France and Italy are redistributing money they do not have

The French and Italian governments have decided to stimulate demand with larger fiscal deficits, which are primarily financing transfer payments to co nsumers, and by pushing up growth in wage s above that in productivity. This of course boosts demand in the short term, but it is important to realise that in both countries this amounts to redistributing money to households that neither of them has. The result will be an impoverish ment of these countries in the future (fiscal deficits will have to be reduced ; income distribution will have to be rebalanced).