structure feeds on itself, without the possibility of being controlled by the state, the police or the judiciary: this structure is criminality with all forms of illegal activity: moonlighting, prostitution, drugs, corruption.
European countries are not able to produce at a lower cost than China or Bangladesh and at the same time, the creation of an ecosystem based on high added value requires massive investments, especially in the sectors of education and training.Impossible to deny it, the explosion of violence in all these forms is now part of our daily society: thefts, assaults, homicides and criminality threaten our lives and push the better-off to take refuge in protected neighborhoods and leave those most in need alone in the face of these crimes with a deep sense of injustice.
The European political class should then ask itself a question: how to stop this Mexicanization in order to preserve our democratic model? The economies of countries manage to develop only in two cases: if they produce goods with high added value or if they manage to produce goods cheaper than others. European countries are not able to produce at a lower cost than China or Bangladesh and at the same time, the creation of an ecosystem based on high added value requires massive investments, especially in the sectors of education and training. But unfortunately, it seems to me that the European Union lacks a real policy, a real project, which makes it weak compared to the USA or China. In addition, European states are no longer in a good condition to come out on their own.
Only one solution remains for the old continent: take charge and make radical choices, choices that are capable of changing the current paradigm. For example, relocating our industries and recreating growth and jobs. For all this, we need more courage and a vision for the future: elected officials must imperatively project themselves to twenty years and not to the next elections. Because it is necessary to remember that globalization has contributed to the birth of a category of people who have nothing more to lose and therefore, who are ready to do anything to avenge their fate: in their eyes, the class social welfare will always be guilty of their ruin.