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Source : New York Times
Page of Review : 0 
Page of Document : 1 
Page of NewsPaper : 4 
Category :FLASH
Author : RASSEGNA FLASH 

Abstract: Temptations Of a Minister Of Finance. The finance minister, 
having sub-mitted a budget that reduced deficit spendine substantially,was 
not amused when the critics spoke up. Economists said thè budget 
relied too much on 'tax-' increasei and not enoough 
on spending cut. and (lUHIUJ aaKllMHldlcl»laiHhad 3aidn*rddtClsloiuhail 
ben matpuied. "Very oliati, when econombtt comment, th«y auune 
politi;* »w«y." he said in an intervie» in New York (hls mooth. 
He recallod a jolce: An econo-miat stranded on • desert l«land 

(a Mked 1< 
he hai aoy sugxeallou far getiing uno a caie af 
canned (oùd tnat hu walhed aahor& "Assume ci cui opener," thè 
economia! beglin. HM—I.OW Thè f inance minister knew thè joke 

because It was bis 
eminence as an economist that m ad* him 
altrac-tive ai a nonpolltlcal (Inane* minutar (or Italy, whoM 
governmeni boa a slendar majority thai some ihought wouid not 
tast tona enough to pass a lna«peech, Tomma«o Padoa-Schiop-pa, 
Italy a fi-nance minister, recalied Fau*t.   budget anyway. 
Thè minister. Tonnmaso Padoa-Schloppa. Is a foriner centrai 

banker 
who ihought he had retired betore being ollered thè 

job 
by Prime Minister Romano Prodi. Mr. Padoa-Sch toppa is 
an unusual {Inance minister. Perhapa Itheips (hat he has r.ever 
run (or office and is uniikely averto do so. ' It is hard u> 
Imagine onoiher minister deli ver tng a letture like thè one 
he gave a tew weeks ago al thè Bun-desbank. thè German centrai 
bank. in which he recalied (he legeitd o( Pausi, who sold his 
acuì to thè devii. "For Faust, thè lure ot Mephi-siapheles's 
services is greatly en-hanced by thè fact that thè price, al-beilaterrible 
one, Is lo be paid laici thè supportobtalnedthrough pub-tlc 
expendilures Is slmilarly en. hanced by thè lact that publlc 
debt 'vili be paid —or reneged — by next generations, olten 
well alier thè end ot one's politicai career." Finance minisi 
ers simplydo not mention. even in passing. that gov-ernments 
can renege on debt. Nor do they. as he did. submit a budget 
(hat (hegoveniinentconlendswill reduce growih in grosa domeatic 
produci •-In his case, to 1.3 percent oext year <romth»1.6percentotherwlaeex-pecud. 
He mai»t» thè country will benefll laier, Bod even arzuei thai 
thén will ' r,A»>.   °»»PO"tlW»b»"dtt! FLOYO  "Peaptein Italy 
kitaw mi NADDIC a'lIuKnMittl'nBMiEd. nunim TheymayhavmorTa-„,„,..;„., 
sp<ctlor»gov»roni«nt tSSiS <haltTln." """"    Ano, twargues, 
they understand that "die economie bal-ance wu dedicated (or 
too long to thè attmulus ot demanar' raiher than lo pronioting 
long-lerm growth- Mr. P«do»-Schloppa seenu to be takingon this 


Jobwith a combinatlon o( zeal and acad»mlc d«iachm«nt (hai 
«howa in hi» discusilon ot thè dirterences between "thè lldy, 
clear-cut, well-discipllned worid of mone-tary concroi" and 
thè "much more complex. otten confusedL uncenatn. even treacherauj 
one of publlc ex-penditure contro!." tieininits rooneiary pollcy 
l« easl-er, tn large part because it u impersonai ; thè centrai 
bank deab with thè market, not witft anyoae who ia direclly 
hurt by adecision. But a (1-nance minister la telling an Interest 
group or other minlaten that they cannot bave thè money Ihey 


that saylng 'no' to someone means co say •yea' io some-one 
else," he said in his lectura al thè German centrai bank. "In 
our aging Europe, saylng a marginai 'no' lo pension bene(iciaries 
today means saylng 'yes' lo their grandchildren." Ot course, 
thè grandchildren do not vote. al leasi noi now. Italy faces 
huge problema. It is a country with lov» growth, high gov-ernment 


debt. a rapidly aging popu- 
 uniteti less by any vision or pollcy 
ihan by opposition to 
thè previous governmeni, which was led by Silvio Berlusconi. 

It needa 
lo become more competitive against olher European 
countrtea, bui wich thè euro in piace il can no longer devalue 
its currency as It used to do when cnses arnved. Mr. Padoa-Sduoppa 
tries (o make ali that sound like a virtue. Thè nar-row governing 
margli», he said, helped make thè cabinet take tough cholcea, 
since ali knew that any de-fection* wouid be likely to cause 
thè govemment to fall. "What made It easy." he said about getting 
cabinet approvai (or thè budget, "was that it was impossible." 
M any a (Inance minisier has come to oKice vowing retorm, and 
ended up doing what was necessary to gei by. which Is one reason 
that (ew li-narice ministers manage lo do what Robert E. Rubiti, 


Hit roriner United Slates Treasury secreiary, did — en-ter 
office wilh an excellent repula* ticn and leave with a betier 
one. Mr Padoa-Schioppa may noi pulì that off, bui if he fails. 
it is uniikaly (o be (or thè normal reason ot excessive deficit 
spending. As he told thè Bundesbank audience, "havtng inherued 
apubllc debt largar ihan G.D.P» andhavmg com» milted royseK 
and my govcrnment to comply with lound fiscal prtnciplei, I 
scarcely can aiford «ven lo confm-plaiethepaulbllltyotacceptuig 

. . Mtphiltopheiea's rrvicc»."