Italy. Oh, Italy.

      Now we know: Italy has slipped into recession.  Again.   Its 3rd recession since 2008.  What's going on in America's favorite European destination?  The new premier, Matteo Renzi, is an attractive, popular 39 year old, who swept into the No.1 leadership role in Italia after being the mayor of the important Tuscan city of Florence(Firenze).  Mario Draghi, the high profile leader of the European Central Bank, has not been able to reverse the downward slid of one of Europe's most important economies.
     What does it mean and what will happen to: Italians, Europe, Germany, Spain, Greece, France, etc?  When will inflation return to ideal levels:2%/ann. rate?   Unfortunately, the economic problems in Southern Europe are more systemic than economic.  Despite austerity measures requested by her northern neighbors, the Italian Parliament has been unable to break the cycles that punish the efforts  of companies, workers, and government institutions.   Academics have been unable to turn around a sluggish rebound that has been plagued by high unemployment in that most important sector: the 18-24 year olds who must provide the engine for growth in any economy.
      Matteo Renzi has tried tax cuts at the payroll level, but has not been able to rein in government spending to meet the cuts.   He has been able to pass some reform of the federal government, but those reductions have not spurred growth.   With a birthrate well below replacement, an aging population, like most of western Europe, cannot provide the stimulus the economy needs.  Recent immigrants from North Africa continue to burden social services, and Mr. Renzi has appealed to the EU for assistance in the area.
     But most of all, the Italian legal system begs for reform.  It is the basis of private property ownership and for the redress of grievances both criminal and contractual.   The present system was put in place in 1930, under the boot of fascism and Mussolini.   It was only modified to any degree in 1988.  1988!  And then only partially.   Combined with out dated work rules, Italy will continue to be constrained by her own internal paralysis.   Change is necessary, but it will only arrive in Italy when the core of the country is significantly altered to effect needed changes.
     What's missing now: Leadership.