Wednesday, August 4, 2010

Italy and the Dimming of Old-World Artisanship

The sensibilities of old-world artisans and 21st-century economic forecasters collide in this NY Times article on the sinking industry of Italian textile manufacturing. Veteran clothier Luciano Barbera claims "this tradition is finita," lamenting the demise of his label with its "spa for yarn" where the Barbera line alchemizes its top-end menswear -- and tries to sell $4,000 suits in a global recession. 

Meanwhile, American outsourcers such as Jos. A. Bank are doing just fine, with the Maryland-based brand reporting $770.3 million in profits over the last fiscal year. Is this another death knell for Old Europe traditions, precipitated by globalization?

For Italy in and of itself, economist Francesco Giavazzi deplores the white-knuckle grip of the "associazioni di categoria" and other guilds and unions on the Italian economy. The article describes:

"... Economists said that worrying about [the decline of artisanship] was like fretting about the head cold of a patient with Stage 3 cancer. They see a country with a service sector dominated by guilds, which don’t just overcharge but also raise the barriers to entry for the millions in ill-fated manufacturing jobs who might otherwise find work as, for instance, taxi drivers. They see a timid entrepreneur class. They see a political system in the thrall of the older voters who want to keep what they have, even if it dooms the nation to years of stasis. 

They see a society whose best and brightest are leaving and not being replaced by immigrants, because Italy has so little upward mobility to offer. 

To Professor Giavazzi, the future here doesn’t look like Greece. It looks like Argentina. 

“Before World War II, Argentina was rich,” he says. “Even in 1960, the country was twice as rich as Italy.” Today, he says, you can compare the per capita income of Argentina to that of Romania. “Because it didn’t grow. A country could get rich in 1900 just by producing corn and meat, but that is not true today. But it took them 100 years to realize they were becoming poor. And that is what worries me about Italy. We’re not going to starve next week. We are just going to decline, slowly, slowly, and I’m not sure what will turn that around.” (...)"

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