On Nov.23rd, the news bites of the RAI televideo dedicated a page to Black Friday in New York, informing viewers that huge lines had begun to form outside the big department stores where the doors had opened to the public as early as midnight, on this day “traditionally dedicated to Christmas shopping.” An increase of 4 % in sales was expected compared to the previous year.
Reading between the lines, the report seemed to suggest that the economy has picked up in the US, hence one might hope things will be improving here in Europe too. Or you could also interpret it in the sense that those idiotic cash-happy Americans are so addicted to shopping that they are willing to brave the cold for hours on a winter night in New York.
Like all news reports with a certain slant, this one omitted two pieces of information that might have made mention of Black Friday newsworthy for Italians. The first and most obvious is, of course, as everybody knows, that top quality goods from high tech electronics to organically raised turkeys to put in your freezer for Christmas, are available at a staggering discount, and, secondly, that for many Americans, though not those who work in retail stores, Black Friday is a holiday from work. Working people are given a day off to do their holiday shopping and guaranteed cut rate prices on that day, both of which generate an enormous boost to the economy. Neither of those things is likely to ever happen in Italy, though while surfing the net, I did find one mention of a Black Friday on line in Italy, offering high tech equipment at the puny discount of a mere 4%.
Sales are regulated by the government in Italy, and can only be held at certain times of the year. Though there has been occasionally talk of holding some sales before Christmas, shopkeepers are firmly against it. Here the rule is, pay full price and then some, and pay it through the nose. Prices always go up before Christmas, never down. Italian friends used to tell me about marvelous buys to be had in the after Christmas sales at elegant shops in Rome and Florence, but I have never had much luck with those. Usually the color or size I require is not available, or the sale price is still way too expensive. Yet the evening news is always full of glowing reports about how much money families are going to save or have saved at the sales.
I confess I don’t relish the idea of shopping at midnight, nor have I experienced Black Friday. Big supermarkets and places like IKEA tend to make my head spin after ten minutes, and I just want to get out. My husband’s level of tolerance is even lower than mine. With its crowds, traffic and frenzy, Black Friday for me would probably be an anticipation of hell on earth, but I appreciate that it exists, that people can stretch their dollars very far on one day to buy something they really need or really want for their families or for themselves. Governments come and go over here, and they all claim to support families, but something as simple as Black Friday has never even been attempted.
Black Friday curiously coincided with a recent development in Italy, the new Redditometro or “Income Meter” designed by the tax people to peak into your wallet to decide whether you are spending more than you earn and hence are a potential tax evader. What is most ironic about the Redditometro is that it has been invented by people who haven’t yet realized that Italy is among the most expensive countries in Europe, with the lowest salaries, highest taxes and poorest services in return, with astronomical gas prices and utilities. A country where ordinary salaries for most people are laughable and not enough to live on, to say nothing of pensions. It is a country in rapid economic decline with booming unemployment. People with ordinary salaries and pensions cannot possibly live within their means any longer here, nor have they been able to do so for a long time -- if indeed they ever have. They require outside help, which usually takes the form of generous financial assistance from their parents and grandparents .In the past, that help came from relatives who had gone to work abroad – in Germany, Belgium, the USA, Argentina, Venezuela and sent money home.
One in four people are unemployed, and the rate is even higher among young people. The statistics published by the CGIL this week claim that 4 million workers are in difficulty. Factories and stores close every day. Every neighborhood is plastered with for sale signs. The real estate market is dead. Car sales are down 21 % compared to last year. Wherever you go, you hear tales of woe. My favorite neighborhood supermarket changed hands twice last year. There was a fellow who worked there at the fish counter with whom we had become friendly. He used to give us tips with what was really fresh and what wasn’t. Last Christmas, while gutting our orate, he told us that he hadn’t been paid in four months. He kept coming to work, hoping he would be paid eventually. We asked him how he lived and he just smiled and shrugged. Perhaps, I thought, the supermarket allowed its unpaid employees to take home food stuffs which had passed the expiry date, fish not sold by the end of the day, fruit and vegetables no longer fresh, so that even if they weren’t being paid, they were at least able to eat and feed their families. A few months ago, the supermarket shut its doors for good. We have no idea what happened to the fish man, or all those families who were dependent on that supermarket for their survival. I know a young couple with two children. They are not married and prefer things that way. Until last summer, they were both employed and doing well, and they recently bought an apartment and have a mortgage to pay. First the young woman lost her job, then her partner .They have been living for months now on the joint assistance from both sets of parents ordinary people with low salaries and pensions.
The Redditometro is designed to investigate the financial affairs of nuclear families, but not extended ones and its software is not yet programmed to take into account that Italian families help each other out economically. When it comes to making a major purchase: an apartment, a car, a motorbike for junior, or dealing with a major health emergency, parents, siblings, cousins, aunts and uncles , especially in areas where the clan mentality reigns, will pitch in with a gift or a loan of cash . A more successful brother will pass cars or vacation homes to a less successful one, help pay medical bills , or pull him out of a tight spot. Parents will purchase homes for their children and just about anything grandchildren need. The entire country is actually supported by the savings, savvy, generosity of the nonni. However if your parents or sibling, who for the fiscal authorities are separate entities if they live at a different address from you, have helped buy you a house or a car, or have contributed to help you pay medical expenses which, according to the tax experts, are beyond what you could have afforded with your earnings or savings, you may have some explaining to do.
Italians since time immemorial have been experts at the art of arrangiarsi, getting by. Nearly everyone at some time in their lives, has practiced this art and supplemented their official income with some sporadic sideline. A retiree with a flourishing vegetable garden might sell produce to neighbors, a contandina might go out at dawn to gather wild salad greens to sell at a makeshift stall in town, a woman with sewing skills might mend or sew garments for friends of friends. Every neighborhood hardware store has its list of local handymen who are all retirees, immigrants, or moonlighters to call when you need a plug fixed or your kitchen repainted. The nurse who lives upstairs may give flu shots to elderly residents in her building or help out on a night shift when she is free. The IT expert who works for a major firm may spend a few evenings a month helping friends of friends fix a virus in their computer , and even sell them computer equipment at a discount. A widow on a pension might do occasional cleaning, take in ironing for people in her building, bake cakes for a trattoria. I do not know if it is illegal for such people not to declare these earnings , but I suspect it is because the Italian fiscal authorities have even invented a system to allow some of these people, specifically pensioners or the unemployed, to pay taxes on their occasional earnings, through a voucher system. Instead of being paid in cash, you are given a voucher, which you may take to the tobacco shop and have exchanged for cash, with ten percent removed and duly sent on to the state coffers. I have heard these vouchers exist, but I have never seen them used.
These people, providing necessary services much appreciated by their community, are the small fry evaders who grease the local economy and keep families afloat. We cannot live without them. But at the other end of the scale loom the VIPs, politicians, and CEOs who provide dubious consulting services to government agencies and private firms, raking in millions which they shoot over to their offshore accounts. In between is a vast gray area, such as professionals: doctors, lawyers, artisans, architects, who, when paid for a service they have provided for you, should give you an invoice with VAT added on, which, in theory, they then declare, but many operate “in nero” selectively, like the restaurant owner who one day will give you a proper fiscal receipt when he brings you your check, and the next day just a note scribbled by hand. For these people, the government has set up a special phone line. You can call in to report a tax evader at any time.
There are whole sectors of Italian society that live thanks to the art of getting by. People running entire businesses who are unknown to the fiscal authorities, or others who possess luxury homes and vehicles registered in the names of senile old uncles who are too old to drive. The Redditometro is supposed to catch them out, along with all those people who claim that they their yearly income is 0, of which, it seems there is an army in this country. My guess is though, that those people probably have very clever accountants and tax lawyers who know how to bend the system to their benefit. They know where all the black holes of the system are located, where they may vanish without a trace.
There has been an outcry over the Redditometro, for various reasons. One telling comment in the Sole 24 Ore, a conservative paper, read:”And are we calling in the Gestapo immediately, or will we wait a while?” The government has tried to pacify agitated souls by claiming that they will be cautious, that they will also start allowing many more deductions of receipts of various kinds, similar to the US system, which they have never allowed before, which wouldn’t be a bad thing at all.
Whatever its merits or demerits, the Redditometro may turn out to be a boomerang. People might just stop spending, or find ways to make their expenditures less noticeable. The tax authorities have a plan for that too. There are some people who advocate the abolishing of cash altogether, requiring payments over 50 euros to be made by credit card.. Which of course is a big favor to the banks, that will be raking in fees for every transaction. If you have been to a supermarket lately or filled up your gas tank, you know just how little fifty euros will buy.
A few years ago there was an unpopular public service commercial airing on Italian TV. It showed a middle aged man carrying a shopping bag full of groceries from a supermarket to his mother’s house. All the people he passes in the street smile at him and say, “Thank you,” to his great bewilderment, because they are all strangers to him. Reaching his destination, his mother takes the groceries and shuts the door in his face, without even so much as a thank you, and he turns away crestfallen. A voice off screen then pipes up, to thank us consumers because it is our spending that makes the economy go round. There was a smugness about this commercial which irked many people, but it certainly conveyed a truth that the current powers that be seem to willfully ignore.
I have a friend who has a passion for local currencies and advocates returning to the barter system. I used to smile when she described the benefits of such things. It didn’t seem to me that they would work. More importantly, I didn’t see the need, but perhaps I was wrong, very wrong.