by Simon Black, Sovereign Man: Every summer around this time I rent a palatial wine and olive estate here in central Italy for a few weeks of relaxation with friends, business colleagues, and Sovereign Man: Total Access members.
We’ve been coming to the same place for six years in a row, and it’s gorgeous.
At the center of the estate is an 18-bedroom mansion that has been in the same family since it was built four centuries ago.
Back then, Italy was still a major center of wealth and power. London was still a developing backwater and New York didn’t even exist yet.
But cities like Florence and Bologna were among the most prominent and prosperous in the world.
This magnificent estate was originally built as a wedding present by one of the region’s leading families. It even has its own chapel on the grounds where the ceremony was performed.
While the estate has miraculously remained in the same family over the centuries, Italy’s wealth and status in the world has diminished.
Today, this country is sadly in dire straits.
Italy has one of the worst public debt burdens in the world, exceeding 130% of GDP.
The banking system here is crumbling, and many of Italy’s leading banks — like Unicredit and Monte dei Paschi — are in desperate need of a bailout.
Unemployment persists around 12%. Youth unemployment exceeds 37%.
Economic growth has flatlined… Italy barely registers 1% annual GDP growth.
Adjusted for population growth, the country has basically been in recession for years.
The signs are obvious. Italians feel the economic pain. It eats into their standard of living.
Naturally the government is a total disaster– corrupt, incompetent bureaucrats whose attempts to ‘fix’ everything have only made the situation worse.
Over the last ten years, in fact, the Italian government has engineered widespread poverty across the country, with the number of people living below the poverty line almost tripling since 2006.
We’ve become close with the current owner of the estate. She’s the great-great-etc. granddaughter of the original nobleman who built this place.
And each year we have what I call the ‘annual airing of the grievances.’
Basically she talks in that highly animated way that only Italians are capable of doing, venting and griping about all the ways the Italian government has been screwing her.
Every year it’s more of the same. Capital controls. Wage and price controls. Debilitating regulations.
A few years ago in an effort to ‘protect’ workers, they imposed a minimum wage so steep that she could no longer afford to harvest her olives.
She had workers who were perfectly willing to accept the normal, lower wage. But the government wouldn’t allow it.
Paying the higher wage, though, meant that she was 100% guaranteed to lose money.
End result? There was no harvest… so nobody made any money.
Now they’ve invented all sorts of new taxes and jacked up existing rates to astronomical levels, in addition to burying her in paperwork.
Year after year I hear these stories, and year after year the situation becomes worse.
But the worst part in my mind is that she isn’t doing anything about it.
I’ve tried to explain to her how many solutions exist. There are ALWAYS completely legitimate ways to solve these problems.